January 19, 2021
A recent Law 360 story by Sarah Jarvis, “Attys Want $11M After Record Home Health Care FCA Deal,” reports that a whistleblower is seeking more than $11 million in attorney fees and costs for a $57 million deal in his suit alleging the Visiting Nurse Service of New York defrauded the government, saying the figure is reasonable for the scope and outcome of the case.
Former VNSNY executive Edward Lacey asked a New York federal court for an order requiring the agency to pay him more than $11,147,000 in fees, costs and expenses incurred in Constantine Cannon LLP's successful litigation of the case, which resulted in a record deal last June to resolve Lacey's False Claims Act suit. Lacey had claimed that VNSNY, the largest not-for-profit home health care agency in the U.S., billed for services it never provided and disregarded patients' formal treatment plans.
"Relator is seeking payment for a total attorneys' fee lodestar of $10,110,337.50," Lacey said. "This amount is reasonable by any objective measure based on [Constantine]'s hourly rates and the hours the firm worked to secure this historic result." Lacey said the firm spent 17,374 hours in attorney and legal support time on the case and used the smallest team possible to avoid duplicating resources, noting that only two lawyers worked on the case for its first 18 months. After that, another lawyer joined in October 2015 and another in January 2016, but that principal team didn't expand again for almost two years to handle an accelerated schedule, according to Lacey's memorandum.
In support of his request, Lacey also noted the quality of the result, saying the $57 million settlement is one of the largest home health care fraud settlements ever and the only one to successfully challenge the failure to comply with patient plans of care. Lacey said the settlement "hopefully remedies — or at least turns a regulatory spotlight on — a practice that adversely affects millions of sick and elderly patients across the country."
June's settlement ended Lacey's claims that VNSNY billed Medicare and Medicaid for therapy and services that doctors never provided and maintained an "accept all referrals" policy regardless of capacity constraints. VNSNY did not admit liability as part of the deal and maintains that it didn't bill for visits doctors never provided. As part of the settlement, the federal government was stipulated to receive $50.1 million of the settlement, with New York state getting about $6.8 million. Lacey was then awarded a 29% share of the total $57 million award, his counsel said, and Lacey noted in his memo that this amount was the outer limit of what the government was allowed to award.