In April of this year several hospices with facilities across the country agreed to pay $12.2 million to settle claims that they violated the False Claims Act by paying doctors and nurses for hospice referrals. Hospice is a specialized type of in-home care intended to maintain or improve the quality of life for someone whose illness, disease or condition is unlikely to be cured. Here, Hospice Plus, Phoenix Hospice, and Goodwin Hospice allegedly submitted claims to Medicare and Texas Medicaid that included money paid for patient referrals, called “kickbacks.”
Kickbacks are a form of bribe or inducement, in this case allegedly paid to doctors, nurses, and a house-call company, as a reward for referring patients to the hospice service. These kickbacks took the form of stock dividends, free rental space, sham loans, gift cards, cash, and other valuables. If these payments took place, that would render any claim to the government under Medicare or Medicaid false, because the money would have been used for illegal purposes. Referral fees are not permitted under these programs. Government payments meant for the treatment of patients would have instead lined the pockets of individuals, wasting taxpayer dollars. False claims made to Medicare and Medicaid drive up the cost of healthcare, further hurting the average citizen. Misusing money in this way is illegal under the False Claims Act, which also provides protection for people called “whistleblowers” who seek to bring these actions to light.
Whistleblowers, or “relators” as they are known under the FCA, are people with knowledge of companies misusing government funds, and seek to bring those companies to justice. The FCA allows whistleblowers to file their own suit against these companies, in return for a payout from the money the government recovers. In the case described here, the whistleblowers received portions of the settlement for their work in the suit. In some cases, that portion of the payout can be as large as 25%.
Mastando & Artrip have experience working with whistleblowers in cases like these. If you believe you have knowledge of potential misuse of government funds, give us a call at 256-532-2222 and we’d be happy to speak to you.