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Guttman, Freidin & Celler Guttman, Freidin & Celler Whistleblower Group

The Stark Law And Whistleblower Claims

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Healthcare billing fraud is a significant problem in the United States. It occurs when providers in the medical industry—hospitals, physicians, clinics, pharmacies, etc—improperly bill private insurance companies or government programs. For health providers that accept government dollars (Medicare, Medicaid, etc), there are especially strict billing regulations in place.

The Stark Law refers to a set of federal regulations that prohibit self-referrals (kickbacks) in public health billing. Stark Law violations carry stiff penalties—and the government often relies on whistleblowers to uncover improper billing practices. Here, our Florida healthcare billing fraud lawyers highlight the key things you should know about the Stark Law and whistleblower claims.

Stark Law: Restrictions on Self-Referrals 

A significant portion of all healthcare costs in the United States are covered by Medicare or Medicaid. The Stark Law bars doctors, hospitals, and other medical providers from billing Medicare or Medicaid based on a “self-referral.” In effect, it is unlawful for a doctor (or other entity) to refer a patient to another provider with which they or their immediate family member has a direct financial interest. 

Whistleblower Rights: The Stark Law and the False Claims Act 

The federal government is responsible for enforcing the Stark Law. However, as with many other types of financial fraud, Stark Law violations are often difficult for authorities to identify. For this reason, the government often relies on whistleblower disclosures to help stop illegal self-referrals, medical industry kickbacks, and other types of healthcare billing fraud.

Through the False Claims Act, a whistleblower can take action to stop a Stark Law violation. A False Claims Act lawsuit can be filed directly by an individual whistleblower against a doctor, hospital, or any other party in violation of the Stark Law. A successful qui tam lawsuit allows a whistleblower to obtain an award constituting a portion of the compensation recovered by the government.

Stark Law and Whistleblower Example: A $115 Million Settlement

The cost of medical services is notoriously expensive. For this reason, many Stark Law violations can be significant. As an example, in 2015, the Department of Justice (DOJ) reached a $115 settlement in a Stark Law whistleblower case. The False Claims Act qui tam lawsuit was filed against Adventist Health System, over alleged Stark Law violations. The company settled the matter after facing accusations that it employed physicians who received direct financial bonuses for making certain referrals that resulted in a prohibited financial benefit for the company.

Notably, the enforcement action by the DOJ occurred after three whistleblowers came forward and filed two separate False Claims Act lawsuits against the company. The federal government, multiple state governments, and the whistleblowers all received an undisclosed share of the $115 million settlement.

Contact Our Florida False Claims Act Attorneys for Immediate Help

At Guttman, Freidin & Celler, our Florida healthcare billing fraud attorneys are strong, effective advocates for whistleblowers. If you have any questions about the Stark Law and whistleblower claims, we can help. Contact us now for a strictly confidential consultation. From our office in Miami, we provide whistleblower representation in Miami-Dade County, Florida, and nationwide.

Resource:

justice.gov/opa/pr/adventist-health-system-agrees-pay-115-million-settle-false-claims-act-allegations

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