Osteoarthritis institute settles FCA allegations under the whistleblower provision for $7 million

Former Osteo Relief Institutes (“ORI”) and their owners have agreed to settle False Claims Act (“FCA”) allegations for $7.1 million. A lawsuit alleged that the ORI’s knowingly submitted and billed Medicare for medically unnecessary viscosupplemention injections and knee braces in order to receive a higher reimbursement from the government. Viscosupplementation is a treatment for osteoarthritis where a doctor injects fluid into a patient’s knee to act as a lubricant, which supplements the natural properties of the joint fluid. The allegations stated that the clinics administered the injections to patients who did not actually need them and the clinics used multiple brands of injections on patients without clinical support. As a result, the clinics allegedly provided unnecessary custom knee braces to the patients. In conduction with the civil settlement, ORI clinics entered into a Corporate Integrity Agreement (“CIA”) with the department of Health and Human Services, which requires a comprehensive compliance control and annual review process from an Independent Review Organization. 

The FCA provides that a person who knowingly submits false claims to the government is liable for the government’s damages. Simply submitting a false claim to the government will not suffice; to violate the FCA, a person has to knowingly submit a false claim. Under section § 3729(b)(1) of the FCA, knowledge of false information is defined as being (1) actual knowledge, (2) deliberate ignorance of the truth or falsity of the information, or (3) reckless disregard of the truth or falsity of the information.

The FCA also has a whistleblower or qui tam provision that allows private persons to sue on behalf of the government and receive a percentage of the recovery, if any. Section 3730(b)(2) provides that a qui tam complaint must be filed with the court under seal, which gives the government time to deicide if it is going to intervene or not. If the government does not intervene, the whistleblower is entitled to pursue the action on is or her own. Here, the settlement was a result of a whistleblower complaint which put the government on notice of this alleged fraudulent activity. According to the Department of Justice, the whistleblower in this action will receive $857,550. 

If you are an individual who has knowledge of fraud being committed against the government, consider speaking with an attorney to learn your rights. Josh Borsellino is a FCA attorney who understands the rules about filing FCA and whistleblower complaints. He offers free consultations so call him today at 817.908.9861 or 432.242.7118. 

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