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Jun 24, 2024 by |

San Francisco Whistleblower Attorney: Hospital System Agrees To Pay $1.5 Million To Resolve Liability Relating To Self-Disclosure Of Improper Discounts


Patient Discounts For Service Referrals

$1.5 Million Settlement

How Qui Tam Cases Begin

Billions of dollars are lost to fraud against the government every year.  To combat this fraud, private citizens help the government recover billions every year from those submitting false claims for government payments.  To help, citizens bring cases in federal courts throughout the country under the False Claims Act, (“FCA”), 31 U.S.C. § 3729 et seq.  The private individuals bringing the cases are referred to as “relators,” and the cases themselves are called “qui tam” cases. If the government recovers, the individuals bringing the lawsuits are eligible for rewards. 31 U.S.C. § 3730(d).   Relators of fraudulent conduct are often employees or managers, or former employees or managers, or (in healthcare cases) patients of the business engaging in the fraud.  Much fraud occurs in the healthcare field and false claims to the government are often accompanied by other infractions such as illegal kickbacks for medical referrals prohibited by the Anti-Kickback Statute and Stark Law.  42 U.S.C. § 1320a-7b (Anti-Kickback Statute); 42 U.S.C. § 1395nn (Stark Law).  If you have credible information of fraud against the government in violation of the FCA in San Francisco or elsewhere in California, call us today at (415)441-8669 and we can help. Our toll-free number is 1-888-50EVANS (888-503-8267).

Recent Settlement[1]

The US Department of Justice (DOJ) recently announced a hospital system has agreed to pay $1.5 million to resolve allegations that it violated the False Claims Act by knowingly causing its subsidiaries to offer discounts to patients to induce them to purchase or refer hospital services reimbursed by federal health care programs. In connection with the settlement, the United States acknowledged that the hospital took significant steps entitling it to credit for cooperating with the government’s investigation.

The Anti-Kickback Statute prohibits parties who participate in federal healthcare programs from knowingly and willfully paying or receiving any remuneration in return for referring an individual to, or arranging for the furnishing of, any item or services for which payment is made by the federal healthcare programs. The United States alleged that the hospital system provided discounts of up to 50% or more on patient cost sharing obligation balances for certain categories of Medicare beneficiaries, chosen by the hospital, without regard to any financial need consideration, for a period of several years. The United States contends that hospital subsidiaries provided these discounts in exchange for the beneficiaries’ purchase or referral of services.

“The department will continue to rely on the False Claims Act to address the use of prohibited remuneration to induce federal healthcare business,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We encourage providers to mitigate the consequences of prior improper conduct by making timely self-disclosures, cooperating with our investigations and adopting enhanced compliance procedures.”

Starting A Qui Tam Action

Any False Claims Act whistleblower case begins by a relator filing a complaint under seal in the federal court usually for the United States District Court for the district where defendant is located or does business. At the same time, the relator submits a disclosure to the DOJ outlining the material evidence the relator has of the alleged false claims. 31 U.S.C. § 3730(b). The seal period of the complaint lasts 60 days during which the DOJ investigates the claims.  31 U.S.C. § 3730(b)(2). (If necessary, the government can, and often does, extend the 60-day period during which the allegations are kept under seal.)  If the government decides to intervene in the case, the government essentially takes over the litigation. 31 U.S.C. § 3730(c)(1).   If the government declines to intervene, the relator may proceed with the litigation on his or her own.  31 U.S.C. § 3730(c)(3).

Contact Us

If you have credible information of government fraud in San Francisco or elsewhere in California, call Ingrid M. Evans at (415) 441-8669, or toll-free at 1-888-50EVANS (888-503-8267) or by email at <a href=””></a>.  In addition to FCA and CFCA whistleblower cases, Ingrid and Evans Law Firm, Inc. also handle bank fraud whistleblower cases 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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