On September 26, 2023, the law firms of Wilbanks & Gouinlock, LLP and Peak Wooten McDaniel & Colwell, LLP, achieved a significant $13,750,000.00 settlement on the eve of trial in a hotly contested False Claims Act/Anti-Kickback Statute case.  The case was brought by a whistleblower (called a “relator”) named Dr. Niles Rosen, a retired pathologist.  Most of the settlement will be paid to the United States Treasury to reimburse American taxpayers, with Dr. Rosen receiving percentage of the recovery as provided by the False Claims Act.

Dr. Rosen was represented by Marlan Wilbanks, Susan Gouinlock, and Elaine Stromgren of Wilbanks & Gouinlock LLP (“W&G”) and Brandon Peak and Joseph Colwell of Peak Wooten McDaniel & Colwell LLP (“PWMC”), all of whom are lawyers experienced in handling False Claims Act cases.  The case was proceeding before the Honorable Mary S. Scriven of the United States District Court for the Middle District of Florida, Tampa Division. 

The Defendants in the case were Exact Sciences Corporation and Exact Sciences Laboratories, LLC (“Exact Sciences”).  Exact Sciences is a laboratory company that manufactures, markets, and sells a colon cancer screening test called “Cologuard” throughout the United States.  Cologuard is an at-home screening test that Exact Sciences claims can detect signs of colon cancer in a person’s stool.

Dr. Rosen filed this case on behalf of the United States Government alleging that over the course of several years, Exact Sciences offered Medicare, Medicare Advantage, andbeneficiaries kickbacks in the form of pre-paid Visa gift cards to induce those beneficiaries to return Cologuard kits to Exact Sciences for testing and billing to government health insurance programs.  Dr. Rosen alleged that these offers and payments were prohibited by the federal Anti-kickback Statute, 42 U.S.C. § 1320a-7b, and that the payments the federal government made for such tests were false and fraudulent claims under the federal False Claims Act, 31 U.S.C. § 3729.

The case was vigorously contested.  Dr. Rosen contended the evidence clearly demonstrated that Exact Sciences offered financial incentives to induce patients who had not taken the Cologuard tests to use and return the kits so that Exact Sciences could bill for them.  It was important for Exact Sciences to get patients to return the kits because it only gets paid for Cologuard kits that patients use, return, and that it tests.  Exact Sciences, on the other hand, denied it committed any violation of the Anti-kickback Statute or the False Claims Act and claimed it sent the financial incentives to get people screened for colon cancer.

The Relator and his counsel were able to obtain this significant recovery despite an unprecedented Advisory Opinion issued by the Office of Inspector General of the Department of Health and Human Services during the late stages of the litigation that Exact Sciences procured and contended absolved it of any liability.  The settlement was reached on the eve of trial while a Motion to Exclude the Advisory Opinion was pending before the Court.

“Dr. Rosen is a courageous man who spent most of his career fighting against fraud, waste, and abuse in the Medicare program,” said Brandon Peak of PWMC, lead trial counsel for the relator.  “He brought this case to the attention of the United States Government because of his strong belief that medical decision-making should not be influenced by financial incentives or profit motives, which in the case of laboratory tests can lead to unnecessary testing and waste taxpayer money.  It was an honor to represent Dr. Rosen throughout this hard-fought case, which had more twists and turns than a country road.”

Joseph Colwell of PWMC said, “the Medicare system is ripe for abuse by laboratory companies.  Over the last several years, the United States Government has recovered tens of millions of dollars from laboratory companies who pushed expensive and often unnecessary lab tests on people at the cost of significant taxpayer dollars.  Dr. Rosen recognized that substantial potential for abuse, which is why he bravely filed and pursued this case.”

“Dr. Rosen and his counsel were committed to obtaining the best result possible for the American taxpayers.  Despite behind-the-scenes lobbying efforts to get the case dismissed by the defendant with government agencies and powerful individuals in Washington, we never wavered in our resolve to obtain this significant recovery,” said veteran whistleblower Marlan Wilbanks of W&G.  “The truth and the facts should matter more than bureaucratic indifference, or the political influence held by wealthy corporations.  Our law firms will continue to represent whistleblowers in fighting fraud on behalf of the American taxpayers, no matter what individuals or big corporations are responsible for the fraud.” 

To read more about this case, read the attached copy of Report on Medicare Compliance: rmc oct 9

Our client, Jacqueline Cushing, filed her complaint pursuant to the False Claims Act (“FCA”) almost four years ago in December of 2019. Her FCA case has now resulted in a $371,489,616 damages award through a default judgment entered on September 21, 2023 against Tomoka Medical Lab, Inc.; Rajen Shah; Golden Rule Management, LLC; Tennessee Valley Regional Laboratory, LLC; Luminus Diagnostics, LLC; and United Diagnostics, LLC (“Defendants”) for laboratory testing fraud. Specifically, Defendants were causing false claims to be submitted to federal healthcare programs for laboratory services that were not ordered by a licensed healthcare provider.

Ms. Cushing worked as the Operations Manager for Tomoka Medical Lab, Inc. in Ormond Beach, Florida. Shortly after she began working there in August of 2019, she soon realized that when a patient’s healthcare provider ordered a basic urinalysis with a culture and sensitivity, Defendants would routinely disobey the order and instead direct the laboratory to perform and bill for a much more profitable Urine PCR test. The CMS reimbursement for a standard urinalysis with culture and sensitivity is approximately $20. The CMS reimbursement for a Urine PCR is approximately between $450 – $500. After investigating Defendants’ improper practices further, Ms. Cushing learned that this fraud was not limited to the laboratory locations in Florida, but also was happening at laboratories outside of the State of Florida as well.

As soon as Ms. Cushing became aware of the fraud, she reported it internally and took steps to try to rectify the Defendants’ improper practices. Unfortunately, the Defendants made it clear that they had no intention of correcting their practices. It was at that point that Ms. Cushing contacted our law firm and promptly filed her FCA complaint. Her efforts have assisted the Government in putting a stop to a multi-state fraud that was causing Government healthcare programs hundreds of millions of dollars in damages.

https://www.justice.gov/usao-mdfl/pr/united-states-obtains-more-370-million-judgments-against-kentucky-businessman-and-his 

To read more about this case, follow the link below.

https://www.justice.gov/usao-edtn/pr/dermatologist-agrees-pay-66-million-settle-allegations-fraudulent-billing-practices

U.S. ex rel. Hanvey vs. Sutter Health, et. al. 

In September 2014, a complaint was filed by Wilbanks & Gouinlock on behalf of Laurie Hanvey.  Ms. Hanvey was the former compliance officer of Sutter Medical Center in Sacramento, California.  While working as a compliance professional, the whistelblower gained inside knowledge with regard to a number of violations occurring within Sutter.  Her complaint alleges that Sutter Health overpaid Sacramento Cardiovascular Surgeons Medical Group for physician assistants and medical director agreements in violation of the Stark law.  Despite Ms. Hanvey’s protestations regarding the conduct set forth in her complaint, the bad conduct continued.

Sutter is a nonprofit with 24 hospitals, 5,000 physicians, and 48,000 employees.  Sacramento Cardiovascular Medical Group has three cardiovascular surgeons, Michael Ingram, Robert Kincade, and James Longoria.

After investigating for five years, the United States specified several contentions that confirmed numerous allegations within Ms. Hanvey’s whistleblower complaint.  More specifically, the Government contended that Sacramento Cardiovascular overpaid the neurosurgeons by stacking medical director agreements, paying excessive call coverage, and overpaying the neurosurgeons for the use of mid-levels.  The Sutter hospital was leasing the employees at an excessive rate and then the Sacramento Cardiovascular neurosurgeons were billing for the services of the mid-levels.

This case strikes a common theme with several other successful Wilbanks & Gouinlock Stark cases.  Hospitals routinely find a way to overcompensate key referring doctors to induce referrals.  The use of “free employees” is one way that hospitals can directly and indirectly impact physician compensation.

The case against Sutter Health, Sacramento Cardiovascular Medical Group and a number of other defendants will now proceed with litigation.  The settlements above represent only a fraction of the overall damages that Ms. Hanvey contends the Government incurred as a result of the collective illegal conduct of the other defendants set forth in the case.  The case will be litigated in the Northern District of California.

Click here to read the Wilbanks & Gouinlock press release regarding the Sutter Health settlement.

In September 2018, Health Management Associates (“HMA”) agreed to pay $260 million to resolve a number of lawsuits filed by whistleblowers under the False Claims Act as well as a guilty criminal plea.

Two of the complaints that were a part of the settlement were filed by Wilbanks & Gouinlock on behalf of Mr. Ralph Williams and Dr. Craig Brummer.  Mr. Williams was the chief financial officer for two HMA-owned hospitals in Georgia and Dr. Brummer was an emergency department physician who worked as the medical director of the emergency departments for the same two hospitals.

The complaints were filed separately and independent of each other, but both whistleblowers observed similar patterns of behavior within the HMA hospital system.  Dr. Brummer had daily meetings where emergency department physicians were pressured to increase the volume of inpatient admissions to maximize profits. From the corporate side, Mr. Williams saw HMA set system-wide goals to increase patient admissions at HMA hospitals, even if that increase involved admitting patients into the hospital who could have been treated in a lower acuity setting such as the outpatient setting.

HMA paid approximately $62.5 million to resolve the allegations brought by Dr. Brummer and Mr. Williams. A substantial portion of the criminal case and fine imposed against HMA was based directly on the information that was first brought to the attention of the Government by these W&G whistleblowers.

Click here to read the Wilbanks & Gouinlock press release regarding the HMA settlement.

U.S. ex rel. Berntsen vs. Prime Healthcare, et. al.

U.S. ex rel. Berntsen vs. Prime Healthcare, et. al. was filed in 2011 in the United States District Court for the Central District of California.  On August 3, 2018 a $65 million FCA settlement was announced.  The Wilbanks & Gouinlock client in this case was Karin Berntsen.  She was an employee of a Prime Healthcare of Alvarado Hospital in California.  At the time she filed her complaint, Prime owned 14 hospitals in California and each of these hospitals was named as a defendant in the case.  Karin’s allegations were based upon her personal knowledge of two different schemes.  One scheme involved bypassing medical necessity requirements in order to bill Medicare for inpatient admissions when a lower level of care was appropriate.  The second allegation dealt with multiple instances of “upcoding”.  These were scenarios where the Government was billed for a different service or a higher level of service than was actually delivered by Prime.

The United States government intervened in the medical necessity claim and whistleblower Karin Berntsen and her team handled the upcoding claims.  $45 million was recovered for the improper inpatient admissions and $20 million was recovered for the upcoding claims.  Ms. Berntsen was recognized for her efforts in this case by the Taxpayer’s Against Fraud Education Fund when she was named the national “Whistleblower of the Year” in 2018.

Of particular significance is the fact that as a part of the $65 million settlement by Prime, $3.25 million of that amount was required to be paid personally by Prime CEO Dr. Prem Reddy.  The Government’s Complaint in Intervention listed four or five different types of conduct where they specifically plead that Dr. Reddy was involved in the offensive conduct based upon their investigation.

It also noteworthy that the conduct was of sufficient magnitude to call for the imposition of a corporate integrity agreement (CIA).  This CIA was crafted by the Government to create additional reporting mechanisms and safeguards to ensure that Prime’s conduct in the future is more compliant than it has been in the past.

This $65 million recovery is one of the latest in a long line of FCA recoveries by a W&G client involving systemic and fraudulent conduct by large hospital chains.

The whistleblowers alleged in this case that Wells Fargo illegally charged veteran borrowers hidden fees on refinanced home loans guaranteed back by the Veterans Administration. Six other banks settled for a total of $161.7 million dollars who were also sued by W&G for similar VA mortgage refinance fraud. The Wells Fargo case was settled in August 2017 for $108 million after years of rigorous litigation.  The whistleblowers were VA mortgage brokers who gained first-hand knowledge about the illegal practices of Wells Fargo over the course of several years.  The information they brought forward not only returned over $200 million to the taxpayers, it has armed tens of thousands of veterans with the knowledge that they were being cheated by bug banks who were issuing VA refinance loans that were guaranteed by the U.S. Government.

U.S. ex rel. Williams v. Tenet Healthcare (“Tenet”). In 2009, W&G began prosecuting a massive False Claims Act case against one of the biggest hospital companies in the country, Tenet Healthcare Corporation.  The case officially settled for $368M in 2016.  W&G’s client is whistleblower Bill Williams, an Army veteran and former hospital finance executive.  Mr. Williams received a portion of the civil settlement funds.   Click here for the W&G press release.

The suit alleged that Tenet and four of its hospitals in Georgia and South Carolina, entered into an illegal arrangement with a business called “Clinica de la Mama” that operated walk-in obstetric clinics for undocumented Hispanic women.  The suit alleges that under the arrangement, Tenet paid Clinica to locate and refer to Tenet’s hospitals pregnant, undocumented women who would have their babies at Tenet hospitals at government expense.  Women who are not U.S. citizens are not eligible for regular Medicaid but because labor is an emergency condition, Emergency Medicaid pays for the services.  Paying for referrals of Medicaid patients violates the federal Anti-Kickback Statute and applicable Georgia laws.  The State of Georgia joined W&G in prosecuting the case in 2013 and the U.S. Department of Justice joined in 2014.  Tenet was represented in the case by two major law firms, Alton & Bird, LLP in Atlanta and Latham & Watkins, LLP in Washington, DC and Los Angeles, CA.

It is noteworthy that the knowledge and information shared with the Government was directly responsible for the initiation of the criminal investigation that led to the recovery of $145 in criminal restitution.

Filed in 2007, W&G prosecuted this qui tam case for clients Alon Vainer, MD and Daniel Barbir, RN without government involvement or support for eight years.  The case settled in 2015 for $450,000,000.  The case alleged that dialysis providers DaVita, Inc., and Gambro Healthcare, Inc., deliberately wasted hundreds of millions of dollars of dialysis medications in order to fraudulently boost reimbursements from Medicare and Medicaid. This case was settled for $450,000,000 without Government assistance. The Government declined to prosecute this case but W&G, trial counsel and the two knowledgeable whistleblowers persevered and prevailed.  This was the largest and most successful case in FCA history where the Government declined to participate and only the whistleblower and their counsel handled the case.

Click here to view Complaint.

Don McLendon was an executive at Olsten Management Company and as part of his job he worked directly with HCA.  While there, he learned that HCA was improperly using government dollars to for advertising under the guise of “community education”.  He provided this information as well as other allegations that the government relied on in settling this case. At the time, this $731,400,000 settlement was the largest healthcare fraud recovery under the FCA in history. Mr. McLendon claims were responsible for over $100 million of the total amount recovered.

In September 2015, W&G recovered a record settlement of $118.7M against hospital chain involving physician referrals to hospitals. This Stark case was filed by W&G for an executive with inside knowledge regarding illegal physician compensation schemes that created improper financial incentives to physicians for the referral of Government beneficiaries.

The whistleblower in this case was a corporate Adventist executive.  She had direct and unfettered access to the officers who controlled the hospital chain.  Because of her position within the company, she was able to provide very powerful documents and information to the Government. The abuses she detailed on her complaint were systemic and ultimately proven to exist in Adventist hospitals in several states.

Forest Laboratories settles case involved allegations of off-label marketing and kick-back claims for $300M. Forest Laboratories case involved allegations of off-label marketing and kick-back claims and resulted in a $106,000,000 in civil recovery and $300,000,000 in total dollar recovery. The W&G client in this case was a Forest sales representative who was pressured to sell anti-depressants to pediatric psychiatrists even though the days were not approved for pediatric use.

The lawsuit was filed on behalf of Elin Balid-Kunz (“Ms. Kunz”) who gained inside knowledge from over 17 years of employment at Halifax Hospital where she was the Halifax Director of Physician Services. In her whistleblower lawsuit, Ms. Kunz alleges that Halifax knowingly and intentionally submitted thousands of fraudulent claims to Medicare. Additionally, Ms. Kunz alleged that Halifax paid kickbacks and illegal compensation to key referring physicians in order to generate patient referrals to the hospital. It was announced on March 3, 2014, Halifax Health settled the Medicare illegal physician compensation or Stark law portion of this case for $85,000,000.  At that time, this settlement was the largest Stark law settlement ever.

Ms. Kunz was a compliance professional who brought her concerns repeatedly to her Chief Compliance Officer and other management, to no avail.  Because of her push back, she endured different forms of harassment but she never waivered in her insistence that Halifax follow the law.  For her extraordinary efforts, she was named the national “Whistleblower of the Year” in 2014 by the Taxpayers Against Fraud Education Fund.

Olsten Corporation case involved allegations of fraudulent billing, sales and marketing within home health agencies resulted in a $61,000,000 recovery.  Olsten was acting as a management company to Columbia/HCA.  Our whistleblower wore a wire to obtain key information what ultimately led to a $61,000,000 recovery in Olsten and over a $100,000,000 recovery against Columbia/HCA.

C.R. Bard Inc., a multinational medical device company, agreed to pay the federal government $48.2 million to settle this whistleblower lawsuit that alleged its urological division and wholly owned subsidiary, ProSeed Inc., paid doctors and hospitals kickbacks to entice them to order Bard’s products at inflated prices to treat Medicare patients with prostate cancer.  The W&G whistleblower in the Bard case provided hundreds of documents that proved that Bard was involved in an illegal pay for play scheme.

JP Morgan Chase paid $45 million to settle a lawsuit alleging that it cheated military veterans and taxpayers by hiding illegal fees in home refinancing mortgages impacting military veterans. This lawsuit was filed by Wilbanks & Bridges on behalf of Victor Bibby and Brian Donnelly.  These whistleblowers worked in the mortgage refinance business and they obtained firsthand knowledge of the actions involving JP Morgan Chase and other major national banks.  Overall, more than $250 million has been recovered from 7 different lenders identified in the complaint filed by W&G.

Bank of America/Countrywide Mortgage involved allegations of veteran’s mortgage fraud resulting in a recovery of $45,000,000. This case was another settlement that came out of the VA mortgage fraud complaint filed by W&G whistleblowers.

PNC Financial Services settled a case filed by Wilbanks & Gouinlock clients Victor Bibby and Brian Donnelly. The settlement amount was $38 million. The allegations in this case centered around improper and illegal fees that were charged to military veterans under a Government program that guaranteed mortgage refinance loans.

Saint Joseph’s Hospital of Atlanta settled allegations brought by a Wilbanks & Bridges client for $26 million. Tami Ramsey, a registered nurse and former hospital employee, filed this whistleblower lawsuit based upon her allegations that Saint Joseph’s had not followed Medicare regulations determining whether a patient should be placed into inpatient in St. Josephs hospital or outpatient status. This monetary settlement involved Saint Joseph’s being required to enter into a Corporate Integrity Agreement with the Government.

W&G successfully prosecuted this qui tam case against Shands Healthcare in Florida. The case alleged improper billing of Medicare and Medicaid for admitting patients to the hospital rather than treating them on an outpatient basis because the government pays more for services rendered on an inpatient basis. Shands Hospital case involved medical necessity allegations that led to a $22,000,000 settlement and outpatient overbilling charges led to another $3,000,000 settlement. The case settled for  approximately $26,000,000.

This lawsuit was filed by Wilbanks & Gouinlock and involves concealing and fraudulently bundling financial information. The net result of the fraud was that the Government incurred losses because of guarantees that were placed on these loans under the assumption by the Government that the loan certifications by the lender was accurate and correct – when that was not the case. Wilbanks & Gouinlock settled the case for $16 million.

Wilbanks & Gouinlock filed this lawsuit of behalf of clients who had inside knowledge as to illegal lending practices at Citi Mortgage. They provided proof that military veterans were treated improperly and the Government was defrauded as a result of the failure of Citi Mortgage to adhere to the rules and regulations applicable to banks that are making refinance loans to military veterans. Wilbanks & Gouinlock settled the suit for $7.5 million. Thousands of veterans were alerted to these illegal practices once the facts of these mortgage fraud cases became public knowledge.

Memorial Health involved allegations of payment of excessive fees by hospital to doctors in excess of fair market value with a $5.08 million Government recovery.  The W&G client was a physician who learned about illegal incentives being paid to physicians in the Savannah, Georgia area.

Resurgens Surgery Center involved alleged anesthesia wrongful billing and Medicare and Medicaid fraud resulting in a $3,800,000 recovery.  The W&G client was a former employee who had access to records that the Government needed to prove the case.