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Health care's bounty system

In the Old West, bounty hunters wore cowboy hats and spurs. They would pursue fugitives across plains, through valleys and over mountains in search of a payday. Today, bounty hunters wear business attire and might work for the federal government, suppliers of durable medical equipment, home health care companies or other providers.

They are in pursuit of investigation targets that could mean big paydays from whistleblower lawsuits filed under the False Claims Act. Those whistleblower claims benefit both the federal government and the person who files the lawsuit. (Whistleblowers can receive up to 30 percent of settlements and awards.)

A recent article on the home health care industry makes it clear that this bounty system can punish companies and individuals who have done nothing of substance wrong. The federal government's stated priority of pursuing health care fraud has created something of a gold rush of people interested in cashing in.

Durable medical equipment suppliers and clinical and reference labs are sometimes caught in the rush. If they're lucky, the article states, "their government investigations will merely result in dozens of hours of lost time; (and) thousands of dollars spent in legal and accounting fees." And if their luck holds, damage to the company's reputation will be reversible over time.

However, fines and penalties can add up quickly, quickly soaring into six figures and beyond. Sometimes the companies are punished further by being excluded from Medicare and Medicaid participation.

Health care fraud and kickbacks investigators will also undoubtedly mention that imprisonment is possible for company owners, managers, doctors, etc.

Many observers believe this modern-day bounty system needlessly drags health care providers and suppliers into expensive, damaging investigations that often turn up little more than bookkeeping errors or lack of documentation.

If you or your firm is under investigation, contact the New York City law firm of Rivas Goldstein LLP to discuss your legal options.

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