Articles Tagged with California qui tam law

jimi-filipovski-189724-copy-300x176There are currently two False Claims Act (FCA) qui tam cases against United Health Group (UHG) pending in the Central District of California. The cases are: U.S. ex rel. Benjamin Poehling v. UnitedHealth Group, Inc. and U.S. ex rel. Swoben v. Secure Horizons, et al. The cases were brought by James Swoben, who was previously an employee of Senior Care Action Network Health Plan and a consultant within the risk adjustment industry, and Benjamin Poehling, who was the former finance director of a UHG group that managed the insurer’s Medicare Advantage Plans.

The Qui Tam Cases Against UHG

On May 2, the U.S. intervened in the Swoben False Claims Act suit against UHG based on the allegations the insurer overcharged Medicare Advantage and prescription drug programs. In the DOJ’s complaint, it alleges the insurer knowingly ignored patients’ medical conditions to increase payments it received from Medicare and funded chart reviews to increase the risk adjustment payments it reviewed. However, any information the reviews uncovered regarding misdiagnoses were disregarded to avoid repaying Medicare.

 jimi-filipovski-189724-copy-300x176In the qui tam case of BlueWave Healthcare v. U.S., the government was allowed to execute writs of attachment against both real and personal property and writs of garnishment against bank accounts of the defendants under the Federal Debt Collection Procedures Act (FDCPA). The defendant’s attempted to appeal the denial of their motions to quash these writs, but this appeal was dismissed for lack of jurisdiction.

About the Case

The qui tam case was filed by Scarlett Lutz and Kayla Webster against BlueWave HealthCare Consultants, Robert Bradford Johnson, and Floyd Calhoun Dent in 2014. Lutz and Webster, the relators, alleged that the defendants had violated the Anti-Kickback Statute and the False Claims Act. They stated that the defendants arranged for illegal kickback payments to doctors, which were labeled processing and handling fees. The federal government intervened in the case in April of 2015.

bob-brents-182206-300x240The U.S. District Court of the Southern District of California granted whistleblowers a significant victory this year. In the case of Erhart v. BofI Holdings, Inc., the district court found an employee’s confidentiality agreement with his or her employer did not trump federal whistleblower’s rights. In some circumstances, employees can gather confidential documentation as evidence of fraud, despite signing a confidentiality agreement. Additionally, any retaliatory actions by the company against the whistleblower in relation to these confidential documents is unlikely to succeed.

Erhart v. BofI Holdings, Inc.

Charles Matthew Erhart was an internal auditor for BofI Federal Bank. After being let go, he brought suit against BofI under the Sarbanes-Oxley Act and other whistleblower laws based on the company committing fraud against the government and retaliating for his bringing evidence forward. He stated he was fired because he disclosed the bank’s federal and state law violations to federal regulators.

file5601297827370-300x225Each week new qui tam suits, possible under the False Claims Act (FCA) are brought by private individuals against other individuals and businesses on behalf of the federal government. Many of these lawsuits take years to investigate and litigate. Additionally, each week sees some of these cases settled, finalized, or appealed. Here are a few cases that wrapped up this past week:

  • In February, a physician’s practice in Florida agreed to settle a FCA claim based on Medicare fraud for $750,000. The qui tam suit against Dr. Paul B. Tartell was filed by a former patient Theodore Duay. Duay alleged that Tartell would bill Medicare and the Federal Employee Health Benefits Program for procedures that were not medically necessary or not performed at all. Numerous federal agencies were involved in negotiating this settlement, and Duay will receive $135,000 for filing the action.
  • TeamHealth Holdings will pay $60 million plus interest due to allegations its business, IPC Healthcare Inc., committed fraud against Medicare, Medicaid, the Defense Health Agency, and the Federal Employees Health Benefits Program by billing for more expensive medical services than what were actually provided. Dr. Bijan Oughatiyan filed a qui tam action under the FCA alleging the practice of “upcoding.” The federal government investigated and chose to intervene, providing a detailed description of how IPC Healthcare used false codes to receive greater reimbursements. Oughatiyan will receive $11.4 million for his participation.

drew-hays-206414-200x300In the case of Fair Laboratory Practices Associates v. Riedel, the U.S. Court of Appeals for the 3rd Circuit determined that a qui tam settlement sharing agreement between two claimants did not need to be placed under seal. This is important information for claimants who want to make private agreements to split the proceeds of qui tam cases against the same defendants.

If you are involved in a qui tam lawsuit or believe you have the evidence to bring one, yet you know there are also similar actions in process against the same person, contact an experienced California qui tam attorney from Brod Law Firm right away.

Fair Laboratory Practices Associates v. Riedel

upmisxb0wd0-srikanta-h-uBetween Oct. 2015 and Sept. 2016, the Department of Justice (DOJ) won more than $4.7 billion in judgements and settlements from civil fraud and false claims against the government, a DOJ press release stated. This recovery is from cases brought under the False Claims Act (FCA), including qui tam claims in which a whistleblower brings to light a fraud being perpetrated against the government. The amount is particularly important to note since it is the third highest recovery for a fiscal year since the FCA was enacted. It is also crucial in the sense that it confirms the effectiveness of qui tam cases and other claims brought under the FCA. The legal protections and incentives for whistleblowers to come forward enables the government to stop fraudulent schemes and return funds back to programs that support low-income families, veterans, and the elderly.

Fraud is Common within the Health Care Industry

Fraudulent claims within the health care industry cost the government billions of dollars. The DOJ reported $2.5 billion was recovered for the federal government in relation to this sector from hospitals, physicians, nursing homes, labs, medical device companies, and drug companies during the 2016 fiscal year. Additionally, a total of $19.3 billion has been won in health care fraud claims since January 2009. The recovered funds go back to federally funded medical programs such as Medicare, Medicaid, and TRICARE.  

800px-Cubicle_landIt can be perilous for a single individual to expose a company’s illegal acts. Whistleblowers, as these courageous people as called, risk losing their jobs, damaging their reputations, being ostracized by coworkers and neighbors, and other detriments by daring to speak up.

Federal and state legislatures recognize the dangers and have enacted whistleblower laws, which protect those who come forward from retaliation by the persons or businesses they identify as engaging in illegal conduct. False Claim statutes also provide whistleblowers with legal recourse. These laws allow for qui tam lawsuits, which allow a person to sue an individual or business believed to have defrauded the government of public funds to recover the illegally obtained money. The person bringing suit is referred to as a “qui tam plaintiff,” and can possibly receive a large percentage of the funds collected from the wrongdoers.

By allowing whistleblowers to bring a civil action, governments acknowledge the public service whistleblowers fulfill and the hardships they endure as a consequence of their exposing fraud.

View_of_office_cubicle_looking_south_-_Skinner_Meat_Packing_Plant,_Main_Plant,_6006_South_Twenty-seventh_Street,_Omaha,_Douglas_County,_NE_HAER_NE-12-A-26.tifThe California Whistleblowers law prohibits employers, or someone associated with them and acting on their behalf, to retaliate against employees who report their employer’s unlawful activities. The retaliation can take many forms, such as:

  • Terminating the employee’s employment
  • Demoting the employee or denying the worker a deserved promotion, raise, or bonus

A Whistle blower employee is an informant who exposes a crime, or wrongdoing, taking place within the organization in the hope of stopping it. If you are considering becoming a whistle blower, or if you have been retaliated for reporting a misdeed you should be aware of your rights.

Old Rule

Approximately 50 years ago, unless you had an employment contract, or were a member of a labor union, you were considered an at will employee. The “at will employment doctrine” holds that an employee can be terminated for any reason, at any time and without any compensation. Recently, many exceptions to this rigid rule have emerged from the court system, as well as from state and federal legislatures.