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Whistleblowers and False Claims Act cases helped DOJ recover $3.5 billion last year

Whistleblowers helped the federal government recover more than $3.5 billion from civil cases involving fraud and false claims in fiscal year 2015.

Qui tam cases filed under the False Claims Act proved once again to be one of the main vehicles for government fraud enforcement and recovering funds.

There were 638 qui tam suits filed in FY 2015 compared to more than 700 filed annually in 2013 and 2014. Qui tam cases resulted in $2.8 billion recovered for the government this year. Whistleblower rewards totaled  $597 million in that same period.

Of the $3.5 billion recovered, $1.9 billion came from the health care industry. Other major sources of fraud settlements were housing and mortgage companies ($365 million) and government contractors ($1.1 billion).

Phillips & Cohen LLP’s whistleblower cases were responsible some of the government’s recoveries.

DaVita Healthcare Partners paid $400 million to settle charges involving kickbacks to doctors after a Phillips & Cohen whistleblower lawsuit prompted a federal investigation into the company. The lawsuit alleged that DaVita secretly paid doctors for referrals to its dialysis clinics in order to reduce or eliminate the competition.

Just before the end of the fiscal year on Sep. 30, Adventist Health System paid $118.7 million to settle a Phillips & Cohen case and two others. Phillips & Cohen represented three former employees of a North Carolina hospital who were the first to expose alleged Stark Law violations by the hospital group. Adventist allegedly paid doctors to lock in their patient referrals to Adventist-owned hospitals, clinics and other outpatient services in Florida, North Carolina, Tennessee and Texas.

Another Philips & Cohen kickback case involving medical testing labs resulted in a $48.5 million settlement by Health Diagnostic laboratory and Singulex Inc.Phillips & Cohen filed a qui tam against HDL, Singulex, Berkeley HeartLab and Bluewave on behalf of a doctor whose lawsuit alleged Stark Law violations.

Other top settlements of Phillips & Cohen whistleblower cases this past year include settlements by a CommunityHeatlh Systems subsidiary and three hospitals ($75 million); Chartwells, a food services contractor ($19.4 million); and Office Depot ($68.5 million).

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