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Healthcare fraud recoveries are growing!

If you had asked us 20 years ago which federal false claims cases generate the most publicity and income for the federal government, it would have been aerospace, with health care a distant second. Today, our practice (and the experience of the US Department of Justice) indicates a profound reversal, with healthcare fraud by far the largest single recovery category.  The last fiscal year, the US received $4.2 Billion (with a B) from medical fraudsters. In 2011 the total was 4.1 Billion. Most of these funds come from fraudulently billing Medicare.  Medicare Advantage, which allows private insurance companies to contract with the government to administer benefits, cover about a quarter of Medicare beneficiaries. This ;has been a major source of fraud. Over $1 trillion is spent by the government on Medicare and Medicaid each year.

The major enforcement law is the Federal False Claims Act, 31 USC Section 3729. My firm was honored to have its complaint about federal fraud in California’s Central Valley chosen as the best qui tam complaint of the year and has been included in the National Qui Tam Actions Handbook for attorneys. The case ultimately resulted in a 3.5M settlement in behalf of the government. The Federal False Claims law was strengthened by the Fraud Enforcement and Recovery Act of 2009 “FERA”). Additionally, “reverse” false claims were added. ┬áLiability under the false claims laws subject the health care provider to three times the amount of actual damages and a civil penalty per false claim of $5-11 thousand dollars. The government may also exclude and debar providers from the program.

Some examples we have become aware of (and litigated where appropriate) are finding services not rendered (such as emergency room visits), upcoding (billing for a more expensive procedure than given or medically necessary); offering kickbacks to patient providers.

California employees who report allegedly false billing by their health care employers can receive up to 30% of the amount received by the government. We have also filed claims under California’s false claims statutes and can represent defrauded insurance providers under Insurance Code 1881.7.