Mar 7, 2024

JAX Wound Care Company to Pay $22.5M in Medicare Settlement


Morgan & Morgan’s whistleblower team announces that it has helped the government secure a $22.51 million Medicare settlement in Jacksonville, Florida, in two cases involving allegations that wound care company Healogics and partner hospitals overbilled the government for unnecessary hyperbaric oxygen treatments.

The original February 2014 complaint alleged that contracted doctors Benjamin Van Raalte and Michael Cascio — when they were with the company — were instructed to order and perform medically unnecessary and unreasonable HBO treatments on Medicare patients, while Program Director John Murtaugh was pressured to ensure that the physicians in the wound center performed these unnecessary treatments.

Our firm’s whistleblower team, led by Jacksonville-based whistleblower attorney James Young and senior investigator David Reign, worked closely with clients to gather evidence and build a specific and clear case to expose the allegedly fraudulent scheme.

“These courageous whistleblowers risked their careers and reputations in exposing this scheme,” Young says. “Our clients are healthcare heroes who stepped forward and exposed a scheme that has not only allowed the government to recover over $22 million, but also put a stop to the excessive and unnecessary use of the treatments.”

What It Means When We Help the Government Fight Fraud

The three Relators filed the lawsuit under the whistleblower provisions of the False Claims Act, a federal law that allows private individuals to sue on behalf of the government over false and fraudulent claims, and allows them to share in the recovered funds. The law also allows the federal government to intervene in a lawsuit and assume the case, which it did in this instance.

“Providers should focus on clinical quality and not on how many revenue-producing procedures are performed,” John Murtaugh, former Program Director of the Comprehensive Wound Care Center at Dr. P. Phillips Hospital in Orlando, says. “When key performance indicators are based on healing rates, then financial success will follow. When money comes first, the patient comes last.”

“Just as important, compliance departments should protect employees and ensure there is a channel to report concerns without retaliation,” Murtaugh added.

The settlement with the federal government resolves the claims in the lawsuit.

“I am happy with the result and glad to put this behind me. I feel vindicated because it’s a very lonely feeling to stand up for what you know is right and have almost everyone turn their backs and ignore you,” Cascio said. “Coming forward and exposing this behavior was the most difficult thing I have endured in my career as a physician.”

“This case exposes the fundamental flaw in our healthcare reimbursement system — it relies on the trust and integrity of physicians to bill for necessary and appropriate services and no more,” Reign said. “The government cannot watch or audit every physician or sit in every hospital. Unfortunately, so long as there are greedy people there will be money to be made like this. The sad truth is billing for unnecessary services will never go away.”

Whistleblower Lawsuits at Morgan & Morgan: Contingency-Fee Justice

Contact us today for a free, confidential, no-risk case evaluation. Our whistleblower team is here to help you fight the fraudulent use of taxpayer dollars.

Morgan & Morgan pays for all expenses incurred in a whistleblower lawsuit, including travel and hiring expert witnesses, among other things. You don’t have to fight corrosive, fraudulent actions alone.