In The News

Ambulance Company Agrees to Pay More than $21 Million to Settle Unlawful Kickback Allegations

We have never ever seen the government’s crackdown on fraud and abuses in the healthcare system involve ambulance companies. Unfortunately, there is a first time for everything as last week the Justice Department announced that several ambulance industry defendants have agreed to pay more than $21 million to settle False Claims Act allegations involving violations of the Anti-Kickback Statute. These companies are alleged to have submitted false claims to Medicare and Medicaid. The Anti-Kickback Statute (2 U.S.C. § 1320a-7b) prohibits offering, paying, soliciting or receiving remuneration to induce referrals for services provided by federally funded programs such as Medicaid, Medicare or TRICARE. The statute’s intent is to ensure that the judgment of medical providers is not unduly influence by financial incentives and is based solely on medical need.

The settlement came about as the result of a lawsuit that was originally filed under the qui tam or whistleblower provisions of the False Claims Act. The Act permits private parties to file suit for false claims and to share in any recover that comes about as a result of that suit. Plaintiffs in these instances often engage the services of a whistleblower law firm. Whistleblower lawyers are knowledgeable in all aspects of the False Claims At. The whistleblower in this case was Dr. Stephen Dean who alleged that several healthcare providers, including East Texas Medical Center Regional Healthcare System, Inc. and East Texas Medical Center Regional Health Services, Inc. (together, “the ETMC Defendants”), and their affiliated ambulance company, Paramedics Plus, LLC (“Paramedics Plus”), were involved in a kickback scheme with several municipal entities in the state of Texas. Dr. Dean will receive over $4.9 million as his share of the settlements.

Prior to this agreement, the government settled with Alameda County and Pinellas Emergency Medical Services Authority (EMSA) – two municipal entities involved in the kickback scheme. Alameda County agreed to pay the government $50,000 and Pinellas EMSA agreed to pay it $66,000 plus an additional $5,200 to the State of Florida. The United States settled with the ETMC (East Texas Medical Center Regional Healthcare System, Inc. and East Texas Medical Center Regional Health Services, Inc) defendants and Paramedics Plus for $20.69 million and with EMSA for $300,000.

“Paramedics Plus paid millions of dollars in illegal inducements over the course of a number of years,” said U.S. Attorney Joseph D. Brown for the Eastern District of Texas. “Williamson allegedly received gifts and also directed Paramedics Plus to make political contributions to local Oklahoma politicians, which EMSA could not do on its own. Sophisticated health care companies do not simply give away millions of dollars to referral sources without expecting something in exchange. Quid pro quo arrangements for the referral of health care business are illegal.”