The Largest Health Care Fraud Settlements in 2014

usa-dollar-bills-1431130-mEarlier this week, we profiled some of the Justice Department’s largest mortgage fraud settlements from 2014, including the largest civil settlement from a single entity (Bank of America agreed to pay a record $16.65 billion under a global resolution). In addition to recoveries in the financial sector, DOJ was able to successfully recover roughly $2.3 billion in health care fraud cases, largely due to the help of health care whistleblowers.

The year saw two massive cases settle involving Johnson & Johnson and Omnicare. Both cases accounted for a substantial portion of the total recovered in 2014.

  • Johnson & Johnson – $1.1 Billion: J&J and a couple of subsidiaries agreed to pay $1.1 billion to resolve claims that they promoted several drugs for off label use. J&J allegedly promoted Risperdal, Natrecor and Invega for uses not deemed safe by the U.S. Food and Drug Administration by paying kickbacks to physicians in exchange for writing off-label prescriptions. This caused health care providers to submit hundreds of millions in alleged false claims for reimbursement through government health care agencies. In addition to the $1.1 billion to the federal government, J&J paid over $600 million to state Medicaid programs and $485 million in criminal fines and forfeitures. The settlement, one of the largest in the nation’s history, could not have been possible without the brave men and women who blew the whistle on the pharmaceutical giant. One particular whistleblower from Northern California received $28 million for filing suit against J&J.
  • Omnicare – $116 Million: Omnicare agreed to settlement terms with the DOJ after the nation’s largest provider of pharmaceuticals to nursing homes was accused of paying kickbacks to entice nursing homes into choosing Omnicare as their pharmacy provider. The allegations were in violation of the Anti-Kickback Statute, which prohibits companies from offering, soliciting, paying or receiving payment to induce referrals for goods or services covered by government health care agencies. Omnicare paid an additional $8.2 million to state Medicaid programs that were affected by the alleged fraud. Much like the J&J case, this case was assisted by multiple whistleblowers who came forward and helped the government build a case against Omnicare. One of the whistleblowers, a former Omnicare employee, walked away with $17.24 million for his role in exposing the alleged fraud.