FROM: U.S. DEPARTMENT OF JUSTICE
Wednesday, May 8, 2013
Justice Department Settles Lawsuit Against Golden Corral Restaurant for Violation of the Americans with Disabilities Act
The Department of Justice announced today the settlement of its lawsuit against the Golden Corral restaurant in Westland, Mich., which alleged that the owners and operators of the Golden Corral violated the Americans with Disabilities Act (ADA) by denying service to a mother and her minor children based on the appearance of the children’s skin due to a genetic skin disorder.
The Justice Department’s lawsuit, filed in the U.S. District Court for the Eastern District of Michigan in Detroit, alleged that the manager of the Golden Corral restaurant demanded that Danielle Duford and her four daughters leave the restaurant based on the appearance of the children’s skin caused by a genetic skin disorder, epidermolysis bullosa, which causes blisters to form on the skin in response to minor injuries and temperature changes. Despite Duford informing the restaurant manager of her children’s disability and repeatedly emphasizing that they did not have a contagious disease, the manager required the family to immediately leave the restaurant, claiming that he had received complaints from other customers. Title III of the ADA prohibits public accommodations, such as restaurants, from discriminating against people on the basis of disability, or their association with an individual with a disability, in the full and equal enjoyment of the goods or services offered.
Under the settlement agreement, which must still be approved by U.S. District Court Judge Stephen J. Murphy III, the defendants will pay $50,000 in damages to Duford and her children and $10,000 in civil penalties to the United States. The defendants will also develop and maintain a non-discrimination policy which covers service to customers with disabilities at the Golden Corral restaurant, and provide training to their employees on their obligations under the ADA.
"No one should be excluded from participating in the basic activities of daily living on account of fears of their disability, nor should children be shamed from going out in public," said Eve Hill, Senior Counselor to the Assistant Attorney General for the Civil Rights Division. "We are confident today’s settlement sends that message."
"We hope that today’s settlement will help prevent discrimination based on unfounded fears by raising awareness of the duties to accommodate individuals with less common disabilities," said Barbara L. McQuade, the U.S. Attorney for the Eastern District of Michigan.
The case was handled by Assistant U.S. Attorney Susan K. DeClercq in the U.S. Attorney’s Office for the Eastern District of Michigan, in collaboration with the Disability Rights Section of the Civil Rights Division of the Justice Department.
Saturday, May 11, 2013
Friday, May 10, 2013
U.S. GOVERNMENT WORKS WITH U.S. BUYERS TO IMPROVE WORKING CONDITIONS IN BANGLADESH GARMENT SECTOR
FROM: U.S. STATE DEPARTMENT
State Department Call With U.S. Buyers in Bangladesh Ready-Made Garment Sector
Media Note
Office of the Spokesperson
Washington, DC
May 8, 2013
The State Department, the Department of Labor and the Office of the U.S. Trade Representative convened a conference call with U.S. buyers in Bangladesh’s garment industry to discuss U.S. Government engagement to improve workers’ rights and working conditions in Bangladesh, and to review how the private sector can assist in these vital ongoing efforts. Assistant Secretary of State for South and Central Asian Affairs Robert O. Blake, Jr. and Special Representative for International Labor Affairs Barbara Shailor represented the State Department.
Assistant Secretary Blake and Special Representative Shailor noted that the tragedy at Rana Plaza once again underscores the urgent need for government, owners, buyers, and labor organizations to work together to improve labor safety and the lives of working people in Bangladesh. Both the United States and Bangladesh have a shared interest in ensuring that the growth of Bangladesh’s export sector does not come at the expense of safe and healthy working conditions or fundamental labor rights.
The State Department strongly urged U.S. buyers to coordinate efforts with each other and with the Government of Bangladesh and the Bangladesh Garment Manufacturers & Exporters Association (BGMEA), as well as civil society and labor groups, on factory safety and fire initiatives, including helping pay for independent safety and fire inspectors. They encouraged the buyers to communicate their concerns about labor conditions to the BGMEA and the Bangladeshi Government, and to urge immediate passage of the labor law amendments to lay the basis for the establishment of an International Labor Organization and International Finance Corporation Better Work Program.
State Department Call With U.S. Buyers in Bangladesh Ready-Made Garment Sector
Media Note
Office of the Spokesperson
Washington, DC
May 8, 2013
The State Department, the Department of Labor and the Office of the U.S. Trade Representative convened a conference call with U.S. buyers in Bangladesh’s garment industry to discuss U.S. Government engagement to improve workers’ rights and working conditions in Bangladesh, and to review how the private sector can assist in these vital ongoing efforts. Assistant Secretary of State for South and Central Asian Affairs Robert O. Blake, Jr. and Special Representative for International Labor Affairs Barbara Shailor represented the State Department.
Assistant Secretary Blake and Special Representative Shailor noted that the tragedy at Rana Plaza once again underscores the urgent need for government, owners, buyers, and labor organizations to work together to improve labor safety and the lives of working people in Bangladesh. Both the United States and Bangladesh have a shared interest in ensuring that the growth of Bangladesh’s export sector does not come at the expense of safe and healthy working conditions or fundamental labor rights.
The State Department strongly urged U.S. buyers to coordinate efforts with each other and with the Government of Bangladesh and the Bangladesh Garment Manufacturers & Exporters Association (BGMEA), as well as civil society and labor groups, on factory safety and fire initiatives, including helping pay for independent safety and fire inspectors. They encouraged the buyers to communicate their concerns about labor conditions to the BGMEA and the Bangladeshi Government, and to urge immediate passage of the labor law amendments to lay the basis for the establishment of an International Labor Organization and International Finance Corporation Better Work Program.
Thursday, May 9, 2013
MSHA, U.S. LIME SETTLE 2010 MINE DEATH NEGLIGENCE CASE
FROM: U.S. DEPARTMENT OF LABOR
MSHA, US Lime reach settlement in 2010 mine death
ARLINGTON, Va. — The U.S. Department of Labor's Mine Safety and Health Administration today announced that it has reached a settlement of $211,002 with U.S. Lime Co. in the May 2010 death of a maintenance manager at St. Clair Mine in Marble City, Okla. The settlement involves 39 citations and orders issued in the wake of the accident and during subsequent mine inspections.
U.S. Lime also has agreed to accept a flagrant violation of Section 57.12016 of the Code of Federal Regulations, which requires electrically powered equipment to be de-energized before any mechanical work is performed. That single penalty was assessed by MSHA at $150,600.
According to MSHA's accident investigation report, Wilbur A. Farris was fatally injured while in a roller mill that was not properly locked out and de-energized. The roller mill started while Farris was inside. Investigators found that the linkage from the breaker box handle to the electrical circuit breaker for the lower portion of the vertical roller mill was missing and, consequently, moving the handle to the "off" position did not de-energize the power. They determined that management engaged in aggravated conduct constituting more than ordinary negligence in that two supervisors were present at the time of the accident.
"As I've often stated, mine fatalities are preventable," said Joseph A. Main, assistant secretary of labor for mine safety and health. "This accident occurred because mine management failed to ensure that safe work procedures were being followed while performing maintenance and mechanical work in the roller mill."
MSHA, US Lime reach settlement in 2010 mine death
ARLINGTON, Va. — The U.S. Department of Labor's Mine Safety and Health Administration today announced that it has reached a settlement of $211,002 with U.S. Lime Co. in the May 2010 death of a maintenance manager at St. Clair Mine in Marble City, Okla. The settlement involves 39 citations and orders issued in the wake of the accident and during subsequent mine inspections.
U.S. Lime also has agreed to accept a flagrant violation of Section 57.12016 of the Code of Federal Regulations, which requires electrically powered equipment to be de-energized before any mechanical work is performed. That single penalty was assessed by MSHA at $150,600.
According to MSHA's accident investigation report, Wilbur A. Farris was fatally injured while in a roller mill that was not properly locked out and de-energized. The roller mill started while Farris was inside. Investigators found that the linkage from the breaker box handle to the electrical circuit breaker for the lower portion of the vertical roller mill was missing and, consequently, moving the handle to the "off" position did not de-energize the power. They determined that management engaged in aggravated conduct constituting more than ordinary negligence in that two supervisors were present at the time of the accident.
"As I've often stated, mine fatalities are preventable," said Joseph A. Main, assistant secretary of labor for mine safety and health. "This accident occurred because mine management failed to ensure that safe work procedures were being followed while performing maintenance and mechanical work in the roller mill."
Wednesday, May 8, 2013
STAFFING AGENCY TO PAY ALMOST $2 MILLION IN O.T. BACK WAGES
FROM: U.S. DEPARTMENT OF LABOR
Major staffing agency Hutco to pay nearly $2 million in overtime back wages to workers following US Labor Department investigation
BROUSSARD, La. — Hutco Inc., a major industrial services employment agency, has agreed to pay $1,916,850 in back wages to 2,267 employees assigned to client work sites throughout Louisiana, Mississippi and Texas. An investigation conducted by the U.S. Department of Labor's Wage and Hour Division found that the company utilized improper pay and record-keeping practices that resulted in employees being denied overtime compensation in violation of the Fair Labor Standards Act.
"Employers cannot avoid their legal responsibility to pay overtime by using evasive practices that seek to undermine labor laws and deny workers their rightful wages," said acting Secretary of Labor Seth D. Harris. "As a result of our investigation, not only is nearly $2 million in unpaid wages going into the pockets of the workers who earned it, but today's agreement will also ensure the company's future compliance with the FLSA."
"Temporary employment arrangements can make the worker-employer relationship difficult for workers to understand," said Mary Beth Maxwell, acting deputy administrator of the Wage and Hour Division. "As a result, temporary workers face the risk of not being treated as employees in terms of the wages and legal protections guaranteed under federal law. The Wage and Hour Division is committed to protecting them, and continues to reach out to stakeholders and state agencies to help ensure that employers who utilize contingent work arrangements do so in compliance with all applicable laws."
An investigation of the company's headquarters in Lafayette disclosed systemic overtime violations throughout six branch establishments. Hutco mischaracterized certain wages as "per diem" payments and impermissibly excluded these wages when calculating overtime premiums, thus denying employees earned overtime compensation. This improper pay practice also resulted in FLSA record-keeping violations involving the accuracy of employees' wages and actual hours worked.
Under the settlement, in addition to paying back wages, Hutco has committed to future compliance with the law. The agreement includes specific measures the company will take to prevent future violations, including setting standards to accurately identify and compensate workers who qualify for bona fide per diem payments, paying accurate overtime and ensuring per diem payments are not automatically excluded from overtime calculations, informing employees about their pay and employment conditions, and obtaining written acknowledgment from employees that they understand the criteria for receipt of per diem payments.
Additionally, Hutco must maintain accurate records demonstrating which employees received bona fide per diem payments and that such payments are based on applicable Internal Revenue Service guidelines, or upon a reasonable approximation of the expenses incurred. The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Employers must also maintain accurate time and payroll records.
An employee's regular pay rate, upon which overtime must be computed, includes all wages for employment, except certain payments excluded by the FLSA, such as reimbursements for work-related expenses. Payments reasonably approximating travel or other expenses incurred on the employer's behalf may be excluded from the employee's regular rate of pay when computing overtime. However, where an employee receives such payments but actually incurs no such additional expenses, such payments do not constitute bona fide reimbursements and must be included in the employee's regular rate of pay for purposes of computing an overtime premium.
Hutco Inc. is a labor services company that provides skilled and unskilled labor to clients throughout the United States in industries such as vessel construction, oil field fabrication, warehousing and distribution, manufacturing and other industries. The employees entitled to receive overtime back wages as a result of the department's investigation worked as welders, fitters, tackers, electricians, blasters, painters, forklift operators and warehouse personnel.
Payment of back wages is ongoing. This case also has been referred to the Louisiana Workforce Commission for review.
Major staffing agency Hutco to pay nearly $2 million in overtime back wages to workers following US Labor Department investigation
BROUSSARD, La. — Hutco Inc., a major industrial services employment agency, has agreed to pay $1,916,850 in back wages to 2,267 employees assigned to client work sites throughout Louisiana, Mississippi and Texas. An investigation conducted by the U.S. Department of Labor's Wage and Hour Division found that the company utilized improper pay and record-keeping practices that resulted in employees being denied overtime compensation in violation of the Fair Labor Standards Act.
"Employers cannot avoid their legal responsibility to pay overtime by using evasive practices that seek to undermine labor laws and deny workers their rightful wages," said acting Secretary of Labor Seth D. Harris. "As a result of our investigation, not only is nearly $2 million in unpaid wages going into the pockets of the workers who earned it, but today's agreement will also ensure the company's future compliance with the FLSA."
"Temporary employment arrangements can make the worker-employer relationship difficult for workers to understand," said Mary Beth Maxwell, acting deputy administrator of the Wage and Hour Division. "As a result, temporary workers face the risk of not being treated as employees in terms of the wages and legal protections guaranteed under federal law. The Wage and Hour Division is committed to protecting them, and continues to reach out to stakeholders and state agencies to help ensure that employers who utilize contingent work arrangements do so in compliance with all applicable laws."
An investigation of the company's headquarters in Lafayette disclosed systemic overtime violations throughout six branch establishments. Hutco mischaracterized certain wages as "per diem" payments and impermissibly excluded these wages when calculating overtime premiums, thus denying employees earned overtime compensation. This improper pay practice also resulted in FLSA record-keeping violations involving the accuracy of employees' wages and actual hours worked.
Under the settlement, in addition to paying back wages, Hutco has committed to future compliance with the law. The agreement includes specific measures the company will take to prevent future violations, including setting standards to accurately identify and compensate workers who qualify for bona fide per diem payments, paying accurate overtime and ensuring per diem payments are not automatically excluded from overtime calculations, informing employees about their pay and employment conditions, and obtaining written acknowledgment from employees that they understand the criteria for receipt of per diem payments.
Additionally, Hutco must maintain accurate records demonstrating which employees received bona fide per diem payments and that such payments are based on applicable Internal Revenue Service guidelines, or upon a reasonable approximation of the expenses incurred. The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Employers must also maintain accurate time and payroll records.
An employee's regular pay rate, upon which overtime must be computed, includes all wages for employment, except certain payments excluded by the FLSA, such as reimbursements for work-related expenses. Payments reasonably approximating travel or other expenses incurred on the employer's behalf may be excluded from the employee's regular rate of pay when computing overtime. However, where an employee receives such payments but actually incurs no such additional expenses, such payments do not constitute bona fide reimbursements and must be included in the employee's regular rate of pay for purposes of computing an overtime premium.
Hutco Inc. is a labor services company that provides skilled and unskilled labor to clients throughout the United States in industries such as vessel construction, oil field fabrication, warehousing and distribution, manufacturing and other industries. The employees entitled to receive overtime back wages as a result of the department's investigation worked as welders, fitters, tackers, electricians, blasters, painters, forklift operators and warehouse personnel.
Payment of back wages is ongoing. This case also has been referred to the Louisiana Workforce Commission for review.
Monday, May 6, 2013
MIAMI HOME HEALTH CARE AGENCY RECRUITER SENT TO PRISON FOR 37 MONTHS
FROM: U.S. DEPARTMENT OF JUSTICE
Monday, May 6, 2013
Patient Recruiter of Miami Home Health Company Sentenced to 37 Months in Prison for Role in $20 Million Health Care Fraud Scheme
A patient recruiter for a Miami health care company was sentenced today to serve 37 months in prison for his participation in a $20 million Medicare fraud scheme, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.
Manuel Lozano, 65, was sentenced by U.S. District Judge Joan A. Lenard in the Southern District of Florida. In addition to his prison term, Lozano was sentenced to serve two years of supervised release and ordered to pay $1,851,000 in restitution, jointly and severally with co-conspirators.
In February 2013, Lozano pleaded guilty to one count of conspiracy to receive health care kickbacks.
According to court documents, Lozano was a patient recruiter who worked for Serendipity Home Health, a Miami home health care agency that purported to provide home health and therapy services to Medicare beneficiaries.
According to court documents, from approximately April 2007 through March 2009, Lozano recruited patients for Serendipity, and in doing so he solicited and received kickbacks and bribes from the owners and operators of Serendipity in return for allowing the company to bill the Medicare program on behalf of the patients he recruited. These Medicare beneficiaries were billed for home health care and therapy services that were medically unnecessary and/or not provided.
From approximately January 2006 through March 2009, Serendipity submitted approximately $20 million in claims for home health services that were not medically necessary and/or not provided, and Medicare paid approximately $14 million for these fraudulent claims. As a result of Lozano’s participation in the illegal scheme, the Medicare program was fraudulently billed more than $1 million but less than $2.5 million for purported home health care services.
In a related case, on June 21, 2012, Ariel Rodriguez and Reynaldo Navarro, the owners and operators of Serendipity, were sentenced to 73 and 74 months in prison, respectively, and ordered to pay $14 million in restitution and severally with each other and their co-defendants, Melissa Rodriguez and Ysel Salado. Ariel and Melissa Rodriguez, Navarro and Salada each pleaded guilty in March 2012 to one count conspiracy to commit health care fraud.
This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Monday, May 6, 2013
Patient Recruiter of Miami Home Health Company Sentenced to 37 Months in Prison for Role in $20 Million Health Care Fraud Scheme
A patient recruiter for a Miami health care company was sentenced today to serve 37 months in prison for his participation in a $20 million Medicare fraud scheme, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.
Manuel Lozano, 65, was sentenced by U.S. District Judge Joan A. Lenard in the Southern District of Florida. In addition to his prison term, Lozano was sentenced to serve two years of supervised release and ordered to pay $1,851,000 in restitution, jointly and severally with co-conspirators.
In February 2013, Lozano pleaded guilty to one count of conspiracy to receive health care kickbacks.
According to court documents, Lozano was a patient recruiter who worked for Serendipity Home Health, a Miami home health care agency that purported to provide home health and therapy services to Medicare beneficiaries.
According to court documents, from approximately April 2007 through March 2009, Lozano recruited patients for Serendipity, and in doing so he solicited and received kickbacks and bribes from the owners and operators of Serendipity in return for allowing the company to bill the Medicare program on behalf of the patients he recruited. These Medicare beneficiaries were billed for home health care and therapy services that were medically unnecessary and/or not provided.
From approximately January 2006 through March 2009, Serendipity submitted approximately $20 million in claims for home health services that were not medically necessary and/or not provided, and Medicare paid approximately $14 million for these fraudulent claims. As a result of Lozano’s participation in the illegal scheme, the Medicare program was fraudulently billed more than $1 million but less than $2.5 million for purported home health care services.
In a related case, on June 21, 2012, Ariel Rodriguez and Reynaldo Navarro, the owners and operators of Serendipity, were sentenced to 73 and 74 months in prison, respectively, and ordered to pay $14 million in restitution and severally with each other and their co-defendants, Melissa Rodriguez and Ysel Salado. Ariel and Melissa Rodriguez, Navarro and Salada each pleaded guilty in March 2012 to one count conspiracy to commit health care fraud.
This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
MONTANA HOSPITALS TO PAY NEARLY $4 MILLION TO RESOLVE FALSE CLAIM ACT VIOLATIONS
FROM: U.S. DEPARTMENT OF JUSTICE
Wednesday, May 1, 2013
Montana Hospitals Agree to Pay $3.95 Million to Resolve Alleged False Claims Act and Stark Law Violations
Hospitals Allegedly Compensated Physicians for Improper Referrals
St. Vincent Healthcare, a hospital located in Billings, Mont., and Holy Rosary Healthcare, a hospital located in Miles City, Mont., have agreed to pay $3.95 million plus interest to resolve allegations that they violated the Stark Law and the False Claims Act by improperly providing incentive pay to physicians that made referrals to the hospitals, the Justice Department announced today.
The Stark Law forbids a hospital from billing Medicare for certain services referred by physicians who have a financial relationship with the hospital unless that relationship falls within certain exceptions. A prohibited financial relationship includes a hospital’s agreement to compensate a physician in a manner that takes into account the volume of the physician’s referrals or the revenue realized through those referrals.
The settlement announced today resolves allegations that the hospitals paid several physicians incentive compensation that took into account the value or volume of their referrals by improperly including certain designated health services in the formula for calculating physician incentive compensation. These issues were disclosed by the hospitals to the government.
"The resolution of this matter underscores our commitment to ensure that services reimbursable by federal health care programs are based on the best interests of patients rather than the personal financial interests of referring physicians," said Stuart F. Delery, Acting Assistant Attorney General for the Department’s Civil Division.
"Combating health care fraud is a top priority of the Department of Justice and the Montana U.S. Attorney’s Office. St. Vincent Healthcare and Holy Rosary Healthcare allegedly put their financial interest ahead of their responsibility to provide cost effective health care. The United States recovered $3,950,000 of taxpayers’ dollars from the hospitals. The U.S. Attorney’s Office is committed to enforcing the Stark Law and False Claims Act, as well as other health care laws and regulations against wrongdoers. This case also demonstrates how the Department of Justice will work with those health care providers who disclose their misconduct," said Michael W. Cotter, U.S. Attorney for the District of Montana.
"There is an expectation that corporations providing services to Medicare and Medicaid beneficiaries adhere to the provision of the Stark Law. I applaud St. Vincent Healthcare and Holy Rosary Healthcare for recognizing their potential liability in this matter and making a disclosure," said Gerry Roy, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services region including Montana. "Working closely with our partners at the Department of Justice, we will vigilantly protect federal health care programs against violations of the Stark Law."
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services, in May 2009. The partnership between the two departments has focused on efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover $10.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.2 billion.
Wednesday, May 1, 2013
Montana Hospitals Agree to Pay $3.95 Million to Resolve Alleged False Claims Act and Stark Law Violations
Hospitals Allegedly Compensated Physicians for Improper Referrals
St. Vincent Healthcare, a hospital located in Billings, Mont., and Holy Rosary Healthcare, a hospital located in Miles City, Mont., have agreed to pay $3.95 million plus interest to resolve allegations that they violated the Stark Law and the False Claims Act by improperly providing incentive pay to physicians that made referrals to the hospitals, the Justice Department announced today.
The Stark Law forbids a hospital from billing Medicare for certain services referred by physicians who have a financial relationship with the hospital unless that relationship falls within certain exceptions. A prohibited financial relationship includes a hospital’s agreement to compensate a physician in a manner that takes into account the volume of the physician’s referrals or the revenue realized through those referrals.
The settlement announced today resolves allegations that the hospitals paid several physicians incentive compensation that took into account the value or volume of their referrals by improperly including certain designated health services in the formula for calculating physician incentive compensation. These issues were disclosed by the hospitals to the government.
"The resolution of this matter underscores our commitment to ensure that services reimbursable by federal health care programs are based on the best interests of patients rather than the personal financial interests of referring physicians," said Stuart F. Delery, Acting Assistant Attorney General for the Department’s Civil Division.
"Combating health care fraud is a top priority of the Department of Justice and the Montana U.S. Attorney’s Office. St. Vincent Healthcare and Holy Rosary Healthcare allegedly put their financial interest ahead of their responsibility to provide cost effective health care. The United States recovered $3,950,000 of taxpayers’ dollars from the hospitals. The U.S. Attorney’s Office is committed to enforcing the Stark Law and False Claims Act, as well as other health care laws and regulations against wrongdoers. This case also demonstrates how the Department of Justice will work with those health care providers who disclose their misconduct," said Michael W. Cotter, U.S. Attorney for the District of Montana.
"There is an expectation that corporations providing services to Medicare and Medicaid beneficiaries adhere to the provision of the Stark Law. I applaud St. Vincent Healthcare and Holy Rosary Healthcare for recognizing their potential liability in this matter and making a disclosure," said Gerry Roy, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services region including Montana. "Working closely with our partners at the Department of Justice, we will vigilantly protect federal health care programs against violations of the Stark Law."
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services, in May 2009. The partnership between the two departments has focused on efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover $10.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.2 billion.
Sunday, May 5, 2013
HEALTHCARE COMPANY PAYS OUT $14.1 MILLION TO RESOLVE FALSE CLAIMS ACT ALLEGATIONS
FROM: U.S. DEPARTMENT OF JUSTICE
Friday, May 3, 2013
Adventist Health Pays United States and State of California $14.1 Million to Resolve False Claims Act Allegations
Adventist Health System/West, dba Adventist Health, and its affiliated hospital White Memorial Medical Center have agreed to pay the United States and the state of California $14.1 million to settle claims that they violated the False Claims Act, the Justice Department announced today. Adventist Health is headquartered in Roseville, Calif., in the Eastern District of California, and operates 19 hospitals and over 150 clinics in California, Hawaii, Oregon and Washington. White Memorial Medical Center is a teaching hospital located in Los Angeles.
The settlement announced today resolves allegations that Adventist Health improperly compensated physicians who referred patients to the White Memorial facility by transferring assets, including medical and non-medical supplies and inventory, at less than fair market value. Additionally, Defendant White Memorial paid referring physicians compensation that the United States contended was above fair market value to provide teaching services at its family practice residency program. The United States alleged that these payments violated the Anti-Kickback Act and Stark Statute, and by extension, the False Claims Act. Approximately $11.5 million of the settlement will be paid to the U.S. Government, most of which will benefit the Medicare Trust Fund. The remaining $2.6 million will be paid to California’s Department of Health Care Services.
The Anti-Kickback Act prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and/or other federally-funded programs. The Stark Statute prohibits a hospital from submitting claims for patient referrals made by a physician with whom the hospital has an improper financial arrangement. Both the Anti-Kickback Act and Stark Statute are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and is instead based on the best interests of the patient.
"Kickbacks and other unlawful financial arrangements cost taxpayer dollars and undermine the integrity of medical judgments," said Stuart F. Delery, the Acting Assistant Attorney General for the Civil Division. "The Department of Justice is committed to making sure that physician referrals do not involve payments made in violation of federal law."
"The setttement announced today underscores one of the key purposes of the Stark and Anti-Kickback laws – to ensure that the judgment exercised by health care providers is based on legitimate patient needs and is not influenced by illegal payments," said Benjamin B. Wagner, U.S. Attorney for the Eastern District of California.
"Payouts made by hospitals and clinics – as the government alleged in this case – raise substantial concerns about physician independence and objectivity," said Ivan Negroni, Special Agent in Charge of the Office of Inspector General, U.S. Department of Health and Human Services San Francisco region. "Taxpayers and vulnerable patients rightfully expect such payments to be investigated and pursued."
The settlement announced today resolves a lawsuit filed in the Eastern District of California under the qui tam, or whistleblower, provisions of the False Claims Act. These provisions allow private citizens to bring civil actions on behalf of the United States and share in any recovery. The whistleblowers in this case will collectively receive $2,839,219 of the recovery. The lawsuit is captioned U.S. ex rel. Hector Luque et al. v. Adventist Health et al. No. 2:08CV1271 (E.D. Cal.).
As part of the settlement, White Memorial has entered into a comprehensive five-year Corporate Integrity Agreement with the Office of Inspector General of the U.S. Department of Health and Human Services to ensure its continued compliance with federal health care benefit program requirements.
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $10.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.2 billion.
This case was handled by the United States Attorney’s Office for the Eastern District of California, the Justice Department’s Civil Division, and the Office of Inspector General of the Department of Health and Human Services. The claims settled by this agreement are allegations only, and there has been no determination of liability.
Friday, May 3, 2013
Adventist Health Pays United States and State of California $14.1 Million to Resolve False Claims Act Allegations
Adventist Health System/West, dba Adventist Health, and its affiliated hospital White Memorial Medical Center have agreed to pay the United States and the state of California $14.1 million to settle claims that they violated the False Claims Act, the Justice Department announced today. Adventist Health is headquartered in Roseville, Calif., in the Eastern District of California, and operates 19 hospitals and over 150 clinics in California, Hawaii, Oregon and Washington. White Memorial Medical Center is a teaching hospital located in Los Angeles.
The settlement announced today resolves allegations that Adventist Health improperly compensated physicians who referred patients to the White Memorial facility by transferring assets, including medical and non-medical supplies and inventory, at less than fair market value. Additionally, Defendant White Memorial paid referring physicians compensation that the United States contended was above fair market value to provide teaching services at its family practice residency program. The United States alleged that these payments violated the Anti-Kickback Act and Stark Statute, and by extension, the False Claims Act. Approximately $11.5 million of the settlement will be paid to the U.S. Government, most of which will benefit the Medicare Trust Fund. The remaining $2.6 million will be paid to California’s Department of Health Care Services.
The Anti-Kickback Act prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and/or other federally-funded programs. The Stark Statute prohibits a hospital from submitting claims for patient referrals made by a physician with whom the hospital has an improper financial arrangement. Both the Anti-Kickback Act and Stark Statute are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and is instead based on the best interests of the patient.
"Kickbacks and other unlawful financial arrangements cost taxpayer dollars and undermine the integrity of medical judgments," said Stuart F. Delery, the Acting Assistant Attorney General for the Civil Division. "The Department of Justice is committed to making sure that physician referrals do not involve payments made in violation of federal law."
"The setttement announced today underscores one of the key purposes of the Stark and Anti-Kickback laws – to ensure that the judgment exercised by health care providers is based on legitimate patient needs and is not influenced by illegal payments," said Benjamin B. Wagner, U.S. Attorney for the Eastern District of California.
"Payouts made by hospitals and clinics – as the government alleged in this case – raise substantial concerns about physician independence and objectivity," said Ivan Negroni, Special Agent in Charge of the Office of Inspector General, U.S. Department of Health and Human Services San Francisco region. "Taxpayers and vulnerable patients rightfully expect such payments to be investigated and pursued."
The settlement announced today resolves a lawsuit filed in the Eastern District of California under the qui tam, or whistleblower, provisions of the False Claims Act. These provisions allow private citizens to bring civil actions on behalf of the United States and share in any recovery. The whistleblowers in this case will collectively receive $2,839,219 of the recovery. The lawsuit is captioned U.S. ex rel. Hector Luque et al. v. Adventist Health et al. No. 2:08CV1271 (E.D. Cal.).
As part of the settlement, White Memorial has entered into a comprehensive five-year Corporate Integrity Agreement with the Office of Inspector General of the U.S. Department of Health and Human Services to ensure its continued compliance with federal health care benefit program requirements.
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $10.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.2 billion.
This case was handled by the United States Attorney’s Office for the Eastern District of California, the Justice Department’s Civil Division, and the Office of Inspector General of the Department of Health and Human Services. The claims settled by this agreement are allegations only, and there has been no determination of liability.
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