Consumer Fraud

3 Whistleblowers share $6 million award in case against Texas hospital

whistleblower 3 Whistleblowers share $6 million award in case against Texas hospitalThree whistleblowers will share an award of nearly $6 million for their role in helping the federal government recover $21.75 million from a Texas hospital that allegedly profited by maintaining improper financial relationships that violated the Stark Statute and the False Claims Act.

According to the U.S. Justice Department, the three whistleblowers, Dakshesh “Kumar” Parikh, Harish Chandna, and Ajay Gaalla sued Citizens Medical Center in Victoria, Texas, under the qui tam provisions of the False Claims Act.

The whistleblowers alleged that the hospital, which is owned by Victoria County, Texas, over-compensated several cardiologists for the services they provided and paid bonuses to emergency room physicians that took into account the value of their cardiology referrals – violations of the Stark Statute and the False Claims Act.

The Stark Statute regulates the financial relationships hospitals can have with physicians who refer patients to them. The False Claims Act is designed to fight false and inflated claims submitted to taxpayer-funded agencies and programs such as Medicare and Medicaid.

The whistleblowers will share an award of $5,981,250 for their role in exposing the Stark Statute scheme, the U.S. Justice Department said.

The False Claims Act authorizes private individuals to sue on behalf of the federal government when they have good, original evidence of fraud and other misconduct targeting taxpayer-funded programs and agencies. Most False Claims Act whistleblower lawsuits involve health care fraud and other violations.

Principal Deputy Assistant Attorney General Benjamin Mizer of the Justice Department’s Civil Division said that “improper financial relationships between health care providers and their referral sources … can alter a physician’s judgment about the patient’s true health care needs and drive up health care costs for everybody.”


U.S. Department of Justice