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Aug 28, 2021 by |

San Francisco False Claims Act Whistleblower Attorney: $21.25 Million Settlement Of Illegal Kickback Allegations Against Hospital System


Overpaying Physicians As Form Of Illegal Kickback

Internal Audit Director Blows Whistle

Whistleblower Will Receive 15-30% of $21.25 Million

Healthcare providers in the U.S., including hospitals and clinics, are subject to a number of statutes to prevent any fraudulent billing under government programs like Medicare and Medicaid.  When the providers violate those laws, they also violate the False Claims Act (“FCA”), 31 U.S.C. §§ 3729-3733, for submitting false claims for payment to the government.  One of the underlying protections against fraud in the healthcare field is the Anti-Kickback Statute, 42 U.S.C. § 1320a-7b, which prohibits kickbacks to physicians for patient referrals for services covered by Medicare and Medicaid (known as Medi-Cal in California).   Individuals with information about this kind of scheme can be rewarded for bringing this kind of illegal practice to light.  31 U.S.C. § 3730(b).  The California whistleblower attorneys at Evans Law Firm, Inc. represents individuals who bring FCA cases based for any kind of fraud against Medicare or Medicaid.  If you have credible, original information of healthcare fraud, call us today at (415)441-8669 or toll-free at (888)-50EVANS (503-8267) and we can help.

Anti-Kickback Case Settlement

According to a recent U.S. Department of Justice (DOJ) press release,[1]  a hospital system has agreed to pay $21.25 million to resolve whistleblower claims that they violated the Anti-Kickback Statute. A former director of internal audit at the hospital blew the whistle on the hospital alleging in her FCA qui tam complaint that the hospital group was offering physicians over-market value payments for their services. The qui tam lawsuit stated that hospital was overpaying physicians and physician groups to secure more patient referrals for the hospital system.  Specifically, the whistleblower lawsuit alleged that between 2010 and 2016, the hospital ran a scheme that paid illegal kickbacks to doctors who would send an increased volume of patients to the hospital system, and then charged all of these extraneous costs to the Medicare program. Under the FCA, charging Medicare for doctor’s services that were more than the standard market price is a violation of the Anti-Kickback Statute and the Physician Self-Referral Law, known as the Stark Law, 42 U.S.C. § 1395nn.

“Physicians must make referrals and other medical decisions based on what is best for patients, not to serve profit-boosting business arrangements,” said Special Agent in Charge Lamont Pugh III of the Office of Inspector General for the United States Department of Health and Human Services. “Working closely with our law enforcement partners, we will continue to protect taxpayer-funded federal health care programs as well as patients.” Medical kickback schemes often erode accountability in the medical system, especially when they take advantage of federal medical programs such as Medicare, Medicaid, and TRICARE. Americans covered under Medicare are often some of the country’s most vulnerable citizens, and defrauding them breaks down patient trust in the system, which in turn negatively affects public opinion of federal medical programs. The False Claims Act is uniquely positioned to help detect and end this kind of medical fraud.

How False Claims Act Whistleblower Cases Work

The allegations in this case were first reported by an internal auditor at the defendant hospital in a lawsuit she filed under the qui tam, or whistleblower, provisions of the FCA. 31 U.S.C. § 3730(b). The FCA allow private parties to sue on behalf of the government for false claims, and to receive a share of any recovery. 31 U.S.C. § 3730(b) (procedures for initiating qui tam actions).  The suit is filed confidentially and remains under seal giving the government time to review the allegations in the case.  If the government decides to intervene, the government essentially takes over the case.  If the government declines to intervene, the plaintiff has the right to continue the suit of their own. The whistleblowers stand to receive up to 15-30% of the settlement in accordance with 31 U.S.C. § 3730(d)(1) and (2).

Contact Us

If you have information of healthcare fraud against the federal government or the State of California occurring here in San Francisco or elsewhere in the State, contact Ingrid M. Evans at Evans Law Firm at (415) 441-8669, or toll-free at (888)-50EVANS (503-8267) or by email at <a href=””></a>.   In addition to False Claims cases, Ingrid also represents individual whistleblowers in qui tam cases involving bank fraud under FIRREA/FIAFEA, commodity trading and securities fraud under the Commodities Futures Trading Commission Whistleblower Program and the Securities and Exchange Commission Whistleblower Program, and tax fraud under the Internal Revenue Service Whistleblower Program

[1] Evans Law Firm, Inc. was not involved in the case in any way.

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