Whistleblower Lawsuits and the Case Against HCA, Inc.

The number of qui tam cases has grown by leaps and bounds in the last decade, with an ever-increasing number against the health care industry. Medicare (government insurance for the elderly) and Medicaid (government insurance for the poor) fraud seems to be running rampant and only by virtue of brave whistleblowers has the government been able to recoup some of its losses.

One of the largest qui tam cases in recent years (2003) is actually a group of eight cases filed by whistle blowers against HCA, Inc. (formerly known as Columbia/HCA and HCA - The Healthcare Company). HCA agreed to a settlement and paid the United States $631 million in civil penalties and damages arising from false claims that the government alleged it submitted to Medicare and other federal health programs. This settlement marked the conclusion of the most comprehensive health care fraud investigation ever undertaken by the Justice Department.

Prior to the civil case, HCA subsidiaries pled guilty to substantial criminal conduct and paid more than $840 million in criminal fines, civil restitution and penalties. Investigations revealed that HCA had systematically cheated Medicare, Medicaid and other federally-funded health care programs through schemes dating back to the late 1980s. Combined with the civil settlement and some fines, the government recovered a whopping $1.7 billion from HCA, by far the largest recovery ever reached by the government in a health care fraud investigation.

Under the settlement, the whistleblowers received a combined share of $151,591,500, the highest combined qui tam award ever paid out by the government.

HCA Fraud and Whistleblower Awards

  • HCA engaged in a series of schemes to defraud Medicare, Medicaid and TRICARE, the military’s health care program, ($376 million) through hospital cost reports. An additional $22.6 million in criminal fines were paid. The two whistle blowers were awarded a total of $100 million as their share of the settlement.
  • HCA hospitals and home health agencies unlawfully billed Medicare, Medicaid and TRICARE for claims generated by the payment of kickbacks and other illegal remuneration to physicians in exchange for referral of patients ($225.5 million). A subsidiary of HCA, Columbia Management Companies, Inc., paid a $30 million criminal fine. The whistle blowers--a physician, and two former HCA employees--received $47.3 million as their share.
  • Certain HCA-owned hospitals billed Medicare for unallowable costs incurred by a contractor that operated HCA wound care centers, and for a non-covered drug that the contractor manufactured and sold to hospital patients ($17 million). The whistle blowers--a former HCA financial officer and a former reimbursement manager at the wound care center--received $3.67 million.
  • Claims of excessive costs for patient transfers from HCA facilities to other facilities ($5 million).
  • HCA’s Lawnwood Regional Medical Center submitted false claims in Medicare cost reports by inflating its entitlement to funds to treat indigent patients and by shifting employee salary costs in order to increase its reimbursement from the general health care program ($5 million).
  • HCA shifted its home office costs to hospitals and then submitted them to Medicare for reimbursement ($950,000).

As you can see, whistleblowers, in large cases, stand to gain substantial rewards should the defendants be held liable. If you have good reason to believe your employer has committed fraud against the government, contact a qui tam attorney right away. An experienced qui tam lawyer will be able to evaluate your case and determine if it is worth pursuing.

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