That’s not a misprint. A whistleblower is about to receive $28 million for blowing the whistle on healthcare fraud. Even crazier, the whistleblower was only with the company that broke the law for a few short months.
The U.S. Attorney’s Office in Nashville, Tennessee says a call center employee will receive over $28 million for blowing the whistle on a mail order diabetic testing supply scheme. State and federal prosecutors say Arriva Medical violated the False Claims Act by paying kickbacks to Medicare and Medicaid beneficiaries. Some of the patients who “qualified” for testing supplies were already dead!
The case began in February 2013 when Gregory Goodman started working as a telephone sales rep for Arriva Medical. Arriva was a fast growing mail order medical supply business that sold glucose meters, test strips, lancets and other diabetic testing supplies.
Within weeks Goodman realized that something was wrong. He says Arriva was:
- fraudulently billing Medicare for thousands of glucose meters that were not medically necessary,
- offering kickbacks to their customers―in the form of free, “upgraded” meters and forgiving copayments―to induce beneficiaries to obtain their diabetes testing supplies from Arriva and to further induce beneficiaries to order unnecessary products and services covered and partially paid for by Medicare,
- offering kickbacks, in the form of forgiving copayments, to secondary insurance providers Express Scripts, Inc. (“ESI”) and United Healthcare (“United”) to induce those insurers to refer their Medicare-covered, diabetic patients to defendants to obtain diabetic testing supplies,
- illegally marketing heating pads, back braces, and impotence therapy devices to new patients during calls to place orders for diabetic testing supplies, and then billing government healthcare programs for these illegally marketed items,
- illegally billing Medicare for diabetic supplies without having the necessary prescriptions on file from beneficiaries’ physicians, and
- illegally inducing beneficiaries to switch from one brand of diabetic testing supplies to another.
According to his complaint, Goodman said, Arriva “instructed their sales associates to ‘up-sell’ beneficiaries on every phone call the associates made. Specifically, the sales associates were instructed to market heating pads, back braces and impotence therapy devices to every patient they spoke to, regardless of whether the patient had ever asked about these products.”
By August, Gregory Goodman had seen enough and filed a formal whistleblower complaint in federal court.
On August 2nd, 2021, Arriva Medical settled the government’s charges. Arriva will a penalty of $160,000,000.00. Goodman is slated to receive a whistleblower reward of $28,548,749 as his share. Two former Arriva executives also agreed to each pay $500,000 for their role in the scheme. All were allowed to settle without admitting guilt.
In announcing the settlement, a Justice Department spokesperson said, “Paying illegal inducements to Medicare beneficiaries in the form of free items and routine copayment waivers can result in overutilization and waste taxpayer funds. We will continue to protect the integrity of the Medicare program by pursuing fraudulent claims arising from violations of the Anti-Kickback Statute or other applicable reimbursement requirements.”
Whistleblower Rewards for Medicare and Medicaid Fraud
The case against Arriva involved mostly Medicare fraud. Both the Medicaid and Medicare program, however, pay cash rewards to whistleblowers with inside information about fraud. Under the federal False Claims Act, whistleblowers can receive between 15% and 30% of whatever the government receives from the wrongdoers. 29 states have similar reward programs that cover state funded Medicaid.
The government says the False Claims Act is one of its most important and powerful tools its arsenal against fraud. Tips and complaints from all sources about potential fraud, waste abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477). All fifty states also have a Medicaid Fraud Control Unit for reporting state funded Medicaid fraud.
Calling Medicare or the the states does not get you a reward. The only way to collect a reward is to file a complaint with the court.
Our team of Medicare fraud lawyers have years of experience in ferreting out healthcare fraud and obtaining substantial rewards for our clients. Our team also has the experience to help you put an end to the illegal fraud and to maximize any reward for which you may be eligible. Our lawyers do not charge upfront fees or costs, in fact, you only pay if they are successful and you receive a reward.
To learn more, visit our Medicare fraud whistleblower information page. Ready to see if you qualify for a reward? Contact us online, by email or by phone 202-800-9791. All inquiries kept strictly confidential.