According to the U.S. Department of Justice, the case was initially filed in 2003, by Whistleblower and licensed pharmacist Bernard Listiza. The Whistleblower should receive approximately $5 million of the total $35 Million qui tam settlement and the federal government will receive approximately $18.6 million of the settlement. The remaining $16.4 million will be shared by over 40 states and Puerto Rico, due to separate settlement agreements.

A breakdown of the shares of the Walgreen's settlement by state includes: Florida receives $9.8 million, Illinois, $1.25 million, Georgia $401,000, Indiana $289,000, Ohio $161,000, New Jersey $1.25 million and Pennsylvania $9,000.

Click here to read more on this Whistleblower Medicaid fraud case from the Chicago Tribune.

The whistleblower, Bernard Listiza, a licensed pharmacist, will be rewarded $4,309,330 for his efforts in bringing this medicaid fraud to light.  As previously mentioned previously on the Whistleblower Law Blog, a whistleblower can receive a reward of 15 percent to 25 percent of what the government recovers,  if the government joins the qui tam case and if the government declines to join the qui tam lawsuit, the whistleblower can receive a reward of 25 percent to 30 percent of what the government recovers.

We can only hope that these large awards will begin to serve as deterrents for companies such as CVS Caremark to engage in Medicaid fraud. Thanks to the diligence of U.S. Attorneys such as U.S. Attorney Patrick Fitzgerald, the government is pursuing corporations and individuals charged with fraud against the government. In a recent statement, U.S. Attorney, Patrick Fitzgerald, said, “These penalties, coupled with the willingness of insiders to report fraud, should deter such misconduct, but when it doesn’t, the result in this case and others serves notice that we will aggressively pursue all available legal remedies.” 

The Whistleblower Law Blog salutes the brave whistleblowers who come forward and the diligent men and women prosecuting fraud on behalf of the government.  Sometimes, it may take years and many obstacles to overcome, but it is all worthwhile when a whistle blower's testimony can help the government recoup dollars and treble damages from Corporations and individuals that are found defrauding the government.

Click here to read more from the Department of Justice.

Judge Matthew Perry ruled yesterday that the Justice Department-backed lawsuit against the South Carolina Regional Hospital can proceed and crucial evidence against the Hospital can be admitted into the f the case. The lawyers for the hospital had been trying to get the case dismissed.

Orthopedic Surgeon, Michael Drakeford, initial qui tam lawsuit  was filed under seal in federal court in Columbia in October 2005. The federal government investigated Drakeford’s claims and before taking over as lead plaintiff in the case. 

Time will tell how much of the behind-the-scenes, big-profits world of doctors and hospitals in the billion-dollar S.C. health care industry will be revealed. The hospital is expected to answer the allegations by March 28.

The case could be worth millions of dollars to the government if the South Carolina Hospital is found guilty of fraudulently over billing the government or if they decide to settle and no admit any guilt or wrong doing. 

Charles Miller, a Department of Justice spokesman is quoted as saying, "The government intervenes only if a case has merit. The department gets involved in less than 25 percent of qui tam actions filed each year. In qui tam cases, the government nearly always gets a settlement or wins in a jury trial."

Click here to read more on this case from the State.com

HealthSouth, the nation’s largest provider of inpatient rehabilitation services, was also one of the largest providers of outpatient rehabilitation services, ambulatory surgery services, and diagnostic imaging services until it sold those lines of business earlier this year.

The settlement was due to the joint efforts of the U.S. Attorney for the Northern District of Alabama, the U.S. Attorney’s Office for the Central District of California, the Civil Division of the Department of Justice, the Department of Health and Human Services, Office of Inspector General, and the FBI.

U.S. Attorney for the Central District of California, “Thomas P. O’Brien, gave a powerful statement in response to the settlement and kickbacks “We will not be fooled when healthcare providers attempt to disguise kickbacks as cleverly crafted business arrangements. Medicare providers seeking federal funds must play by the rules. Providing sweet deals to physician groups to insure a steady stream of referrals runs afoul of those rules and will not be tolerated.”

HealthSouth Corporation stock closed yesterday at $21.48. Click here to find out more from Health South.

To read more from the Department of Justice, Click here.

Click Here to read the article "How Qui tam helps fight Medicaid Fraud".

Allegedly, Direct Nursing Assistance, Inc. submitted claims to Medicare for $1 million. Aenlle had prescription pads printed, and forged the names and signatures of physicians. For his part in this Medicare scheme, Aenlle faces a maximum of 40 years in prison. His sentencing is scheduled for Dec. 13, 2007. 

U.S. District Judge Donald Middlebrooks presided over the case and the case was prosecuted by Deputy Chief Kirk Ogrosky from the Fraud Section of the Criminal Division and Assistant U.S. Attorney Ryan K. Stumphauzer of the Southern District of Florida.

Click here to read more from the Department of Justice.

This was a collaboration of seven qui tam actions brought under the False Claims Act. Those actions include the following cases:  United States ex rel. Richardson v. Bristol Myers Squibb, Civil Action No. 06-11821-NG (D. Mass.); United States ex rel. Piacentile v. Bristol-Myers Squibb Co., Civil Action No. 05-10196-MLW (D. Mass.); United States ex rel. Forden v. Bristol-Myers Squibb Co., Civil Action No. 04-11216 -RGS (D. Mass.); United States ex rel. Cokus v. Bristol Myers Squibb, Civil Action No. 01-11627-RGS (D. Mass.); United States ex rel. Barlow v. Bristol-Myers Squibb, Civil Action No. 04-11540-MLW (D. Mass.); United States ex rel. Ven-A-Care of the Florida Keys, et al. v. Apothecon, et al., Civil Action No. 00-10698-MEL (D. Mass.); and United States ex rel. Ven-A-Care of the Florida Keys, Inc. v. Bristol Myers Squibb Co., Civil Action No. 95-1354 (S.D. Fla.).

The settlement was by no means the effort of one person, but the joint efforts of several offices and individuals including: the Boston offices of the Office of Inspector General for the Department of Health and Human Services, the Federal Bureau of Investigation, and the Food and Drug Administration's Office of Criminal Investigations, along with Department of Justice Trial Attorney Andy Mao of the Fraud Section of the Civil Division, District of Massachusetts Assistant U.S. Attorneys Gregg Shapiro and Susan Poswistilo, and Southern District of Florida Assistant U.S. Attorney Mark Lavine.

The National Association of Medicaid Fraud Control Units participated in the negotiation of the settlement, and the Corporate Integrity Agreement was negotiated by Mary Riordan of the Office of Inspector General at the Department of Health and Human Services.

Cheers to everyone involved in making this huge settlement possible. And not to forget the brave whistleblowers who risked a lot to come forward.  They will share $50 million of the settlement for their bravery and participation. A relator can receive anywhere from 15 percent to 30 percent in a successful qui tam claim depending upon the government's involvement.

Click here to read more about this Bristol Myers Squibb Settlement from the DOJ and Bristol Myers Squibb.

Attorney General Cuomo issued strong words in a statement on the case  "Merck's irresponsible and duplicitous conduct endangered the health of New Yorkers and wasted our tax dollars. As alleged in the complaint, even as evidence was piling up showing just how dangerous this drug was, Merck put profits above all else and put thousands at risk by continuing to push Vioxx inappropriately on doctors and patients.We will hold accountable those who put our families at risk, and we will fight back when New Yorkers are harmed and fleeced.”

According to Ed Silverman of the Pharmalot Blog, did a great job covering this story. He brings out in his recent post that this the lawsuit comes just five months after the newly appointed Jim Sheehan came aboard as New York State’s Medicaid Inspector General. Jim Sheehan is former Assistant Attorney General in Philadelphia. We owe him tremendous gratitude for his efforts in the Medco case. A company that was once owned by Merck.

This is the only the beginning. New York has jumped out first in using their new State False Claims Act to help prosecute this alleged fraud against the residents of New York.  Companies across the U.S. should be on notice that they will be prosecuted by more states for any State False Claims Act violation.  There are about 22 states with a Sate False Claims Act on their books.  Florida recently modified the the Florida False Claims Act to be in line with the Deficit Reduction Act and to receive additional funds.

Stay tuned for more news on this case with New York and the makers of Vioxx, Drug giant, Merck.  They probably will settle to get this case closed and behind them as quick as possible, before more start cropping up. This probably will not be the last Vioxx case we will hear about. 

On a side note: Merck stock closed at $50.57 an increase of $1.10 from previous trading. I guess the Shareholders are confident that Merck can handle this new law suit.

It makes me think of the two baseball teams Boston and the Yankees. Boston took the Boys of Summer for granted and did not protect their lead.  The Yankees appear to be closing in on the narrow lead Boston has over them.  One word to the wise, never take New York and New Yorkers  for granted.  

This case involves allegations by former finance and accounting employee, Louanne Boothe against Sun Healthcare Group, a U.S. Healthcare provider, claiming that Sun Healthcare Group over-billed the United States in ten distinct ways. The complaint includes allegations of the following: 1)  Sun over-billed the government by abusing the Section 1010 exception in the years 2000-2002;  2) Sun defrauded Medicare by disregarding Medicare’s prudent-buyer guidelines and overcharged for therapy management services for  $2.6 million; 3) overstated its temporary nursing staff’s labor hours in 2001 and 2002 by $500,000; 4) overcharged Medicare by $240,000 in 2002 for pharmacy charges  5) improperly billed Medicare in 2001 for $200,000 worth of stolen medical supplies; 6) overcharged Medicare by $540,000 in 2000-02 by funneling costs between Denver Mediplex and an outpatient clinic; 7) filed Medicare reimbursements for $3.6 million worth of mortgage interests payment; 8) released patients earlier than its prior practice from Ballard Rehabilitation Hospital to inflate its Medicare revenue by $2 million; 9) manipulated patient discharges to impose improper costs on Medicare of $500,000; and 10) signed without the knowledge or consent of its patients admission forms for three years ending January 2003 to receive from Medicare $9 million in reimbursements for accident and injury treatments when liability potentially rested with third parties.

These allegations seem pretty specific, however, the primary issue at hand is whether the allegations are “based upon” information already in the public domain or whether Ms. Louanne Boothe is an “original source” of the information.

The district court held that it lacked subject matter jurisdiction under 31 U.S.C.§ 3730(e)(4) of the False Claims Act, 31 U.S.C. § 3729-33, to hear the case.

According to the Tenth Circuit, the district's assessment was accurate that it lacked jurisdiction in three of the claims Ms. Boothe presented. However, jurisdictional analysis of each of Ms. Boothe’s
remaining seven claims of fraud is necessary. Therefore, the United States Court of Appeals Tenth Circuit remanded the cases for further proceedings. The Court included the following language "Three bad apples does not necessarily warrant discarding the barrel". Interesting choice in words.

It is also important to note that Sun Healthcare Group tried to use the following arguments against Ms. Boothe: (1) Ms. Boothe waived her right to pursue a qui tam complaint in a severance agreement she executed upon her departure from Sun; (2) Sun’s intervening bankruptcy, from which it emerged in 2002, discharged Sun’s obligations to satisfy the claims in Ms. Boothe’s qui
tam complaint; and (3) Ms. Boothe failed to plead her qui tam complaint with sufficient particularity.

Citing lack of jurisdiction, the district court declined to address these arguments for dismissal and the Tenth Circuit did not address them either. It will be interesting to see if they come up again as this saga continues.

Let's all hope that Sun Healthcare Group is operating with the integrity and honesty that they are known for in the healthcare community rather than the over-billing of Medicaid and Medicare as was alleged in the qui tam suit of Luanne Boothe. The company has been around since 1993 and is continuously growing, serving more sick and terminally ill patients, and doing lots of business with the government. In the year, 2006, they took in $1.116 Billion in revenue according to their quarterly reports. Currently they operate 216 skilled nursing, long-term care and assisted living and mental health facilities in 25 states with approximately 23,520 operating beds according to their self published reports. The company closed out the second quarter at $446.7 million, up 73 percent compared to $258.5 million second quarter 2006. The stock price closed on the Nasdaq Friday at $15.30 per share.

The whistleblower, in this qui tam case, is John Thomas, a former employee of Nu Med Technologies, that sold medical instruments and devices used in spinal surgery.

No one is immune to being charged with a qui tam false claims lawsuit, if they are breaking the law. The government will prosecute small or large companies that fraudulently submit bills to the government. Regardless of the size, fraud, even on a small scale, cost taxpayers money. As former Federal Prosecutor, Brian LaBovick mentioned in a previous post, on the Whistleblower Law Blog , the false claims act does not discriminate against prosecuting small fish (small companies) when they break the law.

If you have knowledge of fraud against the government, contact an experienced qui tam attorney to discuss your claim. It is essential that you take the necessary steps in protecting your relator's share of the government's recovery, which can be 15 – 30% of the government’s total recovery along with additional civil penalties. Since false claims act cases are often complex, it can take several years to settle or to litigate. Whistleblowers often hire an experienced attorney to help in submitting a qui tam claim. LaBovick and LaBovick are former federal prosecutors experienced in prosecuting cases on behalf of the government.

The Whistleblower Law Blog is presented as a service of the Private Law Firm, LaBovick & LaBovick, Civil Justice Prosecutors. LaBovick & LaBovick is a Plaintiff's firm that represents whistleblowers across the United States in qui tam (False Claims Act) litigation; including Federal and State False Claims Act Cases. They offer free confidential consultations to whistleblowers that need to discuss sensitive matters, including those involving current or a former employers.

Thanks to the brave whistleblower, Benjamin Turner, a former division manager at Maximus, the acts and deeds of the corporate wrongdoers, did not go unpunished. In recognition for his efforts, Mr. Turner will receive $4.93 million as a result of filing a qui tam or whistleblower lawsuit under the provisions of the False Claims Act. There are times when a whistleblower gets compensated for his brave actions. And there are times when the whistleblower gets nothing, even after going to the Supreme Court, as in the case of Rockwell v. United States, as mentioned here previously on the Whistleblower Law Blog. Take a look at the Whistleblower statistics reported by the US DOJ, from 1986 - 2006. There were over 5,500 whistleblower cases filed.  As John Mack, blogger for Pharma Blogoshere points out, that comes to about  $326,341 per whistleblower if they all shared the approx. $1.79 billion equally. This is not enough to retire on, but it is not a bad start for a new life after standing up for what is right and turning in an employer for defrauding the government.

According to the US DOJ Press Release, Assistant Attorney General for the Civil Division, Peter D. Keisler said " The Maximus settlement demonstrates the Justice Department’s strong commitment to vigorously pursuing those companies that defraud the Medicaid program.

Let's hope more brave whistleblowers step forward and turn in corporations for qui tam or false claims act violations. If you are a whistleblower, with vital confidential information on your company, fraudulently billing the government, contact an attorney that handles qui tam litigation. You need to protect your rights, and your "relator's" share of what the government recovers from the qui tam claim. The Lawyers of LaBovick & LaBovick are former Federal Prosecutors that know how to prosecute qui tam claims on behalf of the government. Call today for a confidential free consultation.

Click here to read more on Maximus from Forbes and Associated Press and the US Department of Justice.

The Whistleblower Law Blog is presented as a service of the Private Law Firm, LaBovick & LaBovick, P.A., Civil Justice Prosecutors. LaBovick & LaBovick is a Plaintiff's firm that represents whistleblowers in Florida and throughout the United States in qui tam (False Claims Act) litigation

“Our Medicaid program exists to ensure that our citizens receive the medical care they need,” said Florida Attorney General Bill McCollum. “When individuals attempt to steal those funds, other people in genuine need are victimized.”

The Agency for Health Care Administration tipped off the Medicaid Fraud Control Unit, with information that the Fonts were failing to perform their services, by either not delivering equipment or delivering faulty equipment while billing Medicaid for fully functional equipment. This is a serious issue because not only were the Fonts stealing from the government, but they were also putting the lives of the patients with severe breathing problems in danger.

If Fernando and Ileana Fonts are prosecuted for Florida False Claims Act (qui tam) violations, they could be face substantial penalties. According to the new Florida False Claims Act violators face civil penalties for making false or fraudulent claims, written or electronically, to the government for the purpose of getting a false or fraudulent claim paid. The penalties can be up to $11,000 per claim and triple the amount of damages the government agency sustains. The new Florida False Claims Act was approved and signed into law in June 2007 by Governor Charlie Crist.

Click Here to read more from the Attorney General's Office on this case.

The Whistleblower Law Blog is presented as a service of the Private Law Firm, LaBovick & LaBovick, P.A., Civil Justice Prosecutors. LaBovick & LaBovick, P.A. is a Plaintiff's firm that represents whistleblowers in Florida and throughout the nation in qui tam (False Claims Act) litigation.