Medtronic Inc. Agrees to $9.9 Million Settlement in Whistleblower Lawsuit

June 18, 2014 — Medtronic Inc., the Minnesota manufacturer of pacemakers and defibrillators, has resolved Medicare fraud charges alleged against it in a whistleblower lawsuit brought by a former employee. The False Claims Act lawsuit alleged that Medtronic paid kickbacks to encourage doctors to use the manufacturer’s medical devices when performing heart surgery. Under the qui tam provisions of the statute, tipsters who notify the government of False Claims Act violations by filing a lawsuit are eligible for a sizable share of any recovery.
The company will pay the United States $9.9 million. Adolfo Schroeder, the whistleblower, will receive more than $1.7 million as a reward for his willingness to come forward.

Pacemaker Manufacturer Allegedly Paid Kickbacks to Heart Doctors

Pacemakers and defribrillators are used by cardiologists in the treatment of cardiac rhythmic disease. But the decision whether to implant a medical device in a person’s body should be made based on what’s best for the patient, not the doctor. That’s why it’s illegal for a medical device maker to pay financial incentives to a physician or for anyone to submit reimbursement claims to federally funded health care programs like Medicare and Medicaid as part of some kickback operation.
Medtronic’s goal reportedly was to convince doctors either to continue the use of Medtronic pacemakers or to switch to Medtronic products from a competitor’s brand. The manufacturer allegedly influenced doctors in a variety of ways. The kickbacks might be something as simple as free tickets to sporting events. Or, Medtronic might pay agreeable physicians to lecture at events arranged to increase the flow of the doctors’ referral business.

Company Insiders Lead the Fight Against Medicare Fraud

Kickback operations and false claims to Medicare are often revealed by insiders, as in this medical device case. George Tankard and Anne Izzo, knowledgeable lawyers in Waters & Kraus’ Baltimore office, guide whistleblowers through the process, protecting their interests. Contact us by email or phone our False Claims Act lawyers at 855.784.0268 to collaborate with us to safeguard Medicare spending for those who need it.

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