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Jury finds Amerigroup violated False Claims Act

A federal jury found insurance company Amerigroup Corp. and an Illinois affiliate liable for discrimination by denying coverage to pregnant women. The jury awarded $48 million to the plaintiffs (including the federal and Illinois governments and a whistleblower former employee), an amount that will be tripled under the provisions of the False Claims Act. The company could also be liable for as much as $199 million in penalties.

Amerigroup had contracted with Illinois to provide services to Medicaid patients but decided to maximize its profits by keeping pregnant women and others with expensive medical conditions off its rolls. That cheated the government, which was subsidizing the company to market its services evenly among all low-income patients.

The verdict was reported on in the October 30, 2006 editions of Bloomberg News and the Houston Chronicle.

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