Tag: Kaiser

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Whistleblowers Awarded $95M in Kaiser Fraud Settlement

Whistleblower Attorneys Los Angeles, rewards and protection.

Whistleblowers Reward: Inside the $95 Million Payout from Kaiser Settlement

Whistleblowing is a courageous act that defends public funds and holds powerful organizations accountable. It offers not only the chance to fulfill a moral imperative but also the potential for financial rewards for those daring enough to step forward and stop corporations from misusing public resources.

Recently, healthcare giant Kaiser Permanente agreed to pay an astounding $556 million to resolve allegations of defrauding the federal government. However, the most inspiring aspect of this story goes beyond the corporation’s penalty—it lies in the rewards earned by the brave individuals who exposed the fraud. The whistleblowers in this case will collectively receive $95 million for their vital role in uncovering the scheme.

If you possess knowledge of corporate fraud, this case serves as a powerful reminder of the profound impact you can make, along with the protection and rewards that are available to you under the law.

The Kaiser Permanente Case: A Breakdown

The settlement represents the collaboration of Kaiser Foundation Health Plan of Washington, Kaiser Foundation Health Plan, Inc., and their dedicated affiliated entities. At its heart, the case highlights the importance of integrity within the Medicare Advantage program, a vital government-funded health insurance option for our seniors.

The Allegations

The essence of the case revolves around the critical aspect of “risk adjustment” within our healthcare system. In the Medicare Advantage program, the government empowers insurance plans with a monthly allowance per beneficiary, promoting fairness and responsiveness to individual health needs—ensuring that plans receive appropriate support for patients facing greater health challenges and managing chronic conditions.

According to the Department of Justice and the settlement agreement, Kaiser was accused of:

  • Pressuring physicians to create addenda to medical records after patient visits had concluded, specifically to add diagnoses that the patients did not actually have or that were not relevant to the visit.
  • Submitting false claims for risk-adjustment payments based on these improper diagnoses.
  • Mining medical records for potential diagnoses that could boost revenue, often without sufficient medical justification.

Essentially, the government alleged that Kaiser made its patients look sicker on paper than they actually were to collect higher payments from Medicare.

The Resolution

To settle these allegations, Kaiser agreed to pay $556 million to the United States, a significant step toward accountability. This settlement resolves civil claims arising from the company’s violations of the False Claims Act, highlighting the importance of integrity in our systems. Notably, as is customary in such agreements, Kaiser does not admit liability, and the United States does not concede the validity of its claims.

The Role of the Whistleblowers

This remarkable recovery of taxpayer dollars owes much to the courage of those within the organization. The settlement stems from lawsuits initiated by two brave whistleblowers who stood up for what is right under the qui tam provisions of the False Claims Act.

The whistleblowers in this case were:

  1. Ronda Osinek, a former employee who filed her lawsuit in 2013.
  2. James M. Taylor, M.D., a physician who filed his lawsuit in 2014.

Understanding the False Claims Act

The Kaiser settlement highlights the power of the False Claims Act (FCA), which is the government’s primary tool for combating fraud. The FCA incentivizes individuals (relators) to report fraud by offering them a share of the financial recovery.

What is a Qui Tam Action?

A qui tam action allows a private individual with knowledge of fraud against the government to file a lawsuit on the government’s behalf. If the lawsuit is successful, the whistleblower receives a percentage of the funds recovered.

As detailed in the Helmer Friedman LLP resources on whistleblower rewards, the FCA covers various types of fraud, including:

  • Charging for goods or services not provided.
  • Billing for unnecessary medical procedures or tests.
  • Falsely certifying information to get paid.
  • “Upcoding” or billing for more expensive services than those actually rendered.

Calculating the Reward

The reward amount in a False Claims Act case is not random. It is statutory. If the government intervenes in the case (takes over the prosecution), the whistleblower is generally entitled to receive between 15% and 25% of the recovery. If the government declines to intervene and the whistleblower pursues the case on their own, the reward can increase to between 25% and 30%.

In the Kaiser case, the roughly $95 million payout represents a significant percentage of the total settlement, acknowledging the critical role Osinek and Dr. Taylor played in the investigation.

Why You Need a Whistleblower Attorney

While the rewards can be substantial, navigating a False Claims Act case is legally complex and fraught with potential pitfalls. You cannot simply call a government hotline and expect a multi-million dollar check.

To file a qui tam lawsuit and be eligible for a reward, you must follow strict procedural rules:

  1. Confidentiality: The lawsuit must be filed “under seal,” meaning it is kept secret from the public and the defendant while the government investigates. Breaking this seal prematurely can disqualify you from receiving a reward.
  2. Original Information: The information you provide must be “original,” meaning it is not already publicly known or previously disclosed to the government by someone else.
  3. Legal Representation: You generally cannot file a qui tam suit pro se (without a lawyer). You need an attorney to represent the government’s interests as well as your own.

Furthermore, employers often fight back. While the law prohibits retaliation against whistleblowers, having an experienced employment lawyer is essential to protect your career and rights throughout the process.

Other Whistleblower Programs

The False Claims Act isn’t the only avenue for reporting fraud. Depending on the nature of the violation, other programs may apply:

  • SEC Whistleblower Program: For violations of securities laws (like insider trading, Ponzi schemes, or accounting fraud). The SEC awards 10-30% of sanctions over $1 million.
  • IRS Whistleblower Program: For reporting tax evasion or underpayment. Awards generally range from 15% to 30% of the proceeds collected by the IRS.

Taking the First Step

The $95 million award to the Kaiser whistleblowers stands as a powerful reminder that choosing to do the right thing can lead to both justice and financial reward. These cases demand patience, discretion, and expert legal guidance.

If you possess credible information about corporate fraud, Medicare fraud, or other violations of federal or state law, prioritize confidentiality by avoiding discussions with colleagues or posts on social media. Your first step should be a private consultation with a qualified whistleblower attorney who can evaluate your claim and expertly navigate you through the journey of protected disclosure.

At Helmer Friedman LLP, we bring over 20 years of dedicated experience advocating for justice and empowering individuals who are ready to challenge the status quo. We recognize the significance of your actions, and we are unwavering in our commitment to securing the maximum reward you rightfully deserve.

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Jury Could Find Termination Substantially Motivated by Disability

Disability Discrimination Lawyers of Helmer Friedman LLP have extensive knowledge in this area of law.

Although Employer Had Tentatively Placed Employee RIF List Before Becoming Aware of Her Disability, It Did Not Terminate Her Employment Until After It Was Aware Of Her Disability – A Reasonable Jury Could Find That Employee’s Ultimate Termination Was Substantially Motivated By Her Disability

Lin v. Kaiser Found. Hosps., 88 Cal.App.5th 712 (2023)

Suchin I. Lin was employed by Kaiser as an IT Engineer. Lin became disabled as a result of a fall in the workplace which caused her to suffer an injury to her left shoulder. A doctor issued a work status report placing Lin on modified duty with restrictions requiring Lin to use a sling and to limit the use of her left arm. The doctor also indicated that surgery might be necessary. As part of a round of employee layoffs Kaiser planned, at least tentatively, to terminate Lin before Lin became disabled. Following her disability, Kaiser went forward with her layoff. Lin sued for disability discrimination. Kaiser filed a motion for summary judgment, arguing that it was entitled to summary adjudication of Lin’s disability discrimination and retaliation claims because the decision-maker had made the decision to eliminate Lin’s position in a RIF before Lin sustained her disability. Lin opposed the motion arguing that, while her name was selected for the initial RIF list prior to her disability, this “proposed” list was “subject to further review,” as reflected in the list’s gradual reduction from 31 employees to the 17 who were ultimately laid off. She further argued that her ultimate termination was a result of the decision-maker’s reliance on her supervisor’s post-disability assessment of her, particularly a post-disability email to the decision-maker rating her performance much lower than that of her teammates. The trial court granted Kaiser’s motion.

On appeal, the Court of Appeal reversed. The Court of Appeal held that Kaiser’s plan to terminate Lin before she became disabled, by itself, was (of course) not discrimination against Lin because of her disability. But Kaiser did not complete its layoff plans—or, a reasonable jury could find, make its final determination to terminate Lin—until after Lin had become disabled. The Court of Appeal found that there was evidence from which a reasonable jury could conclude that Kaiser’s ultimate decision to terminate Lin was motivated, at least in substantial part, by concerns Kaiser had about Lin’s disability. The Court of Appeal found the following facts important in its decision:

  • Before Lin sustained her disability, neither her then-current supervisor nor any prior supervisor had given her a negative performance evaluation.
  • After Lin sustained her disability, her then-current supervisor began giving her negative feedback and a poor performance evaluation.
  • Lin’s then-current supervisor’s criticisms, in large part, revolved around his concerns about her “slow delivery” and her “pace of execution” – concerns that a jury could find stemmed directly from her disability.

Lin’s then-current supervisor agreed to Lin’s request for light-duty work as a form of accommodation for her disability (but he never actually provided her with light-duty work). His agreement to assign Lin lighter tasks supported a reasonable inference that he believed her disability prevented her from handling her usual workload.