NJ Man Gets $15.4 Million for Uncovering Largest Medicaid Fraud In History

A New Jersey man is being awarded $15.4 million for his part in uncovering the largest Medicaid fraud in history.

Business Insider reports:

Richard West was shocked when he went for some dental work and was told his Medicaid benefits had maxed out.

Pulling up his Medicaid record, he totaled the care he'd received, the bills submitted by his provider--and found the problem.

According to The Star-Ledger, West, 63, found the company arranging his nursing care, Maxim Healthcare, was over-billing the government for hundreds of hours of service from people he'd never seen.

After being given the runaround, and being routed from one government agency to the next, the Vietnam veteran decided to enlist the aid of his own lawyer. What they found was staggering.

During their preliminary investigation, West and his lawyer "unraveled a fraud stretched across 40-states and resulted in a $150 million settlement--the largest settlement for healthcare fraud in history."

The resulting federal probe showed that submitting false bills to federal agencies “was a common practice at Maxim from 2003 through 2009. During that time period, Maxim received more than $2 billion in reimbursements from government health care programs in 43 states based on billings submitted by Maxim,” according to a recent Gazette.net article.

For example, according to nj.com, one of West's nurses was told that she would be paid $27 an hour. The article continues:

When she received her paycheck, it showed her hourly rate was only $21 an hour. According to the lawsuit, the manager of the office showed her payroll stubs indicating that she was being paid for administering to a patient she had never seen.

"What’s this?" she asked.

"If you want to make the money, this is how we do it," he responded.

“Fraudulent billing for services not rendered uses patients as pawns in a game of corporate greed that puts cash over care and wastes precious taxpayer dollars,” said Tony West, assistant attorney general of the Justice Department's Civil Division in a Gazette.net report.

“At a time when we're all looking for ways to reduce public expenditures, settlements like this one recapture taxpayer dollars lost to fraud and abuse, and help ensure that funds are available for the vital health care programs and services that people depend on day in and day out,” he said.

Authorities charged the home healthcare provider with conspiracy to commit health care fraud and operating offices that were not properly licensed.

The lawsuit also forced Maxim to return $121.5 million in state and federal claims; $8.4 million to the VA, and pay a $20 million fine.

As a reward for his part in uncovering the Medicaid fraud, West will receive $15.4 million. "He told the Ledger it wasn't tough figuring out the scam," reports Business Insider.

"The hard part," he said, "was turning them in."

Also, according to the report, nine people have pleaded guilty to felony charges, but no top executives have been charged.

What conditions, or gross lack of oversight, could enable one company to scam so much?