Justice Department Reaches $60 Million Dollar Settlement with TeamHealth/IPC

Our Los Angeles attorneys report that TeamHealth, the parent of a local physician management and staffing company by the name of IPC Healthcare (located in North Hollywood, CA), agreed to settle with the Department of Justice after allegations arose that it violated the False Claims Act (“FCA”).  The Complaint alleged that the emergency physicians and hospitalists companies billed Medicare, Medicaid, and other federal programs for higher levels of medical services than those that were actually performed.  Such a practice in the industry is called “up-coding”.  As part of the settlement, TeamHealth/IPC is paying the government $60 million dollars plus interest.

Interestingly, a former employed physician brought these claims to light on behalf of the government under the qui tam, or whistleblower laws within the FCA.  This allowed the case to remain under seal while the government investigated the claims.  Then, after investigating the case and finding that IPC knowingly and systemically supported its clinicians’ false billings, the government intervened to hold the companies accountable for encouraging its clinicians to maximize billings by coding their diagnosis and thus billing the government at a higher level than they truly were.  These types of corporate pressure schemes have landed many other organizations in hot water with government enforcers.  Consequently, once the government intervenes, there is not much that an unscrupulous organization like IPC and TeamHealth can do but settle.  The whistleblower here is to receive around $11.4 million for his reporting of the case.

As the main enforcement arm of the federal government, the Justice Department reviews all cases filed under the FCA.   Then, once the whistleblower case is assessed, the government decides whether it will step in and prosecute or step back and allow the whistleblower to bring the complaint on the government’s behalf.  Here, the Department of Justice decided to step in and intervene.

The FCA is used to stem out fraud related to billing, staffing, and kickbacks. Examples of these are when financial companies are supposed to abide by state and federal laws and chose to ignore them.  They also bills for services that were not provided or the bill was submitted at an improperly higher rate of reimbursement for the services.  In addition, financial companies are often fount to illegally bill the government for substandard services by fraudulently certifying otherwise. Alternatively, these companies may realize that they have credit from their services that they have to repay to the government, but the companies do not reimburse the government within the 60 day time frame.  See these blogs for more examples of the FCA.

If you witness any potential false claims in California (i.e. requests for reimbursement to the government, not actually rendering work when reimbursement is received, or receiving and knowingly retaining an overpayment) by your company, or you are retaliated against for voicing your concern about potential wrongdoing, immediate action is vital.  Contact the experienced employment law attorneys at Stephen Danz & Associates for a free consultation to discuss your circumstances and legal options.