Whistleblower Receives More Than $17 Million in Omnicare Case

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A decision has been made in the case against Omnicare, Inc. that will net a former Omnicare pharmacist more than $17.2 million in the ensuing settlement.

The settlement with the Department of Justice orders Omnicare, Inc. to pay more than $124 million after having allegedly violated the Anti-Kickback Statute (AKS). Omnicare was accused of luring in nursing homes to choose the company to be its primary drug supplier for Medicare and Medicaid patients by offering discounts to those facilities. The whistleblower lawsuits resulting from these accusations were filed under the False Claims Act.

The money not awarded to the pharmacist/whistleblower will go to the federal government. Of the amount sent to the government, about $8.2 million will be sent to states that were affected by the alleged kickbacks, which harmed Medicaid programs.

Under the AKS, it is considered a felony to provide these kinds of rewards when federal healthcare programs are involved. Therefore, there are some significant penalties involved for these violations. Violators could be penalized $50,000 for each instance. Over the course of the last five years, the government has doled out fines of more than $19.5 billion for False Claims Act violations, which includes AKS violations. This has been largely due to the Obama administration’s determination to fight healthcare fraud.

Cases such as these, with whistleblowers receiving huge settlements, are going to continue to be common over the next ten years — the Affordable Care Act has a significant amount of funding ($350 million) allocated toward fighting healthcare fraud, conducting fraud investigations and more. The theory is that so long as whistleblowers continue to be rewarded, they will keep coming forward in droves.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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