Friday Enforcement Wrap: DOJ Announces Anti-Kickback Settlement & More Headlines

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Headlines that Matter for Companies and Executives in Regulated Industries

DOJ News

$3.825 Million Settlement in Anti-Kickback Suits

Vascular Access Centers LP, which operates dialysis facilities in eight states, settled False Claims Act allegations for $3.825 million. Whistleblowers alleged in two lawsuits that VAC billed Medicare for non-reimbursable vascular access procedures performed on End Stage Renal Disease patients and paid kickbacks in return for referrals for the procedures. VAC will pay the settlement over five years, and has entered into a Corporate Integrity Agreement with HHS-OIG. <.p>

Read the DOJ press release here.

Mortgage Lender Pays $13.2 Million to Resolve False Certification Case

Universal American Mortgage Company LLC agreed to pay $13.2 million to settle a False Claims Act whistleblower lawsuit filed in Washington. A former employee of a related UAMC entity alleged that the mortgage lender violated the False Claims Act by falsely certifying that it complied with FHA mortgage insurance requirements in connection with certain loans. Specifically, the complaint alleged that UAMC knowingly submitted loans for FHA insurance that did not qualify. 

Read the DOJ press release here.

Government Intervenes in Suit Alleging False Claims by Ophthalmologist

The Government intervened in a False Claims Act lawsuit against an ophthalmologist from Georgia filed by a former office manager for the provider. The lawsuit alleges that the provider engaged in multiple schemes to submit false claims, including claims for medically unnecessary cataract extraction surgery when less invasive measures, such as glasses, would have been appropriate.

The provider also allegedly rendered false glaucoma diagnoses and billed Medicare for tests performed on a machine that was not functioning. The investigation was led by the US Attorney’s Office for the Northern District of Georgia.

Read the DOJ press release here.

Orthopedic Company Agrees to Settle Claims of False Billing for $455,000

Olsen Orthopedics, based out of Oklahoma City, will pay $455,000 to settle civil allegations that it submitted false claims to Medicare and TRICARE. The government investigation, led by US Attorney Robert J. Troester of the Western District of Oklahoma, arose out of claims that Olsen Orthopedics billed Medicare for drugs and devices not approved by the FDA. 

Read the DOJ press release here.

Florida Eye Centers Pay $525,000 to Settle FCA Claims

In yet another case involving cataract surgeries, the US Attorney for the Middle District of Florida announced a False Claims Act settlement with Eye Centers of Florida for $525,000. Eye Centers is an ophthalmology practice with 11 locations across southwest Florida. The government investigation focused on the alleged falsification of cataract surgery examination scores as part of a scheme to bill for cataract surgeries that would not otherwise have qualified under Medicare guidelines.  

Read the DOJ press release here.

Medical Equipment Supplier Pays $5.25 Million for Misrepresenting Ingredients in Compounded Creams

Cooley Medical Equipment, Inc., a medical equipment supplier based out of Kentucky, settled False Claims Act allegations for $5.25 million. The company, which makes compounded medical creams, billed prescriptions to Kentucky Medicaid and the Department of Veterans Affairs, Veterans Health Administration without obtaining prior authorization to use bulk powder forms of Lidocaine and Prilocaine as ingredients in the creams. 

Instead, Cooley misrepresented the nature of ingredients used in the cream and submitted thousands of false claims between January 2015 and December 2016.  Cooley voluntarily disclosed the misconduct and no longer operates a compounding pharmacy.

The DOJ press release is here.

Litigation Developments

Doctor Convicted for Illegal Kickbacks

A doctor in St. Louis was found guilty of sending blood and urine samples to a clinical laboratory in return for kickbacks. The doctor and his co-defendants defrauded Medicare and Medicaid of $526,000. The doctor was previously convicted in a 2015 health care fraud case involving false statements he made about another scheme.  

The DOJ press release is here.

CA Claims Against Champion Fitness Move Forward

A judge determined that a relator sufficiently alleged that Champion Fitness LLC billed Medicare for services not actually provided. Champion Fitness is alleged to have submitted payment requests to Medicare for reimbursement of physical therapy services. The court held that the relator satisfied the heightened pleading requirements for fraud and the materiality standard to constitute a false claim. The case is United States ex rel. Morgan v. Champion Fitness, Inc., Case No. 1:13-cv-1593, in the Central District of Illinois.


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