In a recent case, a Dayton-based managed health care
organization, CareSource, agreed to pay $26 million to settle
claims alleging CareSource defrauded the federal government. Two
former employees brought whistleblower actions in 2006 accusing
CareSource of failing to provide required services under the
Medicaid program and submitting false claims requesting
reimbursement from the federal government for unrendered services.
The whistleblowers filed suit under the federal False Claims Act
which allows private individuals to file suit on behalf of the
federal government against people or organizations whom they know
to be defrauding the government. The federal False Claims Act
carries stiff penalties including reimbursement, triple damages,
civil penalties of $5,500 to $11,000 per false claim, and possible
exclusion from all federal health care programs. Under the law, the
whistleblower may be awarded a portion of the funds recovered. From
the $26 million CareSource
