Whistleblowers Can Help Stem Healthcare Fraud and Are Protected Under Texas and Federal Laws

Law enforcement authorities estimate that healthcare fraud, including Medicare fraud, costs taxpayers more than $11 billion a year. Texas hospitals and medical treatment facilities are far from immune. But the eyes of the law are not everywhere. Sometimes the only person who knows about a scam is the hospital administrator or a small cadre of employees who sees where the money goes. We can help you understand what you should do if you suspect that something is not right at your hospital or treatment facility.

But there is a dilemma for the potential whistleblower. The Texas Health & Safety Code creates a legal duty for someone who knows about a violation of law to report it to authorities. But whistleblowers can find themselves fired, demoted, harassed or re-assigned to a desk in the basement next to the trash compactor. Employees can be sued in retaliation. Fortunately, federal law and the Texas Health & Safety Code protect employees who report billing malfeasance if the reporting is done in good faith. It is a tricky situation. Failure to report can be a misdemeanor, but a misstep can destroy the protection the law offers whistleblowers.

On the other hand, a successful whistleblower lawsuit can help you get your job back while paying you damages and a share of the financial recovery. The bottom line is that you should speak with a whistleblower attorney before you do anything.

Step One for a Potential Whistleblower: Get Help

The employment lawyers at Kilgore & Kilgore may be able to counsel you on what to do if you believe that you have witnessed Medicare fraud at the hospital or treatment facility where you work. Click this link Contact Kilgore Law to get the conversation started. We offer a free evaluation of the facts of your case. To learn more about whistleblower law, click this link Employee Whistleblower Law.

Houston Whistleblower Reports Malfeasance and Wins Big

Robert McCaslin, a hospital billing department employee in Houston, realized that his employer was billing Medicare for accident victims, even though they had private insurance. The hospital also billed Medicare for prisoners, even though they are not covered by Medicare. When he alerted his boss, McCaslin was told not to bother and assured that that was normal procedure. With his help, the U.S. Department of Justice was able to pursue the case and the Houston Hospital District paid back approximately $15 million. McCaslin received $3 million. For another example of a Texas whistleblower and the Texas Whistleblower Act, click this link Whistleblower Claimant in Texas.

Another Texas Hospital Whistleblower Loses Case

Another whistleblower case involving a medical treatment center in Dallas reported in 2019 tells a more complicated story. The whistleblower filed a lawsuit in 2017 claiming that Baylor Scott & White Health submitted more than $61.8 million in false claims to Medicare over a seven-year period. The whistleblower accused the hospital of inflating Medicare charges by adding secondary diagnosis codes to make treatments appear more medically significant than they were. The federal court dismissed the complaint, finding that there was nothing inappropriate in the hospital’s attempt to take full advantage of coding opportunities to maximize Medicare payment. There was no allegation that the hospital knew that using a particular code was incorrect. In this case, the whistleblower lost.

Fifty Shades of Medicare Fraud

The variety of scams perpetrated at hospitals and other treatment facilities is testimony to the creativity of fraudsters. Federal and state laws, including the False Claims Act, make a wide range of bad actions illegal. The law imposes civil liability on anyone, including corporations, who intentionally uses a false record or statement to get money from the government via fraud, or who conspires to do so. The qui tam provisions of the law allow a whistleblower to act in the place of the U. S. government. A few of the most common scams include:

  • Billing for services not performed – Billing scams are the most common types of Medicare fraud. Think about x-rays and blood tests that were never taken or home healthcare hours never provided. Providers have been known to pad their Medicare claims with personal expenses.
  • Rendering of services not actually needed – Some of the most stomach-churning stories involve elderly, frail patients who are not able to object to or resist treatments that may actually be harmful. Sometimes the nurse or therapist administering the “therapy” can tell that it is wrong, but feels pushed to follow doctor’s orders.
  • Double billing – These are scams whereby a provider bills more that one source such as the patient, Medicare, and private insurance for the same treatment, or alternatively, bills the treatment to the same payers more than once.
  • Unbundling – In this scheme, each component of a medical procedure is billed separately. Think of the difference between ordering a meal and ordering the meal’s components a la carte. Medicare sets reimbursement rates for certain groups of procedures that should be performed together. Medical providers may unbundle the procedures and bill each component of the group separately to increase profits.
  • Upcoding – This is a method of billing for a more expensive service than what was rendered. The Baylor Scott & White Health case described above is example of apparent upcoding.

Texas State and Federal Laws Cast a Wide Net for Malfeasance

By far, the most common form of malfeasance involves Medicare fraud. It may be because Medicare processes a huge number of claims and exercises relatively little scrutiny. It is important to know, however, that federal laws apply to many kinds of violations, including patient abuse.

Most people who bring whistleblower lawsuits act out of a basic desire to work for justice. This is especially true in healthcare. But there is the possibility of a reward, as well. Like Robert McCaslin, the plaintiff in a successful whistleblower lawsuit can receive a reward of up to 30 percent of the proceeds, plus reimbursement for attorney fees, costs, and expenses. But there can be risks. That is why it is so important to work with a whistleblower attorney. To learn more about the protections and benefits that whistleblowers enjoy under the law, click this link False Claims Act Law Benefits Whistleblowers.

Texas Health & Safety Code Protection for Whistleblowers

What happened to the whistleblower at Baylor Scott & White Health mentioned above? The importance of the process of whistleblowing may be the key. Different states have varying requirements. It is important that a whistleblower follow a certain procedure for revealing the malfeasance. This is another reason why it is important to consult with a whistleblower attorney before acting AND not to wait too long to make a report, as there may be a time limit.

In Texas, however, there are protections for good faith whistleblowers. Chapter 161 of the Texas Health & Safety Code makes it unlawful for an employer to act against a whistleblower employee with termination or retaliation for reporting a violation of law. It covers volunteers and contractors as well as employees. An employee who suspects wrongdoing, including but not limited to Medicare fraud, may report the situation to a supervisor, to the agency that licenses the treatment facility, or to the appropriate state health care regulatory agency. The report may be verbal or in writing, but it must be documented. It is best to learn how to make a whistleblower report in Texas before taking the first step.

The person who reports in good faith is immune from civil or criminal liability arising from the report. That immunity does not extend to the individual who caused the abuse or neglect or who engaged in the illegal, unprofessional, or unethical conduct. In addition, a hospital, mental health facility, or treatment facility may not terminate the employment of, or discipline or otherwise discriminate against, an employee who made an appropriate report.

The critical issue is not whether the whistleblower was ultimately right about the existence of a violation of law, but whether he or she acted in good faith. It is important to be able to prove good faith.

Our Employment Lawyers Can Help Employees Who Wish to Report Medicare Fraud

The Texas employment lawyers at Kilgore & Kilgore can help you assess your legal situation and advise on the best strategy for approaching this difficult situation of a potential whistleblower. To learn more about Sabine Pilot, a situation wherein an employee suffers retaliation or termination from refusing to perform an illegal act, click here At Will Employment-Whistleblower. If you find yourself in need of legal advice in a matter involving blowing the whistle on your employer, click here to reach a form for submitting your contact information Contact Us. We offer a free evaluation of the facts of your case.

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