Third-party fund which allegedly funneled illegal Medicare copay reimbursements for pharmaceutical companies settles False Claims Act case
The Department of Justice (“DOJ”) settled another portion of a long-running legal saga involving a False Claims Act (“FCA”) case concerning Medicare fraud against numerous pharmaceutical companies and other entities. Last week, the DOJ announced it had reached an agreement to settle an FCA case against Patient Services, Inc. (“PSI”). The DOJ alleged PSI served as a conduit to funnel illegal kickbacks from pharmaceutical companies to unsuspecting Medicare patients. PSI agreed to pay $3 million to settle the FCA claims it was facing. Based on the amount of fraud that PSI partook in, this amount could have been much higher. The DOJ lowered the amount based on its analysis of “PSI’s ability to pay after a review of its financial condition.”
The DOJ previously settled with three pharmaceutical companies that conspired with PSI for hundreds of millions, and first became aware of this far-reaching scheme through several whistleblowers who had worked at the pharmaceutical companies. These individuals initiated multiple FCA cases on behalf of the government by filing qui tam complaints. As a part of the settlements, they received sizable whistleblower rewards for their roles in uncovering the medicare fraud.Read more here.