Addicted to Fraud? Health Care Industry Forced to Return Nearly $2 Billion to Taxpayers Under False Claims Act

Apr 27, 1998

Foreword

The Project On Government Oversight (POGO) is a non-partisan, non-profit organization that, since 1981, has investigated, exposed, and remedied abuses of power, mismanagement and subservience to special interests by the federal government.

Our methods include networking with government investigators and auditors whose findings have received little attention, working with whistleblowers inside the system who risk retaliation for exposing waste and fraud themselves, and performing independent investigations into areas we suspect are problematic.

Most examples of fraud against the government are never detected and prosecuted. The corporations and individuals listed below have either settled lawsuits, settled allegations independent of a lawsuit or charges being filed, or have been found liable under the False Claims Act. This survey is, by necessity, only a partial listing of settlements and judgements. Many False Claims Act settlements are not made public, and there are many cases still pending resolution. There is no official database that compiles information on those cases that are made public.

This is POGO's third report analyzing False Claims Act settlements and recoveries and the defense and health care industries' attacks on the law.

Background

The False Claims Act (FCA) has succeeded in returning over $4 billion owed American taxpayers to the U.S. Treasury since major improvements were introduced in 1986. The FCA forces corporations, institutions and individuals to be held accountable for the goods and services they provide that are paid for with taxpayers' money. Two areas of the private sector most susceptible to fraud include the defense industry -- generally government military contractors and their subcontractors; and the health care industry -- typically those organizations participating in Medicare or Medicaid programs. The corporations that make up these industries have fought the False Claims Act in the courts and in Congress, since its inception.

A new wave of heightened attacks on the FCA has appeared in the last year. The defense and health care industries have launched a massive lobbying campaign on Capitol Hill in an effort to dilute the effectiveness of the FCA. Last year the Aerospace Industries Association, Shipbuilders Council of America, National Security Industrial Association and Electronics Industries Association; together with the American Medical Association, American Hospital Association and American Association of Medical Colleges, submitted amicus curiae briefs to the Supreme Court arguing against the law.

Currently, a bill that could enact the health care industry's wishes is pending before the House of Representatives. The bill, the Health Care Claims Guidance Act, H.R. 3523, would give the health care industry the freedom from accountability that it has so urgently pursued. Among other things, the bill excuses fraud in specific quantities — as much as 10% of a hospital's total billings. In the case of some of the large, multi-billion dollar health care providers this would mean tens of millions of dollars of false claims could be sheltered from prosecution. The bill would also create defenses and elevate the burden of proof -- making the prosecution of health care fraud much more difficult. To make matters worse, the bill would allow the health care industry to protect previous interests by applying the freedom from accountability retroactively. If passed, the bill would play a starring role in deciding the ongoing investigation of the enormous hospital conglomerate, Columbia/HCA, on its alleged record-breaking Medicare and Medicaid fraud.

Health care associations and providers offer faulty arguments stating that the False Claims Act unfairly hurts those who commit purely innocent mistakes. Their proposed legislation would irreparably harm the FCA. POGO analyzed the impact of the False Claims Act on catching fraud being committed against the taxpayers and the judgements and resulting settlements recovered.

Current estimates by officials of the Department of Health and Human Services indicate that Medicare fraud costs taxpayers about $23 billion annually. The Department of Justice recently reported that in the health care area alone, as much as $100 billion is lost every year to fraud and abuse. In light of these reports, the more than $1.8 billion that the FCA has recovered from health care fraud in the past four years is barely the tip of the iceberg. Clearly, the escalation of Medicare fraud shows that the False Claims Act needs to be strengthened, not watered down.

The False Claims Act became law during the Civil War. It rose out of concern over war profiteering committed by companies taking money from the Union Army and never delivering the weapons and supplies. As President Lincoln described the situation, "worse than traitors in arms are the men who pretend loyalty to the flag, [but] feast and fatten on the misfortunes of the nation..." To counteract the fraud and abuse, Congress passed the statute on March 2, 1863. One hundred and thirty-five years later the FCA's relevance and value continues to increase as one of our most valuable tools to fight fraud against the government.

Findings

Sectors included in this survey as part of the health care industry were: hospitals, nursing homes, billing agencies, medical equipment manufacturers and providers, pharmaceutical companies, medical laboratories, research institutes, insurance providers, and individual physicians.

Types of health care fraud involved included: poor quality of care; bills for services that was never provided; false statements and certifications to inflate reimbursement checks; overbilling; bills for unnecessary procedures or tests; and kickback schemes.

The total amount paid to the government in False Claims Act (FCA) settlements and penalties for health care fraud since January of 1994 exceeds $1.89 billion.
Contrary to the industry claim that the law is used to target smaller defendants for minor sums of money, two-thirds of the settlements were for more than $1 million. Only 6.1% were less than $100,000.
The average settlement amount was nearly $17 million.
The vast majority of the cases involving kickbacks were settled by hospitals and other health care providers. Those cases account for the greatest portion of recoveries from that sector.
Over one third of the cases involved poor quality care, care not provided or unnecessary services performed.
Despite claims that the law focus's on billing "errors," in fact, the majority of the cases involved FCA violations other than false billing or overbilling.

Chart: Distribution of Recoveries in Health Care FCA Cases

Bar Graph of the Distribution of Recoveries in Health Care FCA Cases

Chart: Health Care FCA Cases by Type*

Bar Graph of Health Care FCA Cases by Type

Funds Returned to the United States Treasury By the Health Care Industry Under the False Claims Act January 1994 - April 1998

I. Hospitals, Nursing Homes, and Other Health Care Providers

Advanced Medical Diagnostics

$85,000 to settle allegations that it submitted claims for services not rendered.

— BNA Health Care Fraud Report, March 26, 19971

Adventist Rehabilitation and Extended Care

$19,000 to settle allegations that the company filed fraudulent claims for reimbursement through a third party billing service.

— BNA HCFR, March 26, 1997

Alton Ochsner Medical Foundation

$1.7 million to settle allegations of double billing to Medicare under the "72 hour window" investigation.

— TAF False Claims Act and Qui Tam Quarterly Review, January 19982

Baptist Medical Center

$17.5 million to settle allegations that it paid kickbacks to a local medical group in return for the group's referral of Medicare-eligible patients.

— QTQR, October 1997

Booth Radiology Associates

$175,000 to settle allegations of the submission of improper claims to the Medicare Program by billing for a more expensive diagnostic chemical than patients' conditions warranted.

— DOJ press release, March 25, 19983

Brooklyn Hospital Center, Dr. Schwartzman

$875,000 to settle a qui tam4 suit ($25,000 of which was paid by Dr. Schwartzman personally) for allegedly billing for full medical exams on Social Security Administration disability applicants, when in fact only brief interviews were performed.

— QTQR, January 1996

Caremark Inc.

$161 million civil settlement and criminal fines for alleged kickbacks and fraud in its home infusion, oncology, hemophilia and human growth hormone businesses.

— U.S. Attorney, Southern District of Ohio press release, April 22, 1996

Charter Westbrook Behavioral Health Systems Inc.

$2 million to settle a qui tam suit alleging improper compensation to physicians for referrals.

— Department of Defense Inspector General Semi-Annual Report, October 1, 1994

Chester Care Center, Bishop Nursing Home

$500,000 to settle allegations of inadequate care for nursing home residents.

— QTQR, April 1998

CHR Claridge House

$415,000 for allegedly billing the government improperly for medical supplies in treatment of CHR residents using a third party billing agent, Handle With Care.

— Settlement Agreement, March 27, 1995

Community Psychiatric Centers of Oklahoma Inc.

$750,000 to settle a qui tam suit alleging that a subsidiary, CPC Southwind, treated children in an unsafe and harmful environment and then billed Medicaid for services.

— Department of Justice press release, February 11, 1997

Crozer-Chester Medical Center

$664,504 to settle allegations involving the misuse of a pneumonia diagnosis code in its Medicare claims.

— QTQR, January 1998

Everett Surgical Center

$50,000 to settle allegations that it used false billing codes to bill Medicare.

— BNA HCFR, July 30, 1997

First American Health Care of Georgia

$255 million to settle allegations of, among other things, overbilling and submitting fraudulent Medicare claims by the home health care company. The settlement amount is lumped with other payments outside the FCA charges.

— DOJ press release, October 18, 1996

Florida Club Care Center

$245,488 for allegedly submitting claims for supplies that had not been used.

— DOJ press release, June 23, 1995

Geisinger Wyoming Valley Medical Center

$425,000 to settle the center's involvement in U.S. v. Metzinger and allegations of Medicare overbilling.

— BNA HCFR, June 4, 1997

GMS Management-Tucker Inc. et al.

$600,000 settlement for allegedly not providing adequate nutritional or wound care to their nursing home residents, yet billing Medicaid and Medicare for these services.

— QTQR, July 1996

Health Care Capital, Central Park Lodges, Health Resources Northwest

$2.2 million to settle allegations that these three nursing home management companies and nursing facilities submitted false Medicare bills for supplies.

— DOJ press release, December 1, 1995

Horizon/CMS Healthcare Corporation

$5.78 million to settle allegations that the nursing home chain inflated Medicare and Medicaid bills for certain medical supplies that it had used. — U.S. Attorney, District of New Mexico press release, December 31, 1996

Massachusetts Hospitals "72 Hour Rule" Investigation

$3.4 million settlement paid by 83 Massachusetts hospitals for alleged duplicate billing to Medicare. Massachusetts General Hospital paid the highest fine: $400,000. This settlement is part of an ongoing nationwide government probe into Medicare outpatient billing practices.

— DOJ press release, May 22, 1996

Mt. Sinai Medical Center of Cleveland

$472,000 to settle allegations that the company resubmitted Medicare claims for blood work under new codes after having been denied reimbursement for them.

— DOJ Health Care Fraud Report,5 1994.

National Medical Enterprises

$379 million to settle civil allegations and fulfill criminal penalties for paying kickbacks for patient referrals and providing unnecessary treatment at psychiatric hospitals in 30 states.

— Settlement Agreement, June 29, 1994

North Hudson Community Action Health Center, Palisades General Hospital

$145,000 to settle allegations of a kickback scheme between the two providers.

— DOJ press release, January 14, 1998

Northwestern Institute of Psychiatry (Matrix Health Management)

$1.4 million for allegedly referring railroad employees for unnecessary drug and alcohol treatment and paying kickbacks to a firm that recruited patients.

— DOJ HCFR, 1994

"Ohio Hospital Project" Investigation

$7,236,979 total settlement by 16 different hospitals for allegedly billing Medicare and Medicaid for individual blood tests even though they were performed in "bundles" on automated machines. The hospitals and their respective settlement amounts are listed below:

1. Medina General Hospital	$155,000
2. Barberton Citizens Hospital	$950,000
3. Cuyahoga Falls General	$505,979
4. Western Reserve Care System	$265,000
5. Massillon Community Hospital	$100,000
6. Akron General Medical Center	$550,000
7. Amherst Hospital	$120,000
8. Mercy Hospital	$240,000
9. Mt. Sinai Medical Center	$700,000
10. University Hospital of Cleveland	$225,000
11. Timken Mercy Medical Center	$1,100,000
12. - 16. Riverside Hospital, Warren General Hospital, Wood County Hospital, Providence Hospital, and Doctors Hospital	$2,326,000

— Cleveland Plain Dealer December 4, 1996

OrNda Healthcorp

$12.65 million to settle a qui tam suit alleging that several of its hospitals defrauded Medicare through illegal contracts and kickbacks.

— BNA HCFR, July 30, 1997

Paracelsus-Fentress County General Hospital Inc.

$3 million to settle a qui tam suit alleging that it defrauded Medicare and Medicaid by providing services with inadequate physician involvement. — BNA HCFR, January 28, 1998

Park Medical Center

$1.45 million settlement for allegedly billing Medicare and Medicaid for geriatric psychiatric services that were not reasonable or necessary.

— QTQR, October 1996

Pineville Community Hospital Association Inc. et al.

$2.5 million to settle a qui tam suit alleging fraudulent billing by a hospital association and two doctors, over a ten year period, for work not performed.

— QTQR, July 1995

Porter Memorial Hospital

$700,000 to settle the hospital's involvement in U.S. v. Metzinger which alleged Medicare overbilling.

— BNA HCFR, June 4, 1997

Project III of Central Florida, MACO Associates Inc.

$1.5 million to settle allegations that it submitted false information to the government to obtain federal funds for a drug abuse program.

— Settlement Agreement, September 28, 1995

Respro

$90,000 for allegedly participating in a scheme to increase the volume of Medicare claims so it could boost reimbursements to itself.

— DOJ press release, September 29, 1994

Riverside Hospital

$473,000 to settle allegations of the submission of Medicare claims for services not provided or medically unnecessary services.

— BNA HCFR, July 30, 1997

San Luis Valley Regional Medical Center

$265,000 to settle a qui tam suit alleging that the hospital overbilled Medicare and Medicaid for blood tests.

— QTQR, April 1998

St. Francis Medical Center

$617,000 to settle the hospital's involvement in U.S. v. Metzinger which alleged Medicare overbilling.

— Settlement Agreement, December 30, 1996

St. Luke's Hospital

$1.3 million to settle allegations of Medicare double billing for radiology tests performed on inpatients.

— DOJ press release, April 14, 1997

Sterling Medical Associates

$700,000 to settle a qui tam suit alleging Sterling, a provider of civilian physicians to military hospitals, misrepresented the size of the company to obtain federal contracts.

— Government Contract Litigation Reporter, January 4, 1996

Sutter Memorial Hospital

$1.26 million to settle a qui tam suit alleging improper billing for cardiac device implant procedures not covered by Medicare.

— DOJ press release, February 14, 1996

T2 Georgia

$500,000 settlement by national provider of outpatient and home infusion therapy for allegedly offering stock options to physicians in exchange for referrals.

— DOJ press release, September 26, 1994

U.S. HomeCare Corporation

$650,000 to settle a qui tam suit alleging the submission of false Medicare claims, and inadequate documentation including forged nurses signatures and "canned" nursing notes.

— DOJ press release, April 24, 1995

Vendell Healthcare Inc.

1. $654,000 to settle allegations of Medicare overcharges.

— Settlement Agreement, June 1, 1997

2. $4.2 million to settle allegations of overcharging several federal health insurance programs.

— QTQR, January 1998

Warren General Hospital

$145,000 to settle the hospital's involvement in U.S. v. Metzinger which alleged Medicare overbilling.

— BNA HCFR, June 4, 1997

West Jersey Health System

$875,000 to settle allegations that it failed to refund Medicare overpayments.

— BNA HCFR, February 12, 1997

II. Medical Equipment and Drugs

Advanced Care Associates Inc. et al.

$4.03 million to settle a qui tam suit alleging the falsification of documents on the medical condition of Medicare beneficiaries to obtain reimbursement for lymphedema pumps, which are used to reduce swelling of the limbs.

— DOJ press release, June 19, 1996

Apria Healthcare Group Inc. et al.

$2 million qui tam settlement by Apria Healthcare Group, a home health care provider of pulmonary equipment, Georgia Lung Associates, a group of four physicians, Paso del Norte Health Foundation of El Paso, Texas and Physicians Pharmacy Inc. of Georgia for allegedly defrauding Medicare through improper kickbacks and patient referrals.

— QTQR, April 1997

Becton Dickinson & Company

$3.3 million to settle a qui tam suit for allegedly overcharging the Department of Veterans Affairs for medical equipment for microbiological tests.

— DOJ press release, June 19, 1995

Circa Pharmaceutical Inc.

$2.7 million to settle allegations of selling untested generic drugs to Medicare, Medicaid, and the Department of Veterans Affairs.

— DOJ press release, March 28, 1996

Curative Industries Inc., UltraMed Inc.

$2.1 million to settle a qui tam suit for allegedly submitting Medicare claims for lymphedema pumps that did not meet engineering requirements. — DOJ HCFR, 1994

Home Americair of California

$5 million to settle a qui tam suit alleging that they conspired to defraud Medicare by knowingly submitting false claims for home oxygen equipment.

— DOJ press release, April 8, 1998

Huntleigh Technology

1. $4.9 million to settle a qui tam suit alleging false representations to dealers and suppliers that its lymphedema pump qualified for Medicare's highest reimbursement rate, causing the dealers and suppliers to submit false claims for reimbursement.

— Settlement Agreement, July 24, 1995

2. $1.35 million to settle a qui tam suit alleging that the Texas medical equipment dealer submitted false Medicare claims for lymphedema pumps and sleeves.

— DOJ press release, May 23, 1997

Medline Industries

$6.4 million to settle a qui tam suit for alleged submission of thousands of false invoices for health care products, equipment and supplies to the Department of Veterans Affairs. Medline failed to disclose that certain of its items were manufactured in non-designated countries.

— QTQR, July 1996

Modern Wholesale Drug Midwest Inc. (Rugby Laboratories)

$7.5 million to settle a qui tam suit for allegedly overcharging the Department of Veterans Affairs for generic drugs.

— DOJ press release, October 31, 1995

National Medical Systems

$1.5 million to settle a qui tam suit for alleged billing of Medicare for top-of-the-line lymphedema pumps when it actually provided much cheaper equipment.

— Settlement Agreement, September 29, 1995

Nissim Institutional Providers, Howard Weiss, et al.

$1.75 million to settle a qui tam suit alleging improper marketing of incontinence supplies for elderly patients.

— QTQR, April 1998

Olympus

$22.8 million to settle allegations that the company failed to disclose all discount and pricing information on a contract for endoscopic equipment for the Department of Veterans Affairs.

— Settlement Agreement, August 7, 1997

Orem Medical Corp. et al.

$3 million to settle allegations of false billings under a Department of Veterans Affairs medical supplies contract.

— BNA HCFR, June 18, 1997

Royal Medical Supplies et al.

$380,000 to settle allegations that they defrauded the Medicare program.

— BNA HCFR, September 10, 1997

Shiley Inc., Pfizer Inc.

$10.75 million to settle allegations that the company submitted false claims on potentially fatal artificial heart valves. FDA approval of the valves was based on false statements.

— DOJ HCFR, 1994

Summit Healthcare Systems Inc, Global Medical Systems Inc.

$500,000 for allegedly overbilling Medicare by as much as 700% for durable medical equipment.

— DOJ press release, June 11, 1996

Superior Surgical Manufacturing Company Inc.

$6.5 million settlement for allegedly overcharging the Department of Veterans Affairs, the General Services Administration, and other agencies for medical and clothing items.

— QTQR, July 1996

United States Surgical Corp.

$10 million settlement for alleged failure to disclose accurate and complete pricing information to government negotiators for surgical instruments.

— DOJ press release December 7, 1995

Wick's Pharmacy Inc.

$112,950 to settle a qui tam suit alleging False Claims Act violations.

— BNA HCFR, November 19, 1997

III. Medical Laboratories

Allied Clinical Laboratories Inc.

$4.9 million to settle a qui tam suit for alleged false claims for Medicare reimbursement of laboratory tests.

— DOJ press release, March 20, 1995

Corning Clinical Laboratories Inc.

1. Damon Clinical Laboratories Inc.

$119 million qui tam payment of settlements and criminal fines for manipulating doctors to order blood tests that were not medically necessary and improperly billing the tests to Medicare. Damon is currently owned by Corning Clinical Laboratories.

— DOJ press release, October 9, 1996

2. Metpath Inc.

$8.6 million to settle a qui tam suit for allegedly submitting claims to Medicare and Medicaid for lab tests not performed. Metpath is owned by Corning Clinical Laboratories.

— QTQR, July 1995

3. Metpath Inc.

$7 million to settle a qui tam suit (along with $4 million by Unilab Corp.) for allegedly billing for certain blood tests that were not ordered or medically necessary.

— DOJ press release, September 19, 1996

4. Bioran

$6.67 million settlement for allegedly manipulating doctors into requesting medically unnecessary tests whenever doctors ordered simple blood tests. These were then improperly billed to Medicare. Bioran is owned by Corning Clinical Laboratories.

— Settlement Agreement, February 1996

Franklin Laboratories Inc. et al.

$4.9 million to settle allegations that the lab defrauded Medicare by submitting claims for blood and urine tests that were not medically necessary or were never performed.

— DOJ press release, April 24, 1997

Laboratory Corporation of America

1. $187 million in qui tam settlements and criminal fines for billing Medicare for lab tests that were not performed, or that had not been requested by physicians.

— DOJ press release, November 21, 1996

2. $700,000 to settle a qui tam suit alleging Medicare overcharges of car mileage reimbursement for phlebotomists driving their personal vehicles to the residences of homebound or nursing home patients to draw blood samples.

— DOJ press release, June 17, 1997

Mediq Imaging Services Inc.

$4.2 million to settle allegations that it billed Medicare and other federal health care programs for tests that were not medically necessary or were ordered through an improper arrangement with doctors.

— DOJ press release, December 22, 1997

Meris Laboratories Inc. et al.

$5.2 million to settle a qui tam suit for allegedly defrauding Medicare and Medi-Cal, the California Medicaid program, by improperly billing for various lab tests.

— QTQR, April 1997

Physicians Clinical Laboratory et al.

$2 million to settle allegations that the laboratory overbilled Medicare, Medi-Cal, and CHAMPUS, for lab tests.

— QTQR, January 1998

SmithKline Beecham Clinical Laboratories Inc.

$325 million to settle three qui tam suits alleging that the company defrauded Medicare, Medicaid, CHAMPUS, the Railroad Retirement Board, and the Federal Employees Health Benefits Program.

— DOJ press release, February 24, 1997

Spectra Laboratories

$10.1 million to settle a qui tam suit alleging that the company improperly billed Medicare and other government health insurance programs for laboratory tests on patients suffering from kidney failure.

— DOJ press release, December 20, 1996

Unilab Corp.

$4 million to settle a qui tam suit (along with $7 million by Metpath Incorporated) for allegedly billing for certain blood tests that were not ordered or medically necessary.

— DOJ press release, September 19, 1996

IV. Research Colleges and Institutes

Clinical Practices of the University of Pennsylvania

$30 million settlement for alleged inadequate documentation and false Medicare billings by attending physicians for services performed by residents in training.

— Settlement Agreement, December 12, 1995

Henry M. Jackson Foundation for the Advancement of Military Medicine

$45,920 to settle a qui tam suit for allegedly mischarging labor, training and research costs not covered in NIH contract for radiology services. — QTQR, July 1995

New York University Medical Center

$15.5 million to settle a qui tam suit alleging it submitted false information in connection with indirect costs associated with federally sponsored research grants and contracts.

— QTQR , July 1997

Thomas Jefferson University, Jefferson Faculty Foundation

$12 million settlement for alleged inadequate documentation and billings by attending physicians when residents actually performed the services.

— DOJ press release, August 22, 1996

University of Chicago

$250,000 to settle allegations of misappropriations of federal grant funds for cancer research.

— QTQR, January 1998

University of Connecticut Health Center

$1.3 million to settle a qui tam suit alleging fraud involving a grant program at its Medical and Dental Schools.

— Settlement Agreement, October 27, 1997

University of Pittsburgh School of Medicine

$17 million to settle allegations of improper Medicare and Medicaid billings, including physicians billing for services performed by residents. In addition they also allegedly engaged in "upcoding," — billing for a service or procedure using a code corresponding to a more expensive service or procedure.

— QTQR, April 1998

University of Utah, University of California, Dr. Ninneman

$1.6 million to settle a qui tam suit alleging the two Universities ($950,000 paid by University of Utah and $625,000 paid by University of California) knowingly allowed Dr. Ninneman to falsely report research results to NIH.

— DOJ HCFR, 1994

University of Virginia Health Services Foundation

$8.6 million to settle allegations of improper billing of Medicare for services provided by residents and interns in the teaching setting.

— QTQR, January 1998

V. Ambulance Services

American Ambulance and Oxygen Service

$1.47 million to settle allegations that the company defrauded Medicare and Medicaid by submitting claims for ambulance transport for physician office visits, a service for which reimbursement is generally prohibited.

— DOJ press release, April 1, 1997

Crescent City EMS Inc.

$1.86 million to settle a qui tam suit alleging billing for ambulance service for Medicare dialysis patients whom they claimed were confined to bed, when they could actually walk.

— DOJ HCFR, 1994

Fire Protection District No. 5, Mason County et al.

$160,000 to settle a qui tam suit alleging fraudulent billing for ambulance services.

— QTQR, July 1996

Health Careers Inc. et al.

$12 million settlement for allegedly billing for ambulance services for Medicare beneficiaries when they were in fact transported in passenger vans, as well as billing for patients whose medical condition did not require transportation by ambulance.

— Settlement Agreement , April 25, 1996

Professional Ambulance Service Inc. et al.

$700,000 settlement by three ambulance companies for allegedly billing Medicare for unnecessary services.

— DOJ press release, December 18, 1996

VI. Insurance Providers and Billing Services

Blue Cross/Blue Shield of Florida

$10 million to settle a qui tam suit alleging mishandling of claims and knowingly choosing a data processing firm that could not handle the claims volume.

— DOJ HCFR, 1994

Blue Cross/Blue Shield of Massachusetts

$2.75 million to settle a qui tam suit for allegedly submitting false Medicare reports.

— DOJ HCFR, 1994

Blue Cross/Blue Shield of Michigan

1. $27.6 million to settle a qui tam suit alleging improper billing and submitting false documentation to Medicare, and inadequate audits of hospital cost reports.

— DOJ press release, January 18, 1995

2. $24 million to settle allegations of unlawfully billing Medicare for thousands of claims that should have been paid from private insurance funds.

— DOJ press release, January 18, 1995

Blue Shield of California

$12 million to settle a qui tam suit alleging that it submitted false claims under its contract with HCFA to process and pay Medicare claims.

— DOJ press release, May 2, 1997

Emergency Physicians Billing Services et al.

1. $7.75 million to settle a qui tam suit alleging that it overcharged Medicare, Medicaid, CHAMPUS, and the Federal Employees Health Benefits Program in connection with claims submitted by its billing company.

— DOJ press release, May 21, 1997

2. $268,460 to settle a qui tam suit alleging that Medicus Medical Group received over-payments based on false claims submitted by Medicus' billing company.

— DOJ press release, June 5, 1997

Metzinger et al.

$60,000 to settle allegations that two billing consultants defrauded Medicare in connection with clinical laboratory outpatient services.

— QTQR, October 1997

Provident Accident Life and Accident Insurance Co.

$27 million to settle a qui tam suit for alleged false Medicare billing.

— National Health VII. Physicians

VII. Physicians

Dr. Anthony et al.

$1.52 million qui tam settlement by nine physicians and their medical imaging corporations for alleged improper Medicare and Medicaid referrals to diagnostic firms in which the doctors had a financial interest.

— QTQR, July 1995

Dr. Marlou Davis

$4.1 million judgement for soliciting elderly patients from nursing homes, supermarkets, malls, and drug stores and promising them early detections of illnesses including heart disease and strokes. He then charged Medicare for the tests.

— BNA Medicare Report, October 25, 1996

Dr. Dennis Gilbert

$100,000 to settle allegations that he billed Medicare for medically unnecessary or unreimburseable procedures.

— BNA HCFR, July 30, 1997

Dr. Jaramillo et al.

$700,000 to settle a qui tam suit alleging billing Medicare, Medicaid, and CHAMPUS for psychiatric services that were not provided or were provided by a non-physician assistant without appropriate supervision.

— QTQR, July 1996

Dr. Kurwa et al.

$375,000 to settle allegations of fraudulent Medicare billing.

— BNA HCFR, December 17, 1997

Lopez et al.

$2 million to settle allegations of improper claims involving kickbacks to physicians and clinic owners in exchange for patient referrals by two clinics Lopez operated.

— QTQR, January 1998

Dr. Merendino et al.

$3.1 million to settle allegations that the doctor submitted improper Medicare claims for physical therapy services rendered at seven nursing homes.

— DOJ press release, June 17, 1997

Dr. Nalls

$4.29 million judgement against Nalls for defrauding Medicare.

— QTQR, July 1997

Dr. Schneider

$15,000 to settle allegations that Dr. Schneider sought reimbursement from Medicare for the incision and drainage of abscesses that he never performed.

— BNA HCFR, August 13, 1997

Dr. Schwartz, Dr. Barr, Dr. Silver et al.

$278,800 to settle a qui tam suit against a group of doctors for allegedly billing for chemotherapy treatment even though the treatment was provided by nurses, and no doctors were present at the hospital at the time of treatment.

— DOJ press release, July 24, 1996

Dr. Skodnek

$490,000 to settle allegations that he submitted Medicare claims for services not rendered.

— BNA HCFR, January 28, 1998

Dr. George Wied

$400,000 to settle allegations that he misappropriated federal funds for cancer research.

— QTQR, January 1998

Dr. Wurtzel, Life Centers Limited

$500,000 paid by the physician/owner of a mental health clinic to settle a qui tam suit for allegedly charging Medicaid for services never performed or otherwise not reimbursable.

— Settlement Agreement, November 6, 1995

Funds Returned to the United States Treasury By the Health Care Industry Under the False Claims Act January 1994 - April 1998
Health Care Providers	Funds Recovered
Advanced Medical Diagnostics	$85,000
Adventist Rehabilitation and Extended Care	$19,000
Alton Ochsner Medical Foundation	$1,700,000
Baptist Medical Center	$17,500,000
Booth Radiology Associates	$175,000
Brooklyn Hospital Center et. al.	$875,000
Caremark Incorporated	$161,000,000
Charter Westbrook Behaviorial Health Systems Inc.	$2,000,000
Chester Care Center et. al.	$500,000
CHR Claridge House	$415,000
Community Psychiatric Centers of Oklahoma Inc.	$750,000
Crozer-Chester Medical Center	$664,504
Everett Surgical Care	$50,000
First American Health Care of Georgia	$255,000,000
Florida Club Care Center	$245,488
Geisinger Wyoming Valley Medical Center	$425,000
GMS Management-Tucker Inc. et. al.	$600,000
Health Care Capital et. al.	$2,200,000
Horizon/CMS Healthcare Corporation	$5,780,000
Massachusetts Hospitals 72 Hour Rule Investigation	$3,400,000
Mt. Sinai Medical Center of Cleveland	$472,000
National Medical Enterprises	$379,000,000
North Hudson Community Action Health Center	$145,000
Northwestern Institute of Psychiatry	$1,400,000
Ohio Hospital Project Investigation	$7,236,979
OrNda Healthcorp	$12,650,000
Paraceisus-Fentress County General Hospital	$3,000,000
Park Medical Center	$1,450,000
Pineville Community Hospital Association Inc. et. al.	$2,500,000
Porter Memorial Hospital	$700,000
Project III and MACO Associates	$1,500,000
Respro	$90,000
Riverside Hospital	$473,000
San Luis Valley Regional Medical Center	$265,000
St. Francis Medical Center	$617,000
St. Luke's Hospital	$1,300,000
Sterling Medical Associates	$700,000
Sutter Memorial Hospital	$1,265,000
T2 Georgia	$500,000
U.S. HomeCare Corporation	$650,000
Vendell Healthcare Inc.	$654,000
Vendell Healthcare Inc.	$4,200,000
Warren General Hospital	$145,000
West Jersey Health System	$875,000
Advanced Care Associates Inc. et. al.	$4,030,000
Apria Healthcare Group Inc.	$2,000,000
Becton Dickinson & Company	$3,300,000
Circa Pharmaceutical Inc.	$2,700,000
Curative Industries Inc. et. al.	$2,100,000
Home Americair of California	$5,000,000
Huntleigh Technology	$4,900,000
Huntleigh Technologies	$1,350,000
Medline Industries	$6,400,000
Modern Wholesale Drug Midwest Inc.	$7,500,000
National Medical Systems	$1,500,000
Nissim Institutional Providers et. al.	$1,750,000
Olumpus	$22,800,000
Orem Medical Corp.	$3,000,000
Royal Medical Supplies	$380,000
Shiley Inc. et. al.	$10,750,000
Summit Healthcare Systems Inc. et. al.	$500,000
Superior Surgical Manufacturing Company Inc.	$6,500,000
United States Surgical Corporation	$10,000,000
Wick's Pharmacy Inc.	$112,950
Allied Clinical Laboratories Inc.	$4,900,000
Damon Clinical Laboratories Inc.	$119,000,000
Metpath Inc.	$8,600,000
Metpath Inc.	$7,000,000
Bioran	$6,675,000
Franklin Laboratories Inc. et. al.	$4,900,000
Laboratory Corporation of America	$187,000,000
Laboratory Corporation of America	$700,000
Mediq Imaging Services Inc.	$4,200,000
Meris Laboratories Inc. et. al.	$5,200,000
Phyisicians Clinical Laboratory	$2,000,000
SmithKline Beecham Clinical Laboratories Inc.	$325,000,000
Spectra Laboratories	$10,100,000
Unilab Corporation	$4,000,000
Clinical Practices of the University of Pennsylvania	$30,000,000
Jackson Foundation for Advancement of Military Medicine	$45,920
New York University Medical Center	$15,500,000
Thomas Jefferson University	$12,000,000
University of Chicago et. al.	$250,000
University of Connecticut Health Center	$1,300,000
University of Pittsburgh	$17,000,000
University of Utah et. al.	$1,600,000
University of Virginia Health Services Foundation	$8,600,000
American Ambulance and Oxygen Service	$1,475,000
Crescent City EMS Inc.	$1,860,000
Fire Protection District No. 5 Mason County et. al.	$160,000
Health Careets Inc. et. al.	$12,000,000
Professional Ambulance Service Inc. et. al.	$700,000
Blue Cross/Blue Shield of Florida	$10,000,000
Blue Cross/Blue Shield of Massachusetts	$2,750,000
Blue Cross/Blue Shield of Michigan	$27,600,000
Blue Cross/Blue Shield of Michigan	$24,000,000
Blue Shield of California	$12,000,000
Emergency Physicians Billing Services et. al.	$7,750,000
Emergency Physicians Billing Services et. al.	$268,460
Dr. Metzinger et. al.	$60,000
Provident Accident Life and Accident Insurance Co.	$27,000,000
Dr. Anthony et. al.	$1,520,000
Dr. Davis	$4,100,000
Dr. Gilbert	$100,000
Dr. Jaramillo et. al.	$700,000
Dr. Kurwa et. al.	$375,000
Dr. Lopez et. al.	$2,000,000
Dr. Merendino et. al.	$3,100,000
Dr. Nalls	$4,290,000
Dr. Schneider	$15,000
Dr. Schwartz et. al.	$278,800
Dr. Skodnek	$490,000
Dr. Weid	$400,000
Dr. Wurtzel et. al.	$500,000
TOTAL	$1,892,808,101