DOJ Boasts $2.4 Billion Recovered from Health Care-Related Fraud Cases in 2011

The Department of Justice announced last Monday that of the more than $3 billion recovered under the False Claims Act in 2011, $2.4 billion stemmed from recoveries from fraud against federal health care programs.   Included in those programs that were the target of fraud were Medicare, Medicaid, TRICARE, Federal Employees Health Benefits, and Veterans Administration health programs.

According to Assistant Attorney General for the Civil Division, Tony West, since the False Claims Act was amended in 1986, $30 billion dollars have been recovered, and “[28] percent of the recoveries in the last 25 years were obtained since President Obama took office [in 2009].”  The new release states that fighting health care fraud is a top priority for the Obama Administration, and credits the Health Care Fraud Prevention and Enforcement Action Team (HEAT), created in May 2009, for much of the DOJ’s success.  

It does not appear to be coincidence that the False Claims Act recoveries have so drastically increased since Obama took office.  HEAT’s mission, according to the team’s website include:

  • (1) utilizing government resources to prevent waste, fraud, and abuse in Medicare and Medicaid;
  • (2) reduce health care costs and improve quality of care;
  • (3) highlight best practices by providers and public sector employees; and 
  • (4) add to DOJ and HHS relationships, like Medicare Fraud Strike Forces, to reduce fraud and recover taxpayer dollars. 

The Obama Administration also plans to invest funds in strengthening program integrity in Medicare and Medicaid, particularly with regard to Medicare Advantage and Medicare prescription drug programs.  [For more information on HEAT, refer to the program’s website.]

Also credited for the large recovery is the passage of the Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148) last year, which provided more incentive for whistleblowers to step forward and strengthened the Anti-Kickback Statute. 

The pharmaceutical industry was the biggest source of recoveries, according to the DOJ news release, with nearly $2.2 billion coming from civil claims, including $900 million from eight drug manufacturers for engaging in illegal pricing, and $750 million from civil and criminal claims against GlaxoSmithKline PLC for knowingly submitting, or causing to be submitted, false claims for adulterated drugs and for drugs that did not meet the strength, purity or quality required by the Food and Drug Administration.

A record amount of $2.8 billion came stemmed from whistleblower provisions of the False Claims Act which allow private citizens to bring suit (qui tam suits) on behalf of the federal government.  A total of 638 qui tam actions were filed over the past year.