James Taylor, MD, a former physician director of coding and medical director of revenue cycle at Kaiser’s Colorado Permanente Medical Group, just wanted Kaiser to do the right thing and stop submitting false claims to Medicare Advantage.
Dr. Taylor, who describes himself as tenacious to a fault, says he waited 7 years to file his lawsuit because he thought he could convince Kaiser to fix the coding problems on their end. He alternated between optimism and despair as Kaiser’s management supported some solutions only to shut them down later.
Finally, Dr. Taylor had had enough – the stress was getting to him, and his job was on the line.
As a last resort, he consulted a law firm that specializes in whistle-blower cases. Soon afterward, they filed a civil lawsuit in Colorado.
“My wife says that I have a justice gene – she can tell when it’s vibrating because I get amazed, not because people do wrong things, which they do all the time, but to that scale where it’s millions of dollars, and they’re being smug and acting like a bully. They thought they would never get caught and just kept going and even ramped it up in some situations,” says Dr. Taylor.
Several other whistle-blowers filed five lawsuits also alleging that Kaiser knew it was committing Medicare Advantage fraud amounting to tens of millions of dollars. The U.S. Department of Justice (DoJ) announced in July that it will join the six lawsuits and that it would file its complaint by late October.
Martin Mansukhani, a former regional CFO for Prime Health Care, was out of the country when the CEO signed a multimillion dollar contract with a cardiologist that went into effect immediately. At first, he tried to make the agreement work financially but then realized there were serious problems with the contract. He consulted a law firm, which confirmed that this was a kickback scheme in which the cardiologist was being overpaid in exchange for referring patients to Prime hospitals. The attorneys filed his whistle-blower lawsuit in 2017.
“My goal in filing the lawsuit was to get the company to stop these business practices,” says Mr. Mansukhani.
For being a whistle-blower, Mr. Mansukhani will receive nearly $10 million from the $37 settlement the DoJ negotiated. The False Claims Act entitles whistle-blowers to receive a higher reward (25% to 30%) when the DoJ doesn’t join a case than when it does (15% to 25%).
His lawsuit alleges that Prime Health Care, a hospital chain in California, its CEO, Prem Reddy, MD, and cardiologist Siva Arunasalam, MD, violated the federal Anti-Kickback Statute and the Stark Law, which generally make it illegal for anyone to offer or to provide something of value in exchange for a referral for a federal health care service. The suit also alleges that Prime had engaged in fraudulent billing practices.
The most challenging aspect was the decision to file the case. “It was a big-time commitment to pull together the evidence and to spend time interviewing law firms to determine who would best represent me, before I chose Phillips & Cohen,” says Mr. Mansukhani.