whistleblower 375 210 250x140 Health care fraud involving pharmacies, benefit managers opens new front for whistleblower litigation under False Claims ActA growing number of False Claims Act whistleblower lawsuits are taking aim at pharmacies and pharmacy benefit managers, accusing the “middlemen” companies of defrauding Medicare and Medicaid through improper billing practices and kickback arrangements.

Traditionally, most False Claims Act lawsuits involving health care fraud directly target pharmaceutical companies, hospitals, and other health care providers for pedaling prescription drugs for off-label purposes, providing physicians with illegal kickbacks to boost sales, or deliberately overbilling Medicare and other government health care programs.

Now, an expansion of Medicare Part D and Medicaid under the Affordable Care Act and the more complex rules for prescription drug reimbursement that go along with them have opened up a new front in health care fraud litigation involving pharmacies and pharmacy benefit managers, according to a law 360 report. Simply put, there are more ways to cheat the system.

“As the ways in which drugs are reimbursed get more complicated and expand, the ways in which people can defraud the government expand as well,” lawyer David Stone told Law 360.

Whistleblowers are suing pharmacies and pharmacy benefit managers on behalf of the U.S. government for a wide range of fraudulent activity, including “submitting inaccurate paperwork, wrongly billing Medicare for state sales taxes, failing to substitute generics, failing to pass along savings when generics are substituted, supplying fewer pills than prescribed, wrongly billing Medicaid instead of private insurance, manipulating wholesale prices, and misstating expiration dates,” Law 360 reports.

Whistleblower lawsuits are also exposing illegal kickback schemes in which the patient’s needs take a back seat to profit. Such schemes take the form of gift cards to patients, cash to nursing homes for patient referrals, payments to pharmacy benefit managers for favoring certain drugs, and payments to insurers for using a particular pharmacy benefit manager.

Tighter budgets and a growing population dependent on Medicare and Medicaid have helped make the whistleblower’s role more important than ever.

A record number of whistleblowers filed lawsuits under the federal False Claims Act in the last two years, most of which involve fraud against government health care programs. That means the U.S. government is on track to recover billions of dollars in vital health care funds. Without the whistleblower’s inside knowledge and evidence, many health care fraud cases potentially would go unnoticed.

Whistleblowers suing under the False Claims Act are entitled to seek three times the actual damages. Whistleblowers who help the U.S. recover funds fraudulently taken from federal agencies and programs receive up to 30 percent of the total recovery as a reward.

The U.S. Justice Department reported earlier this year that 2013 was the fourth consecutive year that whistleblower cases helped the government recover more than $3 billion in funds taken from government agencies and programs through fraudulent practices. Seventy-six percent of the recovered funds went back to Medicare, Medicaid, and other government health care programs.

For more information about whistleblower statutes under the False Claims Act, contact Beasley Allen attorneys Andrew Brashier at andrew.brashier@beasleyallen.com, Larry Golston at larry.golston@beasleyallen.com, or Archie Grubb at archie.grubb@beasleyallen.com, or call 800-898-2034.

Sources:

Law 360
U.S. Department of Justice



We're here to help!

We live by our creed of "helping those who need it most" and have helped thousands of clients get the justice they desperately needed and deserved. If you feel you have a case or just have questions please contact us for a free consultation. There is no risk and no fees unless we win for you.

Fields marked    may be required for submission.
  1. I'm an attorney

Whistleblower helps Mississippi win record False...

A Mississippi mental health facility has agreed to pay the U.S. government and the state’s Medicaid...

Most of $3.7 billion in taxpayer recoveries in 2017...

Whistleblowers were responsible for nearly 92 percent of the $3.7 billion the United States government...

Whistleblowers expose illegal drug recycling in Penn...

The whistleblower complaints alleged that Med-Fast violated the False Claims Act by distributing and...
Whistleblower

CFTC whistleblower program finally gaining steam

Payouts of $45.5 million would be a record for the CFTC since its whistleblower program was created...

Is SCOTUS poised to limit SEC whistleblowers?

The Dodd-Frank Act defines a whistleblower as someone who tips off the SEC, and that is the narrow...

Failure to promptly disclose FCA lawsuit triggers...

The SEC filed the lawsuit against RPM International after the company violated antifraud regulations...

Number one firm

I really appreciate the law firm, they look into every detail, they review everything with you not just once but several times to make sure everything is correct. They are a very good law firm and I would highly recommend them. They'll always call you back when you call with questions. They're number one in my book.

—Melva