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False Claims Act Update: Enforcement in the Health Care Sector is White Hot

On July 22, 2019, the United States Department of Justice (DOJ) filed a Complaint-In-Intervention in Federal court in New York against medical device manufacturer Life Spine, Inc. and two members of its executive management team alleging violations of the False Claims Act (FCA). The DOJ and the Relator (four former Life Spine employee whistleblowers) contend that defendants engaged in an illegal kickback scheme by paying surgeons millions of dollars in...

NY Anesthesiologist Indicted in Telemedicine Healthcare Fraud Scheme

A New York anesthesiologist was indicted on July 9 for her participation in an alleged telemedicine conspiracy to submit fraudulent claims to Medicare, Medicare Part D, and private insurance plans. The physician was charged with one count of conspiracy to commit healthcare fraud. According to the indictment, the physician, along with other providers, participated in a fraudulent scheme to order and prescribe Durable Medical Equipment (DME) and prescription drugs through...

FDA Issues New Warning Letters to API Repackers

The Food and Drug Administration (FDA) recently issued warning letters to three repackers of Active Pharmaceutical Ingredients (API) for alleged violations of Current Good Manufacturing Practice (CGMP) requirements. The FDA's issuance of these warning letters, along with statements made in a press release dated July 2, 2019, indicate that the FDA is increasing its oversight of the global supply chain for pharmaceuticals and active pharmaceutical ingredients, and issuing warning letters...

Jury Finds Medical Marketing Company Owner Guilty of Medicare Fraud Scheme

In a follow up to last month's OIG fraud alert regarding genetic testing scams, a federal jury found the owner of a Tampa, Florida-area medical marketing company guilty for his role in an over $2.2 million Medicare fraud scheme involving the payment of kickbacks and bribes to medical clinics. The problematic payments were in exchange for the referral of DNA swabs, to the Miami-based lab, that were obtained from Medicare beneficiaries....

Quest Diagnostics and LabCorp Report Major Data Breaches Caused by a Business Associate

Quest Diagnostics (Quest) and LabCorp each reported in their respective 8-K filings with the Security and Exchange Commission that the companies had been notified by American Medical Collection Agency (AMCA), a billing collections vendor, that between August 1, 2018 and March 30, 2019 an unauthorized user had access to AMCA's system that contained information that AMCA had received from both companies. The number of affected individuals is estimated to be...