Agreeing to pay a total of $15.5 million, a diagnostic imaging company has settled with the Department of Justice under the False Claims Act for allegedly submitting claims to Medicare for services never completed.
Claims purportedly were made to federal Medicare and to New York and New Jersey Medicaid Programs for CT scans and other bundled tests. Further, alleged payments were made to physicians to reward them for referrals. Under the February 2014 settlement, the company will pay the federal government $13.65 million and an additional $1.85 million to New York and New Jersey, for a total of $15.5 million.
This settlement allows the three individuals bringing forward the allegations to share in the recovery to the extent of $1.5 million, $1.07 million, and $204,250, respectively, the three whistleblowers received these sums under the qui tam provisions of the False Claims Act.
With whistleblower recoveries regularly making the headlines, companies need to minimize their exposure by checking their procedures periodically to make sure they encourage employees to report suspicions over possible irregularities to their companies, rather to the government. Silence is not necessarily golden where legal compliance is at issue — still take a step back and review your internal processes. Given the staggering settlements the Department of Justice enters into with companies and the increasing number of FCA cases, the time to act is now.