In North Carolina, major healthcare fraud is civilly and criminally prosecuted by the Eastern Western and Middle District United States Attorney’s Offices and the State’s own Medicaid Fraud Control Unit.
The federal government often accomplishes this task with the assistance of the North Carolina Medicaid Fraud Control Unit (MFCU). The MFCU takes the responsibility of stopping fraud very seriously and is often assisted in its efforts by the bravery and actions of whistleblowers.
Modeled after the federal False Claims Act, the North Carolina False Claims Act permits private citizens to bring qui tam actions on behalf of the State of North Carolina to recover treble damages and civil penalties. N.C. Gen. Stat. §§ 1-605 et seq.
Nolan Auerbach & White represents whistleblowers in federal court only. We will bring cases on behalf of whistleblowers under the North Carolina qui tam statute as part of an action under the federal False Claims Act. We do so under the Court’s pendent jurisdiction.
The liability provisions of the North Carolina False Claims Act, N.C. Gen. Stat. § 1-607(a), provide that it is unlawful for any person who:
(1) Knowingly presents or causes to be presented a false or fraudulent claim for payment or approval;
(2) Knowingly makes, uses, or causes to be made or used, a false record or statement material to a false or fraudulent claim;
(3) Conspires to commit a violation of subdivision (1), (2), (4), (5), (6), or (7) of this section;
(7) Knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the State, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the State
Cases completed in North Carolina that were originally brought in a North Carolina federal court include:
Medicaid Dental Center (MDC), a privately-owned chain of dental clinics in North Carolina, agreed to pay more than $10 million to the U.S. and the State of North Carolina to resolve allegations that it violated the False Claims Act by billing for medically unnecessary services. According to allegations made by the U.S. and the State of North Carolina, MDC and its owners, Michael A. DeRose DDS, P.A. and Letitia L. Balance, DDS, had fraudulently billed the North Carolina Medicaid Program for medically unnecessary pulpotomies or “baby root canals” on low-income children. MDC and its owners also allegedly performed certain dental procedures without receiving informed consent and placed stainless steel crowns in patients without medical necessity.