Seventh Circuit Holds Medicare Part D is Entitled to Lower Prices Offered by Pharmacies to Patients under Discount Programs

The issue of what constitutes a medical provider’s “usual and customary” price has been at the center of a litany of false claims act litigation, at both the state and federal levels.  When dealing with prescription drugs paid for by Medicare Part D, CMS states “where a pharmacy offers a lower price to customers throughout a benefit year” the lower price is considered the “usual and customary” price rather than “a one-time ‘lower cash’ price.” Read More ›

Ninth Circuit Limits Public Disclosure Defense

In federal and California state courts, defendants often look to the “public disclosure bar,” 31 U.S.C. § 3730(e)(4)(A) and Cal. Gov. Code section 12652, subd. (d)(3)(A), to shield them from liability from claims brought under the Federal and California False Claims Acts. Not surprisingly, defendants routinely argue that the public disclosure bar should be broadly construed to bar claims that are only tangentially related to information publicly disclosed before the whistleblower (also called the “relator”) filed their false claims action. Read More ›

Court of Appeal Limits Public Disclosure Defense under the California False Claims Act

Under the California False Claims Act, like its federal counterpart, defendants often seek to have claims against them dismissed on the basis of the “public disclosure” bar, Cal. Gov. Code section 12652, subd. (d)(3)(A). The scope of the California False Claims Act’s public disclosure bar was recently considered by the Second District Court of Appeals, which explained that the bar is intended “to prevent parasitic or opportunistic actions by persons simply taking advantage of public information without contributing to or assisting in the exposure of the fraud.” State ex rel. Bartlett v. Miller (2016) 243 Cal.App.4th 1398, 1407. Read More ›

False Claims Act Prosecutions of Fraudulent Provision of Nursing Home Rehabilitation Continue to Increase

The federal government spent roughly 14% of its overall expenditures on Medicare in 2014. Included in those costs were significant money paid to rehabilitation companies and skilled nursing facilities to provide rehabilitation and care services to seniors. Given the massive amount of money being spent on those services, there is also an increasing amount of fraud, abuse and deception occurring, where dishonest providers are seeking to line their pockets with taxpayer dollars. Read More ›

Senator Grassley Files Supreme Court Brief Advocating Broad Application of False Claims Act

Currently pending before the Supreme Court is an important False Claims Act case, Universal Health Services v. United States ex rel. Escobar. The complaint in the case alleges that Universal Health Services knowingly hired unlicensed, unqualified and unsupervised non-medical professionals to provide mental health services in violation of Massachusetts’ Medicaid rules. The company then billed the state and federal governments as if those services had actually been provided by professionals. The misconduct had tragic consequences. According to the complaint, after seeking mental health services and receiving inadequate care from untrained non-professionals, a seventeen year old girl suffered a fatal seizure and died. When her parents discovered Universal Health Services’ failures, they sued under the False Claims Act. Read More ›

AB 1509 Expands California Whistleblower Protections to Family Members of Whistleblowers

Effective January 1, 2016, Assembly Bill (AB) 1509 prohibits employers from retaliating against an employee who is a family member of a whistleblower. Specifically, the bill “extend[s] the protections of these provisions…to an employee who is a family member of a person who engaged in, or was perceived to engage in, the protected conduct.”  Read More ›

“Proceeds” Means Proceeds: Relators Are Entitled to a Share of All Taxpayer Money Recouped Through False Claims Act Lawsuits

Under most federal and state False Claims Act statutes, successful relators are entitled to a percentage “of the proceeds of the action or settlement of the claim.” Unfortunately, in some cases, the government tries to twist this language to prevent whistleblowers from receiving a share of all of the proceeds of their cases. Whistleblowers and their attorneys should fight such efforts. Read More ›

Further Criminal Charges in CPM Whistleblower Case

The United States Department of Justice has announced further criminal charges in connection with CPM’s spine surgery qui tam case. Federal prosecutors announced charges against five individuals, including Paul Richard Randall, a key defendant in CPM’s case. Randall has been charged with, and pleaded guilty to, the conduct described in CPM’s whistleblower complaint, filed in May 2012. CPM’s complaint, and the subsequent indictments, allege that Michael Drobot paid millions of dollars in bribes and kickbacks to doctors in order to steer spinal surgeries to his hospital—Pacific Hospital of Long Beach. Randall and several others were on the receiving end of those kickbacks. Read More ›

Whistleblower Barred From Receiving Portion of $322 Million Settlement

On June 1, 2015, District Court Judge John Walter of the Central District Court of California dismissed whistleblower James Swoben’s federal False Claims Act (FCA) case, finding that he was not the “original source” of the information. This dismissal effectively barred Swoben from receiving a portion of a $322 million settlement between the U.S. Department of Justice and Swoben’s former employee, Scan Health Plan.   Read More ›

Judge Allows Whistleblower Case Against BP to Proceed

In an order issued August 14, 2015, Judge Curtis E.A. Karnow of the San Francisco Superior Court cleared the path for CPM and California Attorney General Kamala Harris to pursue whistleblower claims against BP (formerly British Petroleum) for overcharging the State of California on purchases of natural gas. The case was filed in 2012 by a former-employee of BP, under the California False Claims Act. California Attorney General Kamala Harris joined the case in late 2014. The case accuses the oil company of massive overcharging of California cities, counties, universities, and government agencies on purchases of natural gas over the course of the past decade. Read More ›