Current whistleblower case brings attention to health care fraud

Whistleblowers can hold employers accountable for violating the law.

Whistleblowers are an important part of the workplace. A whistleblower is defined by Black’s Law Dictionary as:

An employee who turns against their superiors to bring a problem out in the open

The "problems" that whistleblowers expose can include cases of an employer committing health care fraud, corporate fraud, construction fraud and fraudulent billing.

Whistleblower cases and qui tam litigation

A recent case provides an example of a specific type of whistleblower case: a qui tam case. The term qui tam is Latin for "who as well" and refers to cases brought by an informer and joined by the government. These cases often fall within the False Claims Act. In return for providing the information, the private parties who bring the suit generally receive a share of the recovered funds. The Department of Justice notes that those who violate the False Claims Act can be liable for up to three times the government’s losses as well as additional civil penalties.

These cases have been productive in the past, with the agency stating it has received over $24 billion due to False Claims Act cases since 2009.

Background of the case

The Department of Justice recently intervened in three False Claims Act lawsuits, according to the Department of Justice’s Office of Public Affairs. The claims were made against HCR ManorCare, the nation’s largest healthcare provider with 281 skilled nursing facilities in 30 states.

The agency filed a claim stating that the nursing home chain has "knowingly and routinely submitted false claims to Medicare and Tricare for rehabilitation therapy services that were not medically reasonable and necessary." The allegations further state that ManorCare set prospective billing goals designed to increase revenue, resulting in pressure on the skilled nursing facilities to meet "unrealistic financial goals". According to the complaint, ManorCare received complaints that the corporate pressure to meet these goals was "undermining therapists’ clinical judgment at the expense of patients’ wellbeing".

These claims are supported by data from the payments received by ManorCare. ManorCare experienced a dramatic increase in the use of "ultra high" rehabilitation requests, the highest reimbursement level of the available Resource Utilization Group levels a patient can be assigned. This type of rehabilitation requires the use of a minimum of 720 minutes of therapy every week, along with two therapy disciplines where one discipline must be given at least five days a week. A facility in Delaware jumped from billing for this form of rehabilitation in 14 percent of its cases in 2006 to 92 percent in 2010, a facility in California jumped from 52 percent in 2006 to 94 percent in 2012, and another in Virginia reportedly billed at this level for 33 percent of claims in 2006 and 89 percent in 2010. Overall, ManorCare’s average billing was reported at the ultra high level for 38 percent of therapy billing in 2006 and 81 percent in 2010.

The complaint is calling for the damages allowed under the False Claims Act, plus civil penalties of not less than $5,500 and up to $11,000 for each violation.

Lessons from this case

This case provides an example of how employees can hold their employers accountable for violating the law. Those who find themselves in similar situations are wise to seek the counsel of an experienced health care fraud whistleblower attorney.