Top 10 US Health Fraud Cases

Since 1986 False Claims Act judgments and settlements against fraud feasors have totaled over $12 billion. Below are the top 10 recoveries to date.

1) HCA -- $731,400,000 under the False Claims Act In December 2000,

HCA The Healthcare Company (formerly known as Columbia HCA), the largest for-profit hospital chain in the United States, pled guilty to criminal conduct and agreed to pay more than $840 million in criminal fines, civil penalties and damages for unlawful billing practices. Of this amount, $731,400,000 was recovered under the False Claims Act. Underthe settlement agreement, HCA's payment will resolve five allegations regarding the manner in which it bills the U.S. government and the states for health care costs. HCA 's frauds on the taxpaying public included: billing for lab tests that were not medically necessary and not ordered by physicians, "upcoding" medical problems in order to get higher reimbursements for more serious medical issues, billing the government for advertising under the guise of "community education," and billing the government for non-reimbursable costs incurred in the purchase of home health agencies around the country. Note that the December 2000 agreement does not resolve allegations that HCA unlawfully charged the U.S. Government for the costs of running its hospitals, and that it paid kickbacks to physicians to get Medicare and Medicaid patients referred to its facilities.

2) HCA -- $631,000,000 under the False Claims ActIn June 2003,

HCA Inc. (formerly known as Columbia/HCA and HCA – The Healthcare Company) agreed to pay the United States $631 million in civil penalties and damages arising from false claims submitted to Medicare and other federal health programs. This settlement resolves HCA's civil liability for false claims including cost report fraud and the payment of kickbacks to physicians. In a separate administrative settlement with the Centers for Medicare & Medicaid Services (CMS), HCA agreed to pay an additional $250 million to resolve overpayment claims arising from its cost reporting practices. Combined with the December 2000 settlement, the government has recovered $1.7 billion from HCA, by far the largest recovery ever reached by the government in a health care fraud investigation.

3) TAP [Taketa-Abbott Pharmaceutical] Pharmaceutical Products Inc. -- $559,483,560 under the False Claims ActIn October 2001,

TAP Pharmaceutical Products Inc. agreed to pay $875 million to resolve criminal charges and civil liabilities in connection with fraudulent drug pricing and marketing of Lupron, a drug sold for the treatment of prostate cancer. Of this amount, $559,483,560 was recovered under the False Claims Act. In addition, TAP pled guilty to a conspiracy to violate the Prescription Drug Marketing Act and paid a $290 million criminal fine, the largest criminal fine ever in a health care fraud prosecution. Under the Lupron scheme, TAP gave doctors kickbacks by providing free samples with the knowledge that the physicians would bill Medicare and Medicaid $500 per dose. At the time the Lupron fraud was discovered, Lupron accounted for 10% of the money spent on prescription drugs under Medicare Part-A. As part of the settlement, TAP entered into what prosecutors called a "sweeping" corporate integrity agreement.

4) Abbott Labs-- $400,000,000 under the False Claims ActIn July of 2003,

TAP,a unit of Abbott Laboratories, Inc. pled guilty to obstructing a criminal investigation and defrauding the Medicare and Medicaid programs and agreed to pay $400 million to resolve civil claims. In addition, the subsidiary of Abbott Labs, CG Nutritionals, Inc., agreed to a criminal fine of $200 million. The Abbott/CG Nutritionals scam involved the sale of enteral products which pump special foods into the stomachs and digestive systems of patients who, because of disease or some other disorder, are not able to ingest meals in a normal manner.

5) Fresenius Medical Care of North America -- $385,000,000 under the False Claims ActIn January of 2000,

Fresenius Medical Care of North America, the world's largest provider of kidney dialysis products and services, agreed to pay the United States $486 million to resolve a sweeping investigation of health care fraud at National Medical Care, Inc. (NMC), a kidney dialysis subsidiary owned by Fresenius. Of this amount, $385,000,00 was recovered under the False Claims Act. Three NMC subsidiaries also pled guilty to three separate conspiracies and were levied fines of $101 million. Fresenius has also entered into a corporate integrity agreement with the U.S. Department of Health and Human Services. The Fresenius/NMC scam involved fraudulent and fictitious blood testing claims by LifeChem, Inc., NMC's clinical blood testing laboratory, kickbacks to dialysis facilities to obtain blood testing contracts for LifeChem, and fraudulent claims submitted to Medicare for intradialytic parenteral nutrition (IDPN), a nutritional therapy provided to patients during their dialysis treatments.

6) SmithKline Beecham Clinical Laboratories Inc. doing business as GlaxoSmith Kline -- $325,000,000 under the False Claims Act (tie)In March of 1997,

SmithKline Beecham Clinical Laboratories Inc. (SBCL) was ordered to pay $325 million for filing of false claims relating to laboratory tests paid for in whole or in part by the federal government. SmithKline Beecham Clinical Laboratories also agreed to adopt a corporate compliance agreement. The multiple scams involved adding on laboratory tests not requested by doctors and which were not medically necessary, billing for lab tests that were not actually performed, giving kickbacks to doctors in order to get their business, and billing Medicare for dialysis testing already paid for by kidney dialysis centers.

6) HealthSouth -- $325,000,000 under the False Claims Act (tie)In December of 2004,

HealthSouth Corporation, the nation's largest provider of rehabilitative medicine services, agreed to pay the United States $325 million to settle allegations that the company systematically defrauded Medicare and other federal healthcare programs. Said Assistant Attorney General Peter Keisler, "HealthSouth's fraud on Medicare was driven both by longstanding business practices in its outpatient physical therapy business and improprieties in its inpatient rehabilitation business."

7) National Medical Enterprises-- $324,200,000 under the False Claims ActIn July 1994,

National Medical Enterprises Inc. was ordered to pay $379 million in criminal fines, civil damages, and penalties as part of a settlement in a case involving alleged Medicare and Medicaid fraud at psychiatric and substance abuse hospitals in over 30 states. The charges involved kickbacks to doctors for making referrals to the hospitals. Of the total $379 million settlement, $324,200,000 represented recoveries under the False Claims Act, and the rest represents criminal and civil fines.

8) Gambro Healthcare -- 310,000,000 under the False Claims Act In December 2004, Gambro Healthcare agreed to pay $310.5 million to resolve civil liabilities stemming from alleged kickbacks paid to physicians, false statements made to procure payment for unnecessary tests and services, and payments made to Gambro Supply, a sham durable medical equipment company. The settlement also requires Gambro to allocate $15 million to resolve potential liability with various state Medicaid programs. Gambro Healthcare has also entered into a comprehensive Corporate Integrity Agreement. The Gambro Supply Corporation, a wholly-owned subsidiary of Gambro Healthcare, has also agreed to plead guilty to to criminal felony charges; admit to execution of a healthcare fraud scheme; pay a $25 million fine; and be permanently excluded from the Medicare program.

9) Schering-Plough-- $292,969,482 under the False Claims Act In July 2004,

Schering-Plough, a major pharmaceutical manufacturer, agreed to plead guilty to fraud in the pricing of Claritin sold to the Medicaid program. The settlement agreement included a criminal fine of $52.5 million, $117 million to settle state claims, and nearly $176 million to settle federal False Claims Act claims

10) AstraZeneca Pharmaceuticals -- $266,127,844 under the False Claims Act In June 2003,

AstraZeneca Pharmaceuticals LP, a major pharmaceutical manufacturer, pled guilty to health care fraud and agreed to pay $355,000,000 to resolve criminal charges and civil liabilities in connection with its drug pricing and marketing practices with regard to Zoladex, a drug sold for the treatment of prostate cancer. Of this amount, $266,127,844 was recovered under the False Claims Act, and the remainder was levied as criminal fines. AstraZeneca pled guilty to giving doctors kickbacks by providing free drug samples knowing that the doctors would then turn around and bill Medicare and Medicaid hundreds of dollars per sample.

Insider is considering changing his job. Whistleblowing pays MUCH better!

Source: http://www.taf.org/