In April 1999, the Food & Drug Administration (FDA) determined that the unapproved drug Nitroglycerin SR lacked substantial evidence of effectiveness and published a notice proposing to withdraw approval of the product.  The qui tam lawsuit alleged that, after the FDA notice, Nitroglycerin SR no longer was legally eligible for reimbursement by government health care programs such as Medicaid.

The lawsuit alleged that  Eon submitted false quarterly reports to the government that misrepresented Nitroglycerin SR’s regulatory status as a Covered Outpatient Drug under the Medicaid program.

The settlement resolves allegations against Eon in a multi-defendant whistleblower action, which remains sealed in part.

For the full release, go to: http://www.justice.gov/opa/pr/2010/February/10-civ-171.html.

For more information about qui tam law and health care fraud, contact Nolan and Auerbach, PA. at http://www.whistleblowerfirm.com.

According to the U.S. Department of Justice, which made this announcement March 6, 2009, the suit was filed under the qui tam or whistleblower provisions of the FCA by Robert Baker, a former revenue manager in CHS’s corporate office.

The relator’s complaint alleges that, beginning in 2000, CHS and its hospitals improperly obtained federal funds through the New Mexico Sole Community Provider Fund (SCPF) and Sole Community Hospital Supplemental Payments (SCHSP) Medicaid programs.

To review the DOH press release, go to http://www.usdoj.gov/opa/pr/2009/March/09-civ-200.html. Or, for more information about the False Claims Act or qui tam whistleblower law, contact Nolan and Auerbach, PA.

According to the hospital in its own news release, the parent company of Harris Methodist HEB Hospital (Texas Health Resources) did a self report by telling the Office of Inspector General of Health and Human Services about it identification of a physician contract that did not comply with federal regulations. This triggered an investigation based on information provided by Harris Methodist HEB that Medicare and Texas Medicaid programs paid for orthopedic items and services referred to the hospital by a physician group that received free rent from the hospital, a violation of Stark self-referral law (also known as Physician Self-Referral Law).

The Stark law was created to forbid physicians from profiting from their own referrals.  This law acts to sanction improper physician referrals and to stop the potential for over-utilization. In this fashion, physicians and other health care professionals are able to exercise independent judgment for what is in the best interests of their patients as opposed to themselves.

To read the full story click here or on the following to read more about the False Claims Act and the Stark Laws .

If you believe you have information concerning a violation of the False Claims Act and want to read more about Nolan & Auerbach, P.A. you may contact us.

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To read more click here or visit Nolan & Auerbach to read about Health Care Fraud.

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Medicare and Medicaid programs depend on physicians and other health care professionals to exercise independent judgment in the best interests of patients. Financial incentives tied to referrals have a tendency to corrupt the healthcare delivery system in ways that harm the federal programs and their beneficiaries. Corruption of medical decision-making can result when a physician refers a patient to a provider on the basis of the physician’s financial self-interest instead of the patient’s best interests. Restrictions on the practice of self-referral exist at both the state and federal levels.

Medical directorships, interest free loans/forgiveness of debts, illegal recruitment arrangements and improper discounts in the form of professional courtesy, may represent additional financial windfalls to physicians, resulting in hospital referrals and a violation of the “Stark” statute. A Stark scenario may also be present when a hospital circumvents potentially compliant contracts by providing outside of what appear to be legitimate contracts, office space, renovations, equipment, furniture, housekeeping services, office supplies, copy and fax machines, telephone, utility and transcription services to referring physicians for free or less than fair market value.