United States Settles False Claims Act Allegations Against Patient Safety Consultant and His Companies
Dr. Charles Denham, of Laguna Beach, California, has agreed to pay the United States $1 million to settle allegations that he violated the False Claims Act by soliciting and accepting kickbacks, the Justice Department announced today. Denham is a patient safety consultant who operates the consulting company Health Care Concepts Inc. and the research organization Texas Medical Institute of Technology, both of which are also parties to the settlement. In 2009 and 2010, Denham was co-chair of the Safe Practices Committee of the National Quality Forum.
“Kickback schemes undermine the integrity of medical decisions, subvert the health marketplace and waste taxpayer dollars,” said Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division. “Doctors and other health care professionals who accept illegal inducements undermine the public’s trust in federal health care programs and will continue to be the focus of our enforcement efforts.”
The settlement resolves allegations that, under agreements entered into in 2008, Denham received monthly payments from CareFusion Corporation while serving as the co-chair of the Safe Practices Committee, which reviews, endorses and recommends standardized healthcare performance measures and practices. The United States contended that Denham did not disclose to the committee, or any other individual or component of the National Quality Forum, that he was receiving payments from CareFusion. The United States further contended that Denham solicited and received these payments in exchange for influencing the recommendations of the National Quality Forum and for recommending, promoting and/or arranging for the purchase of CareFusion’s product, ChloraPrep, in violation of the Federal Anti-Kickback Statute. The United States alleged that this conduct caused the submission of false or fraudulent claims for ChloraPrep to federal health care programs.
“Quality and patient safety must drive medical recommendations,” said Inspector General Daniel R. Levinson of the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG). “Doctors that put profits ahead of this core value must be held accountable. Dr. Denham and his two businesses will be excluded from Medicare, Medicaid and all federal health programs as part of this settlement.”
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $23.8 billion through False Claims Act cases, with more than $15.2 billion of that amount recovered in cases involving fraud against federal health care programs.
The settlement was the result of a coordinated effort among the Civil Division, the U.S. Attorney’s Office for the District of Kansas and the HHS-OIG.
The claims resolved by the settlement are allegations only; there has been no determination of liability.