Geico Surrenders $517,000 to Settle Allegations

 

According to Top Class Actions GEICO has agreed to a $517,000 class action settlement over allegations that the insurance provider received reimbursement from a third party without first obtaining a judicial determination or an agreement with car accident victims that they were “made whole” by their settlement.

Lead plaintiff Lisa Stokes filed the GEICO class action lawsuit claiming that GEICO should have waited to obtain a “made whole” statement from insured customers before they sought reimbursement of Med Pay/PIP payments.

According to the GEICO class action, in the absence of a “made whole” agreement or judicial determination, GEICO should not have received subrogation payments.

GEICO denies any liability to Stokes and Class Members on the claims asserted in the class action lawsuit. However, the insurance company agreed to settle in order to avoid the expense and uncertainty of continued litigation.

Who’s Eligible

Class Members include individuals who received medical treatment as a result of an automobile accident and (a) who were insured under an automobile insurance policy that was issued in Arkansas by GEICO and pursuant to which GEICO made a Med Pay/PIP payment to a medical provider on behalf of the insured; and (b) who settled a bodily injury claim with a third party arising out of the automobile accident “pro se” and without the assistance of an attorney; and (c) as a result of that settlement, GEICO received a subrogation payment as reimbursement for a Med Pay/PIP payment between the dates of Nov. 1, 2008 and April 3, 2015.

Potential Award Varies.

Class Members who file a valid Claim Form will receive a payment not to exceed 100% of the amount GEICO received in Med Pay/PIP subrogation on their claim. If the number of eligible claims exceeds the amount available in the class action settlement fund, distributions will be made on a pro rata basis.

To see if you qualify go to http://topclassactions.com/lawsuit-settlements/open-lawsuit-settlements/170747-geico-auto-insurance-class-action-settlement/

Lovaza's Labeling is Incomplete--Side Effects Not Accurate

Lovaza, a prescription medicine made with omega 3 fatty acids  has recently been associated with a higher risk of  bleeding complications including subdural hematomas.

The omega-3 fatty acids found in Lovaza are the same type found in fish oil. Research for dozens of years has pointed to a link between the intake of omega-3 fatty acids and a lower risk of cardiovascular disease that can cause premature death.

Research has also shown that omega-3 fatty acids have a number of other positive effects, such as decreasing triglyceride levels, slowing the growth of atherosclerotic plague, and slightly lowering blood pressure.

However, recent studies have shown that omega-3 fatty acids also inhibit the function of platelets. Platelets are part of the process that causes proper and healthy blood clotting.

When the platelets are inhibited, bleeding time can be prolonged and therefore more dangerous. Omega-3 fatty acid supplements, including Lovaza, inhibit the function of platelets in blood clotting, which puts patients at risk of extended Lovaza bleeding complications such as subdural hematomas.

For those suffering from a subdural hematoma, excess blood collects between the layers of tissue surrounding the brain. The outermost layer of this tissue around the brain is called the dura, and the layer beneath it is called the arachnoid.

Subdural hematoma causes bleeding between the dura and the arachnoid. While subdural hematoma bleeding is not inside the brain itself, it can still negatively affect the brain.

Bleeding accumulates and pressure builds, which puts an increasing amount of pressure on the brain from outside. This pressure, if allowed to reach a very high level, can cause unconsciousness and in some cases, death.

Treatment of subdural hematomas can range from simply monitoring the condition and waiting to brain surgery. In cases where there is too much pressure on the brain, surgeons may have to perform serious operations to relieve the dangerous pressure.

Lovaza’s label, approved by the FDA, includes a warning about increased Lovaza bleeding complications with omega-3 fatty acids.

According to the American Heart Association, patients who wish to treat coronary artery disease or high triglycerides with omega-3 fatty acids may not be able to intake as much as they need in a regular diet. Therefore, the AHA recommends at least one gram of fish oil per day for coronary artery disease patients, and at least two grams per day for hypertriglyceridemia patients.

People who took Lovaza or a similar omega-3 fatty acid supplement or fish oil and have since suffered a subdural hematoma may be able to file a Lovaza lawsuit. Drug manufacturers such as GlaxoSmithKline have a legal responsibility to adequately warn consumers about the potential side effects of using their drugs.

Adventist Health Systems To Pay Out $118.7 Million

Three former employees of a North Carolina hospital were the first to expose an alleged scheme by Adventist Health System to pay doctors excessive compensation to lock in their patient referrals to Adventist-owned hospitals, clinics and other outpatient services in Florida, North Carolina, Tennessee and Texas.

The US Justice Department announced today that Adventist will pay a total of $118.7 million to the federal government and four states to settle a whistleblower (qui tam) lawsuit filed in December 2012 by those former employees. The settlement agreement also covers a separate qui tam lawsuit filed in 2013 that made the same allegations as some of those made earlier in Phillips & Cohen's qui tam lawsuit.

The Adventist settlement is the largest healthcare fraud settlement ever made involving physician referrals to hospitals. It is nearly twice the previous largest settlement involving hospital kickback allegations, which was North Broward Hospital District's recent $69.5 million settlement.

It was alleged Adventist's hospitals paid doctors outrageous sums and offered overly generous benefits and lax billing oversight as part of a corporate strategy to capture and control physician referrals for inpatient and outpatient services near its hospitals. Federal law prohibits hospitals from paying doctors directly or indirectly for referrals so that doctors make recommendations for care based on what's best for the patient – not what's best for the doctor's bank account.

A substantial portion of the settlement amount is based on allegations involving Florida Hospital Medical Group, an Adventist-owned physician practice in Florida whose doctors worked at several Adventist hospitals and dozens of Adventist-owned outpatient clinics. Those hospitals include Florida Hospital Altamonte, Florida Hospital Apopka, Florida Hospital Celebration Health, Florida Hospital Kissimmee, Florida Hospital Orlando, Florida Hospital Waterman (Tavares, Fla.), Florida Hospital for Children (Orlando, Fla.) and Winter Park Memorial Hospital.

The three whistleblowers were longtime employees at Adventist's Park Ridge Health in Hendersonville, NC, where they became aware of the alleged system-wide kickback scheme. Michael Payne was a risk manager and Melissa Church was the executive director of physician services at Park Ridge. Gloria Pryor was a compliance officer for physician offices at Park Ridge.

GM Reaches Settlement

 

General Motors announced that they have reached a criminal settlement to end the current government investigation of their faulty ignition switches. GM will pay $900 million for the Department of Justice fine incurred.

Additionally, GM has reached a resolution with over half of the death and personal injury lawsuits that are a part of the current multidistrict litigation through the U.S. District Court for the Southern District of New York. General Motors also settled in a shareholder class action lawsuit filed in the U.S. District court in Michigan for two civil lawsuits. The total for these settlements will set GM back another $575 million.

GM’s ignition switch defect caused cars to suddenly turn off when driving, most notably when the car was jostled from uneven road conditions. As well as an engine shutdown, power steering and power brakes were disabled and the airbags became deactivated. This led to numerous car accidents with severe injuries and deaths.

The MDL and shareholder class action settlements resolve about 1,380 death and personal injury lawsuits in total. GM did not release the individual settlement values paid in the various settlements.

The remaining lawsuits in the multidistrict litigation include economic loss claims, 370 injury lawsuits and 84 death lawsuits. Prior to Thursday’s announcement, GM had already agreed to offer ignition switch settlements to 124 families in death lawsuits and another 275 who were injured.

The nearly $1.5 billion GM is faced with in fines and settlements so far for the defect does not include the cost of fixing the 2.6 million vehicles that have been recalled due to the GM ignition switch defect.

Some consumers oppose how the situation was handled under the law. The Justice Department was criticized for not bringing charges against individual GM employees who were believed to have direct responsibility. In general, this criticism has extended to the DOJ in general for going after companies in general rather than prosecuting individuals for their wrongdoing.

When the GM scandal first came to light over a year ago, the company fired 15 employees for failing to resolve the ignition switch problem.

As it stands, there is no law that deals with criminal penalties for auto makers failing to disclose safety problems, so broader laws such as wire fraud and false statements are used.

According to court documents, GM knew of the ignition switch problem a decade ago in 2004 and 2005. Rather than making a simple and inexpensive change in the part at the time, which was estimated to cost approximately a dollar per vehicle, the situation was overlooked.

U.S. Attorney Preet Bharara summarized the situation, “”They let the public down. They didn’t tell the truth in the best way that they should have — to the regulators, to the public — about this serious safety issue that risked life and limb.”

KYB Agrees to Plead Guilty and Pay $62 Million Criminal Fine for Price Fixing

According to The Department of Justice, Kayaba Industry Co. Ltd., dba KYB Corporation has agreed to plead guilty and to pay a $62 million criminal fine for its role in a conspiracy to fix the price of shock absorbers installed in cars and motorcycles sold to U.S. consumers. 

According to charges filed, KYB conspired from the mid-1990s until 2012 to fix the prices of shock absorbers sold to Fuji Heavy Industries Ltd. (manufacturer of Subaru vehicles), Honda Motor Co. Ltd., Kawasaki Heavy Industries Ltd., Nissan Motor Company Ltd., Suzuki Motor Corporation and Toyota Motor Company, including their subsidiaries in the United States. 

“KYB turned the competitive process on its head by agreeing with its competitors to fix the prices of shock absorbers installed in cars and motorcycles sold in the U.S.,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division.  “Working with the FBI and our other law enforcement partners, the Antitrust Division will continue to protect American car buyers and hold automotive part suppliers accountable for their illegal conduct.”

“Fixing prices and rigging bids is against the law and ultimately harms consumers by artificially inflating prices and creating a corrupt marketplace,” said Special Agent in Charge Angela L. Byers of the FBI’s Cincinnati Division.  “The FBI and our partners will continue to investigate anticompetitive practices and promote fair competition.”

According to the information filed in the U.S. District Court of the Southern District of Ohio, KYB, based in Tokyo, and its two co-conspirators agreed to allocate the supply of shock absorbers sold and determine the price submitted to the targeted vehicle manufacturers.  To keep prices up, KYB and its co-conspirators also agreed to coordinate on price adjustments requested by the vehicle manufacturers and strived to keep their conduct secret. 

Jury Convicts Houston Psychiatrist in $158 Million Medicare Fraud Scheme

A Houston psychiatrist was convicted late yesterday by a federal jury of participating in a $158 million Medicare fraud scheme involving false claims for mental health treatment.

Sharon Iglehart, 58, of Harris County, Texas, was convicted of one count of conspiracy to commit health care fraud, one count of health care fraud and three counts of making false statements relating to health care matters, following a seven-day jury trial before U.S. District Judge Ewing Werlein Jr. of the Southern District of Texas.  Iglehart is scheduled to be sentenced on Dec. 5, 2015.
According to evidence presented at trial, from 2006 until June 2012, Iglehart and others engaged in a scheme to defraud Medicare by submitting, through Riverside General Hospital (Riverside), approximately $158 million in false and fraudulent claims for partial hospitalization program  services to Medicare.  A PHP is a form of intensive outpatient treatment for severe mental illness.
The evidence presented at trial showed that the Medicare beneficiaries for whom Riverside billed Medicare did not receive PHP services.  In fact, according to evidence presented at trial, most of the Medicare beneficiaries for whom Riverside billed Medicare rarely saw a psychiatrist and did not receive intensive psychiatric treatment.
In addition, evidence presented at trial showed that Iglehart personally billed Medicare for individual psychotherapy and other treatment to patients at Riverside locations – treatment that she never provided.  The evidence at trial also demonstrated that Iglehart falsified the medical records of patients at Riverside’s inpatient facility to make it appear as if she provided psychiatric treatment when, in fact, she did not.

Columbus Regional Healthcare System and Physician Ordered to Pay Over $25Million False Claims Violation

Columbus Regional Healthcare System and Dr. Andrew Pippas have agreed to pay more than $25 million to resolve allegations that they violated the False Claims Act by submitting claims in violation of the Stark Law.  Under the settlement agreement, Columbus Regional has agreed to pay $25 million, plus additional contingent payments not to exceed $10 million, for a maximum settlement amount of $35 million, and Pippas has agreed to pay $425,000.

The Stark Law prohibits physician referrals of certain health services for Medicare and Medicaid patients if the physician has a financial relationship with the entity to which he or she refers the patient.  The United States alleged that between 2003 and 2013, Columbus Regional provided excessive salary and directorship payments to Pippas that violated the Stark Law.

The United States also alleged that from May 2006 through May 2013, Columbus Regional submitted claims to federal health care programs for services at higher levels than supported by the documentation, and between 2010 and 2012, they submitted claims to federal health care programs for radiation therapy at higher levels than the therapy that was provided.

 

Of the $25.425 million that Columbus Regional and Pippas have agreed to pay to resolve their respective civil claims, they will pay $24,666,040 to the federal government for federal healthcare program losses and $758,960 to the state of Georgia for the state share of its Medicaid losses. 

Also as part of the settlement, Columbus Regional will enter into a Corporate Integrity Agreement  with the Department of Health and Human Services-Office of the Inspector General that requires Columbus Regional to implement measures designed to avoid or promptly detect future conduct similar to that which gave rise to this settlement.

 

 

Walter Investment Management Corp. Must Pay More than $29 Million

 

The Justice Department announced today that Walter Investment Management Corp. WIMC has agreed to pay $29.63 million to resolve allegations that WIMC, through its subsidiaries, Reverse Mortgage Solution Inc., REO Management Solutions LLC and RMS Asset Management Solutions LLC, violated the False Claims Act in connection with their participation in the Department of Housing and Urban Development’s Home Equity Conversion Mortgages program, which insures “reverse” mortgage loans.  WIMC, through subsidiaries such as RMS and Green Tree Servicing LLC, provides business support to the residential mortgage industry, including servicing of reverse or forward mortgages on behalf of major financial institutions.*

“The Department of Justice is committed to ensuring that those who service HUD-insured reverse mortgages are held accountable for their knowing failure to comply with important HUD requirements,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “Schemes such as these undermine an important tool available to older Americans who wish to use a HUD-insured reverse mortgage loan to age in place.”

Reverse mortgage loans allow elderly people to access the equity in their homes.  To encourage reverse mortgage loans, HUD insures such loans through a program administered by HUD’s Federal Housing Administration.  Under HUD’s program, a loan becomes due and payable when the home is sold or vacant for more than 12 months or upon the death of the homeowner, whichever comes first.  The lender is repaid the amount of the loan, including the costs of servicing the loan and interest that accrues, after a loan becomes due and payable.  HUD will reimburse a lender that is unable to recoup the full amount of the loan.  In order to file a claim, the servicer is required to meet a number of requirements and deadlines.  Failure to meet these requirements and deadlines could result in denial of the insurance claim.

The government alleged that, from August 2009 to March 2015, RMS, with the knowledge and support of its corporate parent, WIMC, submitted false claims for debenture interest from HUD by failing to properly disclose that it had not met certain deadlines and, therefore, was not entitled to such interest payments.  In order to obtain such interest, HUD requires lenders and their servicers to obtain appraisals within 30 days of the loan becoming due and payable.  The significance of the 30-day appraisal requirement is, among other things, to establish a mutual understanding between the lender and HUD as to the market value of the property so that a decision can be made as to whether to proceed with foreclosure, engage in a workout with the lender or deal with estate rights issues.

The government also alleged that from July 2010 to October 2014, WIMC, through its subsidiaries, submitted false claims to HUD for the reimbursement of unlawful referral fees by falsely representing them to be lawful sales commissions.  As part of an insurance claim, HUD will reimburse lenders or their servicers for sales commissions paid to real estate agents as part of the liquidation of foreclosed properties.  HUD will not, however, reimburse lenders or their servicers for fees paid for the referral of liquidation business.  According to the government, RMS often used straw companies to liquidate foreclosed properties.  Upon sale of the foreclosed property, the straw companies split the six-percent sales commissions: the real estate agents shared a five-percent sales commission and the companies kept a one-percent referral fee.  These straw companies, in turn, deducted a small fee from the one-percent referral fee and kicked the remainder back to RMS.  Nonetheless, RMS submitted insurance claims to HUD that included payment for the full six-percent sales commission, when, in fact, the payment included a prohibited referral fee.

The settlement resolves allegations filed in a lawsuit by Matthew McDonald, a former executive of RMS, under the qui tam, or whistleblower, provisions of the False Claims Act.  The act permits private individuals to sue on behalf of the government for false claims and to share in any recovery.  The False Claims Act also permits the government to intervene in such lawsuits, as it did in this case.  Mr. McDonald will receive $5.15 million as his share of the recovery in this case.

This information verified by the Dept. of Justice

FDA Cannot Prohibit the Promotion of Truthful, Off-Label Uses

Last week, a federal judge ruled that the Food and Drug Administration (FDA) cannot prohibit a pharmaceutical company from marketing its drugs for off-label uses if its claims are truthful and not misleading. This ruling, while not precedential, alters the traditional compliance regarding the legality of off-label marketing.

In 2012, the FDA approved Amarin’s drug, Vascepa®, for patients with very high triglyceride levels, a condition known to increase the risk of pancreatitis and cardiovascular disease. However, the FDA rejected a second use of the drug that would have allowed Amarin to market Vascepa to patients with persistently high triglycerides who also take statins (i.e., drugs used to lower cholesterol). Although it was undisputed that Vascepa was safe and effective in reducing such triglyceride levels, the FDA told Amarin it needed to submit additional data regarding whether lowering triglyceride levels for patients on statins actually translates to a reduced cardiovascular risk. Absent formal approval, the FDA contended that distributing information about the alternate use would constitute misbranding under the Federal Food, Drug, and Cosmetic Act (FDCA).

Amarin subsequently filed a lawsuit seeking declaratory and injunctive relief that would prevent the FDA from prosecuting it for truthful, non-misleading speech concerning Vascepa. Amarin argued that the FDA’s efforts to stop it from sharing “off-label” information would violate its free speech protections. In a 71-page opinion, Judge Engelmayer agreed with Amarin and ruled that, consistent with the First Amendment, Amarin “may engage in truthful and non-misleading speech promoting the off-label use of Vascepa.”

The FDA has 60 days to appeal Judge Engelmayer’s ruling. If the decision stands, it could continue to pave the way for pharmaceutical companies and medical device manufacturers to engage in the off-label marketing of drugs that is truthful and not misleading. While Amarin and Caronia signal a potential change in the way the government will have to approach off-label marketing cases, it is important to note that these decisions both come out of the Second Circuit, and it still is uncertain how other circuits will rule when presented with similar facts.

Kmart Guilty of False Claims Act Violation

KMART Corp. (Kmart), a discount department store chain that operates approximately 780 in-store pharmacies, has paid the United States $1.4 million to resolve allegations that it violated the False Claims Act by using drug manufacturer coupons and gasoline discounts as improper Medicare beneficiary inducements, the Justice Department announced today. 

 

The settlement resolves allegations that Kmart violated the False Claims Act by providing illegal benefits to beneficiaries of the Medicare program.  The government alleged that from June 2011 to June 2014, Kmart knowingly and improperly influenced the decisions of Medicare beneficiaries to bring their prescriptions to Kmart pharmacies by permitting the Medicare beneficiaries to use drug manufacturer coupons to reduce or eliminate prescription co-pays that they otherwise would be obligated to pay.  Federal law prohibits a person from offering beneficiaries of certain federal health programs, such as Medicare, remuneration that is intended to influence the beneficiary’s choice of provider.  The government alleged that Kmart’s conduct caused the Medicare beneficiaries to seek expensive, brand name drugs in lieu of cheaper generic drugs, which caused the government’s costs to increase without any medical benefit to the beneficiary.  The government also alleged that Kmart improperly encouraged Medicare beneficiaries to bring their prescriptions to Kmart pharmacies by offering them varying levels of discounts on the purchase of gasoline at participating gas stations based on the number of prescriptions that they filled at Kmart pharmacies.

 

The settlement resolves allegations in a lawsuit filed by Joshua Leighr, a former Kmart pharmacist, under the qui tam, or whistleblower provisions of the False Claims Act.  The act authorizes private parties, such as Mr. Leighr, to sue for fraud on behalf of the United States and to share in any recovery.  Mr. Leighr will receive approximately $248,500 of the settlement.   

 

Medtronic Infuse Bone Graft Class Action Lawsuit

Medtronic Inc., the nation’s largest medical device maker, is facing over 1,000 Infuse Bone Graft lawsuits that accuse the manufacturer of intentionally concealing dangerous side effects. These spinal surgery patients claim they suffered serious Infuse Bone Graft problems, including male sterility and other genital injuries, nerve damage, excessive bone growth, chronic pain, and difficulty breathing, swallowing, and speaking. These patients further accuse Medtronic of marketing the Infuse Bone Graft for off-label uses, putting thousands of spine surgery patients at risk for dangerous complications.

Class action lawsuit attorneys are currently looking for patients who were injured after undergoing back surgery with an Infuse Bone Graft. These patients can receive a free legal review using the form on this page and determine if they’re eligible to pursue compensation for their injuries, medical expenses, pain and suffering, and more.

  

Medtronic’s promotion of off-label uses for the Infuse Bone Graft has led to two whistleblower lawsuits and a $40 million settlement with the U.S. Department of Justice in 2006. In addition, Medtronic recently agreed to an $85 million settlement with shareholders who filed a lawsuit over the drop in stock prices related to the DOJ’s investigation.

In 2012, the Senate Finance Committee announced the results of its year-long investigation into allegations Medtronic used false advertising and kickbacks to increase sales of their products. The study revealed that Medtronic paid more than $200 million in consulting fees to authors who were supposed to be studying the efficacy of Infuse.

Hundreds of Infuse Bone Graft lawsuits have been filed in state and federal courts by plaintiffs who allege they suffered serious Infuse Bone Graft complications.