Merck agrees to $650m settlement in Medicaid fraud case
March 14, 2008 by bob
H. Dean Steinke, a former sales manager who brought fraudulent sales practices by the drug maker Merck to light will be awarded $68 million dollars for his role as a whistleblower in the medical-care fraud case. This settlement is the largest of its kind under the federal False Claims Act. When asked by The Washington Post about his motivation for seeing the case through, Steinke replied:
“Sometimes you just get so frustrated about things that are wrong. These are the things that drive you, and you’re not going to stop until things are resolved.”
The case was in response to deceptive sales practices by Merck that flooded hospitals with the drugs Vioxx, Zocor, and Pepcid at heavily discounted prices in exchange for prescribing the medications for as many as three-quarters of eligible patients or being placed on a list of preferred medications. Many patients that rely on Medicaid were initially given prescriptions by hospitals at the cut-rate prices, only to have Medicaid foot the ongoing prescription cost at full price. This practice allowed Merck to gain advantage over its competitors making generic versions of the drugs in question. The practice also was in direct contradiction of the law that requires that pricing for the government be no more than for other customers.
The practice of gouging Medicaid for prescriptions which were written by doctors at hospitals given discounted pricing has been often called in to question recently. Many believe that dozens of drug companies may be guilty of this type of fraud. This case confirms that there are brave whistleblowers that are willing to take a stand and stop the taxpayer waste by drug companies.
If you are seeing Medicaid or other fraud on the government, contact us by calling 800-377-1812 for strictly confidential advice from experienced counsel, with no fee obligation.
AstraZeneca to pay $215 Million in Medicaid Fraud Case
March 3, 2008 by bob
The news out of Alabama marks the second major decision in a Medicaid fraud case this month.
from the Associated Press:
MONTGOMERY, Alabama – A state-court jury awarded Alabama $215 million in its Medicaid drug-price-fraud suit against an AstraZeneca PLC unit.
The state had claimed the unit, AstraZeneca Pharmaceuticals LP, made Alabama’s Medicaid system pay too much for drugs prescribed to its patients by inflating prices. The firm said it had obtained for the state the best price it could for its drugs.
The circuit-court jury said the subsidiary must pay $40 million in compensatory damages and $175 million in punitive damages.
This type of Medicaid and Medicare fraud has been prevalent in recent years. Without the help of courageous whistleblowers, this fraud against the government would go on without consequence. If you are seeing fraud on the government, contact us via email or call (800) 377-1812 for strictly confidential advice from experienced counsel, with no fee obligation.
Warren Whistleblowers Win Medicare Fraud Case
December 20, 2007 by bob
Peter Salvatori and Sara Iveson will share in $1.2 million dollars for their role in a Medicare fraud case against Warren Hospital of Phillipsburg, New Jersey. This is part of a of a 7.5 million dollar settlement that the hospital agreed to after charges were brought under the Federal False Claims Act.
According to the U.S. Department of Justice, the hospital inflated Medicare charges to receive payments it wasn’t entitled to between January 1998 and August 2003. The allegations related to Medicare’s costliest treatments. Patients under such care are called ‘outliers’ because their needs stretch beyond typical parameters of the program.
Indicators have suggested that this is just another example of rampant Medicare Fraud. From The Morning Call:
Whistle-blowers have tipped off the government to $1.3 billion worth of fraud cases in the last year, largely at hospitals or other health care providers, the Justice Department said.
The department recovered $3.1 billion from individuals and companies during the fiscal year that ended Sept. 30, 2006.
In return, whistle-blowers were paid $190 million for alerting the government to the fraud.
For the basics on prevention and detection check out the US Department of Health’s Medicare Fraud page.
Halliburton Couldn’t Stop Bunny Greenhouse
January 4, 2007 by bob
Despite prevailing tides at the U.S. Army Corps of Engineers, Bunny Greenhouse just couldn’t reconcile the lack of competition for large military contracts that were being awarded to the defense industry contractor Halliburton. As a longtime procurement official at that agency she was determined to deliver the best outcomes and full disclosure for American taxpayers on large-scale military contracts that were being handed out as no-bid contracts to Halliburton and its subsidiary Kellogg, Brown, and Root (KBR).
Bunny referred to the mismanagement of these matters as “the most blatant and improper contract abuse I have witnessed during the course of my professional career.”
From The Washington Post:
Bunny Greenhouse was once the perfect bureaucrat, an insider, the top procurement official at the U.S. Army Corps of Engineers. Then the 61-year-old Greenhouse lost her $137,000-a-year post after questioning the plump contracts awarded to Halliburton in the run-up to the war in Iraq. It has made her easy to love for some, easy to loathe for others, but it has not made her easy to know.
In late August, she was demoted, her pay cut and her authority stripped. Her former bosses say it’s because of a years-long bout of poor work habits; she and her lawyer say it’s payback for her revelations about a politically connected company.
Now Bunnatine Hayes Greenhouse is becoming one of the most unusual things known in the upper echelons of government and industry — a top-shelf bureaucrat who is telling all she knows. For honesty’s sake, she says.
