• AML
  • Qui Tam
  • SEC
  • CFTC
  • FCPA
  • FAQS
Demand Protections for Artificial Intelligence Whistleblowers | Take Action!
Subscribe
Donate
Get Help
No Result
View All Result
Whistleblower Network News
The Truth at Any Cost.
Qui Tam, Compliance and Anti-Corruption News.
Whistleblower Network News
No Result
View All Result
Home False Claims-Qui Tam

Two False Claims Act Settlements to Close Out January 2022

Ana PopovichbyAna Popovich
February 4, 2022
in False Claims-Qui Tam
Reading Time: 4 mins read
Photo of a stethoscope and a clipboard on a table.
Share on TwitterShare on FacebookShare on LinkedInEmail

The False Claims Act was enacted in 1863 in an effort to root out fraud and corruption during the Civil War. Since then, it has become a vital tool for the U.S. Department of Justice (DOJ) to recover taxpayer money from companies and individuals who defraud the government.

In the 2021 fiscal year, the DOJ recovered more than $1.6 billion from qui tam whistleblower lawsuits that were filed under the False Claims Act. The qui tam provisions of the False Claims Act enable private citizens to file lawsuits on behalf of the U.S. government if they have knowledge of an individual or company defrauding the government. Under these provisions, qui tam whistleblowers can be eligible for 15-30% of the amount the government recovers in a settlement. Additionally, there are no caps on rewards for qui tam whistleblowers: according to whistleblower law firm Kohn, Kohn and Colapinto, “the value of the information the whistleblower provides serves as the basis for the amount of the award.”

At the end of January 2022, the DOJ announced two False Claims Act settlements, both of which stemmed from qui tam whistleblower suits. Read more about the cases below.

Register for National Whistleblower Day Register for National Whistleblower Day Register for National Whistleblower Day

Hayat Pharmacy

On January 28, U.S. Attorney Richard G. Frohling announced that Hayat Pharmacy, an operator of “23 pharmacy locations in the greater Milwaukee area,” will pay $2,050,000 to resolve allegations “that it submitted false claims to Medicare and Medicaid for prescription medications.” Allegedly, Hayat Pharmacy “submitted false claims to Medicare and Medicaid in 2019 for two prescription medications.” The medications were “a topical cream consisting of iodoquinol, hydrocortisone, and aloe, and a multivitamin with the trade name Azesco.” The federal medical programs were paying “thousands of dollars per prescription” for the cream and “hundreds of dollars per prescription for Azesco.” However, the government alleges that Hayat Pharmacy “switched Medicaid and Medicare patients from lower cost medications” to the cream and Azesco “without any medical need and/or without a valid prescription.”

Hayat Pharmacy will pay the $2,050,000 to settle the allegations; it also “agreed to conduct annual training concerning waste, fraud and abuse, and compliance with rules concerning medication switches.”

This case stemmed from a qui tam whistleblower’s complaint; thus, the whistleblower will receive a share of the settlement. The press release did not release the amount of the whistleblower’s reward.

Cardinal Health, Inc.

In another healthcare-related settlement, Cardinal Health, Inc. will pay $13,125,000 to resolve allegations that it violated the False Claims Act’s Anti-Kickback Statute. The Anti-Kickback Statute “prohibits pharmaceutical distributors from offering or paying any compensation to induce physicians to purchase drugs for use on Medicare patients.” Allegedly, Ohio-based Cardinal Health provided “upfront discounts” to customers, and the discounts “were not attributable to identifiable sales or were purported rebates which Cardinal Health’s customers had not actually earned.”

The press release explains that a pharmaceutical distributor can “legally offer commercially available discounts to its customers under certain circumstances permitted” by the Department of Health and Human Services’ Office of Inspector General; however, the agency “has advised that upfront discount arrangements present significant kickback concerns” unless they meet specific requirements.

In the press release, U.S. Attorney Rachael S. Rollins explains that Cardinal Health “recruited new customers by offering and paying cash bonuses.” Rollins states that kickback schemes “have the potential to pervert clinical decision-making and are detrimental to our federal health care system and taxpayers.” Special Agent in Charge of the FBI’s Boston Division Joseph R. Bonavolonta said that Cardinal Health “thought it hit upon a surefire moneymaker by paying kickbacks to doctors.”

The False Claims Act in 2021

The DOJ’s recently released data from FY 2021 about the False Claims Act described healthcare fraud as “once again the leading source of the department’s False Claims Act settlements and judgements.” Indeed, several of the qui tam whistleblower cases from 2021 originated from the healthcare field: read a breakdown of notable False Claims Act cases from 2021 here.

In FY 2021, whistleblowers helped the DOJ recover over $1.6 billion in settlements; however, “the DOJ only paid out $237 million to whistleblowers, the lowest single-year total since FY 2008,” WNN reports. Whistleblower attorney Stephen M. Kohn said that the FY 2021 totals “reflect a troubling trend in recent years…The DOJ has begun to treat whistleblowers like second-class citizens. It routinely throws out strong whistleblower cases without just cause. While the SEC and CFTC are making great strides forward with their whistleblower programs, the Justice Department is in reverse.” Read the full article about the False Claims Act in FY 2021 here.

Read more False Claims Act/qui tam news on WNN.

Tags: False Claims / Qui TamFalse Claims/Qui TamQui Tamqui tam whistleblowers
Previous Post

Whistleblowers on Their Own: Europe’s New ‘Protection’ Systems Offer Little Comfort

Next Post

SEC Whistleblower Office Posts Notices for JP Morgan Recordkeeping Case, 11 Other Actions

Ana Popovich

Ana Popovich

Ana Popovich is a contributing editor with Whistleblower Network News, where she writes about breaking whistleblower news, healthcare fraud whistleblowers, and Covid-19 fraud whistleblowers. Ana has a B.A. in English from Georgetown University. While at Georgetown, she was the marketing chair of an affinity group and wrote content for the McDonough School of Business’ Business for Impact program. In 2018, Popovich was a public interest legal intern at the whistleblower law firm Kohn, Kohn and Colapinto. 

Next Post

SEC Whistleblower Office Posts Notices for JP Morgan Recordkeeping Case, 11 Other Actions

Receive Daily Alerts

Subscribe to receive daily breaking news and legislative developments sent to your inbox.

  • This field is for validation purposes and should be left unchanged.

Most Popular

SEC Should Continue Strong Crypto Enforcement, Whistleblower Advocates Argue

Advocate Details Impact of Bipartisan AI Whistleblower Bill for Tech Works

CFTC Awards $700,000 to Whistleblower for “Courage” and “Critical Role in Enforcement Efforts”

Whistleblowers to Receive Up to $920K after Alleging Fraud in Breast Cancer Testing

Supreme Court Upholds, For Now, Trump Firing of MSPB Chair

Whistleblower Suit Leads to $3.3 Million Stark Law Settlement

Whistleblower Poll

Whistleblower Poll
Whistleblower Poll

Exclusive Marist Poll: Overwhelming Public Support Among Likely Voters For Increased Whistleblower Protections

byGeoff Schweller
October 6, 2020

ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT

STAY INFORMED.
Subscribe to receive breaking whistleblower updates.

  • This field is for validation purposes and should be left unchanged.

About Us

  • About
  • Contact Us
  • Donate
  • Careers

Subscribe

  • Daily Mail
  • Follow us on Twitter
  • YouTube Channel

Contribute

  • Letter to the Editor
  • Submission Guidelines
  • Reprint Guidelines

Your Experience

  • Accessibility Statement
  • Privacy Policy
  • Terms of Use

Help

  • Rules for Whistleblowers
  • Frequently Asked Questions
  • Advertise
Whistleblower Network News

Whistleblower Network News is an independent online newspaper providing our readers with up-to-date information on whistleblowing. Our goal is to be the best source of information on important qui tam, anti-corruption, compliance, and whistleblower law developments.

Submit an Article

Copyright © 2025, Whistleblower Network News. All Rights Reserved.

This Newspaper/Web Site is made available by the publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this website, you understand that there is no attorney-client relationship between you and the Newspaper/Web Site publisher. The Newspaper/Web Site should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

Become a Whistleblower Network News Subscriber

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Fill the forms below to register

All fields are required. Subscribe to WNN

Retrieve your password

Please enter your username or email address to reset your password.

Subscribe to WNN
Join the Waitlist for National Whistleblower Day 2025! July 30, 2025 on Capitol Hill
JOIN WAITLIST

Add New Playlist

Demand Protections for Artificial Intelligence Whistleblowers

Take Action!
No Result
View All Result
  • Exclusives
  • Government
    • False Claims-Qui Tam
    • Federal Employees
    • Intelligence
  • Corporate
    • CFTC & Commodities
    • Dodd-Frank
    • IRS & Tax
    • SEC & Securities
  • Features
  • Legislation
  • International
    • Foreign Corruption
  • Rewards
  • Whistleblower of the Week
  • Environment & Climate
  • Opinion
  • Editorial
  • Employment
    • Sarbanes-Oxley Whistleblowers
    • Retaliation
    • OSHA
  • Make National Whistleblower Day Permanent
  • Media
    • Podcasts
    • Videos
    • Webinars
    • National Whistleblower Day
  • Whistleblower Poll
  • Whistleblower Resources
    • Frequently Asked Questions
    • Resources for Locating An Attorney
    • The New Whistleblowers Handbook

Copyright © 2024, Whistleblower Network News. All Rights Reserved.

Go to mobile version