Tuesday, October 31, 2006

Amerigroup Slammed in Whistleblower Case to Tune of Potentially $144 Million

AmerigroupA major US insurance company, Amerigroup, has been found liable in a whistleblower suit for discriminating against low-income pregnant women in the issuance of health insurance policies. 

Here's a taste from Yahoo! News via the AP:

Insurance company Amerigroup Corp. and its Illinois affiliate were held liable Monday for what lawyers said ultimately would total $144 million in damages for discriminating against pregnant women.

A federal court jury returned a verdict against the company that specializes in health care for low-income patients calling for $48 million in damages — an amount lawyers said would be tripled under state and federal laws.

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Federal and state prosecutors as well as a whistleblower said that while marketing its services in Illinois, Amerigroup avoided pregnant women and others likely to run up high doctor bills.

That cheated the government, which was subsidizing the company to market its services evenly among all low-income patients regardless of whether they were pregnant or had costly illnesses, the attorneys said.

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The suit was based on a whistleblower complaint from Cleveland Tyson, a former lobbyist for Amerigroup's Illinois affiliate. Tyson, who was fired in 2002, had lobbied state lawmakers and regulators.

Tyson's attorneys said it was "unclear" why he was fired and Jenkins said it would be improper for the company to comment on personnel matters.

The basic damages awarded by the jury were $48 million. Attorneys said that as a matter of law U.S. District Judge Harry D. Leinenweber would be required to triple the damages to $144 million.

They said the tripling is required under both the federal False Claims Act and the Illinois Whistleblower Act.

The company plans to appeal, but in the meantime you can file this one under the "Corporate Greed Has No Bounds" category. 

And yet according to this article in the New York Times, as I write this, corporate America is in the process of trying to dilute whistleblowing and other employee and shareholder protections from such unconscionable corporate conduct.

PS

https://lawprofessors.typepad.com/laborprof_blog/2006/10/amerigroup_slam.html

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