Consumer Fraud

U.S. takes over whistleblower lawsuit against national hospital care provider

osha whistle U.S. takes over whistleblower lawsuit against national hospital care providerThe U.S. Justice Department said it has chosen to intervene in a whistleblower lawsuit against IPC The Hospitalist Co. of North Hollywood, Calif., – a national hospital care provider with more than 1,300 facilities in 28 states.

Dallas, Texas, physician Bijan Oughatiyan filed the lawsuit in 2009 under the qui tam, or whistleblower provisions of the False Claims Act, which allow private-sector employees to sue on behalf of the U.S. government when they have evidence that their employer or affiliated company defrauded taxpayer-funded programs such as Medicare and Medicaid or government agencies.

Dr. Oughatiyan worked for IPC in San Antonio from 2003 to 2008. He alleges in his lawsuit that IPC physicians sought payment from the federal government for higher and more expensive levels of medical service than were actually performed – a practice commonly referred to as “upcoding.”

According to the lawsuit, IPC encouraged its physicians to bill at the highest possible levels regardless of the actual service provided. The lawsuit also alleges IPC trained physicians on how to use higher level codes for lesser services and pressured physicians with lower billing levels to “catch up” to their peer who were overbilling Medicare.

The False Claims Act also allows the federal government to intervene in a whistleblower lawsuit, essentially taking it over, as it has done in this case. Whether or not the government becomes directly involved in the case, the whistleblower receives a share of the recovery, usually between 15 and 30 percent.

Under the terms of the False Claims Act, the government can recover three times its damages plus civil penalties.

The Justice Department said that its intervention in the whistleblower suit against IPC demonstrates the government’s ramped-up efforts to combat health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, a task force formed by an alliance of the Justice Department with the Department of Health and Human Services.

The False Claims Act is one of the government’s greatest weapons in recovering money fraudulently taken from federal health care programs. Since January 2009, the Justice Department has recovered more than $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.


U.S. Department of Justice