Whistleblowers help feds recover record $3B in healthcare false claims

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The U.S. Justice Department shattered records by recouping nearly $3 billion in healthcare fraud recoveries for the first time in a single year.

DoJ yesterday announced that it recovered $4.9 billion in total this fiscal year ending Sept. 30 from settlements and judgments involving both healthcare and mortgage fraud, uncovered with the help of whistleblowers. The new numbers eclipse previous records by more than $1.7 billion, the DoJ said.

DoJ's announcement suggests strengthening scrutiny on the healthcare programs--and that authorities aren't likely to let up anytime soon.

"Today's announcement underscores the Obama Administration's ongoing commitment to recover losses, to prevent fraud, to bring abuses to light, and to hold accountable those who violate the law and exploit some of the government's most critical programs," Attorney General Eric Holder said in the statement. "By aggressively investigating allegations of waste and pursuing those who would take advantage of the most vulnerable members of society, I'm confident that we will continue to build on this historic progress in the months and years ahead."

Most false claims were filed using whistleblower (qui tam) provisions. This year represents the second consecutive year in which the department broke records under the False Claims Act for healthcare fraud.

According to the Association of Certified Fraud Examiners, employee tips are the most common method of fraud detection since 2002.

The Attorney General and U.S. Department of Health & Human Services turned up the heat on providers in 2009 by establishing the Health Care Fraud Prevention and Enforcement Action Team. Since then, the department recovered $9.5 billion in federal healthcare dollars under the False Claims Act.

The biggest source of recoveries involved pharmaceutical and medical device companies, particularly GlaxoSmithKline and Merck. However, hospitals weren't immune from federal scrutiny.

Among the biggest hospital false claims settlements this year:

For more information:
- see the DoJ statement

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