Tuesday, January 17, 2017
Sturbridge whistleblower gets $3.56M in ambulance settlement
A Sturbridge woman will receive $3.56 million of a $12.7 million settlement for her role as the whistleblower who alleged that an ambulance company fraudulently billed Medicare for unqualified services.
Dale Meehan, a former billing manager for Leominster-headquartered MedStar Ambulance Inc., alleged that MedStar and its four related companies - Pioneer Valley EMS Inc., MedStar EMS Inc., Metrowest Emergency Services Inc., and Fitchburg Emergency Medical Services Inc., - fraudulently billed Medicare between 2005 and 2013 for ambulance services, according to a 2013 civil complaint filed in U.S. District Court. All the companies are run by brothers Gregory and Nicholas Melehov, according to the complaint.
The alleged fraud included billing for ambulance trips that were not medically necessary and "up-coding" runs - or making them seem more serious than they actually were - to get higher payments from the government, according to the complaint.
Ms. Meehan also alleged she was fired for her continued questions and her attempts to correct the fraudulent billing, according to the complaint.
MedStar Ambulance Inc., and its related companies have agreed to pay $12.7 million to settle the False Claims Act lawsuit, according to a press release Friday from the office of Ms. Meehan's lawyer, Jeffrey A. Newman. Ms. Meehan will receive $3.56 million of the settlement under the federal False Claims Act, which allows whistleblowers to sue companies that are defrauding the government and receive a reward if the government recovers any funds as a result.
"Dale Meehan courageously came forward and told the truth about this multimillion dollar fraud scheme to make more profits," Mr. Newman said in the press release. "The Medicare system is already severely over-taxed at a time when every penny should be used for those who need it."
As part of the settlement, MedStar must also enter into a Corporate Integrity Agreement with the Office of the Investigator General.
There are no criminal charges involved, according to lawyers.
"MedStar was pleased to work with the Department of Justice to resolve the overpayment issues," said lawyer Kenneth C. Pickering. "There was absolutely no intent by MedStar to overbill, and the company is glad to turn its attention back to providing unparallelled ambulance service in the region."
He said the case also involves a claim against MedStar for retaliation which remains in litigation, which the company "vehemently denies."