A Planned Parenthood affiliate in Texas knowingly sent in about $6 million in false claims to Medicaid and took steps to cover up its acts, says a federal "whistleblower" lawsuit that was unsealed Friday.
Planned Parenthood Gulf Coast submitted more than 87,000 reimbursement claims for services that were "false, fraudulent, and/or ineligible," said the lawsuit filed by Abby K. Johnson on behalf of the United States and the state of Texas in U.S. District Court for the Southern District of Texas in Houston.
Ms. Johnson is a former director of one of the clinics and had "system-wide" access to patient records and billing activities for about two years.
Ms. Johnson, who became a pro-life activist after viewing an ultrasound and has converted to Catholicism, said Friday she filed the lawsuit under the federal False Claims Act in 2009 "to simply expose Planned Parenthood and expose their corruption, and expose what they are doing with American tax dollars."
"Everyone, no matter what you think about abortion, should be interested in where our money is going and how it is being spent," Ms. Johnson said. "As someone who saw the inside of this and saw the fraudulent billing and the fraudulent claims, I felt like I had a duty, and it was necessary for me to come forward with this information."
The lawsuit was kept under seal until Friday, when U.S. District Judge Kenneth Hoyt made it public. It alleges that the 10 clinics in Planned Parenthood Gulf Coast put in fraudulent claims worth about $5.7 million to the Texas Women's Health Program, the state's Medicaid program.
Requests for comment Friday from Planned Parenthood Federation of America and Planned Parenthood Gulf Coast were not answered.
The lawsuit, if decided in favor of Ms. Johnson, could result in multimillion-dollar damages and penalties from Planned Parenthood Gulf Coast. As the whistleblower, Ms. Johnson could also receive as much as 30 percent of the amount recovered.
Under the law, it is likely that Planned Parenthood was not aware of the sealed lawsuit, said Alliance Defense Fund senior counsel Michael J. Norton, one of the lawyers representing Ms. Johnson.
But once Planned Parenthood responds, "I suspect we will be, very shortly, in sort of what you would characterize as an all-out war," he said.
According to the lawsuit, Planned Parenthood Gulf Coast contracted with the state to help prevent unwanted pregnancies among a population of eligible women. The clinics' main service was to offer women an annual family-planning exam and consultation; only office visits "related to contraceptive management" were reimbursable by the Medicaid program, the lawsuit said.
However, owing to financial pressures of its own, Planned Parenthood Gulf Coast leaders and staff collaborated to register all kinds of ineligible services — pregnancy tests, sexual-disease tests, Pap tests — for Medicaid reimbursement, the lawsuit claims, adding that the bosses admitted to Ms. Johnson and other clinic directors that these claims were not eligible for reimbursement, but told them, "We have to keep these people as patients" and "We must turn every call and visit into a revenue-generating client."
In addition, clinic staff "falsely notat[ed]" patients' charts to "fix" and "cover up" the frauds before inspectors or auditors came, the lawsuit said.
Regarding abortion services, the lawsuit said that Planned Parenthood Gulf Coast was required by law to refer pregnant women to doctors or clinics that did not perform or promote or refer for elective abortion. But instead, Planned Parenthood referred pregnant women "to its own abortion clinics for performance of abortion, in violation of state law," Mr. Norton said.
The case was unsealed Friday because federal and Texas authorities decided not to intervene in the case, Mr. Norton said.
A spokesman for the Justice Department in Washington said Friday the agency had "no comment" on the case. A spokesman for the Texas attorney general's office could not be immediately reached.
The lawsuit is likely to be of interest on Capitol Hill.
Rep. Cliff Stearns, Florida Republican and chairman of the House Energy and Commerce subcommittee on oversight and investigations, is planning a hearing into federal funding to Planned Parenthood Federation of America. A hearing date has not been set.
Mr. Norton said that this is the third false-claims lawsuit against Planned Parenthood affiliates, and "I don't think it would be unfair to suggest that more will be coming."
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