Kaiser Foundation Health Plan to Settle False Claims Act Allegations

Oakland, CA based Kaiser Foundation Health Plan has agreed to pay $6.3 million to settle allegations that it submitted false Medicare Advantage patient diagnoses in order to receive inflated payments from Medicare.

Under the Medicare Advantage program, Medicare pays private insurers based on the cost of providing care for all recipients enrolled in their plans. Generally, patients with worse or more numerous diagnoses result in larger payments while healthier patients result in smaller payments.

The suit was brought by a former employee of Kaiser Health foundation. She will receive $1.5 million for her role in the settlement.

Read the full press release here: https://www.justice.gov/opa/pr/medicare-advantage-provider-pay-63-million-settle-false-claims-act-allegations

Peer Review Doesn’t Apply in False Claims Act Suit

Massachusetts General Hospital could not assert the medical peer review privilege to block production of documents sought by a whistleblower in her False Claims Act suit over the hospital’s alleged double and triple booking of surgeries, a U.S. magistrate judge has ruled.

. . .

During discovery, Wollman (relator) moved to compel production of medical peer review records and communications. In response, MGH asserted the peer review privilege, which keeps reports and records of medical peer review committees confidential.

. . .

Wollman’s attorney, Reuben A. Guttman of Washington, D.C., hailed the decision as an important ruling under the False Claims Act and said it was consistent with black-letter law.

“The case cries out for transparency,” Guttman added. “It is about cheating the government through the gross compromise of patient relationships and critical health care standards.”

Source: Massachusetts Lawyers Weekly. Read full article here.

Medtronic USA Inc. Agrees to $9.2 Million Settlement

Minnesota-based Medtronic USA Inc. has agreed to pay $9.2 million to resolve allegations that it violated the anti-kickback provision of the False Claims Act. The company was accused of illegally paying Wilson Asfora, M.D., a South Dakota neurosurgeon, to induce use of it’s SynchroMed II infusion pumps, which are implantable drug delivery devices. For a period of nine years, the lawsuit contends, Medtronic’s kickbacks were paid in the form of sponsoring hundreds of social gatherings hosted by Asfora at a restaurant which it knew he owned. Medtronic’s settlement also resolves it’s liability for failing to disclose that it sponsored events for Asfora, which qualifies as a transfer of value to a physician and therefore violates the CMS Open Payments Program.

Read more here: https://www.justice.gov/opa/pr/medtronic-pay-over-92-million-settle-allegations-improper-payments-south-dakota-neurosurgeon

DOJ Announces $24.9 million Settlement with Guild Mortgage Company

San Diego based Guild Mortgage Company, participant in the Federal Housing Administration insurance program, has agreed to pay $24.9 million to resolve allegations that it caused the submission of false claims for recovery of defaulted home loans. Guild was accused of violating the False Claims Act by knowingly approving ineligible home ownership loans then recovering the insurance payments when the loans defaulted. Prior to underwriting a federally insured loan, mortgage companies participating in the FHA mortgage insurance program must review it for compliance with FHA rules and loan quality control.

The suit was brought under the qui tam provision of the False Claims Act. The whistleblower, former head of quality control at Guild, will receive nearly $5 million for his role in the case.

Read more here: https://www.justice.gov/opa/pr/guild-mortgage-company-pay-249-million-resolve-allegations-it-knowingly-caused-false-claims

Santee Christian College to Pay $225,000 Over Federal Violations on Recruiting

San Diego Christian College in Santee will pay $225,000 to resolve allegations that it compensated a student recruiting company in violation of a federal ban on incentive-based compensation, the Department of Justice announced Monday.

The university’s settlement resolves allegations that it hired student recruiting company Joined Inc. between 2014 and 2016 to recruit prospective students to SDCC and paid the company a share of the tuition SDCC received from enrolled, recruited students.

Title IV of the Higher Education Act prohibits institutions receiving federal student aid from compensating student recruiters with a commission, bonus, or other incentive payment based on the recruiters’ success in securing student enrollment, according to the Department of Justice.

“Higher education enrollment decisions should put students first,” said Acting Assistant Attorney General Jeffrey Bossert Clark of the Justice Department’s Civil Division. “Offering recruiters financial incentives to enroll students undermines students’ ability to make educational decisions in their own best interests.”

The settlement stems from a lawsuit brought by an unnamed whistleblower, who will receive $33,750 of the settlement proceeds, according to the DOJ.

In a statement, a college spokesman said Tuesday: “Due to the anticipated costs of prolonged litigation as well as the distraction from the pursuit of its mission, SDCC’s Board of Trustees decided that it is in its best interest to come to this resolution. In addition to denying the allegations of the complaint, SDCC assures its students, faculty, staff, alumni, stakeholders, and the public that at no time did it submit a “false claim” to the government nor misuse federal taxpayer funds. This settlement concludes the government investigation into SDCC’s relationship with [Maurice] Shoe,”  co-owner of Joined Inc., a California-based student recruiting company.

Reuben Guttman, who represents the whistleblower, told Times of San Diego that his client
lives on the West Coast.

“The case named three defendants: Oral Roberts, North Greenville University and San Diego Christian,” Guttman said. “This marks the third settlement, and approximately $3 million has been recovered.”

He said the settlement with San Diego Christian was small because it reflects the school’s financial condition and ability to pay.

“The settlement is being paid in installments,” Guttman said.

Neil Sanchez is special agent in charge of the U.S. Department of Education Office of Inspector General’s Southern Regional Office.

“Today’s settlement is a result of the hard work and effort of the Office of Inspector General and the Department of Justice to protect and maintain the integrity of the Federal student aid programs,” Sanchez said. “We will continue to work together to ensure that Federal student aid funds are used as required by law. America’s taxpayers and students deserve nothing less.”

Source: The Time of San Diego, https://timesofsandiego.com/education/2020/10/19/santee-christian-college-to-pay-225000-over-federal-violations-on-recruiting/

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