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.
The 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.)
A 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.