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Children’s Hospital (DC) whistleblower awarded $1.9 million

A former employee of Children’s Hospital in the District of Columbia who blew the whistle on alleged false cost reports submitted to federal and state Medicaid programs will collect $1.9 million as his share of a False Claims Act settlement.

James A. Roark Sr. sued Children’s Hospital and the Children’s National Medical Center Inc. as a private citizen on behalf of the United States. Under the False Claims Act, the United States is entitled to intervene in so-called qui tam lawsuits, as it did in this case.

Children’s Hospital and affiliated entities agreed Monday to pay $12.9 million to resolve allegations in the lawsuit that they violated federal law by submitting false cost reports to Department Health and Human Services (HHS), as well as to Virginia and District of Columbia Medicaid programs.

The defendants are based in Washington, D.C. and provide pediatric care throughout the metropolitan region.

In a separate case from 2013, Roark collected $800,000 as part of a $4.2 million settlement of a False Claims Act complaint against Specialty Hospitals of America LLC. His lawsuit alleged that inaccurate cost and expense data led to inflated Medicare claims at two long-term care facilities in Washington, D.C.

Roark had performed regulatory and compliance duties for Portsmouth, New Hampshire-based Specialty Hospitals.

According to Monday’s settlement, Children’s Hospital allegedly misreported its available bed count on applications for payments and misstated overhead costs. That resulted in overpayments from Medicare and from Virginia and District of Columbia Medicaid programs.

“The false reporting alleged in today’s settlement deprived the Medicare Trust Fund of millions of taxpayers’ dollars,” Benjamin C. Mizer of the DOJ’s civil division said Monday in a statement.

Since January 2009, the DOJ has recovered more than $24.3 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.

The case was United States ex rel. Roark v. Children’s Hosp., et al., No. 1:14-cv-00616 (D.D.C.).

The DOJ said the claims resolved by the settlement are allegations only, and there has been no determination of liability.

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.

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