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Frohsin & Barger, LLC Announces Near $1.9M False Claims Act Settlement With Mississippi-based DME Company

August 31, 2012

When Frohsin & Barger client Wendy Horne became convinced that her former employer Pinnacle Medical Solutions was submitting false claims not only to the overly-strapped Medicare system but also to Tricare – the healthcare system for our nation’s veterans – she decided she couldn’t keep her allegations quiet. In 2009, Frohsin & Barger filed a qui tam Complaint on behalf of Horne and the United States (U.S. ex. rel. Horne v. Pinnacle, cv-09-BE-1193, NDAL), which culminated in the settlement announced today.  Pursuant to the settlement, Pinnacle will pay a total of $1,899,851.85 and enter into a Corporate Integrity Agreement with the U.S. Dept. of Health and Human Services to curtail any future fraud while denying any current wrongdoing.

According to Pinnacle’s website, the company offers home delivery of medical supplies to diabetic patients, including insulin pumps, test strips, and other durable medical equipment. According to the allegations in her qui tam Complaint however, Pinnacle’s strategy was “to send as much equipment to as many people as possible without regard to whether such equipment was medically necessary or [had] been properly prescribed or documented or whether the patient actually need[ed] or [had] ordered” it.

The settlement documents announced today recite that Horne’s initial report to HHS resulted in a voluntary repayment by Pinnacle of $236,204. Now, the company has agreed to re-pay an additional $1,663,647.85 pursuant to the terms of the settlement documents. “Wendy Horne put her career on the line to stand up for our nation’s veterans and the elderly,” said Jim Barger, of Frohsin & Barger, LLC, one of Horne’s attorneys. “She was faced with the choice of reporting her allegations and suffering the consequences or keeping quiet and suffering the pangs of conscience – for most people that would be a tough choice, but I don’t believe Wendy even considered keeping mum. That’s just who she is.”

While it has been said that conscience is its own reward, the False Claims Act rewards whistleblowers with between 15 and 25% of recoveries in cases where the government intervenes.

A Civil War-Era statute, the False Claims Act has of late become the most powerful tool in addressing healthcare fraud due in no small part to whistleblowers and their attorneys. Barger and partner Henry Frohsin founded their firm together with Elliott Walthall in 2008 to concentrate on representing whistleblowers under the False Claims Act after years with a large civil defense firm. In the less than four years after opening its doors, Frohsin & Barger, LLC has recovered more than $32 million in qui tam suits on behalf of whistleblowers and the taxpayers.

“It’s an honor to represent people like Wendy,” said Frohsin. “Too many people are all too willing to turn a blind eye – it takes courage to be a whistleblower, and that courage deserves to be rewarded.”

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