The Department of Justice has settled a whistleblower lawsuit against certain cardiac monitoring companies, resolving allegations that the companies were purposely overbilling Medicare, violating the False Claims Act and committing fraud against the government.

The companies targeted for allegedly overbilling Medicare are AMI Monitoring Inc. (also known as Spectocor), Medi-Lynx Cardiac Monitoring LLC, and Medicalgorithmics SA.

According to the whistleblower lawsuit, these companies made a habit of overbilling Medicare by charging for more expensive cardiac monitoring services than physicians actually requested. The lawsuit alleges that this practice violates the False Claims Act.

The Department of Justice announced in a June 26 press release that the companies have agreed to a $13.45 million total settlement amount to resolve these allegations.

The specific claim leveled against these companies is that when physicians attempted to enroll patients in a program called Pocket ECG, they would automatically be enrolled through whatever service that cost the most.

“We will vigilantly ensure the appropriate use of our country’s limited Medicare funds,” said Acting Assistant Attorney General Chad A. Readler. Readler belongs to the Civil Division of the Department of Justice. “Independent diagnostic testing facilities that improperly steer physicians to order higher levels of service will be held accountable,” Readler said.

“Billing for unneeded services, as the government alleged, takes unfair advantage of Medicare patients and steals from taxpayers,” said Special Agent in Charge Scott J. Lampert for the U.S. Department of Health and Human Services Office of Inspector General in a statement. “OIG, along with our law enforcement partners, will aggressively investigate these crimes.”

This issue was initially brought to the government’s attention through a whistleblower, Eben S., who formerly worked as a sales manager for Spectocor. Whistleblower lawsuits like Eben’s are allowed under the False Claims Act, which gives employees and former employees who have witnessed some kind of fraud to sue on behalf of the government.

Whistleblowers also receive a share of the settlement money for their role in alerting the government to these allegations. In the case of this whistleblower, his portion is around $2.4 million of the total $13.45 million settlement money.

Whistleblower Lawsuits

Whistleblowers are individuals who report the fraud and illegal activities against the government of their current or former employers. Many employees choose to come forward as whistleblowers because they do not feel right about their employer’s actions. A whistleblower lawsuit can be filed while working at the company, but can also be filed after having left the company. While a person considering becoming a whistleblower may be worried that they will face retaliation for their actions, federal law offers protections for whistleblowers against retaliatory actions by their employers.

If the claim is successful, the whistleblower is also typically given a substantial reward—often between 15 and 30 percent of the money recovered in the subsequent whistleblower lawsuit.

If you believe you have witnessed some kind of fraud by your current or former employer, such as purposely overbilling Medicare, you may be able to file a whistleblower lawsuit (also known as a qui tam lawsuit) against your employer on behalf of the government.