Legal Eagle Eye Newsletter for the Nursing Profession(4)4 Jan 96  PDF Version

   Quick Summary: It violates the Federal False Claims Act to terminate an employee who blows the whistle on the employer for false or fraudulent Medicare billing practices and the employee can file a retaliatory discharge lawsuit.

   The Federal False Claims Act, which has been in effect since 1863, empowers a private individual to bring a suit against persons who knowingly present false or fraudulent claims to the U.S. Government for approval or payment in violation of law.

   In this case there were claims of overuse and misuse of spirometry tests and MRI’s for Medicare patients.

   In addition, after the responsible parties were confronted with these claims, the person who had uncovered them was discharged from her employment.

   The court needed to hear specific facts to support the employee’s case, which she was able to supply. It would not allow the employee to go on a "fishing expedition" for potentially improper Medicare billings in the employer’s records. UNITED STATES DISTRICT COURT, NEW YORK, 1995.

   Allegations were made that spirometry tests were being performed incorrectly, performed with uncalibrated instruments, repeatedly administered to patients when unnecessary, and administered without subsequent interpretation of the test results.

   Likewise, it was claimed that expensive MRI’s were ordered to the exclusion of more diagnostically-useful and less expensive x-rays and CT scans, that MRI’s were ordered when they simply were unnecessary, and that they were ordered to be performed upon parts of patients’ bodies which had no relation to the diagnosis and treatment of their medical ailments.

   There were further allegations of corporate interconnections between the referring physicians and the facilities which did the MRI’s, and that two of the referring physicians in fact received substantial yearly "consulting fees" from the MRI facilities, in violation of Federal law and state Medicare regulations.

   The United States District Court for the Southern District of New York, in its opinion in this case, ruled that the false claims and "whistle-blowing" provisions of the Federal False Claims Act apply to false or improper Medicare billings.

   The court did not rule on the validity of the specific allegations of improper Medicare billing practices. At this stage in this litigation the task for the court was only to find that there was on file a sufficiently accurate and detailed affidavit of the events in question to permit trial to go forward on the allegations that had been raised.

   The court ruled that the employee had made out a prima facie case of false and/or fraudulent Medicare billing practices, and had not launched upon a "fishing expedition" to try to uncover potential discrepancies or errors in the defendants’ records to justify her suit having been filed. Mikes vs. Strauss, 889 F. Supp. 746 (S.D.N.Y., 1995).

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