Breaking Legal News: Whistle Blower Lawsuit Results in Medicare Fraud Settlement of Forty-One Million Eight Hundred Thousand Dollars ($41,800,000)

David A. Burkhalter, II
Attorney
P.O. Box 2777
Knoxville, TN 37901
Phone: (865) 524-4974
Fax: (865) 524-0172
david@burkhalterrayson.com

U.S. SETTLES CIVIL FRAUD MEDICARE FRAUD COMPLAINT WITH HILL-ROM COMPANY, INC. WHICH PAYS $41,800,000.

Fraud exposed by Tennessee Whistle Blowers who will receive $8,360,000.00.

David A. Burkhalter, II, Attorney, Knoxville, Tennessee, represented whistle blowers.

KNOXVILLE, TN. (September 27, 2011) – Hill-Rom Company, Inc. entered into an agreement with the United States acting through the U.S. Department of Justice on behalf of the Office of the Inspector General of the Department of Health and Human Services to pay forty-one million, eight hundred thousand dollars ($41,800,000) in settlement of a False Claims Act case filed in Federal Court for the Eastern District of Tennessee at Knoxville.

Today’s settlement results from a suit filed by Tennessee whistle blowers under the qui tam provisions of the Federal False Claims Act, 31 U.S.C. § 3729, et. seq.

The whistle blowers, Lisa Brocco of Nashville, Tennessee, and Laurie Salmons of Knoxville, Tennessee, filed their complaint in the U.S. District Court for the Eastern District of Tennessee, which sits in Knoxville, Tennessee: United States of America ex. rel. Laurie Salmons and Lisa Brocco v. Hill-Rom Company, Inc., United States District Court, Eastern District of Tennessee, 3:05-CV-210. The whistle blowers were represented by Attorney, David A. Burkhalter of Knoxville Tennessee. The False Claims Act qui tam provisions allow private parties to bring suits on behalf of the government where they have knowledge that the government has been cheated or defrauded, Mr. Burkhalter stated.

The settlement was entered into by Hill-Rom Company, Inc., with principal offices located in Batesville, Indiana. Hill-Rom is a major supplier of durable medical equipment, including hospital beds and support surfaces. The case was originally filed under seal on April 20, 2005, and it was thereafter investigated by the Government.

Laurie and Lisa decided to file this case after they learned during their employment that Hill-Rom was receiving payments from Medicare on patients who did not qualify. These two ladies knew this was wrong. The practice appeared to be widespread so they decided to do something about it. As the complaint alleged, some of these patients had died, and yet, claims continued to be submitted and Medicare continued to pay. After much soul searching, Laurie and Lisa, Senior Account Managers for Hill-Rom, made the decision to become whistle blowers and expose the fraud. At the time the suit was filed, Laurie had been laid off but Lisa was still employed. Lisa remains employed by Hill-Rom as of the current date. Laurie and Lisa are to be commended for having the courage to stand up and do the right thing. This was an especially courageous act on Lisa’s part, said Mr. Burkhalter.

Unfortunately, healthcare fraud can be very difficult to detect without inside information, and that is why whistle blower suits are such an important tool in the fight against fraud. There are numerous ways to game the system and new ways are being invented daily. Taxpayers should be thankful there are brave and honest people like Laurie and Lisa who are willing to come forward and expose fraud, said Mr. Burkhalter.

The False Claims Act is also known as “The Lincoln Law” because it was originally passed during the Civil War to combat rampant fraud involving military sales to the government. Federal and State False Claims Acts allow private citizens with knowledge of fraud to help the government recover ill-gotten gains and penalties. These statutes allow the government to collect up to three times the amount of the False Claims, and in addition, civil penalties of $5,500 to $11,000 per false claim. Burkhalter noted that: “Whistle blowers, known as qui tam relators, can receive an award for exposing fraud. In this case, Laurie and Lisa will share in an award of $8.36 million dollars.”

To date, in excess of $22 Billion Dollars has been recovered for the Government since the 1986 Amendments to the False Claims Act. Unfortunately, that is just the tip of the iceberg as law enforcement authorities estimate that healthcare fraud costs taxpayers more than $60 Billion each year, said Mr. Burkhalter.

Today’s settlement was achieved through the efforts of the U.S. Attorney’s office, including the efforts of Assistant U.S. Attorney, Elizabeth Tonkin who is in the Eastern District of Tennessee. Special Agents of the FBI and the Office of the Inspector General, Department of Health and Human Services, also assisted in the investigation and prosecution of the case. “They did an excellent job,” said Mr. Burkhalter.

As part of the Settlement Agreement, Hill-Rom which did not admit liability, also entered into a Corporate Integrity Agreement with the Office of Inspector General.

Note: Burkhalter, Rayson & Associates, P.C. is located in Knoxville, Tennessee and the firm is known for representing employees and injured parties, as well as whistleblowers in qui tam suits. For a copy of the Complaint that was filed, visit Burkhalter, Rayson & Associates, P.C.=s website at www.burkhalterlaw.com.

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