Warren Whistleblowers Win Medicare Fraud Case

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.

Miami Hospital Pays $15.4 Million to Resolve Fraud Case for Kickbacks and Unnecessary Treatments

via United States Department of Justice

THURSDAY, NOVEMBER 30, 2006

WASHINGTON – Larkin Community Hospital in Miami and its current and former owners, Dr. Jack Michel, Dr. James Desnick, Morris Esformes and Philip Esformes, have paid $15.4 million to settle federal and Florida civil health care fraud claims against them, the Justice Department announced today. Additionally, 34 related companies owned by the Esformes that were used to operate nine assisted living facilities are part of the settlement along with Claudia Pace, an employee of one of the Esformes-owned companies; and Frank Palacios, a long-time employee of the hospital.

The settlement resolves the civil case entitled United States v. Jack Jacobo Michel, M.D., et al., which the government filed in 2004, alleging violations of the False Claims Act. The state of Florida joined the suit later that year.

The government alleged that in 1997, Larkin, then owned by Desnick, paid kickbacks to physicians in return for patient admissions. The United States contended that the primary recipient of the kickbacks was Jack Michel, who was paid for patient admissions to Larkin by himself and his brother, Dr. George Michel. Jack Michel purchased Larkin in 1998. In 2000, Desnick was a party to a $14 million settlement with the United States for a similar kickback scheme from 1992 to 2000 at another facility he owned, Doctors Hospital of Hyde Park in Chicago.

The United States also alleged in the Michel suit that from 1998 to 1999, Jack Michel, George Michel, Morris Esformes, Philip Esformes, Frank Palacios and Claudia Pace conspired to admit patients to Larkin for medically unnecessary treatment. The government asserted that some of these patients came from assisted living facilities owned and operated by Jack Michel, Morris Esformes and Philip Esformes.

“The Department of Justice is committed to vigorously litigating cases about conduct that undermines the integrity of the Medicare and Medicaid programs,” said Peter D. Keisler, Assistant Attorney General for the Department’s Civil Division. “We will not tolerate health care providers who pay kickbacks or perform medically unnecessary treatments on elderly beneficiaries in order to generate Medicare and Medicaid payments.”

The case was investigated by the U.S. Department of Health and Human Services, Office of Inspector General; the Federal Bureau of Investigation; and the Florida Medicaid Fraud Control Unit. The case was handled by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Southern District of Florida in Miami and the Office of the Attorney General of the state of Florida.

Francine and Rhea Did the Right Thing

As part of a 1998 settlement, Francine Mettevelis and Rhea Jones received $903,899 for reporting that Charter Behavioral Health Systems, in Orlando, Florida, billed Medicare for medically unnecessary psychiatric care for elderly patients with severe dementia, Alzheimer’s Disease and other organic brain disorders.

Medicare fraud, where doctors, HMO’s, or hospitals create frauludent items on patient invoices and submit them to Medicare for reimbursement, is a growing problem, and contributes to the enormous and rising costs of health care in this country. It is important for patients, family, and friends of people who use these services to report cases of suspected fraud.

If you’ve witnessed Medicare fraud in your workplace, you may be able to receive up to one-third of the money recovered in the fraud case under the Federal False Claims Act. And, you can sleep soundly at night, knowing that you did the right thing, and that you are helping lower health care costs for everyone by reporting the fraud to the people.

We can help you if you’ve witnessed this type of activity - contact us to receive information about what you can do to help stop these abuses.

GlaxoSmithKline pays $150 million in Medicare fraud case

GlaxoSmithKline has agreed to pay more than $150 million to settle fraud allegations over the pricing of two anti-nausea drugs for federal health programs, the Justice Department said Tuesday.

James Moorman, president of the advocacy group Taxpayers Against Fraud, said whistle-blower claims have so far resulted in $2.4 billion in settlements with drug companies.

Read the full story here.

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