Due to its origins during the Civil War, the False Claims Act (FCA) is sometimes called “Lincoln’s Law.” Those who run afoul of the FCA may be defrauding the government.
Fraud often occurs in the health care sector such as in Medicare or Medicaid. However, pharmaceutical companies are among the primary offenders, and whistleblowers bring their misdeeds to light.
Qui tam lawsuits
A qui tam lawsuit is one in which someone who witnesses fraudulent activities can initiate a lawsuit through the protection of the False Claims Act. The federal government will reward the whistleblower with a portion of any funds it recovers. Sara Behnke, Plan D auditor for the Aetna Insurance Company, became a whistleblower for a case brought by the Department of Justice in the spring of 2018.
A little background
The cost of pharmaceutical drugs is reimbursable to beneficiaries under Medicare Part D. Aetna is one of the companies that administers Medicare Part D.
The CVS Caremark lawsuit
The lawsuit alleged that the pharmaceutical company CVS Caremark reported false Part D drug prices to Aetna, which had a contract with that company to receive a discount on wholesale prices. Due to fluctuating prices, CVS Caremark was able to manipulate the amounts paid to pharmacies based on the Aetna contract terms and keep anything left over.
Auditor Sarah Behnke noticed that CVS Caremark was raising prices that ordinarily decrease for generic pharmaceuticals and that Aetna was paying up to 40 percent more than other insurance companies. Other pieces to the puzzle began to fall in place, and the result was a Justice Department lawsuit, the allegations of which have yet to be proven in court.
Overcharging the government is a fraudulent activity that an alert employee or independent contractor may discover. Someone who notices possible fraud should find out about his or her legal options. Individuals can help initiate a qui tam claim under the protection of the FCA—Lincoln’s Law.