TAMPA — A Tampa pathologist who blew the whistle on Medicare fraud will get $4 million for his trouble, the U.S. Justice Department said Monday.
Dr. Alan Freedman filed a 2004 lawsuit under the whistle-blower provision of the False Claims Act to call attention to an illegal kickback arrangement between a Venice dermatologist and Tampa Pathology Laboratory, dating back to 1997.
The dermatologist, Dr. Steven J. Wasserman, has now settled with the government. He agreed to pay $26.1 million to resolve the allegations, the Justice Department said.
In describing the kickback scheme, the department said Wasserman had entered into an arrangement with the Tampa lab and owner Dr. Jose SuarezHoyos, to increase the lab's referral business.
Wasserman sent biopsy specimens from Medicare patients to the lab for testing, and in return, the government said, the lab made it appear to Medicare that the dermatologist had performed diagnostic work.
He billed Medicare for work he didn't do, the government said.
He also performed thousands of unnecessary skin surgeries at the expense of Medicare, the government said.
Freedman worked at the lab from 2000 to 2003, his federal lawsuit states.
According to the lab's website, the company was established in 1983 to provide pathology services to local hospitals, clinics and physicians. The lab, based on Armenia Avenue, says it process an average of 40,000 biopsies per year and employs a staff of 40 and four pathologists.
The Justice Department characterized the $26.1 million settlement as "one of the largest with an individual under the False Claims Act in U.S. history."
Before the settlement with Wasserman, the government had already agreed to a $950,000 settlement with Tampa Pathology Laboratory and SuarezHoyos.
U.S. Attorney Robert O'Neill weighed in with praise.
"Schemes of this magnitude require extraordinary remedies, and we are proud to have reached such an outstanding resolution for the taxpayers and their health programs," he said in a prepared statement released by the Justice Department.
Wasserman will no longer be permitted to accept payments under Medicare, Medicaid and all other federal health care programs, the government said.