Qui Tam — the consultant’s new revenue line.
Qui Tam, also called Whistleblower and False Claims Act, allows someone with inside knowledge of a company’s illegal actions against the government to inform the government. The whistleblower will get between 15% and 30% of any fines. Usually Qui Tam is done by former or current employees.
1. Shands to pay $26M for false claims
Six of the Florida system’s hospitals allegedly overbilled Medicare and Medicaid
8/20/13 Healthcare Finance News (excerpt)
The six Florida hospitals were named as defendants in a whistle-blower lawsuit, filed in 2008, brought under the False Claims Act by Terry Myers, president of a healthcare consulting firm, YPRO Corp. Medicare and the other federal healthcare payers will receive nearly $25.2 million of the $26 million settlement, the DOJ said in the press release. Adding that Myers’ portion of the recoveries had not yet been determined. (Could be between $4 million and $8 million.)
2. 1989-1993 — Tom Nicholas and I worked for a consulting firm. In the beginning things were good; employer and staff were friendly; learned lots; loved the clients, and the business. About late 1991 the managing partner of the firm fell in love with an insurance product that gave big kickbacks to the person who sold the policy. He wanted everybody to be pushing the product in order to get the kickbacks. The product was not a good product, and we were told not to disclose that or the matter of the kickback. Tom & Tom had a hard time with this and danced a pretty step in order NOT to have clients we worked with buy it. We thought we were working for a dairy (milk, butter, cheese, and the cow lives) and discovered our boss was wanting to be a butcher killing and selling our cows.
In 1993 as the pressure built on us to sell the product I asked the member hotline of the Institute of Management Accountants (IMA) what should or could I do. IMA said to quit or do the job as the firm’s actions were not illegal. T & T, the dynamite consultants, started September 17, 1993. Ethics, not money forced us to go out on our own.
I tell people we are a 100% ethical firm as Tom Nicholas has 200% and we average out. It did not occur to either of us to blow the whistle on those providers we knew that had bought the insurance product or on our former employer. If successful, Medicare would have forced the providers to pay back the money to Medicare (which paid for most of the cost in the cost reimbursement era of the 1990’s) which would have closed down most of them. I found it ironic that both the insurance agency and our former employer within a few years filed bankruptcy.
I am appalled at the consultants who file Qui Tam actions against their clients. As Tom Nicholas has said “you ride for the brand.” Quit and find another brand. I admit in the above Qui Tam case, and also that of the LHC Group I would have tried other avenues to convince the client not to break the law and to return the monies — which in all cases cost less than the fines.