Florida Businessman Reaches $27 Million Civil Settlement to Resolve Three False Claims Act Allegations
Daniel Hurt, the owner and/or operator of multiple medical companies, recently agreed to pay $27 million to resolve allegations that he and his companies conspired with others to violate the False Claims Act by submitting false claims to (and receiving payment from) Medicare. Hurt and the companies filed false claims for cancer genomic tests that were not medically necessary and obtained through illegal kickbacks.
The five companies involved – Fountain Health Services LLC, Verify Health, Landmark Diagnostics LLC, First Choice Laboratory LLC and Sonoran Desert Pathology Associates LLC – as well as Hurt also agreed to be excluded from Medicare, Medicaid, and other Federal health programs by the Department of Health and Human Services Office of Inspector General (HHS OIG).
The DOJ alleged that Hurt and his companies (as well as other individuals) conspired to knowingly submit false claims for cancer genomic tests that were not medically necessary to treat or diagnose a condition and that Hurt received and paid kickbacks on, in exchange for Medicare referrals. The United States alleged that from January 2019 to November 2021, Hurt conspired with: certain telemarketing agents to solicit Medicare beneficiaries for “free” cancer genomic tests; certain telemedicine providers to prescribe the medically unnecessary cancer genomic tests; and with certain billing laboratories and a hospital to submit claims for payment to the Centers for Medicare and Medicaid Services (CMS).
The settlement amount represents resolution of three cases, all brought under the qui tam provision of the False Claims Act. One of the three claims was filed by a minority owner of Sonoran Desert Pathology who ran the billing operations for cancer genomic tests.
Within the settlement, it notes that multiple properties, vehicles, and an aircraft owned by Hurt are considered “Settlement Assets” and are to be turned over to the government and/or sold as part of the settlement agreement.
This settlement follows Hurt’s guilty plea to criminal health care fraud for these offenses and the settlement amount is based on Hurt’s ability to pay.
“Submitting false claims for medically unnecessary services to Medicare and Medicaid jeopardizes the integrity of vital health care programs, and we, along with our law enforcement partners, will continue to make sure those who attempt to do so are held accountable,” said Deputy Inspector General of Investigations Christian J. Schrank of HHS-OIG. “This substantial settlement underscores our steadfast dedication to safeguarding federal health care programs.”
Criminal Case
In late 2022, Hurt pled guilty to one count of conspiracy to commit health care fraud, pay and receive unlawful kickbacks, and commit money laundering; one count of conspiracy to commit health care fraud; and one count of conspiracy to pay and receive kickbacks. These guilty pleas resolved three separate cases and allegations in different district courts in the United States.
As part of the criminal resolution, Hurt agreed to pay restitution to Medicare, TRICARE, and CHAMPVA in the amount of $97,360,451.76. Hurt also agreed to pay forfeiture money judgments totaling $31,148,624.70, and to forfeit his luxury watercraft, “In My DNA.”
In May 2024, Hurt was sentenced to ten years in prison, followed by three years of supervised release.