A West Virginia hospital has agreed to pay the United States $50 million to settle a whistleblower lawsuit alleging the hospital engaged in illegal physician self-referral arrangements and kickback schemes for more than a decade.

Wheeling Hospital, an acute care hospital in Wheeling, West Virginia, settled the allegations after the U.S. Justice Department (DOJ) investigated the whistleblower’s allegations and chose to intervene. A former executive vice president of the hospital, Louis Longo, filed the lawsuit in 2017 under the False Claims Act’s whistleblower provisions.

According to the DOJ, Wheeling Hospital billed Medicare for services resulting from the improper financial arrangements from 2017 to 2020. Federal prosecutors say that during that time, Wheeling Hospital “systematically violated the Stark Law and Anti-Kickback Statute by knowingly and willfully paying improper compensation to referring physicians that was based on the volume or value of the physicians’ referrals or was above fair market value.”

The Physician Self‑Referral Law, commonly known as the Stark Law, prohibits a hospital from billing Medicare for certain services referred by physicians with whom the hospital has a financial relationship, unless that relationship satisfies one of the law’s statutory or regulatory exceptions.

The Anti‑Kickback Statute is an anti-corruption statute that prohibits transactions intended to induce or reward referrals for items or services reimbursed by Medicare, Medicaid, and other federal health care programs.

Both the Stark Law and the Anti-Kickback Statute are intended to ensure that medical decisions are not influenced or compromised by improper financial incentives and are instead based on the best interests of the patient.

“Improper inducements made to physicians can interfere with medical decision-making and undermine the public’s trust in the health care system,” said Special Agent in Charge Maureen Dixon of the Health and Human Services Department’s Office of Inspector General. “Our agency will continue to investigate those who seek to improperly enrich themselves at the expense of public safety and federal health care programs.”

Whistleblowers whose False Claims Act lawsuits result in a recovery of federal funds are awarded up to 25% of the total judgment or settlement. According to the DOJ, Mr. Longo received $10 million (20%) of the Wheeling Hospital settlement as an award for bringing the hospital’s misconduct to light.

False Claims Act litigation

Beasley Allen has a Whistleblower Litigation Team in place to handle False Claims Act (FCA) claims. Due to our firm’s heavy involvement in whistleblower litigation, there was a definite need for the creation of a team specializing in whistleblower cases. Fraud against the federal government has been and continues to be a huge problem, involving many industries in this country, and is usually rampant in the health care industry as well as in the wake of disasters requiring federal assistance, such as major hurricanes, the Deepwater Horizon oil spill, and as we have seen in recent months, the coronavirus pandemic. We expect the amount of fraud against the government to increase greatly during the coming months.

As we have consistently stated, whistleblowers are the key to exposing corporate wrongdoing and government fraud. A person who has first-hand knowledge of fraud or other wrongdoing may have a whistleblower case. Before you report suspected fraud or other wrongdoing – before you “blow the whistle” – it is important to make sure you have a valid claim and that you are prepared for what lies ahead. Beasley Allen’s group of lawyers dedicated to handling whistleblower cases can navigate you the oftentimes risky and complex litigation.

Lawyers on our whistleblower litigation team are Lance GouldLarry GolstonLauren MilesLeon HamptonLeslie PesciaPaul Evans and Tyner Helms. If you are aware of fraud being committed against the federal or state governments, you could be rewarded for reporting the fraud. If you have any questions about whether you qualify as a whistleblower, you can contact a lawyer at Beasley Allen for a free and confidential evaluation of your claim.

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My claim was handled in a very professional and appropriate manner. I was very pleased with my outcome and that the claim was resolved without having to go through a trial.

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