2015 Hospital Qui Tam Settlements Instruct Employers to Take Heed of Employee Compliance Concerns

Friday, January 15, 2016
By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

Two qui tam settlements taking place at the tail-end of 2015, were originally filed by former employees of the hospitals.  The first qui tam relator was a physician at Fairview Park Hospital in Dublin, Georgia.  He was the Executive Medical Director of Cardiovascular Services.  The second relator was a former president and chief executive officer of Memorial Health Inc. and Memorial Health University Medical Center located in Savannah, Georgia.  Both cases settled in December 2015, at the cusp of the new year. 



What Did the Hospitals Settle For?


HCA Whistleblower Case
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HCA Holdings Inc. (HCA), the largest operator of health care facilities in the United States (including Fairview Park Hospital), agreed to pay almost $2 million to settle its FCA lawsuit filed in 2010.  Claims asserted in the qui tam case alleged that two physicians practicing at Fairview Park Hospital performed unsafe and medically unnecessary cardiology procedures.  The physicians purportedly misled patients by overstating the severity of their conditions in an effort to secure the patients' consents for the procedures.  

To read the full complaint filed with the U.S. District Court for the Southern District of Georgia, click here

The terms of the settlement provided for the federal government to receive its portion of $1,934,590.34, and the state of Georgia to receive its share of $65,409.99.  The qui tam relator will receive a significant share of the recovery monies as well, retaining $541,685.30 from the federal government's portion and another $18,314.70 from the state of Georgia.  

To read the full settlement, click here

Memorial Health Whistleblower Case
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The second settlement announced by the U.S. Department of Justice (DOJ) on December 23, 2015, involved Memorial Health Inc. (Memorial Health), located in Savannah, Georgia.  Memorial Health, and its related entities, agreed to pay more than $9.8 million to resolve FCA allegations filed against the facilities by the second qui tam relator.  Memorial Health was also required to enter into a five-year corporate integrity agreement with the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG), as conditioned by the settlement.  

This case involved allegations of the submission of false claims in violation of the Stark Law.  A sealed complaint was filed by the relator in March 2011, under the whistleblower provisions of the FCA.  These provisions allow for private citizens with direct knowledge of false claims to file suit on behalf of the government and to share in any recovery monies obtained.  To learn more about whistleblower/qui tam cases brought under the FCA, read our two-part blog.  Click here for part one and click here for part two

The nearly $9.9 million settlement sum acquired in this case makes history as the largest civil fraud recovery by the U.S. Attorney's Office for the Southern District of Georgia.  That's a far cry from the Adventist Health System (Adventist) settlement of $118.7 million in September 2015.  The Adventist settlement involved several central Florida area Florida Hospitals and has been named the largest health care fraud settlement ever made involving physician referrals to hospitals.  To read my previous blog covering the historical Adventist settlement, click here.  However, any settlement in the millions takes its toll, and the qui tam relator in this case will still receive a whopping $2.3 million as his share from the record-breaking settlement in Georgia.  

To read the press release issued by the DOJ, click here


Employees' Concerns Disregarded.


Both qui tam relators alleged that they repeatedly informed their former employers of compliance concerns.  The second relator alleged his employment was terminated in retaliation, as a result of his whistleblowing.  Former employee of Memorial Health alleged he was fired by the hospital facility after raising concerns about the following potential issues:

(1)    Fair market value of the defendants' physician compensation model;

(2)    Inappropriate consideration of downstream revenue from admission and referrals used when developing the compensation model; and

(3)    Potential conflicts of interest on the part of board members who were related or married to physicians affected by the arrangements, or who were themselves physicians affected by the arrangements.  

The qui tam relator also alleged that Memorial Health failed to pay all compensation and severance due to him according to the terms of his employment agreement.  Instead, the expectation of payment was contingent upon the relator dropping all claims.  Memorial Health denied these allegations.  

Former employee of Fairview Park Hospital for HCA alleged his attempts to rectify potential issues were continually met with resistance.  Although HCA denied liability, the qui tam relator in this case also alleged that not only did the facility fail to look into his concerns, it chose rather to conceal relevant records of the potentially illegitimate cardiac procedures.  

I think it's important to note that the Adventist settlement, briefly discussed, originated as a qui tam suit filed by three former hospital employees as well. 


Logical Conclusion.


If nothing else, these cases should be glaring red flags that former employees can be a health care facility's biggest nightmare when it comes to qui tam risks.  Rather than prematurely firing employees that raise concerns regarding potential FCA violations, hospitals and providers should take heed to review their compliance with all health care fraud and abuse laws and regulations.  For more information on fraud and abuse laws, click here for a "roadmap" issued by the OIG


Most Whistleblower Cases Filed by Physicians and Employees.


Most of the qui tam or "whistleblower" (false claims act) cases we have seen are brought by physicians, nurses, pharmacists or hospital employees.  These are usually the professionals with direct patient contact and who are aware if medical treatment and services are falsely billed.  

Physicians, nurses and other health professionals should be concerned that money paid for patient care is actually used for that patient care.  They take an oath to advocate for their patients.

We often have physicians, nurses, pharmacists and other health care employees who bring their whistleblower qui tam cases to us for us to prosecute.  We are happy to work with physicians and other health professionals in such cases. 


Comments?


Have you received complaints or concerns from an employee that may put you at risk for a qui tam suit under the FCA?  Are you an employee of a health care facility who has raised concerns regarding potential FCA violations to your employer, but nothing has been done to resolve the issues?


Contact Health Law Attorneys Experienced with Qui Tam or Whistleblower Cases.


Attorneys with The Health Law Firm also represent health care professionals and health facilities in qui tam or whistleblower cases both in defending such claims and in bringing such claims.  We have developed relationships with recognized experts in health care accounting, health care financing, utilization review, medical review, filling, coding, and other services that assist us in such matters.  We have represented doctors, nurses and others as relators in bringing qui tam or whistleblower cases, as well.

To contact The Health Law Firm, please call (407) 331-6620 and visit our website at www.TheHealthLawFirm.com.


Sources:


"Adventist Health System's $118.7 Million Settlement Started With a Whistleblower Lawsuit by 3 Former Hospital Employees."  News Release.  PRNewswire/USNewswire: 21 Sept. 2015.  Web.  15 Jan. 2016.  

Huryn, Christopher.  "2015 Ends With Additional Qui Tam Hospital Settlements, Including the Largest Civil Fraud Recovery by the U.S. Attorney's Office for the Southern District of Georgia."  American Health Lawyers Association: 7 Jan. 2016.  E-mail.  11 Jan. 2016.

U.S. Attorney's Office.  "Government Settles Alleged False Claims Act Violations With Memorial Health, Inc."  Press Release.  U.S. Department of Justice: 23 Dec. 2015.  Web.  14 Jan. 2016.


About the Author:
George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida area.  www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.



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1/15/2016

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