There are many laws designed to protect the integrity of the nation’s health care system. Two of the most important — and which can result in whistleblower lawsuits by private individuals — are the anti-kickback statute and Stark Law.
The anti-kickback statute makes it illegal for anyone to offer, pay, solicit or receive anything of value for inducing or rewarding referrals for federal health care business. This applies to any items or services for any federal health program.
The Stark Law applies only to Medicare/Medicaid and prohibits physicians from making referrals to Medicare patients for designated health services in which the physician has a financial interest.
Our successes include a $51 million recovery for medical device fraud and Stark Law violations, a $16.5 million recovery for Stark Law and anti-kickback statue violations involving HCA hospitals, and an $8 million recovery against a pharmaceutical retailer for illegal kickbacks.
How Are These Laws Involved In Qui Tam Prosecutions?
Because violations of these laws can result in the federal government both overpaying for services and paying for ineligible services, both are subject to civil litigation under the False Claims Act. This means that individuals with evidence about physicians who make illegal service referrals or physicians or other medical providers who accept or furnish illegal kickbacks can serve as “relators” in qui tam prosecutions and potentially share in the recovery of government funds.
Our firm has achieved noteworthy success prosecuting cases involving violations of the anti-kickback statute and Stark Law, representing individuals who have information on Medicare fraud and working closely with federal prosecutors.
Examples of illegal kickbacks and referrals include:
- A Massachusetts pharmaceutical company paid a $559.5 million settlement for giving illegal kickbacks to doctors who prescribed its prostate cancer drug. A vice president of sales for the company quit his job and alerted the government when he became concerned about the company’s marketing practices. Additionally, an HMO provider had come under increasing pressure to switch from an equally effective but significantly less expensive alternative drug because the pharmaceutical company offered its doctors a panoply of inducements to prescribe the expensive drug, including ski and golfing trips, free televisions and VCRs, cocktail party bar tabs, and an array of free products and services.
- A Texas durable medical equipment company paid durable medical equipment dealers and independent agents fees in exchange for the referral of Medicare patients. The kickback scheme included payment of specific amounts, which increased based on the dollar volume of durable medical equipment delivered to the patients. The company agreed to a $1.2 million settlement.
- A California hospital gave free office space to a psychiatric services management company, and inflated management and director fees to induce it to funnel patients to the hospital. This kickback scheme violated the Stark Law and resulted in a $5.1 million settlement paid by the hospital.
- A Florida durable medical equipment company agreed to a $10 million settlement for giving kickbacks to suppliers and physicians for patient referrals. The company distributed mail-order respiratory medication and diabetic supplies to Medicare beneficiaries. The company paid kickbacks, disguised as “marketing fees,” each time a patient received a medication shipment, and also waived co-insurance payments for Medicare beneficiaries.
Contact Warren | Benson Law Group
If you have information related to illegal Medicare referrals or kickbacks, contact our attorneys for a confidential consultation. Call 800-844-4406 or send an email.