By Jim Kouri
The Department of Justice, in cooperation with the Department of Health and Human Services, has guided the enforcement efforts of the national Health Care Fraud and Abuse Control Program (HCFAC) since its inception in 1997.
The program was designed to coordinate federal, state and local law enforcement on cases of health care fraud and abuse as part of the Health Insurance Portability and Accountability Act (HIPAA).
In 2008, the Department’s efforts to investigate and prosecute the individuals and companies who commit health care fraud are as strong as ever, thanks in large part to the Department’s many components working closely with partners at the Department of Health and Human Services, and state and local law enforcement.
Strengthening Criminal Enforcement:
In recent years, the Department has stepped up its enforcement efforts related to health care fraud, including the following accomplishments in Fiscal Year 2007:
– U.S. Attorneys’ Offices opened 878 new criminal health care fraud investigations involving 1,548 potential defendants.
– Federal prosecutors had 1,612 health care fraud criminal investigations pending, involving 2,603 potential defendants, and filed criminal charges in 434 cases involving 786 defendants.
– A total of 560 defendants were convicted for health care fraud-related crimes during the year.
– In one of the most recent enforcement actions, on May 21, 2008, Jorge Alan Rodriguez Sanchez was indicted in the Eastern District of Pennsylvania for conspiring to distribute Schedule II controlled substances illegally through an Internet pharmacy.
Beginning in 2002, Rodriguez Sanchez allegedly sold via e-mail narcotic prescription drugs, such as Oxycontin, Vicodin and Xanax to customers without prescription or legitimate medical use. Rodriguez Sanchez did not require a prescription or physical examination by a licensed physician from any of his customers. He retrieved the money sent by the customers at a Western Union location in Mexico, but shipped the drugs from Southern California to customers throughout the United States, including the Philadelphia area.
– During FY 2007, the Department opened 776 new civil health care fraud investigations, and had 743 civil health care fraud investigations pending at the end of the fiscal year.
– During FY 2007, the federal government won or negotiated approximately $1.8 billion in judgments and settlements, and it attained additional administrative impositions in health care fraud cases and proceedings.
– The Medicare Trust Fund received transfers of approximately $797 million during this period as a result of these efforts, as well as those of preceding years, in addition to $266 million in federal Medicaid money separately transferred to the Treasury as a result of these efforts. Some recent civil enforcement actions include:
(This article is a consolidation of information received by the 14,000-member National Association of Chiefs of Police’s Fraud Investigation Committee.)
Jim Kouri, CPP is currently fifth vice-president of the National Association of Chiefs of Police and he’s a staff writer for the New Media Alliance (thenma.org). In addition, he’s the new editor for the House Conservatives Fund’s weblog. Kouri also serves as political advisor for Emmy and Golden Globe winning actor Michael Moriarty.
He’s former chief at a New York City housing project in Washington Heights nicknamed “Crack City” by reporters covering the drug war in the 1980s. In addition, he served as director of public safety at a New Jersey university and director of security for several major organizations. He’s also served on the National Drug Task Force and trained police and security officers throughout the country. Kouri writes for many police and security magazines including Chief of Police, Police Times, The Narc Officer and others. He’s a news writer for TheConservativeVoice.Com and PHXnews.com. He’s also a columnist for AmericanDaily.Com, MensNewsDaily.Com, MichNews.Com, and he’s syndicated by AXcessNews.Com. He’s appeared as on-air commentator for over 100 TV and radio news and talk shows including Oprah, McLaughlin Report, CNN Headline News, MTV, Fox News, etc. His book Assume The Position is available at Amazon.Com. Kouri’s own website is located at http://jimkouri.us
Tuesday, August 5, 2008
Saturday, August 2, 2008
Health care fraud comes in many forms
Investigating Chiropractic Fraud
July 31st, 2008
Health care fraud comes in many forms and unfortunately is not limited to any one health care discipline. Chiropractic is not immune from their members engaging in fraudulent activity that violates the laws and rules governing health care. With more than twenty years of experience, including investigating chiropractic fraud and assisting chiropractors on employing compliance programs, I offer the following bullets to refresh and/or develop fraud-fighters (providers, insurers, regulators & law enforcers) insight on chiropractic fraud.
July 31st, 2008
Health care fraud comes in many forms and unfortunately is not limited to any one health care discipline. Chiropractic is not immune from their members engaging in fraudulent activity that violates the laws and rules governing health care. With more than twenty years of experience, including investigating chiropractic fraud and assisting chiropractors on employing compliance programs, I offer the following bullets to refresh and/or develop fraud-fighters (providers, insurers, regulators & law enforcers) insight on chiropractic fraud.
PhyAmerica Physician Group Case connect to NCFE
Judge Warns of Fines in PhyAmerica Physician Group Case.
Publication: Knight Ridder/Tribune Business News
Date: Saturday, January 24 2004
By Jean P. Fisher, The News & Observer, Raleigh, N.C. Knight Ridder/Tribune Business News
Jan. 24--A Maryland judge has warned Dr. Steven M. Scott, former owner of PhyAmerica in Durham, that he will face a $50,000-per-violation fine each time he or his associates seek to lure the company's contract physicians and clients to Scott's new competing business.
Baltimore bankruptcy court Judge E. Stephen Derby, who has presided over PhyAmerica's reorganization under Chapter 11 bankruptcy protection for 14 months, on Wednesday found that Scott had violated a
Publication: Knight Ridder/Tribune Business News
Date: Saturday, January 24 2004
By Jean P. Fisher, The News & Observer, Raleigh, N.C. Knight Ridder/Tribune Business News
Jan. 24--A Maryland judge has warned Dr. Steven M. Scott, former owner of PhyAmerica in Durham, that he will face a $50,000-per-violation fine each time he or his associates seek to lure the company's contract physicians and clients to Scott's new competing business.
Baltimore bankruptcy court Judge E. Stephen Derby, who has presided over PhyAmerica's reorganization under Chapter 11 bankruptcy protection for 14 months, on Wednesday found that Scott had violated a
More Than 500 Backlogged Whistle-Blower Cases Allege Health Care, Drug Company Fraud
Whistle-blower lawsuits alleging that pharmaceutical companies and government contractors defrauded the federal government have created a backlog of more than 900 cases at the Department of Justice, the Washington Post reports. According to the Post, more than 500 of the cases involve the health care and pharmaceutical industries, as well as Medicare and Medicaid.
July 3rd, 2008
July 3rd, 2008
Medical Equipment Company Sentenced ...but what was the deal
AND WHERE IS THE MONEY? SHOW ME THE MONEY!
Owner of Medical Equipment Company Sentenced to 130 Months in Prison for Health Care Fraud
July 3, 2008
A Miami resident was sentenced to 130 months in prison for his role in schemes to defraud the Medicare program, Acting Assistant Attorney General Matthew Friedrich of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida has announced.
Gustavo Smith, 43, was sentenced in the U.S. District Court for the Southern District of Florida by Judge Marcia G. Cooke. In addition to the prison sentence, Judge Cooke ordered Smith to serve three years of supervised release following his release from prison, forfeit $287,000 and pay $1,988,969 in restitution to the U.S. Department of Health and Human Services (HHS).
At trial, the jury heard testimony that Smith was the owner of Medstar Services and Orthotics Fitters of Miami, two durable medical equipment (DME) companies that Smith used to submit more than $4.6 million in fraudulent claims to the Medicare program. The items billed by Medstar Services and Orthotics Fitters to the Medicare program were primarily negative pressure pumps and related wound care supplies. Medicare beneficiaries whose names and Medicare numbers Smith used to bill for these items testified at trial that they had never heard of Smith or his companies and that they never needed or received the items being billed to Medicare by Medstar and Orthotics Fitters. Doctors whose provider numbers were used by Smith to bill the Medicare program also testified that they had never heard of Smith or his companies and that they had never prescribed the items being billed by Smith’s companies.
Several of Smith’s associates testified at trial that Smith would open companies in the names of nominee owners, who would be listed as owners in official corporate documents, bank accounts and in official Medicare documents. Once Medicare made payments on the fraudulent claims submitted by Smith’s companies, Smith employed a money launderer to cash the proceeds of the fraud and transfer the cash to Smith. Witnesses also testified that Smith used the Medicare money to buy jewelry, purchase airline tickets for personal travel and make payments on his Mercedes-Benz.
In addition to the Medstar and Orthotics Fitters fraud, witnesses also testified about several other forms of health care fraud in which Smith engaged, including: brokering the purchase and sale of DME companies for the purpose of “burning Medicare,” or submitting more than a million dollars in fraudulent claims within a window of two to three weeks; accepting payments from approximately 180 DME companies in return for agreeing to be listed in official Medicare records as the DME companies’ orthotics fitter, when in reality Smith performed no services for those companies; and owning an interest in two additional medical equipment companies that were committing Medicare fraud.
Following a six-day trial, Smith was convicted on April 23, 2008, of all counts contained in a seventeen count indictment, including conspiracy to defraud the United States, to commit health care fraud, and to cause the submission of false claims; seven counts of health care fraud; seven counts of false claims; one count of conspiracy to launder the proceeds of his crimes; and money laundering. Smith was allowed by the court to remain free on bond after his conviction, with the requirement that he be placed on home confinement with electronic monitoring. On June 14, 2008, Smith violated the terms of his release and fled the country. A warrant has been issued for his arrest.
The case was prosecuted by Trial Attorneys Hank Bond Walther and John K. Neal of the Criminal Division’s Fraud Section in Washington, D.C., with the investigative assistance of the FBI and HHS, Office of Inspector General. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Fraud Section of the Criminal Division and U.S. Attorney Acosta of the Southern District of Florida. From investigations opened during the period of Strike Force operations between March and October of 2007, federal prosecutors have indicted 82 cases with 142 defendants in South Florida. Collectively, these defendants billed the Medicare program for more than $492 million.
Source: DoJ
Net News Publisher for World News
Owner of Medical Equipment Company Sentenced to 130 Months in Prison for Health Care Fraud
July 3, 2008
A Miami resident was sentenced to 130 months in prison for his role in schemes to defraud the Medicare program, Acting Assistant Attorney General Matthew Friedrich of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida has announced.
Gustavo Smith, 43, was sentenced in the U.S. District Court for the Southern District of Florida by Judge Marcia G. Cooke. In addition to the prison sentence, Judge Cooke ordered Smith to serve three years of supervised release following his release from prison, forfeit $287,000 and pay $1,988,969 in restitution to the U.S. Department of Health and Human Services (HHS).
At trial, the jury heard testimony that Smith was the owner of Medstar Services and Orthotics Fitters of Miami, two durable medical equipment (DME) companies that Smith used to submit more than $4.6 million in fraudulent claims to the Medicare program. The items billed by Medstar Services and Orthotics Fitters to the Medicare program were primarily negative pressure pumps and related wound care supplies. Medicare beneficiaries whose names and Medicare numbers Smith used to bill for these items testified at trial that they had never heard of Smith or his companies and that they never needed or received the items being billed to Medicare by Medstar and Orthotics Fitters. Doctors whose provider numbers were used by Smith to bill the Medicare program also testified that they had never heard of Smith or his companies and that they had never prescribed the items being billed by Smith’s companies.
Several of Smith’s associates testified at trial that Smith would open companies in the names of nominee owners, who would be listed as owners in official corporate documents, bank accounts and in official Medicare documents. Once Medicare made payments on the fraudulent claims submitted by Smith’s companies, Smith employed a money launderer to cash the proceeds of the fraud and transfer the cash to Smith. Witnesses also testified that Smith used the Medicare money to buy jewelry, purchase airline tickets for personal travel and make payments on his Mercedes-Benz.
In addition to the Medstar and Orthotics Fitters fraud, witnesses also testified about several other forms of health care fraud in which Smith engaged, including: brokering the purchase and sale of DME companies for the purpose of “burning Medicare,” or submitting more than a million dollars in fraudulent claims within a window of two to three weeks; accepting payments from approximately 180 DME companies in return for agreeing to be listed in official Medicare records as the DME companies’ orthotics fitter, when in reality Smith performed no services for those companies; and owning an interest in two additional medical equipment companies that were committing Medicare fraud.
Following a six-day trial, Smith was convicted on April 23, 2008, of all counts contained in a seventeen count indictment, including conspiracy to defraud the United States, to commit health care fraud, and to cause the submission of false claims; seven counts of health care fraud; seven counts of false claims; one count of conspiracy to launder the proceeds of his crimes; and money laundering. Smith was allowed by the court to remain free on bond after his conviction, with the requirement that he be placed on home confinement with electronic monitoring. On June 14, 2008, Smith violated the terms of his release and fled the country. A warrant has been issued for his arrest.
The case was prosecuted by Trial Attorneys Hank Bond Walther and John K. Neal of the Criminal Division’s Fraud Section in Washington, D.C., with the investigative assistance of the FBI and HHS, Office of Inspector General. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Fraud Section of the Criminal Division and U.S. Attorney Acosta of the Southern District of Florida. From investigations opened during the period of Strike Force operations between March and October of 2007, federal prosecutors have indicted 82 cases with 142 defendants in South Florida. Collectively, these defendants billed the Medicare program for more than $492 million.
Source: DoJ
Net News Publisher for World News
Whistle-Blower Suits Languish at Justice.....
I wonder why?
Hmmm..........Who do we know IN the WHITE HOUSE that would like to hide this? How much has been paid and to whom?
Instead, we can think about Paris and Brittany!
BOY, are we just a bunch of DUMB AMERICANS
DO not knwo what we have until we lose it and this BUSH has really progressed in that department now hasn't he?
July 3rd, 2008 5:18 pm
A Backlog Of Cases Alleging Fraud
Whistle-Blower Suits Languish at Justice
By Carrie Johnson / Washington Post
More than 900 cases alleging that government contractors and drugmakers have defrauded taxpayers out of billions of dollars are languishing in a backlog that has built up over the past decade because the Justice Department cannot keep pace with the surge in charges brought by whistle-blowers, according to lawyers involved in the disputes.
The issue is drawing renewed interest among lawmakers and nonprofit groups because many of the cases involve the wars in Iraq and Afghanistan, rising health-care payouts, and privatization of government functions -- all of which offer rich new opportunities to swindle taxpayers.
Since 2001, 300 to 400 civil cases have been filed each year by employees charging that their companies defrauded the government. But under the cumbersome process that governs these cases, Justice Department lawyers must review them under seal, and whistle-blowers routinely wait 14 months or longer just to learn whether the department will get involved. The government rejects about three-quarters of the cases it receives, saying that the vast majority have little merit.
Disputes can stay buried for years more while the government investigates the allegations.
"Even if no new cases are filed, it might take 10 years for the Department of Justice to clear its desk. Cases in the backlog represent a lot of money being left on the table," said Patrick Burns, a spokesman for Taxpayers Against Fraud, which advocates for Justice to receive more funding to support cases by whistle-blowers and their attorneys.
Supporters of federal intervention in the cases say the dividends are substantial: In recent years, verdicts and settlements have returned nearly $13 billion to the U.S. government.
At issue in most of the cases is whether companies knowingly sold defective products or overcharged federal agencies for items sold at home or offered to U.S. troops overseas. Under the Civil War-era False Claims Act, workers who file lawsuits alleging such schemes cannot discuss them or even disclose their existence until Justice decides whether to step in.
By its own account, the 75-lawyer unit in Washington that reviews the sensitive lawsuits is overloaded and understaffed. Only about 100 cases a year are investigated by the team, which works out of the commercial litigation branch of Justice's civil division.
Critics argue that the delays are at least partly the result of foot-dragging by Justice and the federal agencies whose position it represents, especially in the touchy area of suppliers that may have overbilled the government for equipment, food and other items used by troops in Iraq and Afghanistan.
Justice lawyers have rejected about 19 cases involving contractor fraud in Iraq and Afghanistan, registering five settlements that resulted in $16 million, officials said. Government officials said this week that they are considering whether to dive into 32 more whistle-blower cases involving Iraq or the Middle East.
"It's just flatly absurd for us to be five years into this war" with so few public cases, said Alan Grayson, a whistle-blower lawyer in Florida who has criticized the Justice effort and who is running for Congress as a Democrat.
In a statement, Justice spokesman Charles Miller said that career lawyers and supervisors base their determinations on merit, not on political sensitivities. "Our decisions to intervene or decline in cases involving Iraq and the Middle East are entirely consistent with our record in [whistle-blower] cases generally," he said.
Help from Justice greatly enhances the chances that a complicated fraud scheme can be unraveled, lawyers say. And department statistics show that cases Justice turns away win paltry, if any, financial recoveries.
Key lawmakers have called on Justice to make false-claims investigations a priority.
"Whistle-blowers are the key to the secrets locked in closets throughout the federal bureaucracy and government contractors," said Sen. Charles E. Grassley (R-Iowa). "These patriotic Americans stick their necks out, against all odds, to help the federal government pursue fraud and save taxpayers tens of billions of dollars that would otherwise be lost."
Last month, Deputy Assistant Attorney General Michael F. Hertz told Congress that "the number and increased complexity of the fraud schemes presented to the department, combined with the volume of cases now under review, certainly present challenges."
Among the largest false-claims cases to date are a $650 million settlement earlier this year by drugmaker Merck in connection with an alleged failure to repay Medicaid rebates; a $515 million deal with Bristol-Myers Squibb to cover illegal drug pricing and marketing; and a $98 million agreement with software maker Oracle over pricing.
If their claims are successful, whistle-blowers can receive a hefty slice of the settlements or verdicts, sometimes as much as 20 percent of the award. A former Merck sales manager collected $68 million earlier this year for his role in exposing an alleged drug-pricing scheme.
Even bigger lawsuits containing potentially explosive allegations are waiting in the wings. The vast majority, more than 500 cases, involve the health-care and pharmaceutical industries and often involve Medicare and Medicaid funds.
Only a few hints of the Iraq and Afghanistan disputes have erupted publicly. One is a suit filed by two former employees of Custer Battles, a defense contracting company in Fairfax. The workers accused the company of inflating expenses on a contract it won to replace the Iraqi currency. After a three-week trial in 2006, a jury found in favor of the plaintiffs and awarded them $10 million. But U.S. District Judge T.S. Ellis III later tossed out the case, ruling that the money at issue, controlled in the early years of the Iraq conflict by the Coalition Provisional Authority, belonged to the Iraqi government, not U.S. taxpayers.
Justice declined the whistle-blowers' request to intervene before the case went to trial, plaintiffs' lawyers said. The government eventually weighed in with a court brief on behalf of the whistle-blowers when the case was appealed.
Frederick M. Morgan Jr., a Cincinnati lawyer who represents whistle-blowers, said that the numbers of lawyers willing to take on cases involving defense contractors has dwindled, in part because of Justice's slow decisions.
One of Morgan's lawsuits, against contractors hired by the Navy to build nuclear submarines and an Ohio company that manufactured submarine valves, took five years to resolve.
Another case, involving the manufacture of the F-22 fighter, was filed in early 1999. It was late 2006 before Justice decided not to intervene. The case is now in active litigation.
"The impact of a 7 1/2 -year delay in the litigation of a case is difficult to quantify but impossible to discount," Morgan said.
Whistle-blower lawyers say other factors can contribute to long delays, including the difficulty in investigating claims in war-torn areas and complications that arise when military officials contend that technology or other products at issue in the lawsuits are classified. In addition, Justice lawyers who handle civil cases often cannot proceed until authorities decide whether a case merits criminal prosecution, the lawyers said.
Even when older cases are pushed into the open, the passage of time can present courtroom challenges.
Last year, a D.C. jury awarded whistle-blower Richard Miller more than $30 million, a figure that now-Chief Judge Royce C. Lamberth tripled to $90 million. But in the dozen years since the suit was filed, witnesses' memories of events had dimmed and the U.S. Agency for International Development had tossed its investigative files.
The judge blasted civil division lawyers for "doing virtually nothing" to follow up for four years after Miller brought forward allegations in 1995 about bid rigging on construction contracts in Egypt. The delays meant "loss of evidence, fading memories, disappearance of documents," he wrote.
Justice spokesman Miller said that the civil case was stalled for years because criminal proceedings in the matter took priority. He added that the whistle-blower did not object to the government's repeated entreaties for more time.
Last week, Lamberth denied defense motions for a new trial. But the verdict is likely to be appealed, according to lawyers who participated.
"I have a feeling we're some way away from resolution," said Charles S. Leeper, a lawyer for B.L. Harbert International, the main construction company involved in the case.
Hmmm..........Who do we know IN the WHITE HOUSE that would like to hide this? How much has been paid and to whom?
Instead, we can think about Paris and Brittany!
BOY, are we just a bunch of DUMB AMERICANS
DO not knwo what we have until we lose it and this BUSH has really progressed in that department now hasn't he?
July 3rd, 2008 5:18 pm
A Backlog Of Cases Alleging Fraud
Whistle-Blower Suits Languish at Justice
By Carrie Johnson / Washington Post
More than 900 cases alleging that government contractors and drugmakers have defrauded taxpayers out of billions of dollars are languishing in a backlog that has built up over the past decade because the Justice Department cannot keep pace with the surge in charges brought by whistle-blowers, according to lawyers involved in the disputes.
The issue is drawing renewed interest among lawmakers and nonprofit groups because many of the cases involve the wars in Iraq and Afghanistan, rising health-care payouts, and privatization of government functions -- all of which offer rich new opportunities to swindle taxpayers.
Since 2001, 300 to 400 civil cases have been filed each year by employees charging that their companies defrauded the government. But under the cumbersome process that governs these cases, Justice Department lawyers must review them under seal, and whistle-blowers routinely wait 14 months or longer just to learn whether the department will get involved. The government rejects about three-quarters of the cases it receives, saying that the vast majority have little merit.
Disputes can stay buried for years more while the government investigates the allegations.
"Even if no new cases are filed, it might take 10 years for the Department of Justice to clear its desk. Cases in the backlog represent a lot of money being left on the table," said Patrick Burns, a spokesman for Taxpayers Against Fraud, which advocates for Justice to receive more funding to support cases by whistle-blowers and their attorneys.
Supporters of federal intervention in the cases say the dividends are substantial: In recent years, verdicts and settlements have returned nearly $13 billion to the U.S. government.
At issue in most of the cases is whether companies knowingly sold defective products or overcharged federal agencies for items sold at home or offered to U.S. troops overseas. Under the Civil War-era False Claims Act, workers who file lawsuits alleging such schemes cannot discuss them or even disclose their existence until Justice decides whether to step in.
By its own account, the 75-lawyer unit in Washington that reviews the sensitive lawsuits is overloaded and understaffed. Only about 100 cases a year are investigated by the team, which works out of the commercial litigation branch of Justice's civil division.
Critics argue that the delays are at least partly the result of foot-dragging by Justice and the federal agencies whose position it represents, especially in the touchy area of suppliers that may have overbilled the government for equipment, food and other items used by troops in Iraq and Afghanistan.
Justice lawyers have rejected about 19 cases involving contractor fraud in Iraq and Afghanistan, registering five settlements that resulted in $16 million, officials said. Government officials said this week that they are considering whether to dive into 32 more whistle-blower cases involving Iraq or the Middle East.
"It's just flatly absurd for us to be five years into this war" with so few public cases, said Alan Grayson, a whistle-blower lawyer in Florida who has criticized the Justice effort and who is running for Congress as a Democrat.
In a statement, Justice spokesman Charles Miller said that career lawyers and supervisors base their determinations on merit, not on political sensitivities. "Our decisions to intervene or decline in cases involving Iraq and the Middle East are entirely consistent with our record in [whistle-blower] cases generally," he said.
Help from Justice greatly enhances the chances that a complicated fraud scheme can be unraveled, lawyers say. And department statistics show that cases Justice turns away win paltry, if any, financial recoveries.
Key lawmakers have called on Justice to make false-claims investigations a priority.
"Whistle-blowers are the key to the secrets locked in closets throughout the federal bureaucracy and government contractors," said Sen. Charles E. Grassley (R-Iowa). "These patriotic Americans stick their necks out, against all odds, to help the federal government pursue fraud and save taxpayers tens of billions of dollars that would otherwise be lost."
Last month, Deputy Assistant Attorney General Michael F. Hertz told Congress that "the number and increased complexity of the fraud schemes presented to the department, combined with the volume of cases now under review, certainly present challenges."
Among the largest false-claims cases to date are a $650 million settlement earlier this year by drugmaker Merck in connection with an alleged failure to repay Medicaid rebates; a $515 million deal with Bristol-Myers Squibb to cover illegal drug pricing and marketing; and a $98 million agreement with software maker Oracle over pricing.
If their claims are successful, whistle-blowers can receive a hefty slice of the settlements or verdicts, sometimes as much as 20 percent of the award. A former Merck sales manager collected $68 million earlier this year for his role in exposing an alleged drug-pricing scheme.
Even bigger lawsuits containing potentially explosive allegations are waiting in the wings. The vast majority, more than 500 cases, involve the health-care and pharmaceutical industries and often involve Medicare and Medicaid funds.
Only a few hints of the Iraq and Afghanistan disputes have erupted publicly. One is a suit filed by two former employees of Custer Battles, a defense contracting company in Fairfax. The workers accused the company of inflating expenses on a contract it won to replace the Iraqi currency. After a three-week trial in 2006, a jury found in favor of the plaintiffs and awarded them $10 million. But U.S. District Judge T.S. Ellis III later tossed out the case, ruling that the money at issue, controlled in the early years of the Iraq conflict by the Coalition Provisional Authority, belonged to the Iraqi government, not U.S. taxpayers.
Justice declined the whistle-blowers' request to intervene before the case went to trial, plaintiffs' lawyers said. The government eventually weighed in with a court brief on behalf of the whistle-blowers when the case was appealed.
Frederick M. Morgan Jr., a Cincinnati lawyer who represents whistle-blowers, said that the numbers of lawyers willing to take on cases involving defense contractors has dwindled, in part because of Justice's slow decisions.
One of Morgan's lawsuits, against contractors hired by the Navy to build nuclear submarines and an Ohio company that manufactured submarine valves, took five years to resolve.
Another case, involving the manufacture of the F-22 fighter, was filed in early 1999. It was late 2006 before Justice decided not to intervene. The case is now in active litigation.
"The impact of a 7 1/2 -year delay in the litigation of a case is difficult to quantify but impossible to discount," Morgan said.
Whistle-blower lawyers say other factors can contribute to long delays, including the difficulty in investigating claims in war-torn areas and complications that arise when military officials contend that technology or other products at issue in the lawsuits are classified. In addition, Justice lawyers who handle civil cases often cannot proceed until authorities decide whether a case merits criminal prosecution, the lawyers said.
Even when older cases are pushed into the open, the passage of time can present courtroom challenges.
Last year, a D.C. jury awarded whistle-blower Richard Miller more than $30 million, a figure that now-Chief Judge Royce C. Lamberth tripled to $90 million. But in the dozen years since the suit was filed, witnesses' memories of events had dimmed and the U.S. Agency for International Development had tossed its investigative files.
The judge blasted civil division lawyers for "doing virtually nothing" to follow up for four years after Miller brought forward allegations in 1995 about bid rigging on construction contracts in Egypt. The delays meant "loss of evidence, fading memories, disappearance of documents," he wrote.
Justice spokesman Miller said that the civil case was stalled for years because criminal proceedings in the matter took priority. He added that the whistle-blower did not object to the government's repeated entreaties for more time.
Last week, Lamberth denied defense motions for a new trial. But the verdict is likely to be appealed, according to lawyers who participated.
"I have a feeling we're some way away from resolution," said Charles S. Leeper, a lawyer for B.L. Harbert International, the main construction company involved in the case.
Woman pleads guilty to health care fraud
A Severna Park woman pleaded guilty in federal court to health care fraud yesterday for billing for medical services she did not provide, according to the U.S. attorney's office.
Virginia Vought Acree, 49, a state-licensed clinical specialist in child and adolescent psychiatric and mental health nursing, admitted to falsely billing for services she did not provide on hundreds of occasions from January 2003 to November 2007, prosecutors said. She filed fraudulent insurance claims to collect more than $200,000 from the government and private health care plans.
At times, Acree billed for face-to-face psychotherapy services at the same time she was on vacation in other states or countries, or attending out-of-town conferences, prosecutors said.
Sentencing is set for Oct. 7. Acree could get a maximum sentence of 10 years in prison and a $250,000 fine, prosecutors said.
Virginia Vought Acree, 49, a state-licensed clinical specialist in child and adolescent psychiatric and mental health nursing, admitted to falsely billing for services she did not provide on hundreds of occasions from January 2003 to November 2007, prosecutors said. She filed fraudulent insurance claims to collect more than $200,000 from the government and private health care plans.
At times, Acree billed for face-to-face psychotherapy services at the same time she was on vacation in other states or countries, or attending out-of-town conferences, prosecutors said.
Sentencing is set for Oct. 7. Acree could get a maximum sentence of 10 years in prison and a $250,000 fine, prosecutors said.
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