West: Civil Division Recovered $3 Billion in Fraud Cases in FY 2011
By Elizabeth Murphy | December 19, 2011 1:53 pm

A crackdown on healthcare fraud was a major factor in the Justice Department’s more than $3 billion in False Claims Act recoveries in 2011, keeping the Civil Division’s total on par with last year’s settlements and judgments.

Assistant Attorney General for the Civil Division Tony West announced Monday that of the $3 billion recovered by the Civil Division under the False Claims Act in FY 2011, a record-number $2.8 billion came from whistleblowers.  The federal government recovered about $2.3 billion in settlements through the same whistleblower provisions in 2010.

“[This number] represents a great deal of courage on the part of whistleblowers who have come forward and helped the government in the investigation of these cases,” West said.

West

This announcement comes one week after Deputy Attorney General James M. Cole said the Justice Department recovered $5.6 billion in civil and criminal cases in 2011, the most ever recorded in a single year.

Healthcare fraud recoveries made up the majority of the total at $2.4 billion in 2011, but the number dipped slightly from the $2.5 billion recovered in 2010.

West said that President Obama and Attorney General Eric Holder decided early on to make healthcare fraud an enforcement priority, creating the Health Care Fraud Prevention and Enforcement Action Team (HEAT) in conjunction with Department of Health and Human Services Secretary Kathleen Sebelius.

“Healthcare fraud became a cabinet level priority,” West  said Monday. “That attention and sustained attention has given us some extroardinary results… When that tide rises, the entire tide rises.”

Actions against the pharmaceutical industry provided the largest source of recoveries in 2011, accouting for $2.2 billion in civil claims, West said. The largest single recovery this year came in a case against eight drug manufacturers who allegedly inflated the prices of its drugs, West said.  The companies paid about $900 million in penalties to the government.

West also highlighted the expansion of the Medicare Fraud Strike Forces, which are headed up by the Criminal Division and are located in 9 cities across the country.  The forces have helped refocus attention on prevention, rather than a “pay and chase” model of enforcement, which centers on prosecuting those who have committed fraud after they have received the money.

Since January 2009, the department has recovered $8.7 billion under the False Claims Act, West said, which is the largest three-year total in the department’s history. About $2.4 billion was recovered in 2009 and $3 billion was recovered in 2010.

Looking ahead to the next year, West said the Civil Division will also focus attention on its year-and-a-half old elder abuse initiative.  In the past year, the department has pooled resources to make nursing home abuse a priority, he said.

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