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The False Claims Act allows relators (whistleblowers) to file a claim on behalf of the United States government to recover fraudulently received funds. One such case is proceeding in Missouri where a nursing home is being alleged of Medicare Fraud.
Four businesses listed as defendants in a Medicare fraud case, which involved an alleged kickback scheme for providing contract therapy at 60 Missouri nursing homes, have agreed to pay the federal government $30 million, including RehabCare Group Inc. and RehabCare Group East Inc. paying $25 million and Rehab Systems of Missouri of Dexter, Mo., and Health Systems Inc. of Sikeston, Mo., paying $5 million.
Under the False Claims act a person can serve as a relator and file a lawsuit to receive a portion of the funds eventually recovered by the Government. A lawsuit is filed under seal, during which time the Government investigates potential wrongdoing. This potential wrongdoing may lead to millions of dollars in recovery, such as this set of cases in St. Louis, Missouri. Under the government’s whistleblower program, Health Dimensions Rehabilitation, an employee-owned company, will receive a $5.7 million whistleblower award as its relator share. Health Dimensions Rehabilitation is a competitor of RehabCare, which had contracts with about 50 nursing homes in Minnesota, according to the St. Louis Post Dispatch.
“The case was settled — not because of any liability, but to avoid any further cost of litigation,” said attorney Scott Hinkle of St. Louis, who represented Health Systems. “If we went to trial, we were confident we could have won the case.” This seems somewhat interesting as Thirty Million Dollars seems a tad bit more than the normal amount of legal fees in a case.
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