Med Overbilling Fraud Claims Settled for $3M; Whistleblower to Get $620K

Dr. Alfred Chan, and oncologist in Lakewood, Wash., and his wife Judy Chan have agreed to pay $3.1 million to settle allegations that they defrauded federal health care programs by overbilling for cancer treatment medication, U.S. Attorney Jenny Durkan announced last week.

The government alleged that Dr. Chan, with the assistance of his wife, Judy, routinely billed federal healthcare programs such as Medicare and TRICARE for twice (or more) the amount of cancer treatment drugs actually administered to his patients, resulting in a loss to the U.S. government estimated at over $1 million.  The Chans then allegedly destroyed and falsified patients’ medical records in order to conceal the fraud. 

Upon learning of the government’s investigation, the Chans attempted to sell, transfer, and hide millions of dollars in assets in an ultimately unsuccessful attempt to prevent the government from recovering its overpayments.  In February 2011, the Chans fled to Taiwan.  A grand jury sitting in the Western District of Washington returned a criminal indictment against Alfred and Judy Chan relating to their fraudulent conduct.

The lawsuit was originally filed by Ruth Ruckman, a former employee of the Chans, under the whistleblower provisions of the False Claims Act.  Under the False Claims Act, a private citizen with knowledge of fraud against the government can sue on behalf of the government and share in the recovery.  Ruckman will receive $620,000 as her share of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.