The U.S. Department of Justice obtained more than $4.7 billion in settlements under the False Claims Act for fiscal year 2016, which ended Sept. 30, with the bulk of that from the health care industry.
Of the $4.7 billion recovered, which was the third-highest annual recovery, $2.5 billion came from the health care industry, including drug companies, medical device companies, hospitals, nursing homes, laboratories and physicians, the department said Wednesday in a statement. This does not reflect additional funds that may have been recovered from state Medicaid programs.
The next largest recovery came from the financial industry in the wake of the housing and mortgage fraud crisis, the department said. Settlements and judgments in cases alleging false claims in connection with federally insured residential mortgages totaled nearly $1.7 billion.
Most false claims actions are filed under the act’s whistleblower provisions, where whistleblowers can receive up to 30% of the recovery. The government awarded whistleblowers $519 million during fiscal year 2016, the department said.
The False Claims Act is the government’s primary civil remedy to redress false claims for government funds and property under government programs and contracts, the department said.
Nursing home therapy giant RehabCare has agreed to pay the government $125 million to settle a whistleblower lawsuit alleging it knowingly caused facilities it contracted with to inappropriately bill Medicare for services.