Federal Government Crack-Down on Health Care Fraud During Fiscal 2014 Results in $3.3 Billion in Judgments and Settlements

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Crack-Down on Health Care Fraud Results in $3.3B in 2014
Crack-Down on Health Care Fraud Results in $3.3B in 2014
Crack-Down on Health Care Fraud Results in $3.3B in 2014
Crack-Down on Health Care Fraud Results in $3.3B in 2014

A joint report issued by the U.S. Department of Justice and the U.S. Department of Health and Human Services shows that during the fiscal year 2014, the federal government netted $3.3 billion in judgments and settlements related to health care fraud allegations.

The report details high-profile actions taken against such medical device giants as Boston Scientific and its Guidant subsidiaries, Abbott Laboratories, Inc., Genzyme Corp., CareFusion Corp., Medtronic, Smith & Nephew and Omni Surgical L.P. (also known as Spine 360), according to JDSupra Business Advisor (JDSupra).

The following is a sample of the actions the government took to combat health care fraud during fiscal year 2014:

Boston Scientific and its Guidant subsidiaries agreed to pay the government $30 million to settle civil False Claims Act (FCA) allegations that Guidant knowingly sold defective defibrillators to health care facilities over the course of three years. Those facilities would, in turn, implant the devices in Medicare patients. The defibrillators contained an “arcing” defect that resulted in the device short-circuiting. Although Guidant fixed the defect, it continued to sell its remaining stock of the old, defective versions of the devices and deliberately hid the problem from patients, doctors and the U.S. Food and Drug Administration (FDA), the government said in the report, which was viewed by JDSupra.

-Medtronic allegedly paid kickbacks to physicians to encourage the doctors to use the company’s cardiac rhythm management devices, including pacemakers and defibrillators. The government charged the device maker with paying physicians to speak at events intended to increase referrals, and giving those physicians tickets for sporting events. Medtronic was also accused of developing marketing/business development plans for physicians at no cost. The company agreed to pay $9.98 million to settle the allegations, according to JDSupra.

-Smith & Nephew agreed to pay $8.3 million to settle FCA allegations that the medical device giant violated the act by selling medical devices to the government that had been manufactured in Malaysia, when they were required to be manufactured in the United States, JDSupra reported.

Read more at: http://www.yourlawyer.com/articles/title/justice-department-imposes-fines-of-more-than-100-million-on-medical-device-makers