Qui Tam

Background

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There have been varying reports concerning the vast amount of government fraud that occurs under the Qui Tam or whistleblower category.  These amounts range from $100 billion to $250 billion each year.

Qui Tam is taken from a Latin phrase, which in essence means that a person who assists in the prosecution on behalf of the government is entitled to receive a certain amount of the recovered funds.  This amount can be up to 30% of the recovered funds. If the government intervenes in the case and the case is successful through a settlement or a trial, the whistleblower, or “relator,” is entitled to 15 percent to 25 percent of the amounts collected by the government. If the government declines to intervene in the case and the whistleblower successfully pursues it, the whistleblower reward is between 25 percent and 30 percent of the amounts collected.

Timing is very important because of the “First to File” rule. The First to File rule means that only the first person to file can obtain a recovery if the case is successful.  All others will be entitled to nothing.

Often, these fraudulent activities are done to cheat the system, while others are done because the company simply doesn’t want to follow the federal rules and regulations.

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According to one report, in 2016, there were over $500 million awarded to whistleblowers under the False Claims Act.

Of the $3 billion in settlements and judgments reported by the government in fiscal year 2019, over $2.1 billion arose from lawsuits filed under the qui tam provisions of the False Claims Act.  During the same period, the government paid out $265 million to the individuals who exposed fraud and false claims by filing these actions.

The number of lawsuits filed under the qui tam provisions of the Act has grown significantly since 1986, with 633 qui tam suits filed this past year – an average of more than 12 new cases every week.

Quite often, Qui Tam cases involve healthcare related companies and Medicare.  Folks who are likely to know of fraudulent activity include:

•Administrators for hospitals, nursing homes, and hospice care

•Doctors, nurses and even physician assistants

•Finance department employees

•Accountants

•Benefit administrators and consultants

Medical billing and coding specialists and supervisors

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Typical occurrences of fraud by hospitals, nursing homes, hospice care facilities, and other healthcare related companies include:

•Billing for medical services that were not provided to patients

•Billing for supplies that were never purchased or used

•Admitting patients to hospitals, nursing homes, and hospice care centers who do not meet the eligibility requirements of Medicare or Medicaid

•Kickbacks

•Upcoding – billing for a more expensive procedure than the one performed

•Defense contractors – selling substandard parts

•Price manipulation to avoid government “best price” requirement

•Double-billing

•Unbundling – billing separately for related procedures or lab tests that were performed together

•Knowingly mischaracterizing medical services so that they are reimbursed by Medicare or Medicaid

•Overcharging for costs of ambulance services

•Billing Medicare or Medicaid for services performed by medical residents without the required participation of a supervising teaching physician

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