Health Company Pays $30 Million to Settle Overpayment Allegations
Sutter Health Pays $30 Million to Settle Overpayment Allegations
California-based Medicare Advantage provider, Sutter Health LLC, and several affiliated entities, agreed to settle Medicare Advantage overpayment allegations for $30 million. Sutter Health, headquartered in Sacramento, is alleged to have submitted inaccurate information about the health status of Medicare Advantage beneficiaries, resulting in overpayment to plans and providers.
Specifically, Sutter Health allegedly contracted with certain Medicare Advantage Organizations for the provision of healthcare services to beneficiaries enrolled in the MAO’s Medicare Advantage Plans, and in return, Sutter Health received a portion of the payments that the MAOs received from CMS. Steven J. Ryan, Special Agent in Charge with the DHHS OIG, stated, “With some one-third of people in Medicare now enrolled in managed care Advantage plans, large health systems such as Sutter can expect a thorough investigation of claimed enrollees’ health status.”
Opioid Strike Force Takedown Implicates 60 Individuals
DOJ’s Appalachian Regional Prescription Opioid Strike Force, established in December 2018, is responsible for the charging of 60 individuals for crimes related to the opioid epidemic. The enforcement actions span across 11 federal districts and involve 31 doctors, seven pharmacists, eight nurse practitioners, and seven other licensed medical professionals, and the charges focus on the unlawful distribution of “millions” of opioids and other prescription narcotics.
The ARPO Strike Force’s takedown demonstrates DOJ’s commitment to fighting the opioid crisis. “Reducing the illicit supply of opioids is a crucial element of President Trump’s plan to end this public health crisis,” said HHS Secretary Alex Azar. In addition, AG Barr announced that the ARPO Strike Force, which currently operates in nine districts, will expand into the Western District of Virginia.
Baltimore Health Care Provider Pays $399k to Settle FCA Allegations
The US Attorney’s Office for the District of Maryland announced a settlement agreement with Cardiac Associates, P.C. to resolve False Claims Act allegations. Cardiac Associates has agreed to pay approximately $399,000 to settle claims that they billed for services not rendered. Specifically, the government alleged that between January 1, 2012 and December 21, 2016, Cardiac Associates billed for two similar procedures for the same patient, while performing only one of the procedures. According to the government, the fraudulent billing practices resulted in the submission of false claims to Medicare and Medicaid.
Illinois Federal Judge Rejects DOJ’s Attempt to Dismiss FCA Lawsuit
DOJ has recently filed several high-profile motions for dismissal of False Claims Act lawsuits filed by whistleblowers. In a ruling this week, US District Judge Staci M. Yandle denied the government’s motion, finding that the DOJ’s investigation into alleged kickbacks by UCB Inc. was insufficient. National Healthcare Analysis Group brought a dozen lawsuits alleging that drug companies gave health care providers free nursing services and patient education in return for prescribing their drugs.
DOJ conducted a “collective investigation” of the allegations, which the Court found fell short of “a minimally adequate investigation to support the claimed governmental purpose.” The Court held that because the government did not investigate the specific allegations against UCB Inc., its decision to move for dismissal was “arbitrary and capricious.” Judge Yandle’s ruling follows a ruling earlier this month from a Pennsylvania federal court that also rejected the principle that DOJ has “unfettered discretion” to dismiss whistleblower FCA lawsuits.
The lawsuit is US ex rel. CIMZNHCA v. UCB Inc., case number 3:17-cv-00765, in the US District Court for the Southern District of Illinois.
Government Challenges Federal Court Order Requiring Production of Investigation Files
On April 2, a Minnesota magistrate judge ordered the government to identify every false claim alleged against a defendant and to produce all information relating to interviews it conducted during its investigation. The government intervened in a whistleblower lawsuit in February 2018 alleging that Precision Lens gave providers kickbacks, including skiing, golfing, and hunting vacations, private jet travel, and expensive meals and entertainment, in return for business. Precision Lens initially sought identification of all false claims in the matter, but withdrew that portion of its motion before the Court issued its decision pursuant to an agreement with the government. Nevertheless, the Court ordered the government to identify every false claim, and to do so 45 days before the close of discovery.
This week, the government filed objections to the magistrate judge’s order, arguing that it should be permitted to complete fact discovery and to provide the requested information during expert discovery, rather than producing the information in a shortened timeframe. The government argued that requiring it to identify the false claims in an expedited fashion is prejudicial, particularly given that the defendant has not demonstrated a substantial need for the information prior to the close of fact discovery. The government also objects to providing interview materials on the grounds that the information is protected by the work product doctrine.
The lawsuit is US ex rel. et al. v. Sightpath Medical, Inc. et al., case number 0:13-cv-03003, in the US District Court for the District of Minnesota.
Jury Awards Over $760k in FCA Retaliation Lawsuit
Coloplast Corp., which makes adult diapers, will pay over $760,000 for retaliating against an employee after she and others filed an FCA lawsuit against the company and its distributors. The company argued that it had few options when its largest client refused to work with the plaintiff, but that it nonetheless placed her on leave with salary, $80,000 commission, a raise, and other benefits.
A Massachusetts federal jury rejected the company’s position and found that after the company learned that the plaintiff was a whistleblower, the plaintiff was suspended, given a less profitable workload when she returned to work after her suspension, and was countersued.
The lawsuit is US et al. v. Coloplast AS et al., case number 1:11-cv-12131, in the US District Court for the District of Massachusetts.