The Office of Massachusetts Attorney General Maura Healey announced on June 21 that Pathways of Massachusetts, which was an “outpatient behavioral health provider,” and its former corporate parent Molina Healthcare, Inc., will pay $4.6 million to resolve allegations of False Claims Act violations. Four whistleblowers spurred the case with a qui tam lawsuit filed in the U.S. District Court of Massachusetts, U.S. ex rel. Collins, et al. V. Molina Healthcare, Inc., et al.
The qui tam provisions of the False Claims Act enable private citizens to file lawsuits on behalf of the government if they know of an individual or company defrauding the government. Qui tam whistleblowers are eligible to receive between 15 and 30% of the government’s recovery, if one occurs.
The whistleblowers, who were all former employees at Pathways and worked there between 2014 and 2018, alleged in their lawsuit “that Pathways violated the False Claims Act because its clinics lacked adequate staffing to qualify as eligible mental health centers.”
The AG’s Office states that “Pathways caused fraudulent claims to be submitted to the state’s Medicaid Program, known as MassHealth, for behavioral health care services provided to patients by unlicensed and improperly supervised staff members.” The AG’s Office conducted an investigation and “found that Pathways failed to meet the regulatory requirements for frequency and adequacy of supervision, the qualifications of its supervisors, and that Pathways billed for psychotherapy services rendered by unlicensed individuals who were not supervised by appropriately licensed professionals.”
Additionally, “the AG’s Medicaid Fraud Division initiated an investigation into Pathways after a referral from MassHealth.” Both this investigation and the whistleblowers’ qui tam lawsuit concluded with the $4.6 million settlement.
According to the press release, “Pathways ceased all operations in the state, and Molina has agreed to settle the federal and state False Claims Act claims at issue in the Medicaid Fraud Division’s investigation, as well as the whistleblower allegations, for $4.6 million.”
“This company routinely allowed unlicensed and unsupervised mental health professionals to provide care to patients, all while billing MassHealth for it,” AG Healey said in the press release. “MassHealth patients deserve to receive treatment from qualified individuals, and my office will continue to hold providers accountable for violating these fundamental MassHealth requirements.”
The Importance of Healthcare Whistleblowers
Whistleblowers are key to uncovering fraud and corruption in the healthcare industry: fraudulent schemes can be particularly harmful to patients and erode trust in the medical system. In Fiscal Year 2021, whistleblowers helped the DOJ recover $1.6 billion in settlements. The DOJ highlighted health care fraud as “the leading source of the department’s False Claims Act settlements and judgments.”