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The Justice Department announced late last week that an Oregon-based biotech company will pay nearly $5 million to settle whistleblower claims filed by a former employee. Biotronik allegedly made improper payments to doctors in an effort to entice them to use medical devices that the company manufactured and sold.

Logo_BIOTRONIKThe alleged improper payments caused hospitals and ambulatory surgery centers to submit false claims to both Medicaid and Medicare for the implantation of Biotronik products, specifically defibrillators, pacemakers and cardiac resynchronization devices. According to the Justice Department, Biotronik paid physicians in Arizona and Nevada in the form of meals at expensive restaurants or inflated payments for membership on a physician advisory board.

Brian Sant, a former Biotronik employee, initially filed the allegations in a qui tam lawsuit. The government decided to intervene and take over Sant’s case. Still, he is entitled to compensation for his role in the successful recovery and will receive approximately $840,000.

The lawsuit is United States ex rel. Sant v. Biotronik, Inc., No. 2:09-CV-03617 KJM EFB (E.D. Cal.)


logo.vnsnyA New York nursing service accused of sending improper reimbursement claims to the state’s Medicaid program will pay $35 million to settle civil fraud charges. Visiting Nursing Service of New York, VNS Choice and VNS Choice Community Care (collectively VNS) allegedly enrolled roughly 1,740 Medicaid members into a managed long-term care plan when the needs of these patients did not qualify them for the care plan. In spite of their ineligibility, VNS passed the bills for caring for these patients onto New York’s Medicaid program.

Health care providers like VNS are responsible for managing long-term care services for Medicaid members, for which they are paid roughly $3,800 per month, per each member enrolled in the health plan. In order to qualify for a managed long-term health plan, Medicaid members must be eligible for nursing home level of care, and require at least 120 days of community-based long-term care.

VNS admitted that 1,740 patients were improperly referred to them by social adult day care centers (known as SADCC’s). None of the patients were eligible for the managed long-term health plan. In some cases, these patients received care primarily through the SADCC’s, many of which provided minimal or substandard care.

According to the U.S. Attorney’s Office for the Southern District of New York, the SADCC’s merely served as “a conduit” for VNS to induce the enrollment of more Medicaid members. In addition to the $35 million payment, VNS will be required to credential only with SADCCs that have been properly certified and are capable of providing levels of care consistent with regulatory requirements, monitor SADCCs in network to ensure compliance and prohibit improper marketing practices.


Owner and Operator of Florida Home Health Care Companies Sentenced to 80 Months Behind Bars, Will Pay $45 Million in Restitution

November 5, 2014

The Miami-based owner and administrator of two home health care companies was sentenced to 80 months in prison today and will pay $45 million in restitution after pleading guilty to one count of conspiracy to commit health care fraud. Elsa Ruiz, the 45-year-old owner of Professional Home Health Care Solutions Inc. and administrator of LTC [...]

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Ocean Dental Pays $5 Million to Settle Medicaid Fraud Claims

November 2, 2014

An Oklahoma-based dental company has agreed to pay $5.05 million to resolve a lawsuit claiming it submitted false Medicaid claims. Ocean Dental, which operates 28 dental clinics in seven states, provides dental services to children eligible for Medicaid. The company agreed to the settlement without admitting any wrongdoing, however, a former Ocean Dental employee named [...]

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Former General Counsel for Minnesota Hospital Association Offered $150k as ‘Hush Money’ to Stay Silent on Healthcare Fraud

October 29, 2014

In 2010, David Feinwachs was asked to look into what he describes as a lack of transparency and accountability in Minnesota’s Medicaid program. As general counsel for the Minnesota Hospital Association, Feinwach found that certain hospitals were being reimbursed well below their costs while four HMOs were making an astounding amount of money off the [...]

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House Democrats to SEC: Address Corporate Practices that Deter Whistleblowers

October 27, 2014

The Securities and Exchange whistleblower program has gained steam since its launch in 2011. The agency has received upwards of 6,000 tips on financial fraud from every state in the union, as well as 55 countries. In the last fiscal year alone, the SEC has issued 139 judgments and orders, priming it to be the [...]

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Dialysis Services Company Settles Illegal Kickback Allegations for $350 Million

October 22, 2014

One of the nation’s leading dialysis services companies will pay $350 million to resolve claims that it paid illegal kickbacks to physicians and physician groups in an effort to boost patient referrals. The Justice Department announced today that it had reached the settlement agreement with DaVita Healthcare Partners, Inc., which has dialysis clinics in 46 [...]

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Medical Business Service, Inc. to Pay $1.95 Million to Settle Health Care Fraud Charges

October 20, 2014

The Justice Department announced last week that a Florida-based radiology billing company will pay nearly $2 million to settle claims that it knowingly changed billing codes to Medicare and Medicaid in order to get previously rejected claims paid out. The settlement resolves a whistleblower claim filed by relator, Katlisa N. Vaughn, who will receive a [...]

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Government Intervenes in Defense Company Whistleblower Lawsuit

October 16, 2014

The Justice Department announced today that it has intervened in a whistleblower lawsuit accusing Sikorsky Aircraft Corporation and subsidiaries Sikorsky Support Services Inc. and Derco Aerospace Inc. of overcharging the U.S. Navy on aircraft maintenance costs by using an illegal subcontract. The lawsuit claims that Sikorsky approved an illegal subcontract called a “cost-plus-a-percentage” contract in [...]

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Organon Settles False Claims Allegations for $34 Million

October 15, 2014

Organon, a pharmaceutical company with assets now owned by Merck, has agreed to pay $34 million to settle false claims allegations filed by two whistleblowers. The settlement resolves claims that Organon promoted the off label use of antidepressants, provided improper financial incentives to “nursing home pharmacy companies” and made misstatements about drug pricing which caused [...]

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