September 15, 2015: Settlement discussions afoot in S.D.N.Y. FCA Qui Tam lawsuit over failure to repay Medicaid overpayments within 60 Days

In 2011, Robert Kane, a former employee of Continuum Health
Partners, Inc., filed an FCA qui tam lawsuit under seal in the Federal District Court for the Southern District Court of New York alleging that he was fired after he internally reported
Conituum’s failure to reimburse the government for Medicaid overpayments within
60 days as required by the Affordable Health Care Act. As a Relator, Kane named
other entities, including Healthfirst, Inc., a non-profit insurance program
which caused a network of New York City non-profit hospitals operated and
coordinated by Continuum to submit improper Medicaid claims for payment to the
government. The DOJ investigated the allegations, and the case was unsealed in
June of 2014 when the DOJ intervened. On August 3, 2015, Judge Ramos of the
S.D.N.Y. denied the defendants’ motion to dismiss the lawsuit, finding that as
soon as the defendants were put on notice of the possible overpayments, the 60 day
ACA clock started ticking. Judge Ramos ruled that the defendants will need to
present solid proof of good-faith efforts to investigate and address the
problem in order to avoid FCA liability. The DOJ is seeking treble damages,
penalties of $11,000 for each overpayment retained beyond the 60 days, and
costs of suit. The total damages could well exceed $100M. On September 15,
2015, the DOJ notified Judge Ramos that serious settlement discussions in the
case were underway. As a Relator, Kane stands to recover a substantial portion
of any settlement. The Law Offices of
Elizabeth “Booka” Smith, LLC investigates potential FCA qui tam lawsuits and advises potential relators how to present
their case to the DOJ such that the DOJ will opt to intervene, thereby
maximizing the likelihood of success for the relator. If you have information
that a company is in violation of the FCA for defrauding the government and are
considering becoming a relator in a potential qui tam lawsuit, CONTACT US to schedule an initial consultation and
to evaluate potential representation.