HMO operator Amerigroup has been fined $144 million by a federal jury, which concluded that the company deliberately avoided enrolling pregnant and high-risk patients in its Medicaid plan in an effort to pump up profits. The jury had originally fined the company $48 million, but the judgment was tripled under the federal False Claims Act. Next, the prosecutors plan to seek an additional $200 million in fines, in compensation for the 18,000 false claims Amerigroup filed in the state.
The federal suit was filed by whistleblower Cleveland Tyson, a former Amerigroup executive, who now stands to collect an extremely hefty whistleblower's award of $26 million to $31 million. Amerigroup served as the state's Medicaid HMO contractor from 2000 through 2003, handling $243 million in Medicaid funding. Amerigroup is appealing the decision.