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Whistleblower gets $5.4 million in lawsuit settlement

Surrounded by mountains and forest, Kalispell, Montana, is the gateway to one of the nation’s natural wonders: Glacier National Park. The beautiful scenery is a backdrop to an ugly scandal focused on the 138-bed hospital that takes its name from the town. The medical center has been roiled by charges that physicians there took illegal kickbacks and defrauded the federal government.

Kalispell Regional Healthcare recently agreed to pay $24 million to settle the whistleblower lawsuit that blew the lid off of the scheme. According a news source, it’s the largest False Claims Act recovery in Montana’s history.

The lawsuit alleged that 63 doctors at the facility were involved in the kickback scheme that also included hospital executives. The suit said the hospital and doctors conspired to over-compensate physicians who would then make Medicare patient referrals to the medical center.

The scheme resulted in outsized benefits to specialist doctors, including $392,244 to a part-time cardiologist. If he had worked full-time at that rate, he would have raked in $4.3 million; about five times more than the national average in his invasive cardiology specialty.

The man who blew the whistle on the scheme was the hospital’s physician network chief financial officer. The CFO took complaints to officials with the Department of Health and Human Services and Department of Justice.

He also took the matter to an attorney experienced in whistleblower litigation and they filed two lawsuits under the qui tam provisions of the False Claims Act. The cases were consolidated and then resolved in the settlement. The CFO is to receive $5,411,521 as his share of the settlement.

“This case shows that whistleblowers can have a significant impact by stepping forward in the best interests of patients and taxpayers,” the lawyer told a Montana newspaper.

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