Hope Cancer Institute recently settled a lawsuit that was filed in March 2012 alleging the medical facility had defrauded federal health care programs. Also named in the suit was Hope Cancer Institute’s owner Dr. Raj Sadasivan. The settlement includes $2.9 million in reimbursement and penalties to be paid to the US government. The institute is located in Kansas City, Kansas.
The lawsuit began when three employees brought their allegations of fraud against Hope to federal authorities. The suit claimed Hope was overcharging Medicaid and Medicare for the cancer drugs it was using in its facility. According to the claim, Dr. Sadasivan submitted numerous false medical records that sometimes listed up to two times the dosage of chemotherapy medication he was actually prescribing for patients. There are no allegations regarding patients’ treatments, but it appears the facility was padding its pockets thanks to the payments from Medicare and Medicaid.
The investigation by attorneys for the US Department of Justice began shortly after charges were levied. As a result, Hope and Dr. Sadasivan are required to pay $2,945,187, as well as interest to settle the claims. Additionally, the cancer center is barred from working with Medicaid, Medicare, and other federal health programs for the next decade. This means patients seeking treatment at the facility will need to pay their costs out of pocket or with private health insurance provided the private companies agree to pay. Those covered by Medicare, Medicaid, or federal ACA programs will likely receive no payment assistance for treatments undergone at Hope.
The three employees who filed the claim against Hope were represented by attorneys from Brady & Associates in Overland Park, Kansas. They are protected by the federal False Claims Act, designed to combat fraud and protect whistleblowers from retaliation after reporting employer misconduct. The law, as well as state laws, might also provide significant recovery for employees who speak out against fraud.
The goal of the compensation provided to the whistleblowers is to encourage people to report fraud and to protect them against dismissal from their employer. The recovery amount is often substantial and the award for those damaged by retaliation can include “all relief necessary to make the employee whole.” In other words, if an employer fires a whistleblower for reporting fraud, they could be held responsible for the total amount that employee would have earned, as well as payment for benefits, and other damages. The employer might also be required to rehire the employee and pay litigation costs and attorney’s fees. The Department of Labor administers 15 whistleblower provisions that protect employees disclosing information about violation of laws pertaining to airline, trucking, nuclear, environmental, rail, and workplace safety.
Similar protection is provided under the Dodd-Frank Act for employees reporting violations of securities laws to the SEC or Commodities Futures Tradition Commission. Likewise, federal employees are protected from retaliation under the Whistleblower Protection Act prohibiting federal agencies from punishing employees for whistleblowing. In addition to termination, whistleblowing laws offer protection for employees demoted, intimidating, reassigned, or passed over or promotions because of their actions.