Medical products manufacturer C.R. Bard has agreed to pay the U.S. nearly $50 million to resolve allegations that it provided illegal financial rewards to customers and physicians for choosing its products to treat prostate cancer – a violation of the federal False Claims Act (FCA) and the Anti-Kickback statute.
The settlement resolves a lawsuit filed in the U.S. District Court for the Northern District of Georgia by Julie Darity, a former C.R. Bard manager for brachytherapy contracts. Ms. Darity sued C.R. Bard under the qui tam or whistleblower provisions of the False Claims Act, which allows private citizens to sue on behalf of the U.S. government and receive a percentage of the recovery. The former C.R. Bard manager will receive $10,134,600 for helping the U.S. recover federal health care funds.
According to the U.S. Justice Department, C.R. Bard allegedly provided illegal kickbacks in the form of grants, rebates, free medical equipment, and other financial rewards to customers and physicians as a way to induce them to buy small radioactive capsules known as brachytherapy seeds, which are used to deliver high doses of radiation to a tumor as a form of prostate cancer therapy.
Ultimately, hospitals billed Medicare for C.R. Bard’s brachytherapy seeds, which the U.S. Justice Department says amounted to false claims because of Bard’s illegal kickback activity.
“This settlement is part of the United States’ on-going effort to combat the payment of illegal kickbacks to health care providers,” Stuart F. Delery, Acting Assistant Attorney General for the Department of Justice’s Civil Division, explained. “Such illegal payments subvert the medical marketplace and provide an unfair advantage to those who break the law.”
Sally Quillian Yates, U.S. Attorney for the Northern District of Georgia, said that “illegal kickbacks in any form pervert our health care system, which is designed to insure that health care providers make decisions based solely on what is best for the patient” rather than on financial rewards.
The case against C.R. Bard and other similar resolutions are part of the federal government’s crackdown on health care fraud that depletes the nation’s vital Medicare and Medicaid funds. In May 2009, Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius announced a partnership of their departments called the Health Care Fraud Prevention and Enforcement Action Team (HEAT), an initiative aimed at reducing and preventing Medicare and Medicaid financial fraud.
By allowing private citizens to sue on behalf of the federal government and share in the recovery, the whistleblower provisions of False Claims Act have become some of the most powerful tools the federal government has in fighting fraud, waste, mismanagement, and other forms of corruption. Total recoveries under the False Claims Act since January 2009 have topped $14.3 billion, with nearly 75 percent of those recoveries involving health care fraud.