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Baum Hedlund Whistleblower Lawyers Resolve Major Health Care Fraud Case

Nov. 16, 2020 – Los Angeles, California - - Whistleblower lawyers from the national law firm of Baum Hedlund Aristei & Goldman announced the resolution of a healthcare fraud case against a medical supply company accused of submitting false claims to federal health care programs for medically unnecessary equipment and supplies that were never provided to patients.

Valley Home Medical Supply, Inc., a Canoga Park, California-based company that provides medical supplies and durable medical equipment, will pay $1,072,618 in restitution to settle the allegations initially brought in the whistleblower lawsuit filed by Kari Kitamura, a former Valley Home Medical Supply employee. Ms. Kitamura will receive 22% of the money recovered by the government as a whistleblower reward.

“Health care fraud steals precious dollars from the citizens who need it most to protect their health and often their very lives,” says Baum Hedlund whistleblower attorney Mark Schlein, who represented Ms. Kitamura alongside attorney Diane Marger Moore. “We are proud to have represented this brave whistleblower who had the courage to stand up and ensure that the defendant in this case was held accountable. We also appreciate the prosecutors in the United States Attorney’s Office in the Central District of California, the California Attorney General’s Office, as well as the federal and state agents on the case who, working together, helped us ensure that justice was done.”

Allegations in Valley Home Medical Supply Health Care Fraud Case

Ms. Kitamura filed a qui tam lawsuit against her former employer alleging the company defrauded Medicare and TRICARE from July 2006 until May 2013. The U.S. government elected to intervene in Ms. Kitamura’s whistleblower lawsuit in 2017.

According to Ms. Kitamura’s lawsuit, Valley Home Medical Supply, through its president and owner Kenneth Greenlinger, submitted fraudulent billings for products that were never prescribed or ordered, and in many instances, never delivered to patients with federal health insurance. The whistleblower lawsuit further alleged that the purpose of those billings was to fraudulently bilk money from federal healthcare programs for a variety of medically unnecessary goods.

In some instances, the lawsuit alleged that Valley Home Medical Supply created entirely false orders using the names of existing beneficiaries. In other instances, the company would allegedly use the previous day’s delivery route sheet to add medically unnecessary items to invoices containing otherwise legitimate orders. After billing federal health insurance programs for the medically unnecessary items, Valley Home Medical Supply did not deliver the items it had fraudulently added to the beneficiaries.

Per the complaint, when beneficiaries called Valley Home Medical Supply to say that their benefits statements showed they had received certain products that they had not actually received, Kenneth Greenlinger directed his employees to forward those calls to him. If the company could not placate the beneficiary, it withdrew the claim and said a mistake had been made, according to the allegations.

Based on the evidence uncovered in the course of the whistleblower litigation, Mr. Greenlinger was criminally charged and pleaded guilty in 2017 to two counts of health care fraud. He served an eight-month federal prison sentence on the charges.

Whistleblower provisions under the False Claims Act allow private citizens with unique knowledge of fraud to file a lawsuit on the government’s behalf to recover funds obtained via fraudulent claims. The government may choose to intervene in the lawsuit and prosecute the action based on the whistleblower’s allegations. If the claim eventually leads to a successful enforcement action and money is recovered, the whistleblower may be eligible to receive a reward.

About Baum Hedlund Aristei & Goldman

The law firm of Baum Hedlund Aristei & Goldman is proud to represent brave men and women who come forward to report fraud, and we share in their purpose to obtain justice on behalf of the government and taxpayers. Our firm has successfully represented thousands of clients throughout the nation and around the world in personal injury and wrongful death lawsuits, class action litigation, whistleblower claims, and more. With more than $4 billion in settlements and verdicts, our firm has earned a reputation for its groundbreaking litigation and settlements and verdicts against major national and international companies.

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