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Whistleblowers to split $1.37 million in false claims case

Three former mental health staffers will share a “finders fee” of $1.37 million for their help in uncovering billing fraud at a residential treatment unit for boys.

The three were the first to alert government officials to phony Medicaid claims at the Keystone Marion Youth Center. After an investigation, the owner of the facility agreed to pay $6.85 million to settle the claims.

Government lawyers clashed with the three former Youth Center employees over how much of the settlement they should get. Both state and federal law allow between 15 and 25 percent.

U.S. District Judge James P. Jones determined a 20-percent share was appropriate.

Jones noted the government had no knowledge of fraud at the Youth Center until the “relators” filed suit, and the relators – as front-line caregivers – delivered first-hand information about treatment of residents and pressure on staffers to overbill the government.

On the other hand, the government had to do its own detective work to make its case against the overall owner of the Youth Center.

Also, the relators already have benefited from confidential payments for their individual claims as part of the global settlement with the wrongdoers. The whistleblowers may have given up their right to attorneys’ fees under the state and federal false claims laws, but Jones took note of a “substantial contingent fee” due under their contract with their lawyers.

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