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Rare Case of Patient Whistleblower leads to Successful Settlement

On Behalf of | Feb 18, 2019 | Firm News

AgeVital agrees to pay $775,000 to settle kickback claims

[*See video below on coverage of the settlement on WFLA channel 8 in Tampa. James Hoyer Attorney Jesse Hoyer is interviewed*]

SARASOTA, FL – The action of one patient who recognized possible fraud against Medicare led to this settlement which returns nearly one million dollars to taxpayers.  Vital Life Institute LLC, known as AgeVital Pharmacy LLC, along with owners Jenny and William Wilkins, have agreed to pay at least $775,000 to resolve claims that they violated the False Claims Act by engaging in an illegal kickback scheme.

“The
importance of this settlement goes far beyond the amount recovered. It demonstrates
the value and impact of everyday citizens who come forward to expose fraud,”
said attorney Jesse Hoyer, local counsel for the whistleblower case. “Medicare,
Medicaid and Tricare beneficiaries who carefully review their Explanation of Benefits
statements can make a difference.”

The
settlement resolves allegations that Sarasota-based AgeVital paid kickbacks to
a third-party marketing company to solicit patients for compounded drug
prescriptions, regardless of patient need. The marketing company allegedly
arranged for prescribers to sign those prescriptions, which were then referred
to AgeVital to be filled in exchange for a substantial share of Tricare and
Medicare reimbursements.

Details of case

The case was
filed in federal court in Tampa in 2015, after Manfred Knopf, a patient in New
Jersey who received prescriptions he did not need or want, recognized that
Medicare was billed for the products. AgeVital solicited Mr. Knopf to purchase the
expensive compounded pharmaceuticals after he suffered a slip and fall accident
that required treatment for his injuries.

Despite
never agreeing to receive these medications, AgeVital began sending containers
of expensive compounding creams to his doorstep. The healthcare prescriber
listed on the packages delivered was Dr. Jean Wilson, a provider Knopf had never
heard of or been treated by. Medicare paid approximately $37,377 for these
medically unnecessary compounded pharmaceuticals sent to Knopf. After recognizing
what he believed was fraud, Knopf decided to report his concerns to the
government.

With the
assistance of attorney David Williams of Kline & Specter, P.C. (along with
Jesse Hoyer and Elaine Stromgren of James Hoyer, P.A.), the lawsuit was filed under
the qui tam or whistleblower provisions of the False Claims Act. The Act allows
private citizens who suspect

fraud
against the government to bring a lawsuit on behalf of the United States for
false claims and to share in any recovery.

“The False
Claims Act gives us a powerful tool with which to expose fraud and recover
money on behalf of taxpayers. We thank Mr. Knopf for recognizing the fraud and
having the courage to bring it to the Government’s attention,” said attorney
Hoyer.

Anti-Kickback Statute

The
Anti-Kickback Statute prohibits the knowing and willful payment of compensation
to induce the referral of services or items that are paid for by a federal
health care program. Individuals and entities can be subject to liability under
the False Claims Act for submitting claims to federal health care programs in
violation of the Anti-Kickback Statute.

“Kickback schemes undermine public trust in our health care system and lead to unnecessary health care costs at taxpayers’ expense,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division.

“We will not
tolerate those who profit at the expense of taxpayers by entering into illegal
kickback arrangements,” says U.S. Attorney for the Middle District of Florida
Maria Chapa Lopez. “Our office is committed to holding individuals accountable
for corporate malfeasance.”

Mr. Williams, Ms. Hoyer and Ms. Stromgren sincerely appreciate the efforts of the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Middle District of Florida, the FBI, the Defense Criminal Investigative Service and the U.S. Department of Health and Human Services Office of Inspector General that contributed to the resolution of this case.

Kline &
Specter P.C. is a nationwide personal injury and medical malpractice law firm
with offices in Pennsylvania, New Jersey, Delaware, and New York.

James Hoyer, P.A. is a nationwide whistleblower and employment law firm with offices in Florida, Washington D.C., and Michigan.

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