False Claims Act in Healthcare at work
Florida businessman Daniel Hurt and his associated companies have recently reached a settlement agreement to pay over $27 million to the U.S. government. Hurt, who owned and operated Fountain Health Services LLC, Verify Health, Landmark Diagnostics LLC, First Choice Laboratory LLC, and Sonoran Desert Pathology Associates LLC, allegedly violated the False Claims Act in healthcare by submitting fraudulent claims to Medicare for cancer genomic (CGx) tests. These tests were neither medically necessary nor ethically acquired, as they were obtained through illegal kickbacks.
“We will not tolerate those who prey on older Americans to defraud Medicare,”
declared Principal Deputy Assistant Attorney General Brian M. Boynton, Head of the Justice Department’s Civil Division. “As this settlement reflects, we will use our available resources to protect federal health care programs and the beneficiaries they serve.”
FRAUDULENT MEDICARE CLAIMS FOR UNNECESSARY CGX TESTS
The allegations against Daniel Hurt and his subsequent companies stem from their involvement in the submission of false claims for CGx tests, which are genetic tests that can identify mutations associated with cancer. While these tests can be valuable in certain medical scenarios, their misuse can lead to significant financial waste.
Allegedly, Hurt and his companies orchestrated a scheme to defraud Medicare by submitting false claims for unnecessary CGx tests. They procured patients through illegal kickbacks, undermining the integrity of medical decision-making and exploiting the Medicare system. These kickbacks were handed out to healthcare providers and others in exchange for patient referrals for CGx testing, regardless of the tests’ necessity.
The allegations revealed that CGx tests were performed on patients without any medical need, leading to unnecessary and overly expensive procedures. By submitting these false bills to Medicare, Hurt and his companies received unwarranted payments from the federal healthcare program, exploiting the system for their own personal gain.
HEALTHCARE FRAUD SETTLEMENT
In an effort to resolve these allegations, Daniel Hurt and his companies agreed to a settlement of over $27 million. This settlement serves as a significant step in holding individuals and entities accountable for defrauding the Medicare program while underscoring the government’s commitment to ensuring that taxpayer dollars are used appropriately.
As part of the settlement, Hurt and his companies have also been excluded from Medicare, Medicaid, and all other Federal healthcare programs.
TRENDS IN FALSE CLAIMS ACT IN HEALTHCARE
The False Claims Act (FCA) continues to be a powerful tool in combating healthcare fraud, with significant recoveries and settlements each year. The case involving Daniel Hurt is a testament to the ongoing efforts to hold fraudsters accountable.
- Annual Recoveries: In the fiscal year 2023 alone, the U.S. government recovered over $2.68 billion through FCA settlements and judgments. This reflects a continued trend of high recoveries, with an average annual recovery of approximately $3 billion over the past decade.
- Whistleblower Contributions: Whistleblowers, also known as qui tam relators, play a crucial role in identifying and reporting fraud. In 2023, whistleblowers were responsible for filing 672 qui tam suits, leading to recoveries exceeding $1.8 billion. This underscores the importance of whistleblower provisions in the FCA, which incentivize individuals to come forward with valuable information about fraud.
These statistics highlight the substantial financial impact of healthcare fraud and the effectiveness of the False Claims Act in recovering funds and deterring fraudulent activities. The $27 million settlement in the case of Daniel Hurt serves as a critical reminder of the government’s commitment to protecting the integrity of federal healthcare programs and ensuring that taxpayer dollars are used appropriately.