Tuesday, July 25, 2006

Fraud Investigations return $15 for Every $1 invested

A new report released by Taxpayers Against Fraud concludes that every dollar invested by the government in investigation and prosecution of federal health care fraud returns $15 back to the American people.

Health care economist Jack Meyer looked at total federal health care investigation and prosecution costs, and compared them to the amount of money returned to the Federal treasury minus the cost of awards to whistleblowers that help the government understand and prosecute the often-complex frauds.

Meyer calculates that in the 5-year period from 2000 to 2004, the Federal government spent $443.8 million to recover $6.642 billion in health-care fraud related settlements and judgments. Meyer notes that the fiscal benefits of fraud detection and prosecution extend far beyond the monies recovered.

Click the following link to access the PDF of the Fighting Medicaid Fraud report.

Monday, July 24, 2006

Former Pentagon Officials accused of Fraud

Two former Pentagon officials, including an acting secretary of the Navy, have been accused of scheming with a banned American contractor to get lucrative rebuilding contracts in Iraq, according to an Associated Press report in today’s theledger.com.

The contracting firm, Custer Battles LLC, was suspended two years ago by the military for submitting millions of dollars in fake invoices. The charges come in a sealed federal lawsuit, a copy of which was obtained by The AP. It was filed by two whistleblowers - one of whom won a $10 million judgment in another suit when a federal jury agreed that Custer Battles had swindled the government.

Click the following link to read the full account of the new charges against Custer Battles.

Computer Consulting Firm reaches Settlement in False Claims Case

The computer consulting firm that was accused of questionable billing practices by four employees in 1999 has reached an out-of-court settlement costing the company $1.53 million.

According to the 11-page settlement filed in U.S. District Court in Cincinnati, CGI-AMS Inc. continues to deny wrongdoing but agreed to pay to bring an end to the 4-year-old lawsuit. The computer vendor was known as American Management Systems when the suit was filed in 2002. It was acquired by CGI Group of Montreal in 2004.

AMS was under contract to the Ohio Department of Human Services in 1997 to install a computer system that would help county caseworkers statewide spend less time on data-entry tasks and more time with people in need of benefits. It worked on the project through June 2002. But the four employees - Randall Smith, Michel Wilcox, Alice DeWeese and Ronald Wilinski - began complaining about what they considered false billings in the $95 million AMS contract. And because a federal grant was being used to pay for the work, the employees sued the company under provisions of the federal False Claims Act.

Click the following link to the Cincinnati Enquirer Web site for the full story on the false claims settlement.

GE and Two Subcontractors to pay $11.5 Million to settle False Claims Act Charges

General Electric Co. (GE) and two of its subcontractors have agreed to pay $11.5 million to settle a lawsuit that alleges that GE sold defective blades for engines in U.S. military airplanes and helicopters.

The False Claims Act lawsuit alleged quality-control problems involving the manufacture of several types of engine blades at GE’s Aircraft Engines division facility in Madisonville, Kentucky. The problems included nonconformances in casting and in non-destructive testing.

Two subcontractors, Howmet Corp., a subsidiary of Alcoa, and Precision Castparts Corp. manufactured unfinished castings for the blades, which GE then finished at the Madisonville facility.

The two whistleblowers who initiated the case will split their share—$2,357,500.

Click the following link to read a full account of the GE settlement.

Wednesday, July 19, 2006

Hospice Firm to pay Government $13 Million; Whistleblower to get $2.3 Million

Odyssey Health Care Inc., the second largest provider of hospice care in the U.S., will pay the federal government $12.9 million to settle claims of Medicare over-billing, according to the U.S. attorney’s office in Milwaukee. The claims were made by a former Odyssey employee, JoAnn Russell, who was fired by the company after she questioned its bills to Medicare for hospice services.

In 2003, Russell filed a whistle-blower suit in federal court in Milwaukee, which led to an investigation by the Department of Justice. Because she alerted the government to the situation, Russell will receive $2,326,500 of the settlement. Odyssey, which has headquarters in Dallas, did not admit wrongdoing and will remain solvent after the settlement is paid, according to court records.

Click the following link to read the Milwaukee Journal Sentinel’s account of the false claims settlement.

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