Whistleblower Lawsuit Exposes Healthcare Startup

The world’s richest doctor, Patrick Soon-Shiong, recently established a healthcare startup called NantHealth. The company intends to improve cancer treatment and care, however, whistleblowers in Florida have filed suit saying it is engaged massive in fraud. Whistleblower lawyers at Pintas & Mullins Law Firm explain this case and others like it throughout the country.

NantHealth has been featured on 60 Minutes, along with its founder who claims he has the technology to improve cancer patients’ quality of life. A few of NantHealth’s operations teams are based in Florida, where two former employees recently filed the whistleblower lawsuit.

These employees claim that NantHealth and its parent company, NantWorks, are engaged in a “multitude of fraudulent activities,” including billing and privacy violations. They also accuse the company of exposing patients to products it knew to be harmful. The whistleblowers both previously held senior roles at NantHealth, as Senior Vice President of Professional Services and Senior Director of Marketing, respectively.

NantHealth makes next-generation medical devices and software that are meant to link different hospitals together – for example, it would enable hospitals to link their electronic medical records together so a patients’ entire medical history is known. This way, every device and medication a patient is on would automatically collect and store data in real time.

According to the whistleblowers, however, NantHealth’s technology violates federal privacy requirements; specifically, the Health Insurance Portability and Accountability Act of 1996 and the FDA’s regulations. Furthermore, the former employees allege that an executive at Piedmont Healthcare, a client of Nant’s, threatening to stop working with Nant and warned other hospitals not to work with the company. They claim more than a dozen clients made similar threats.

On the marketing side, the whistleblowers claim that the company made misleading claims in its product advertisements. They believe many customers paid huge costs as a result of Nant’s products not working as promised.

Billions Lost in Medicare Fraud

The whistleblowers also claim that Nant was using money it received from Medicare and Medicaid unlawfully, including back-handed contributions to charities. Unfortunately, Medicare and Medicaid fraud is quite common in the healthcare industry. In fact, it is so prevalent in the United States that it costs taxpayers billions of dollars every year.

Most of this fraud is committed by a few people for smaller amounts of money. In 2012, however, federal authorities reported that they had arrested over 100 healthcare workers, including doctors and nurses, and charged them with defrauding Medicare for more than $450 million. Two years earlier, about 94 health workers were charged with Medicare fraud in the amount of over $250 million.

Florida is widely considered ground-zero of Medicare fraud – in fact, one of New York’s crime families recently moved to Florida because defrauding Medicare was less dangerous and more lucrative. The federal government set up the Medicare Fraud Strike Force in 2007, and its first task was visiting thousands of businesses in Miami that were billing Medicare for medical equipment. Officials discovered that about one-third of these businesses did not exist, yet were billing Medicare for millions in medical equipment.

The five states with the highest incidence of Medicaid fraud are:

1. California 2. Kentucky 3. Texas 4. New York 5. Ohio
Whistleblowers and private citizens play an important role in exposing this fraud and getting billions of dollars back from criminals. Under the law, those who come forward with evidence of government fraud – whistleblowers – are entitled to a percentage of the money ultimately won in the case. Typically, whistleblowers receive between 15 – 30%, which can amount to millions of dollars.

Other than Medicare and Medicaid fraud, common whistleblower cases involve fraudulently buying or holding government property, preparing false records or statements to avoid paying debt, and submitting false or overstated charges to the government for reimbursement.

Our team of whistleblower lawyers is currently investigating cases of government fraud. If you or someone you know has proof of such criminal activity, contact our firm immediately for a free, confidential legal consultation. Our case reviews are always free and available to concerned parties nationwide.

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