Precision Lens and its owner, Paul Ehlen, have been ordered to pay more than $487 million after a whistleblower lawsuit for Medicare fraud.
A federal civil jury concluded the defendants violated the False Claims Act and Anti-Kickback Statute by paying kickbacks to ophthalmic surgeons who used the defendants' products in cataract surgeries reimbursed by Medicare, according to a May 15 news release from the Justice Department.
The jury found 64,575 false claims were submitted to Medicare, resulting in more than $43 million in damages. Under the False Claims Act, each violation carries a minimum civil penalty of $5,000 per false claim and three times the amount of damages sustained by the government. In this case, more than $358 million were assigned in statutory penalties and an additional $131 million in trebled damages.
During the trial, it was proved that the defendants provided kickbacks to physicians in forms such as travel and entertainment. Precision Lens was also proved to have maintained a fund, referred to internally as a secret or slush fund, to finance multiple physicians trips, according to the Justice Department.