Martin noted that his office has recouped $130 million since 2011, compared with only $3 million in 2010. “I made fighting healthcare fraud a top priority,” he said. “We're really just getting started.”
Key healthcare victories for the district include judgments of $82.6 million against Renal Care Group, Nashville, and parent company Fresenius Medical Care, Waltham, Mass., in May 2011 and $11.1 million against MedQuest Associates, Alpharetta, Ga., in October.
The district also settled with Boston Scientific subsidiary Guidant, Natick, Mass., for $9.25 million in September and AmMed Direct, Nashville, for $18 million in April.
Healthcare fraud has been a significant area of focus under the Obama administration, which has reported record-breaking recoveries topping $10.7 billion. In May 2009, the administration introduced the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, and the Patient Protection and Affordable Care Act also sets stricter penalties for fraudulent activities.
HHS and the U.S. Justice Department launched a public-private partnership last month with health insurers to root out billing fraud using sophisticated analytics and data sharing.
Yet Jennifer Weaver, a partner at Nashville-based law firm Waller, noted that the Middle District of Tennessee stands out as one of the U.S. attorneys' offices to participate in a pilot program in which the inspector general's office has placed a special assistant U.S. attorney to focus on criminal healthcare fraud cases.
And she attributed the shift directly to the arrival of Martin, an Obama appointee sworn into office in May 2010, who she said is becoming a “national figure” in healthcare fraud enforcement.
“That automatically attracts relators' counsel,” she said, adding that she expects to see more cases filed in the Middle Tennessee District because of the district's “successful track record” and “demonstrated willingness to intervene.”
“Qui tam” or whistle-blower suits can be brought in any jurisdiction where a defendant “can be found, resides (or) transacts business,” or where the violations of the False Claims Act occurred. Whistle-blowers are more likely to be successful if the government intervenes in their case, making it beneficial for plaintiffs to seek out a jurisdiction with an interest in fraud cases.
Ty Howard, a partner in the Nashville office of law firm Bradley Arant Boult Cummings, noted that recoveries in the Middle Tennessee District have “significantly increased” and more resources have been directed toward False Claims Act suits.
“We see these cases increasing everywhere, but the Middle District of Tennessee is going to be a leader in that,” said Howard, a former assistant U.S. attorney who left the office in March. “I think it is increasingly a qui tam friendly jurisdiction.”
He added that Martin himself is interested in taking on fraud cases. Before becoming a U.S. attorney, he focused on collective and class-action cases involving shareholders, consumers and employees in private practice.
Martin has increased the number of civil attorneys in his office, which now has four attorneys and a full-time investigator devoted to False Claims Act cases. “I think that the word has gotten out,” Martin said.
Patrick Burns, director of communications for the Taxpayers Against Fraud Education Fund, a group that facilitates the filing of qui tam cases, also declined to say whether more plaintiffs are filing suits in the Middle Tennessee District. Yet he noted that Martin recently attended one of the organization's meetings and “emphatically and publicly asked us to bring cases.”
Burns also pegged U.S. Attorney Preet Bharara, whose jurisdiction includes much of New York City, as taking a significant interest in prosecuting fraud cases.
Weaver noted that Martin's win on summary judgment in the Renal Care and MedQuest cases was unusual because the government needed to prevail on each element of its False Claims Act claim.
Most of these cases settle, she added, but the Nashville office has been “proactive in going out and rolling up their sleeves” to win cases.
The district's location in the heart of the for-profit hospital sector is also no coincidence. Nashville is home to industry giant HCA, and eight of the top 20 for-profit chains are headquartered in the Nashville-Brentwood-Franklin corridor, a 20-mile stretch along I-65.
“I think that jurisdiction plays a big role,” Howard said, adding that Nashville is increasingly not just a regional healthcare hub but a national one.
