OIG expects to recover $5.9B in fraud investigations, doubling last year's haul

Medicare spending costs money
The federal government brought in $5.9 billion in fraud recoveries in fiscal 2019 from investigations by the Department of Health and Human Services Office of Inspector General, according to a new report from that agency. (Getty/zimmytws)

The Office of Inspector General (OIG) recovered $5.9 billion from fraud investigations during fiscal year 2019, according to a semiannual report (PDF) to Congress released Monday.

That's more than double from last year when the agency reported pulling in $2.9 billion; officials said they saw fewer large settlements.

The agency pointed to its "first-of-its-kind investigation" of a major genetic testing fraud scheme in 2019 which ultimately resulted in a $42.6 million settlement. They also pointed to charges against 24 telemedicine and medical equipment company executives and physicians for their alleged participation in a $1.2 billion healthcare fraud scheme.

The OIG also partnered with the Department of Justice (DOJ) to obtain a $700 million false claims act settlement with global consumer goods conglomerate Reckitt Benckiser Group plc (RB Group) related to a federal investigation of the marketing of opioid addiction treatment drug Suboxone.

An example of a successful OIG-DOJ partnership included a pharmaceutical company agreeing to pay $700 million to settle allegations that it illegally marketed an opioid treatment drug. The pharmaceutical company entered into a $700 million False Claims Act settlement with the U.S. to resolve allegations that it illegally marketed and promoted the opioid treatment drug Suboxone. The allegations included knowing promotion of Suboxone to physicians who were prescribing it in an unsafe manner as well as making false and misleading claims to physicians, state Medicaid agencies and the Food and Drug Administration to increase sales and delay generic competition.

According to the report to Congress, which summarized OIG activities for fiscal year 2019, the agency estimated more than $819 million will be recovered from audits and more than $5 billion could be expected from investigative recoveries, such as recoveries from criminal actions, civil and administrative settlements, civil judgments and administrative actions by OIG.

RELATED: OIG fraud recoveries dropped $1.2B this year. That might not be a bad thing

Among the OIG's activities, the agency said it:

  • Brought 809 criminal actions against individuals or organizations accused of engaging in crimes against Department of Health and Human Services programs.
  • Brought nearly 700 civil actions including false claims and unjust-enrichment lawsuits filed in federal district court, civil monetary penalty settlements and administrative recoveries related to provider self-disclosure matters.
  • Excluded 2,640 individuals and entities from participation in Medicare, Medicaid and other federal healthcare programs.

The OIG recovered $4.1 billion in 2017 when it agreed to a $155 million settlement with electronic health record vendor eClinicalWorks, and Mylan paid $465 million in an EpiPen settlement