This settlement addresses claims that the company engaged in illegal kickback schemes to induce patient referrals, ultimately leading to the submission of false claims to Medicare. The U.S. Department of Justice accused Oak Street Health of two primary violations:
- Providing Remuneration to Physicians: Oak Street allegedly offered remuneration to physicians and physician groups in exchange for patient referrals to its clinics.
- Marketing Arrangement with Organizations: The company was also accused of entering into marketing arrangements with organizations serving Medicare beneficiaries, paying them based on the number of patients they referred to Oak Street.
Details of the Settlement
Oak Street Health has agreed to pay $60 million to resolve these allegations. It's important to note that the claims resolved by this settlement are allegations only, and there has been no determination of liability.
The case came to light thanks to a whistleblower, Joseph Stinson, who filed the lawsuit under the qui tam provisions of the False Claims Act. As a result of his actions, Stinson will receive $9.9 million, approximately 16.5% of the total settlement amount. The impact of the investigation on Oak Street Health was significant. Following the DOJ's announcement of the investigation in November 2021, the company's stock price plummeted 20% in a single day, dropping from $47 per share to $37 per share. Subsequently, Oak Street Health had to revise its disclosures in SEC filings regarding compliance with the Anti-Kickback Statute.
This settlement underscores the U.S. government's ongoing efforts to combat healthcare fraud, particularly within the Medicare Advantage program. It also highlights the substantial financial and reputational risks companies face when engaging in potentially unlawful marketing practices. The case serves as a stark reminder of the importance of regulatory compliance in the healthcare sector and the power of whistleblowers in bringing fraudulent activities to light.
Impact on Medicare
Medicare fraud is a serious issue that affects not only the government but also taxpayers and beneficiaries. It can lead to increased healthcare costs, reduced quality of care, and misallocation of resources. Whistleblowers play a crucial role in uncovering such fraudulent activities. Their courage in coming forward helps protect the integrity of Medicare and ensures that funds are used appropriately for patient care rather than lining the pockets of unscrupulous providers.
The Importance of Whistleblowers
Whistleblowers are often the first line of defense against fraud in the healthcare system. They provide insider information that can be difficult for regulators to obtain otherwise. The False Claims Act includes provisions that protect whistleblowers from retaliation and offer them a share of any recovered funds, incentivizing individuals to report wrongdoing.
Call to Action: Report Medicare Fraud or Any Other Type of False Claims
If you have knowledge of similar fraudulent activities in the healthcare sector, don't hesitate to speak up. The Whistleblower Advocates offer free, confidential consultations to individuals who wish to report Medicare fraud or other violations of the False Claims Act. Our experienced Philadelphia whistleblower attorneys can guide you through the process, protect your rights, and help you understand your options. Contact The Whistleblower Advocates today to take the first step in fighting fraud and protecting taxpayer dollars.
