The COVID-19 pandemic has wreaked havoc on the American health care industry, the U.S. economy and the everyday lives of Americans. The U.S. government quickly passed the Coronavirus Aid, Relief and Economic Security Act (CARES Act) of 2020 to help American workers, families, small businesses and industries cope with the pandemic.
In a shameless display of corporate greed, unscrupulous businesses have taken advantage of the government’s generosity and fleeced taxpayers of hundreds of billions of dollars through fraudulent means.
These thieves used their ill-gotten gains to purchase luxury items including luxury cars, private jets, mansions and vacations while depriving honest, deserving Americans of funds for basic needs.
The attorneys at The Lanier Law Firm admire the courage of those who blow the whistle on corruption and abuse. Our firm is committed to protecting our clients’ rights while holding bad actors accountable and recovering maximum compensation.
COVID-19 Fraud Schemes
The Department of Justice (DOJ) relies on whistleblowers to expose these abuses, which might otherwise continue undetected.
Health Care Fraud
Medicare and Medicaid fraud occur when health care institutions fraudulently bill these programs to receive higher payments for services. Under the CARES Act, health care providers received the following COVID-19 relief:
- 20 percent higher Medicare reimbursement for COVID patients
- Increased flexibility to offer and bill for telemedicine services
- A waiver of the requirements for in-person visits for opioid medication refills
These provisions gave rise to several types of health care fraud.
Billing Fraud
Providers fraudulently performed and billed for unnecessary services, including the following:
- Unnecessary lab tests, including widespread overuse of expensive tests like the Respiratory Pathogen Panel and cardiac MRI
- Unnecessary COVID-19 tests
Providers also employed fraudulent coding and billing practices:
- Upcoding (such as coding telehealth check-ins as full-service visits)
- Collecting co-pays while billing with non-cost sharing codes
- Billing the patient and the insurance for the same service
- Billing for services that did not occur
Telehealth Fraud
Medicaid and CHIP programs have noted a 2,632 percent increase in billed services since telemedicine has become more common due to COVID-19. This raises serious red flags about fraudulent claims and telemedicine being used inappropriately.
Identity Theft
Fraudsters posing as health care providers have been obtaining personal information and using it to fraudulently bill federal health care programs.
Fraudulent Products
Internet companies are making millions from fraudulent COVID-19 products. These include the following:
- Fake COVID-19 testing kits
- Fake vaccines
- Fraudulent COVID-19 treatments
- Fake vaccine cards
Procurement Fraud
Supply chain challenges and high demand for medical equipment have prompted some purchasing departments to bypass regular vendor screening protocols. Fraudulent vendors have taken advantage of this through procurement fraud. For example:
- Fraudulent vendors require pre-payment for COVID-19 supplies but never deliver the goods.
- Purchasing agents accept bribes or “kickbacks” in exchange for agreeing to purchase goods or services
The U.S. Attorney General has also prosecuted several cases of hoarding and price-gouging personal protective equipment.
Loan Fraud
The Paycheck Protection Program (PPP) is a forgivable loan offered to small businesses to help them pay employees through the pandemic. The Economic Injury Disaster Loan (EIDL) is a loan program for businesses that experienced financial losses from the pandemic. EIDL and PPP loans are administered by the Small Business Administration (SBA).
These programs are no longer available, but it is not too late to blow the whistle on companies that defrauded these programs, which had limited funding. Every dollar fraudulent borrowers stole was from the pockets of fledgling small business owners, millions of whom were deprived of much-needed COVID-19 relief as a result of the fraud.
The fraud was committed through the following methods:
- Falsification of records and statements to obtain funds, commonly pertaining to the following:
- Number of employees
- Average monthly revenue
- Inflated payroll figures
- Applicant criminal backgrounds
- False self-certification of the date businesses were established. Businesses had to be established by January 31, 2020, to qualify for an EIDL grant.
- Creation of fake companies
- Submission of identical loan applications under different company names
- Misappropriation of PPP relief funds for personal gain
Unemployment Fraud
It is estimated that unemployment fraud has resulted in the theft of more than $87 billion dollars of government funds by individual claimants and businesses. Individuals steal from the program through identity theft or by continuing to collect benefits while working.
Business scams have involved the hiring and firing of fake employees and the collection of unemployment benefits by fraud within the company.
What should I do if I am aware that someone is defrauding the government?
Most whistleblowers are employees of a company where fraud is taking place. Blowing the whistle on an employer can be daunting. Many employees attempt to rectify the issue by expressing their concerns to a supervisor or human resources.
Businesses tend to place their own interests above the interests of individual employees. Expressing your concerns could adversely impact your relationship with your employer if you are not aware of your rights.
The safest action is to contact an experienced whistleblower attorney before you discuss your concerns with anyone else. The attorneys at The Lanier Law Firm will keep your concerns confidential and provide you with legal advice about your rights and options.
When you are ready to move forward, you will need strong evidence to back up your claims, such as financial reports, interoffice memos, meeting notes or other documents. You will also need to file a formal complaint through the Office of the Inspector General. You can request anonymity when you file. Your whistleblower lawyer can help you gather the evidence and file your complaint.
What is the False Claims Act?
The False Claims Act (FCA) imposes penalties on those who intentionally engage in acts to defraud the government through the submission of false claims for benefits from government programs, including government-funded loan programs, grants and health insurance programs.
The act allows any individual who has become aware of such wrongdoing to file a lawsuit on behalf of the government under qui tam provisions. In a qui tam lawsuit, the person who files the claim is called a relator. The government is technically the plaintiff and may choose to take over the case. This is called an intervention.
The Whistleblower Protection Act
The primary concern of many whistleblowers is the potential for retaliation. This is a valid concern. Retaliation is a common response by wrongdoers against those who expose their fraud. The federal government values whistleblowers and provides protection against retaliation.
The Whistleblower Protection Act prohibits retaliatory measures against whistleblowers, which include any of the following:
- Termination
- Demotion
- Denial of a promotion
- Undesirable work schedule
- Denial of access to training
- Unfavorable changes to work details
- Any adverse treatment
Whistleblowers can file retaliation claims with the Office of the Inspector General against any retaliatory employer.
The Whistleblower Protection Act also requires government entities to keep confidential the identity of any whistleblower who has not consented to be identified.
The act was enhanced in 2012 to prohibit employers from issuing or enforcing nondisclosure agreements or policies that do not make an exception for blowing the whistle on fraud.
Compensation for Whistleblowers
Whistleblowers are an important weapon in the government’s arsenal against fraud. However, the risks can serve as a deterrent. To counteract this, the government compensates whistleblowers whose assistance results in the successful recovery of funds.
Compensation ranges from 10 to 30 percent of the amount the government recovers. Compensation is only available to one whistleblower in each case. In the event more than one person blows the whistle, compensation generally goes to the first complainant. This is one reason it is important to limit discussions with anyone other than your attorney.
How much time do I have to file a False Claims Act case?
In most whistleblower cases, the statute of limitations for claims is six years after the date of the violation. This can be extended to up to 10 years when the government was not aware of the offense during the prescriptive period.
The statutes of limitations for retaliation claims vary as follows:
- Military service members: The Military Whistleblower Protection Act applies a statute of limitation of one year.
- Health and Human Services contractors, subcontractors, grantees and subgrantees: The National Defense Authorization Act applies a three-year statute of limitations.
- Most other employees: The Whistleblower Protection Act does not impose a statute of limitations.
How can The Lanier Law Firm help?
When you are faced with the uncomfortable predicament of witnessing corruption, you may feel trapped, alone and uncertain. A confidential consultation with an experienced business attorney can help you get it off your chest and clarify the issues.
The Lanier Law Firm has more than 30 years of experience filing qui tam actions and protecting clients from employer retaliation prohibited by whistleblower laws. We are committed to providing strong advocacy for our clients throughout the process.
Our attorneys are professional and supportive. You do not have to go through this process alone. We have office locations in New York City, Houston and Los Angeles, and we take cases nationwide. Contact us today to schedule a free consultation.
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