Healthy Skepticism Library item: 18474

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Publication type: news

Shah N
Medicaid fraud settled for $27 million
The Miami Herald 2010 July 21
http://pharmagossip.posterous.com/chalk-up-another-win-for-whistleblowers-ven-a

Abstract:

A Keys clinic helped obtain a $27 million Medicaid fraud settlement with an Israeli pharmaceutical company.

Full text:

Teva Pharmaceuticals agreed to pay $27 million to resolve concerns about Medicaid fraud brought to light by a Keys whistle-blower, the state attorney general said Tuesday.
The settlement partially resolves two Leon County Medicaid fraud lawsuits that alleged the company knowingly set inflated prices for medications dispensed by pharmacies and other providers reimbursed by the Florida Medicaid program.
The program sets reimbursement rates it pays to Medicaid providers based on prices reported by drug manufacturers. By reporting inflated prices, the drug manufacturers led the Florida Medicaid Program to overpay millions of dollars in pharmacy reimbursements.
GENERAL REVENUE FUND
As part of the settlement with Israel-based Teva, the state’s general revenue fund will be paid about $3.5 million. The Florida Medicaid Fraud Informant Reward Program will receive more than $387,000, and the Agency for Health Care Administration, which administers the Medicaid Program, will receive more than $7.1 million. The rest of the money will be paid from the settlement to the federal government and to the whistle-blower, Ven-A-Care in Key West. Ven-a-Care is a pharmacy owned by four partners who have gained more than $25 million in the past 15 years, starting with a whistle-blower lawsuit filed in 1995.
The Leon County cases are ongoing against four other pharmaceutical companies: Mylan Laboratories, Actavis, Watson Pharmaceuticals and Sandoz Pharmaceuticals.
In an unrelated case, five north Floridians, including a hospital administrator, were arrested Tuesday on charges of Medicaid fraud, racketeering, money laundering and operating a scheme to defraud.
Officers, employees and affiliates of HC Healthcare admitting Medicaid recipients to the hospital without medical necessity, altering medical records on occasion to justify the hospital admissions. False claims for reimbursement were submitted to the Florida Medicaid program for services performed outside the scope of the physician involved.
The fraud occurred at the now closed Trinity Community Hospital and affiliated clinics in Hamilton, Suwanee and Columbia counties. More arrests are pending.
BOGUS IMPROVEMENTS
An investigation found that more than $660,000 in state grant money dedicated to hospital improvements were taken by the corporation, but little if any of the money was used for improvements. Instead, the money was spent on the fraud ring and used by hospital owner Robert A. Krasnow, 36, of Gainesville, who faces several charges, including 10 counts of Medicaid fraud.
The others arrested were Dr. Yong Am Park, 66, of Lake City; Robert T. Krasnow, 58, of Gainesville, the father of Robert A. Krasnow; hospital administrator Christina L. Ortega, 42, of Lake City; and nurse Ashley Lane Butler, 37, of Live Oak.
People who report Medicaid fraud may be entitled to a reward. Call 866-966-7226 with tips. Rewards are paid if a case results in a fine, penalty or forfeiture of property and may be up to 25 percent of what the amount recovered.