$5.3 Million Dollar Settlement after False Claims Act Whistleblower in Oncology Practice Reports Medicare Fraud

Anyone could, and should, report fraudulent activity by his or her employer. In this case, it was a medical coder at an oncology practice. As result, the oncology medical group will settle with the government for $5.3 million dollars to bring to close allegations that it systematically falsely billed Medicare and Medicaid for services that it either did not perform or that it did not have the right to bill for. These types of false billing practices are frowned upon by judges, juries and the government in addition to everyday citizens who have to pay to these crooks using tax dollars.

As health care costs keep rising and taking more and more of Americans’ budgets, fraud against tax-payer backed government programs should continue to be reported. Out office welcomes any whistleblower who exposes any type of fraud against the government whether it is through billing, short-cuts taken by contractors or other misconduct. If you believe that you have witnessed such conduct, contact our office either by phone at (877)789-9707 or via our Online Form for a complimentary confidential consultation.

Specifically, the oncology group not only waived certain Medicare beneficiaries’ copayment amounts, it also billed Medicare for services that were not even performed or medically necessary. Both of these actions are strictly forbidden and outright illegal. When anyone is aware of these types of actions such as the whistleblower here (who was a medical coder), he or she should immediately report the fraudulent billing practices.

Because these types of lawsuits may carry treble (triple) damages plus up to $11,000 per violation, most defendants faced with False Claims Act (“FCA”) settle. The defendant here was no exception as it admitted to illegal conduct so that the government ends its investigation at an early stage. Since the government here intervened (see more below), it became much more likely that the defendant would be found guilty. Here are some examples of the fraud form the Complaint:
“Routinely waived Medicare beneficiaries’ copayments applicable to CTP codes 99211-99215, without an individualized documented determination of financial hardship or exhaustion of reasonable collection efforts;”

“Billed Medicare for the waived copayments, resulting in higher reimbursement amounts from Medicare than…was entitled to; and”
“Billed Medicare and Medicaid for evaluation and management services (code 99211 and 99212) without documenting in the medical record that those services were medically necessary and/or that those services were actually performed.”

The government here used the FCA’s Qui Tam rules which allow private citizens to sue on behalf of the government. Here, because she reported what she believed were false billing practices and the government sued, she was entitled to receive part of the amount that the government recovered. These types of whistleblower, or Qui Tam, lawsuits may be brought by individuals, clients, competitors or vendors who then become “relators.” These relators are then suing on behalf of the government and in return the government compensates the relators for speaking up against violating companies. Out of the recovery, the Justice Department by law is allowed to give the whistleblower between 15% to 30%, which can add up to millions of dollars. What changes these percentages is whether the government intervened/joined the lawsuit which means the relator will not have to expend as much time and effort. If the government selects not to intervene, the whistleblower and his or her attorney are entitled to a much higher amount of around 25-30% of the recovery. If the government intervenes, then the whistleblower is entitled to 15-25% of the recovery.

Most often, the FCA is used within the health care industry to stem out fraud related to billing, staffing, and kickbacks. Examples of these are when a provider of health care services such as a doctor or hospital bills for services that were not provided or the bill was submitted at an improperly higher rate of reimbursement for the services. In addition, health care companies are often fount to illegally bill the government for substandard services by fraudulently using higher diagnostic codes or by falsely certifying the medical necessity of medical procedures. 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. At that point, the nonpayment becomes a false claim. To combat retribution for filing FCA claims, the Health and Safety Code Section 1278.5 prohibits retaliation against patients, physicians, nurses and medical staff who whistleblow to the government or its agencies on patient care issues at a health care facility. Even the IRS has been getting in on the action and recently reported that in Fiscal Year 2015 it paid out more than $103 million to whistleblowers resulting from settlements in successful lawsuits.

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 crucial. Contact the experienced employment law attorneys at Stephen Danz & Associates for a free consultation to discuss your circumstances and legal options.