The Shield Healthcare settlement was reached November 17 and announced last week. Shield is the largest supplier of incontinence supplies, such as adult diapers and waterproof sheeting, to the Medi-Cal program.

 

The settlement will resolve whistleblower claims that Shield Healthcare and its parent company Dharma Ventures Group submitted inflated bills to Medi-Cal that were more than double their net purchase price for the supplies. 

 

The $5 million Shield Healthcare settlement includes a $2 million payment to the United States and a $3 million payment to the State of California since both governments fund the Medi-Cal program. A portion of the settlement will be paid to the whistleblower who filed the lawsuit in August 2007. The whistleblower reportedly discovered the misconduct while working for one of Shield's suppliers. 

 

The amount of money the whistlebower will receive has not been released, but under qui tam provisions of the federal False Claims Act, whistleblowers typically receive between 15 percent and 25 percent of any recovered funds. The whistleblower awards are designed to encourage individuals to report Medicare or Medicaid fraud and sue companies on the government's behalf.