Novartis Unit, Eon Labs, settles Medicaid fraud allegations for $3.5 Million

Novartis logo

In an effort to resolve a qui tam claim regarding submitting false claims to Medicaid for Nitroglycerin Sustained Release (SR) capsules, Novartis Unit, Eon Labs Inc. agreed to pay the U.S. $3.5 million. The U.S. Department of Justice (DOJ) indicated that the settlement “resolves allegations against Eon in a multi-defendant whistleblower action,” case titled United States ex rel. Conrad v. Eon Labs, Inc., et al.

The U.S. Food and Drug Administration concluded in April 1999 that Nitroglycerin SR was “no longer legally eligible for reimbursement” by Medicaid and other government-run health care programs. According to the DOJ, Eon Labs, Inc., allegedly submitted false quarterly reports that included Nitroglycerin SR to the government from April 1999 through September 2008.

U.S. Attorney for the District of Massachusetts, Carmen M. Ortiz, stated the following:

"This is the first False Claims Act agreement with a drug company that sought to charge the government for less than effective drugs, and it shows that the Department of Justice will pursue those who market such drugs and expect the government to pay for them."

Under the False Claims Act, private persons are able to file a whistleblower and qui tam lawsuit on behalf of the U.S. government. If the claim is resolved successfully, the whistleblower may be entitled to receive a share of the settlement. According to the DOJ, the whistleblower involved in this claim will receive approximately $525,000.

Click on the following link to read more on the Eon Labs False Claims Act Settlement, Department of Justice and The Wallstreet Journal.

HHS-DOJ Healthcare Fraud Summit - a step in the right direction


Secretary Kathleen Sebelius  and Attorney General Eric HolderThis week on January 28,  the Department of Healthand Human Services and the Department of Justice held an invitation only  Summit on Health Card Fraud. Key Speakers included Secretary Kathleen Sebelius and U.S. Department of Justice Attorney General Eric Holder.

The summit was an unprecedented event on health care fraud where law enforcement and the private and public sectors come together as a part of the Obama Administration’s coordinated effort to fight health care fraud. The seminar covered such topics as 

  •  Use of technology to prevent and detect health care fraud and improper payments.
  • Role of states in preventing health care fraud.
  • Development of effective prevention policies and methods for insurers, providers and beneficiaries.
  • Effective law enforcement strategies.
  • Measuring health care fraud, assessing recoveries and determining resource needs. 

Highlights from some of the key speakers include the following:

Secretary Kathleen Sebelius gave a moving introduction of the significance of the summit. She reinforced the Obama Administration's stance on "zero tolerance" for criminals who cheat  taxpayers, endanger patients, and jeopardize the future of  Medicare. A few highlights from her speach include the following remarks:

"Today, the President has asked us to put these criminals on notic. The problem of health care fraud is bigger than either government, law enforcement or the private industry can handle alone. We will need all of us working together to solve it. In the fight to prevent, find, catch, and prosecute these crooks, we want every good idea we can get.

Health care fraud is a national problem. It affects federal programs like Medicare, state programs like Medicaid, and private insurance companies. We’re all part of a health care system that has been undergoing rapid growth.

Between 1970 and today, America’s annual health care spending has gone from $75 million to over $2.5 billion. That has produced significant benefits for patients. But it’s also created a much bigger target for criminals. And a much bigger challenge for investigators. The difference between catching fraud then and now is the difference between trying to find a penny in a bathtub and trying to find a penny in a swimming pool."

Attorney General Eric Holder stated in his opening remarks that the HHS-DOJ Healthcaree Fraud summit marks a critical step forward in the work being done by HEAT, our Health Care Fraud Prevention and Enforcement Action Team that was established last May. He gave several insightful comments after addressing the fact that we have a serious problem on our hands with healthcare fraud. If the agencies, concerned advocuates and citizens work together, combined forces, more progress will be made.

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"Defund the Crooks Act" introduced to Congress

Congressman Grayson

Upon returning from holiday recess, the 111th Congress of the United States introduced bill H.R. 4444, better known as the Defund the Crooks Act, in early January 2010. First introduced by Congressman Alan Grayson (D-FL), the Defund the Crooks Act prohibits the Federal Government from awarding Federal funds, contracts, or grants to covered organizations. The Act also prohibits the Federal Government from promoting certain organizations or from entering into other agreements with these organizations.

Based in part on the Defund ACORN Act of 2009, Congressman Grayson’s bill effectively broadens the scope of regulation while not basing the regulation on the acts of one organization. The purpose of the bill is essentially to ensure that Federal funds – taxpayer dollars – do not end up in the hands of organizations that fail to meet certain requirements.

According to the bill, “covered organizations” refers to several of the following examples:

  • Any organization previously convicted of a Federal or State law violation
  • Any organization that failed to comply with Federal or State laws leading to its corporate charter being revoked
  • Any organization that has filed, transmitted, or submitted a fraudulent claim to any Federal or State agency
  • Any organization that knowingly employs, contracts, or relegates authority to any individual who has been convicted of a Federal or State law violation

The Defund the Crooks Act states that no Federal funds, regardless of form, may be provided to organizations that do not meet the aforementioned requirements set out in the bill. It is important to note that the Act does not apply to organizations that received Federal funds prior to the enactment of the bill. However, if organizations that are now deemed unfit to receive Federal funds, grants, endorsements, etc. have a contract extending past the date of the bill’s enactment, they will be terminated.

Click on the following link to view the proposed bill H.R. 4444  introduced to Congress.

Click on the following to learn more on Congressman Grayson and the Defund the Crooks Act (H.R. 4444).

US intervenes in qui tam suit against Johnson & Johnson for Kickbacks to Pharmacy for Nursing Homes

The United States filed a qui tam or False Claims Act complaint against Johnson & Johnson (J&J) and its subsidiary companies Johnson & Johnson Health Care Systems Inc. and Ortho-McNeil-Janssen Pharmaceuticals Inc. According to the complaint, Omnicare Inc., the U.S.’s largest dispenser of pharmaceuticals to patients in nursing homes, was receiving millions of dollars in kickbacks from the companies. This complaint comes after Omnicare entered into a $98 million settlement with the federal government and multiple states in November of last year, an action that supposedly resolved Omnicare’s liability for taking previous kickbacks from Johnson & Johnson.

Allegedly, Omnicare accepted financial kickbacks in return for the company’s purchase and recommendation of Johnson & Johnson and its subsidiaries’ pharmaceutical products to nursing home patients.  Doctors accepted the recommendations of Omnicare’s pharmacists more than 80 percent of the time, and allegedly Johnson & Johnson viewed Omnicare pharmacists as “an extension of its sales force.”

Kickbacks were delivered in several ways, including:

1)      Offering Omnicare rebates when programs to increase the sale of Johnson & Johnson’s prescription drugs to nursing home patients were implemented.

2)      Paying Omnicare millions of dollars for “data”; the complaint alleges that these payments were false and used only to coerce the recommendation of Johnson & Johnson drugs from Omnicare pharmacists.

3)      Johnson & Johnson also made multiple “educational funding” and “grant” payments to Omnicare, with intent only to receive a recommendation from its pharmacists.

Assistant Attorney General for the Civil Division of the Department of Justice had this to say about the situation,

"We will pursue those who break the law to take advantage of the elderly and the poor. He went on to say that, “Kickbacks such as those alleged here distort the judgments of health care professionals and put profits ahead of sound medical treatment." 

Forba Holdings, LLC, settles Medicaid fraud allegations for $24 Million

FORBA Holdings LLC, a dental management company, settled a qui tam claim for allegedly performing medically unnecessary dental services on children. FORBA  Holdings LLC provides administrative services to  "Small Smiles Center, a nationwide operation of 69 dental centers. The settlement calls for FORBA to pay $24 million, plus interest to the United States and participating states, for suspected medically unnecessary dental services for children on Medicaid insurance. In addition, FORBA will implement several new remedial measures, designed to prevent this type of conduct in the future.

Three whistleblowers are credited for the government’s investigation into these allegations. The whistleblowers filed lawsuits under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private citizens to sue on behalf of the United States and share in any recovery. The whistleblowers will receive payments over $2.4 million from the federal share of the settlement.

According to the Department of Justice, FORBA allegedly falsely submitted claims for dental services performed on low-income children. Many of these services performed did not meet professionally recognized standards of care or were not medically necessary.  Tony West, “Assistant Attorney General for the Civil Division of the Department of Justice stated the following:

 "We have zero tolerance for those who break the law to exploit needy children. Illegal conduct like this endangers a child’s well-being, distorts the judgments of health care professionals, and puts corporate profits ahead of patient safety."

To resolve the allegations against it, FORBA will pay $24 million, plus interest. The federal share of the civil settlement is $14,285,645, and the Medicaid share for 21 states is $9,714,355.25.  This settlement sends a clear message that the government will not tolerate fraud. U.S. Attorney for the Western District of Virgini,  Timothy J. Heaphy, is correct in the following statement:

"FORBA put greed and profits before the well-being of children. It endangered the health and safety of innocent children and defrauded the taxpayer of millions of dollars.  Today’s settlement addresses these egregious acts and sends a clear message that Medicaid fraud will be expeditiously addressed by this Department."

The False Claims Act is a powerful tool that has helped the government recover approximately $2.2 billion since January 2009 in cases involving fraud against federal health care programs and over $3 billion in False Claims Act total cases overall.

Qui tam suit charges stent device makers of off-label use

A qui tam law suit that accuses Boston Scientific Corp. (NYSE:BSX), Johnson & Johnson (NYSE:JNJ) and its Cordis Corp. subsidiary and Abbott (NYSE:ABT) of promoting the off-label use of biliary stents to treat cardiovascular disease in hundreds of thousands of patients has been unsealed.

The Whistleblower, Kevin Colquitt, filed the qui tam lawsuit under 31 U.S.C. 3729 (False Claims Act) and other State False Claims Act Statutes for violations against Medicare, Medicaid, CHAMPUS and TRICARE.  The lawsuit allegesthat the companies involved, committed Medicare Fraud and filed fraudulent clearance applications with the FDA.

According to the New York Times, the Justice Department and two of those states, Florida and Tennessee, said in court filings that they were declining for the moment to do so, but added that they were continuing to investigate.

Click on the following link: to view the Colquitt Whistleblower Court Documents 

Click on the following links to learn more on this qui tam lawsuit,

Mass Device
The New York Times


 

 

Happy Martin Luther King, Jr. Day 2010

Today, January 18th,  we celebrate the life and legacy of Dr. Martin Luther King, Jr., a man that sacrificed his life to ending inequality, and spreading a message of peace to the world. As one of the most prominent figures in the Civil Rights struggle of the mid-20th Century, Dr. King proved to everyday that change is possible, through peaceful and lawful means. We can all do something to make the world a better place.

As many valiant whistleblowers understand that it takes courage to stand up for something that is right and to make a difference.  As a firm that fights for the rights of our client's we are passionate about justice and fighting for the rights of others. 

Our firm's culture and philosophy, includes being committed to making a difference in our community. Many of our attorneys and staff members are actively involved in charitable organizations such as The Literacy Coalition for Palm Beach County, The Junior League of the Palm Beaches, Pace Center for Girls, The Quantum House, The Dori Slosberg Foundation,  and many others. It is the collective goal of our team at LaBovick & LaBovick, P.A. to give back to the community while likewise furthering the development of our society in general.

We also pride ourselves on the diversity of our team. At the core of our corporate culture is the understanding that diversity not only adds well-rounded knowledge, it adds cultural depth to the company that increases everyone’s level of acceptance. We are happy to say that our team reflects LaBovick & LaBovick, P.A.’s commitment to diversity, and we are blessed to have a multitude of talented professionals from various backgrounds.

As we celebrate the life and accomplishments of Dr. King today, let’s all take a moment to reflect on the impact his mission had on our society, its effect on the world in general. In so doing, we should also reflect upon our own lives and ask the question, how can we help make a difference in community? How can we can make a positive difference in the life of our neighbors? It only takes a dream to change the world, as Dr. King's vision has shown us all. 

Minnesota Hospital to Pay U.S. nearly $1 Million to Resolve Qui tam Allegations Admissions

The year is starting off on the right tone with qui tam settlements for Medicare fraud. The Minnesota case  United States ex rel. Steven Radjenovich v. Stanley Gallagher, et al., Case No.: 04-4538 (D. Minn.) was settled for $846,461 today. 

According to the Department of Justice, Wheaton Community Hospital knowingly made false claims to Medicare for unreasonable and unnecessary hospital admissions. These false claims were made from 1998 to 2004. The hospital billed Medicare for acute patient care that was not medically necessary.

Tony West, Assistant Attorney General for the Justice Department’s Civil Division stated the following:

 "Hospitals and doctors have a responsibility to provide patients with reasonable and necessary care. When they neglect those obligations, patients and taxpayers suffer."

The whistleblower in this case will be awarded $203,150, as his share of the settlement with Wheaton Community Hospital. In a qui tam case, the whistleblower's reward or relator's award can be anywhere from 15% to 30%, depending upon the level of the government's involvement in the case.

If you are a whistleblower and have pertinent information on Medicare, Medicaid fraud or any other false claims act violations from a company, protect your rights and contact a qualified qui tam attorney to discuss how to protect your rights.

Happy New Year 2010 - Justice prevails

Happy New Year 2010!! Today is the first day of the New Year.  Last year marked a milestone in record breaking settlements relating to qui tam and false claims act violations.

The year ended with a qui tam settlement from Genesys Health System in the amount of  $669,413. The lawsuit brought by the Justice Department alleged that  the health care provider violated the False Claims Act by submitting false claims to Medicare.

Genesys, a Grand Blanc, Mich.-based Company, provides health care services through a network of medical facilities located in Michigan. The government alleged that between 2001 and 2007, Genesys violated the False Claims Act by billing Medicare for higher levels of service than were actually rendered to patients. Specifically, the government alleged that Genesys overbilled for evaluation and management services provided to cardiology patients.

Assistant Attorney General of the Justice Department’s Civil Division, Tony West stated:

"We are committed to vigorously pursuing those who defraud Medicare. Taxpayer dollars should be spent on health care services for patients, not wasted on fraud and abuse."

This case was a success due to the coordinated efforts of the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Michigan, and the Office of Investigations for the Department of Health and Human Services’ Office of Inspector General and Office of Counsel to the Inspector General.
 

Governor Crist comes to SFL to talk about Israel... a personal perspective

Brian LaBovick, Esther LaBovick and  Governor Charlie Crist at Temple Beth Am in Jupiter

From time to time, I come across issues that are not directly related to my Blog topic, but due to my own sense of priority I feel compelled to share these experiences with our readers. In this instance, the subject is meaningful to me. The subject is Israel.

 This past Friday, Governor Crist, visited Temple Beth Am in Jupiter. It was always my feeling that Governor Crist was a committed supporter of Israel. On Friday he told our congregation a story about his experience in Israel. While visiting the Western Wall in 2007, he prayed for the protection of Florida from hurricanes. Believe it or not, this is a true story. While on the trip, a friend encouraged him to visit the Western Wall, aka Wailing Wall, and to insert a written prayer into the wall. Governor Crist did just that. In his prayer, he asked the Lord to protect Florida from storms that year. It is important to point out that thereafter Florida was hurricane free in 2007. When one of the Governor’s friends told him he was going to Israel in 2008, the Governor gave him a similar note to put in the wall. For a second year in a row, our beautiful state was hurricane free. This year another friend went to Israel. The Governor contacted him and requested another prayer be placed into the wall. The 2009 hurricane season is over and wallah! No storms. I hope that when Governor Crist moves onto the national stage, most likely as a Senator, he will continue to send his prayers for Florida's safety to the Western Wall.

On a more serious note, the Governor's visit was a rousing success. Although the crowd wanted to hear about the recent international reports on Israel and Palestinian relations, the Governor wisely chose to be more general and positive in his discussion about the significance of the relationship between Florida and Israel. He acknowledged the 800,000 Jewish voices in Florida who want assurance that the US will not abandon Israel. He reiterated that he will continue to fight to keep our relationship with Israel strong.

In closing, Governor Crist addressed the tragic shootings in Jupiter which took place on Thanksgiving. He asked for prayer and healing for the families. His attention to this issue showed how concerned he is about local community events as well as national events. Overall, the Governor’s speech was moving and sincere. I am honored that I had the pleasure of sitting with him; praying with him and hearing him speak about a subject that is near to my heart.

Brian