Omnicare Agrees to $124 Million Settlement in False Claims Act Lawsuit

July 7, 2014 — Omnicare Inc. will pay more than $124 million to settle False Claims Act allegations of Medicare and Medicaid fraud. Under the qui tam provisions of the statute, whistleblowers who collaborate with the Justice Department by filing a lawsuit for the government’s benefit are eligible for a share of the government’s recovery.

Two Whistleblowers Allege That Omnicare Violated Anti-Kickback Statute

No company provides more pharmaceutical and pharmacy services to the nation’s nursing homes than Omnicare, the Justice Department reports. In two separate qui tam lawsuits filed by whistleblowers under the False Claims Act, it was alleged that Omnicare improperly paid financial incentives to skilled nursing facilities in exchange for the providers’ continued reliance on Omnicare to supply drugs and services to Medicare and Medicaid recipients. The payment of such incentives allegedly violated the Anti-Kickback Statute, which prohibits the payment or receipt of any sort of remuneration in an effort to win business covered by Medicare and Medicaid. The purpose of the statute is to ensure that medical decisions are made with the patient’s best interests in mind, rather than the provider’s financial gain. Nursing homes for the elderly should choose a pharmacist that offers patients the best value and service, not one that provides the facility with illegal discounts.
Omnicare allegedly contracted with skilled nursing facilities to supply prescription drugs and other medications for Medicare and Medicaid patients at below-cost prices. Omnicare offered the deeply discounted pricing as an incentive to make sure that the facilities continued to use Omnicare as opposed to another provider. The nursing homes would bill Medicare and Medicaid for reimbursement for short-term rehabilitation services provided to their elderly patients. In addition, Omnicare filed reimbursement claims with the federal- and state-funded healthcare programs for the drugs Omnicare provided to the nursing homes.
Donald Gale is a former Omnicare employee and was the first whistleblower to file a lawsuit. Gale will receive $ 17.24 million for his share of the government’s recovery. Another $8.24 million of the $124 million settlement will be shared among several states in which Omnicare’s Medicaid violations allegedly occurred.

Health Care Insiders Thwart Medicare and Medicaid Fraud

Fraudulent billings to Medicare and Medicaid like those revealed in the case above are often brought to light by insiders. While Waters & Kraus is not handling this particular case, we are handling similar cases. If you have similar claims against a different pharmaceutical service and nursing facilities, contact us or call our attorneys at 855.784.0268. George Tankard and Anne Izzo, qui tam lawyers in Waters & Kraus’ Maryland office, protect tipsters throughout the whistleblower process.
Contact us by email or phone our False Claims Act lawsuit attorneys at 855.784.0268 to collaborate with us to preserve Medicaid and Medicare tax dollars for those who need it.

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