On Government Sponsored Health Plans: False Claims Act Litigation

HEAT ON GOVERNMENT SPONSORED HEALTH PLANS False Claims Act Litigation

Michael C. Rosenblat Michael C. Rosenblat, PC Chicago, Illinois

$20 Billion Recovered under Federal & State False Claims Acts since 1986

False Claims Act Creates Liability for Knowingly Submitting a False Claim to the Government • Claim is a demand for payment • Liability attaches for: – False claims – False certifications – Kickback & Bribes – Misrepresentation during Contract Negotiations – Causing others to Submit a False Claim

Liability

• Three X Damages • Civil penalties - $5,500 to $11,000 per false claim • Attorneys’ Fees and Costs

Lawsuits Can be Filed By • The Government • Private Individuals – Qui Tam Plaintiff – Relator – Whistleblower

Types of Fraud • • • • •

Billing for Services not Provided Billing for Products not Provided Up coding – Billing at a Higher Rate False Certification – met requirements Tainted Contract – Kickbacks or Bribes

State’s With False Claim Acts • • • • • • • • • • • •

California Delaware District of Columbia Florida Georgia Hawaii Illinois Indiana Louisiana Massachusetts Michigan Montana

• • • • • • • • • • •

Nevada New Hampshire New Jersey New Mexico New York Oklahoma Rhode Island Tennessee Texas Virginia Wisconsin

Lessons from Amerigroup

Lessons from Amerigroup • Listen to Employees

Lessons from Amerigroup • Listen to Employees • Investigate Facts

Lessons from Amerigroup • Listen to Employees • Investigate Facts • Evaluate Liability from a Plaintiff’s Perspective

Lessons from Amerigroup • Listen to Employees • Investigate Facts • Evaluate Liability from a Plaintiff’s Perspective • Make a Reasonable Settlement Offer

Trial Judgment $334 Million Settlement $234 Million

Biggest False Claims Cases Tenet

900,000,000

Jul 2006

HCA

732,400,000

Dec 2000

HCA

631,000,000

Jun 2003

Serono Group

567,000,000

Oct 2005

TAP Pharm

559,483,560

Oct 2001

Schering Plough

435,000,000

Aug 2006

Abbott Labs

400,000,000

Jul 2003

Fresenius Medical Care

385,000,000

Jan 2000

Bristol Myers Squib

338,000,000

Sep 2007

HealthSouth

325,000,000

Dec 2004

SmithKline Beecham Clinical Labs

325,000,000

Feb 1997

State Enforcement of Medicaid Fraud • 23 states have their own version of the false claims act • 49 states have a Medicaid Fraud Control Unit • State Award increased by 10% for having False Claims Act similar to Federal

HEAT ON GOVERNMENT SPONSORED HEALTH PLANS Expect Increased Scrutiny of MCO’s as a Result of The Amerigroup Case and As Their Role Increases in Government Sponsored Health Care Programs