Qui Tam

New York State and NYC sets record for qui tam settlement of $540 million

By Brian F. LaBovick

Everyone knows there is no place like New York and New York City. However, this does not mean that New York and NYC can defraud the government.  The Department of Justice announced today that a settlement was reached by New York and NYC to pay a record sum in the amount of $540 million to settle allegations for knowingly submitting, or causing to be submitted, false claims for reimbursement for school-based health care services, primarily speech therapy and transportation, provided to Medicaid eligible children from 1990 to 2001. Unfortunately, you did not misread this information that New York state workers, knowingly submitted false charges to the Medicaid program. This is appalling information.

According to the News Release from the Department of Justice:

The government's allegations arose from two lawsuits filed under the qui tam or whistleblower provisions of the False Claims Act, which allow private persons, known as 'relators,' to file actions on behalf of the United States and share in any recovery. The relator in these cases, a speech therapist who provided services to preschool children in upstate New York, alleged that New York State and its school districts submitted false claims for speech services that did not qualify for Medicaid reimbursement. The relator will receive $10 million from the settlement.

This is such a travesty since New York is a state that took such much pride in coming out with a state False Claims Act to go after those defrauding the government.  How unsettling to see that their own workers were committing such fraudulent acts to get funds their state did not deserve. Shame, Shame, Shame on you New York. We are grateful to the speech therapist that came forward to bring such light against this fraud.  We can't stress it enough, if you are aware of your company defrauding the government and have proof, find out the necessary steps to  report the fraud. There is a whistleblowers reward to those that help uncover the fraud.  It is not easy and we can attest that many who try to go it alone don't always get the reward they deserve. Seek out legal counsel, find out your rights and discuss the facts with legal counsel that you trust. In some cases, such as this one, there is great reward.  Thankfully in this instance, New York did the right thing and settled the case for $540 million and the relator/whistleblower will receive $10 million for their valiant efforts.

To learn more on the New York False Claims settlement of $540 million, click on the following links:

Department of Justice
Dow Jones

Full post as published by Whistleblower Law Blog on July 22, 2009 (boomark / email).