Amerigroup Corp. announced it has agreed to pay the U.S. government and the state of Illinois a total of $225 million to settle False Claims Act allegations that led to an even larger burden of a 2007 jury verdict and civil penalties under appeal.
Under a proposed settlement agreement, which has not been signed by the parties, Amerigroup will admit no wrongdoing but will consent to the payment, plus attorneys fees, and enter a corporate integrity agreement with HHS inspector generals office, according to a company news release. We are concluding this litigation now to remove a source of significant legal and financial uncertainty for our organization, Amerigroup Chairman and Chief Executive Officer James Carlson said in the release.
A whistle-blower lawsuit filed in 2002 by a former vice president for government relations for Amerigroup, Cleveland Tyson, alleged the company had been cherry-picking healthy enrollees for Medicaid managed care provided under contract with Illinois. For example, Tyson alleged, the company instructed marketing representatives to avoid enrolling pregnant women and applicants in need of specialists. Illinois Attorney General Lisa Madigan and the Justice Department intervened in the case, and a jury verdict combined with court-imposed civil penalties tallied up to $334 million. The Justice Department declined to comment. Madigan said in a written statement, Our goal has been to send a clear message that the state of Illinois will not tolerate interference with the health and well being of Illinoisans. -- by Gregg Blesch
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