DOJ Announces $72.3 Million False Claims Act Settlement

Arent Fox

DOJ Announces $72.3 Million False Claims Act Settlement

Oklahoma Center for Orthopaedic and Multi-Specialty Surgery, its part-owner and management company, a physician group, and other affiliated entities and individuals settled False Claims Act and Oklahoma Medicaid False Claims Act allegations for $72.3 million. A whistleblower alleged that the defendants were engaged in an illegal kickback scheme involving improper payments to referring physicians in violation of the Anti-Kickback Statute and the Physician Self-Referral Law (or the “Stark Law”), which allegedly led to the submission of false claims to the Medicare, Medicaid, and TRICARE programs.

Specifically, the whistleblower alleged that the physicians received kickbacks for referring patients to the hospital, in which they have an ownership interest. The kickbacks took the form of free or below-fair-market-value office space, employees, and supplies, compensation in excess of fair market value for physician services, equity buyback provisions and payments for certain physicians exceeding fair market value, and preferential investment opportunities in connection with anesthesia services.

The USAO press release is here.

Molecular Diagnostics Testing Company to Pay $8.25 Million to Resolve False Claims Act Allegations

Agendia, Inc., a genetic testing company based in Irvine, California, has agreed to pay $8.25 million to settle False Claims Act claims brought in the Western District of Kentucky. The qui tam lawsuit, filed by a former employee of Lourdes Hospital, alleged that Agendia engaged in a nationwide scheme to bill Medicare for its flagship genetic test, which analyzes certain genes in a breast cancer tumor and predicts the risk of breast cancer recurrence in patients. According to the complaint, Agendia conspired with hospitals to delay ordering the test in order to circumvent Medicare’s 14-Day Rule. The 14-Day Rule prohibited laboratories from billing Medicare for tests ordered within 14 days of the patient’s discharge from a hospital, but permitted billing for the test if performed 14 days after discharge. The government intervened in the lawsuit in May 2020 for purposes of settlement.

The USAO press release is here.

Ophthalmic Consultants Agrees to Settle Healthcare Fraud Claims for $4.8 Million

A Florida-based practice, Ophthalmic Consultants, P.A., has agreed to settle fraud claims for $4.8 million. The government alleged that Ophthalmic Consultants used a single vial of certain single-use medications to provide multiple doses to patients. The providers then billed Medicare, TRICARE, and the Federal Employees Health Benefits Program for multiple doses, thereby receiving excessive reimbursements.

The USAO press release is here.

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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