Tuomey Jury Finds Monetary Value of $39 Million for 21,370 Claims Submitted in Violation of False Claims Act
On May 8, 2013, the jury in the False Claims Act lawsuit against Tuomey Healthcare Systems, Inc. returned its verdict. Based on its finding that Tuomey violated the Stark law, the jury found that Tuomey also violated the False Claims Act by submitting 21,370 false claims with a total value in excess of $39 million.
The court instructed the jury that the government’s case was based on allegations that Tuomey entered into compensation arrangements with certain physicians that violated the Stark law. The government sought relief under the False Claims Act for these alleged Stark law violations.
The court instructed the jury that damages for Stark based violations of the False Claims Act are to be based on what the Medicare program paid to Tuomey for claims submitted in violation of Stark. Under the False Claims Act, each false claim is subject to a penalty of between $5,500 and $11,000. In addition, damages may be tripled.
In what might be considered by some as a substantial understatement, one of the attorneys for Dr. Michael Drakeford, who initiated the lawsuit under the whistleblower provisions of the False Claims Act, was quoted as commenting:
“Perhaps the message to be taken from this verdict is that the Stark law really does have teeth and when a hospital decides to pay physicians for referrals, it risks paying a very high price.”
As part of its on-going quarterly lunch time webinar series, the Ogden Murphy Wallace Healthcare Practice Group will provide a presentation on self-disclosure options and avoidance of state and federal False Claims Act liability in its June 4, 2013 webinar (to register click here). If you have questions regarding self-disclosure or Stark in general please contact Greg Montgomery.
