Florida Birth-Related Neurological Injury Compensation Plan and Association to Pay $51 Million to Resolve False Claims Act Allegations
The Florida Birth-Related Neurological Injury Compensation Plan and its administrator, the Florida Birth-Related Neurological Injury Compensation Association (collectively, “NICA”), have agreed to pay $51 million to resolve allegations that they violated the False Claims Act by causing NICA participants to submit their healthcare claims to Medicaid rather than NICA, in violation of Medicaid’s status as the payer of last resort under federal law.
The civil settlement resolves a lawsuit filed and pursued by Veronica N. Arven and the estate of Theodore Arven III against NICA under the qui tam or whistleblower provisions of the False Claims Act, which permit a private party (known as a relator) to file a lawsuit on behalf of the United States and receive a portion of any recovery. Although the United States did not intervene in this case, it continued to investigate the whistleblowers’ allegations, provided substantial assistance to the whistleblowers in defending against a motion to dismiss, and negotiated the settlement announced today. The Arvens will receive $12,750,000 as their share of the recovery in this case.
“Health care plans may not shift the payment of claims to federally funded programs like Medicaid,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “Today’s settlement demonstrates our continuing commitment to ensuring that federal health care dollars are spent appropriately.”
“The Medicaid program provides a safety net for our most vulnerable populations that do not have access to traditional healthcare coverage,” said U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida. “My office is dedicated to protecting critical government healthcare programs, like Medicaid, that serve the elderly and disabled. The misuse of Medicaid funds will not be tolerated.”
“When Medicaid is improperly billed for services that should be covered by other funding sources, the integrity of this safety net program is undermined,” said Special Agent in Charge Omar Pérez Aybar of the Department of Health and Human Services, Office of Inspector General (HHS-OIG). “HHS-OIG will continue to investigate such schemes to protect federal health care programs and those served by them.”
The Florida Legislature established NICA in 1988 as an alternative to the traditional tort system. NICA was intended to provide compensation, on a no-fault basis, for the medical, rehabilitative and custodial care of children who suffered certain categories of birth-related neurological injuries. Under Florida law, once a child is admitted into NICA’s program, NICA is responsible for the payment of medical and other expenses incurred because of a birth-related neurological injury. Medicaid is a joint federal-state healthcare program that provides coverage and benefits to low-income and disabled individuals. Under federal law, Medicaid is generally the payer of last resort.
The qui tam case is captioned United States ex rel. Arven v. The Florida Birth-Related Neurological Injury Compensation Ass’n, et al., Case No. 19-cv-61053-WPD (S.D. Fla.). This case was handled by the U.S. Attorney’s Office for the Southern District of Florida, with assistance from the Civil Division’s Commercial Litigation Branch and the U.S. Department of Health and Human Services Office of Inspector General.
The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement, can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
The matter was investigated by Assistant U.S. Attorney Rosaline Chan for the Southern District of Florida and Fraud Section Attorney Seth Greene.
The claims resolved by this settlement are allegations only and there has been no determination of liability.