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Kickbacks are a Common Form of Medicaid Fraud

Since January of 2009, the Department of Justice has recovered $31.6 billion on money improperly paid out by the government through False Claims Act cases. False Claims Act allows individuals Whistle blower or whistleblowerwho become aware of fraud against the government to file claims. If those claims lead to recovery of government funds, the whistleblower who took action gets a portion of the money. Around $19.2 billion of the $31.6 billion recovered has come from False Claims Act cases which arose out of fraud in Medicaid, Medicare, or other federal healthcare programs.

Just recently, another whistleblower case drew attention to the practices of a home health care agency which was engaged in a form of fraud involving illegal kickbacks. Federal laws strictly prohibit kickbacks, or financial incentives for referrals for medical care.

Illegal Kickbacks Cost Medicaid Millions

Providing a financial reward for referring patients for healthcare services creates a situation which incentives the referral of patients for unnecessary medical care. As a result, kickbacks are not permitted.

One home health care provider was paying out kickbacks and has now been caught thanks to the actions of a whistleblower. Both the health care provider and the owner of the home care agency are responsible for the scheme involving unlawful kickbacks. According to Biz Journals, they must pay $1.8 million to pay claims arising from False Claims Act proceedings. Both the U.S. and state government will be receiving a portion of the money.

The scam which led to accusations of illegal kickbacks involved the home health care agency making arrangements with an individual responsible for transporting patients from their homes to home health care facilities. The individual who was responsible for patient transport received $58,000 in kickbacks for referring patients to the home health care service. After the patients got care based on the referrals, the home health care provider billed Medicaid for the claims. The amount of kickbacks being paid was determined based on a formula accounting for the number of service hours which the healthcare agency billed to Medicaid.

The person who was receiving the illegal kickbacks was actually the one who came forward and made the claim against the home health care agency under the False Claims Act. Because whistleblowers receive a portion of the money they help the government to recover, the whistleblower will be receiving $43,178. This is equal to 10 percent of the recovered funds, minus the amount of money he received in kickbacks.

Kickbacks create an undeniable conflict of interest and can leave Medicaid paying out taxpayer funds for care which may not be medically necessary or which may not be the best and most appropriate type of care. Anyone who becomes aware of unlawful kickbacks being paid out by someone who makes Medicaid or Medicare claims should consider coming forward and making a False Claims Act claim.