The federal government has filed suit against PharMerica Corp, a major long-term care pharmacy. The lawsuit was originally begun in 2009 by a former PharMerica employee turned whistleblower.
The government’s complaint was brought today under the federal False Claims Act and the Controlled Substances Act. It alleges that the pharmacy dispensed prescription drugs without a prescription and sought payment of the drugs from Medicare.
Under the False Claims Act, whistleblowers are entitled to a percentage of whatever the government collects. In this case, the government is seeking triple damages from the pharmacy corporation which could mean a great payday for the whistleblower, Jennifer Denk. According to a press release from the U.S. Department of Justice, two other whistleblowers also came forward in 2010 with additional information about the company. All were pharmacists at the company.
PharMerica does business across the United States including a large processing center in Pewaukee, Wisconsin. The government says the company fills 44 million prescriptions a year from 95 pharmacies across the U.S. Almost half of their scripts are paid by Medicare tax dollars.
The government’s complaint was filed in Wisconsin and is being prosecuted by the Justice Department, U.S. Attorney for the Eastern District of Wisconsin, the DEA and HEAT – the Health Care Fraud Prevention and Enforcement Action Team.
Although it is always depressing to see large companies ripping off taxpayers, we were not surprised to see the complaint centers around the long term care industry. Nursing homes often cut corners in the hopes of saving money. If the allegations of this complaint are true, however, patient safety was jeopardized.
The government’s complaint claims that PharMerica allowed nursing home staff to order narcotics without a valid prescription and without determining whether the drugs were medically necessary and safe for a particular patient’s needs. Although the suit was filed against the pharmacy – they billed Medicare for the drugs – nursing homes appear to be equally guilty if not more so for drugging elderly patients without a doctor’s order. According to Justice Department officials, some of the drugs allegedly dispensed by PharMerica included morphine and oxycodone.
James Santelle, Milwaukee’s U.S. Attorney, said, “The complaint we are filing today reflects the abiding commitment of the Justice Department to the qui tam [whistleblower] process, encouraging people with information about alleged fraud and abuse to report it in a timely and effective matter.”
A whistleblower in a false claims act case typically earns an award of 15 to 30% of whatever is collected by the government. To qualify as a whistleblower, one must have non public, “original source” information about a fraud to taxpayers or a taxpayer funded program. Common examples involve fraud to Medicare, FHA / Freddie Mac / Fannie Mae mortgage programs and procurement fraud (things sold to the government).
We caution that the filing of a complaint by the government does not mean the company is guilty of wrongdoing. Unless earlier settled, all parties will get their day in court.
If you wish to become a whistleblower and think you have a case, give us a call. We represent whistleblowers and help them stop fraud and collect the largest award possible.
Mahany & Ertl – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Minneapolis, Minnesota; Portland, Maine and San Francisco, California. Services available in many jurisdictions.
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Posted by Brian Mahany, Esq.