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Chicago-Based LifeWatch Services Inc. Settles Claims for Medicaid Fraud

The Department of Justice (DOJ) has reported a settlement with Chicago-based Lifewatch Services Inc. for submitting false claims to Medicare for Ambulatory Cardiac Telemetry Services. The company will pay the U.S. government $18.5 million. As part of the settlement, LifeWatch is also required to participate in a comprehensive Corporate Integrity Agreement (CIA) to ensure the company’s future compliance.

LifeWatch is accused of fraudulently billing Medicare for ambulatory cardiac telemetry (ACT) services that the company knew were not eligible for reimbursement. ACT services provide cardiac event monitoring using cell phone technology without requiring patient participation. Traditional event monitoring requires the patient to push a button to record a cardiac event. ACT services are reimbursed by Medicare at a much higher rate.

Allegedly, even though LifeWatch knew ACT services were ineligible for Medicare reimbursement when the patient suffered only mild to moderate palpitations, the company still submitted false claims to Medicare for these patients and used a phony diagnostic code to trick Medicare into paying on the claims.

The complaints against Lifewatch also alleged that LifeWatch provided free, full-time employees to hospitals and medical practices as kickbacks.

A former LifeWatch sales representative blew the whistle on LifeWatch’s Medicare fraud by filing a qui tam lawsuit in December 2009.  Another former LifeWatch sales representative filed a similar complaint in another state in May 2011. Under the False Claims Act, whistleblowers who know about fraud against the government, like these former LifeWatch employees, are able to bring a lawsuit on behalf of the government and share in any recovery.

In this case, the whistleblowers will share a total of $3.4 million plus interest for their role in bringing this enormous healthcare fraud to light.

Waters & Kraus is a national firm with highly skilled lawyers practicing qui tam litigation in four offices, including Dallas, Los Angeles, San Francisco, and Baltimore. Our attorneys have decades of experience successfully representing whistleblowers in a variety of fraud cases. Contact us or call one of our attorneys at 800.226.9880 to learn more about our practice and how we can assist.

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