New Jersey Healthcare Fraud/Medicare Fraud Enforcement

The federal government sometimes accomplishes this task with the assistance of the New Jersey Medicaid Fraud Control Unit (MFCU). Both entities are, in turn, often assisted in their efforts by the bravery and actions of whistleblowers.

Modeled after the federal False Claims Act, the New Jersey False Claims Act permits private citizens to bring qui tam actions on behalf of the State of New Jersey to recover treble damages and civil penalties. N.J. Stat. § 2A:32C-1 (2019) et seq.

Nolan Auerbach & White represents whistleblowers in federal court only. We will bring cases on behalf of whistleblowers under the New Jersey qui tam statute as part of an action under the federal False Claims Act. We do so under the Court’s pendent jurisdiction.

The liability provisions of the New Jersey False Claims Act, N.J. Stat. § 2A:32C-3, provide that it is unlawful for any person who:

(a) knowingly presents, or causes to be presented, to an employee, officer, or agent of the State or to any contractor, grantee, or other recipient of State funds, a false or fraudulent claim for payment or approval;

(b) knowingly makes, uses, or causes to be made or used a false record or statement to get a false or fraudulent claim paid or approved by the State;

(c) conspires to defraud the State by getting a false or fraudulent claim allowed or paid by the State…

Cases completed in New Jersey that were originally brought in a New Jersey federal court include:

Quest Diagnostics, Inc. agreed to pay $11.35 million to settle an FCA suit alleging that it improperly billed Medicare. The Government alleged that one of Quest Diagnostics, Inc.’s subsidiaries and two of its predecessors failed to properly bill Medicare and performed medically unnecessary tests at several of its laboratories across the country.

Corning Clinical Laboratories Inc., formerly known as MetPath Inc. and a wholly-owned subsidiary of Corning Life Sciences Inc., and Unilab Corporation agreed to pay the Government $11 million to settle a qui tam suit alleging that they submitted false claims to Medicare, Medicaid, and CHAMPUS by billing for certain blood indices that were not ordered or medically necessary. The settlement focused on the national clinical labs’ regional operations in California, Colorado, Connecticut, Florida, Michigan, Missouri, and Georgia. According to the Government, certain labs currently owned by Corning and Unilab billed for additional “hemogram indices” whenever a doctor ordered a Complete Blood Count (CBC) or a Retic Count.

Maxim Healthcare Services Inc. agreed to pay the United States and 43 states a combined $150 million to settle claims that it falsely billed home healthcare claims to Medicaid and to the Veterans Affairs program for services that were not rendered, services that were not properly documented, and services that were performed by 13 unlicensed offices. Maxim agreed to pay a criminal penalty of $20 million and to pay $130 million in civil penalties. Maxim also agreed to enter into a deferred prosecution agreement, to enter into a corporate integrity agreement, and to accept a corporate monitor.