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Of the millions of cardiac stents that are inserted into patients each year, approximately 700,000 are used to restore blood flow in heart attack patients – an application that few medical experts would dispute is beneficial. The other half of cardiac stents, however, are inserted into elective-surgery patients in stable condition. It is in these elective surgery situations that reports of overuse, death, injury, and fraud run rampant. In fact, Bloomberg News says that its investigative report reveals that cardiac stent practices in the U.S. “underscore the waste and patient vulnerability in a U.S. health care system that rewards doctors based on volume of procedures rather than quality of care.”

Not only are stents risky and not always the best medical option, but the procedure is fraught with allegations of fraud. According to Bloomberg News, cardiologists get paid meager fees to discuss the risks of cardiac stents with patients and the benefits of alternative measures, whereas they get paid thousands of dollars to insert the stent. As a result, some doctors and hospitals see the procedure as an easy way to make big money by violating anti-kickback laws and the False Claims Act. At least five hospitals have recently reached settlements with the Department of Justice to resolve claims that the hospitals paid illegal kickbacks to doctors for patient referrals in connection with stent procedures.

Unfortunately, money isn’t all that is at stake; patients’ lives are also at stake, as well. Cardiac stents were linked to at least 773 deaths in incident reports to the U.S. Food and Drug Administration (FDA) last year, according to Bloomberg News – a 71 percent increase from 2008. The number of non-fatal stent injuries, such as perforated arteries, blood clots and other incidents, reported to the FDA was 4,135 – a 33 percent increase from 2008.

The importance of whistleblowers in connection with the use of cardiac stents is critical. Patients, doctors, and other healthcare employees who suspect improper practices surrounding cardiac stents should immediately report the suspected activity.

Kan-Di-Ki LLC (formerly known as Kan-Di-Ki Inc.), which is doing business as Diagnostic Laboratories and Radiology, has agreed to pay $17.5 million to settle allegations that the company violated the federal and California False Claims Acts. As part of its alleged kickback scheme, the company allegedly charged Skilled Nursing Facilities (SNFs) in California discounted rates for inpatient services paid by Medicare in exchange for the facilities’ referral of outpatient business to Diagnostic Labs. Because Medicare pays a fixed rate based on the patient’s diagnosis for inpatient services regardless of specific services provided, and it pays for each service separately for outpatient services, the kickback scheme enabled the SNFs to maximize profit earned for providing inpatient services by decreasing SNFs’ costs of providing these services and allowed Diagnostic Labs to receive a steady stream of outpatient referrals that it could directly bill to Medicare and Medi-Cal at a significant profit.

As part of the settlement, the two whistleblowers (former employees of Diagnostic Lab) will together receive $3,755,500 from the federal government’s recovery.

The case against prescription drug wholesaler McKesson, in which the company stands accused of charging inflated prices for its drugs, will be headed to trial, according to the California judge presiding over the case. The lawsuit, which was filed by the Commonwealth of Virginia in 2011 under the Virginia Fraud Against Taxpayers Act, alleges that McKesson inflated the average wholesale price of prescription drugs to order to obtain higher payments from Virginia's Medicaid program. Like the federal False Claims Act, the Virginia Fraud Against Taxpayers Act holds anyone who knowingly brings false payment claims against the commonwealth liable for civil penalties. In denying McKesson’s request for summary judgment, the court concluded that although McKesson raised genuine issues of material fact as to Virginia's knowledge of the drug price inflation, the “extent of Virginia's knowledge as to ‘the actual true facts’ and the determination of whether Virginia actively approved of the underlying facts must be determined by a finder of fact at trial.”

Please contact us at (312) 863-7222 if you would like to learn more about any of the aforementioned whistleblower news updates or would like to schedule a free, confidential appointment with one of our nationally recognized whistleblower attorneys.