Early life and education
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Adam B. Resnick | |
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| Born | March 10, 1972 |
| Occupation(s) | American health care entrepreneur, public speaker and author |
Adam B. Resnick (born March 10, 1972) is an American health care entrepreneur, public speaker, author, and professional whistleblower.
Resnick has exposed Medicare and Medicaid fraud in the institutional pharmaceutical business.
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His 2007 book, Bust: How I Gambled and Lost a Fortune, Brought Down a Bank-and Lived to Pay for It, is an autobiography describing his early addiction to gambling and how he, in a bank fraud conspiracy, contributed to the 2002 failure of Universal Federal Savings Bank in Chicago, Illinois. [1] [2] Resnick was convicted for his role in the fraud and served 19 months in federal prison. [3] Resnick has been involved in suing Omnicare, a supplier of drugs to nursing homes, under federal whistleblower law, as well as the parties to the company's alleged kickback schemes. Resnick filed suit to punish Omnicare for Medicare and Medicaid fraud. Omnicare allegedly paid kickbacks to nursing home operators in order to secure additional business.
"If nursing homes take kickbacks, decisions they make about drugs for their residents ultimately may be based on financial benefits to the nursing homes rather than medical benefits for their patients," Resnick said after a settlement was reached in 2010 with two nursing chains he sued. [4]
In 2006, Resnick filed a lawsuit under the False Claims Act against Omnicare and two nursing homes. The U.S. Department of Justice joined the lawsuit in December 2008, and Omnicare settled by paying $19.8 million to the federal government in November 2010. Subsequently, the two nursing homes also charged in the lawsuit, Mariner Health Care Inc. and SavaSeniorCare Administrative Services L.L.C., paid $14 million in February 2010 to settle their part in the alleged fraud. The two nursing home chains allegedly solicited kickbacks from Omnicare in exchange for 15-year contracts to utilize Omnicare's pharmacy services. [5] [6]
In June 2013, Omnicare settled its part of a whistleblower lawsuit filed against it by Resnick and Maureen Nehls related to its 2004 acquisition of Total Pharmacy Services. Sued for illegally paying kickbacks to the owners of Total Pharmacy, Omnicare agreed to settle the suit by paying $17.2 million to the federal government. [7] Nursing home owners the Esformes family, who sold their share in Total Pharmacy to Omnicare in return for the kickback, agreed to pay the government $5 million. Total Pharmacy provides pharmacy services to institutions such as nursing homes. The terms of the acquisition were in violation of federal and state laws. [8] Omnicare previously settled a complaint with the Commonwealth of Massachusetts stemming from the deal for $98 million. [7] Nehls was a vice president of Total Pharmacy and Resnick was to the deal eir 2007 lawsuit alleged that the price paid by Omnicare for Total, $32 million, as greatly inflated by the kickback paid to the Esformes family. As part of the deal, the Esformes family signed a 10-year pharmacy contract with Omnicare for their chain of nursing homes. [7] Such kickbacks constitute Medicare and Medicaid fraud. Under federal whistleblower laws, the plaintiffs will receive 28% of the Omnicare recovery (worth roughly $4.8 million) and 25-30% of the recovery from the Esformes family (worth from $1.25 million to $1.5 million). The Esformes family also agreed to pay almost $1 million in the plaintiffs’ attorneys' fees. [8] The settlement, which was reached days before suit was scheduled to go to trial, did not include an admission of wrongdoing by the Esformes family. [8]
In 2009, Resnick, decided to use a substantial part of his $3.1 million award from his first Omnicare whistleblower lawsuit to pay restitution to the U.S. government for his role in the 2002 Universal Federal Savings Bank failure. Through an unprecedented arrangement worked out by the Federal Deposit Insurance Corporation, Resnick's restitution was forwarded to Universal's former employees and depositors. Not only has everyone who lost money when the bank failed been made whole, but, as the Chicago Journal reported, Resnick's restitution is also being given to “regular bank customers who didn’t lose a penny when Universal collapsed.” The FDIC says this case marks the first time in history that the U.S. government has received restitution money after it had closed receivership on a failed bank. [9]
In 2012, Resnick sued the Chicago law firm of Neal, Gerber and Eisenberg for legal malpractice over a multi-million dollar contract dispute alleging that they represented both Resnick and the contracting party. The $20 million dispute was settled in an out of court settlement through arbitration. [10]
In 2006, Resnick was presented with a Lifting Up the World with a Oneness-Heart Award by Chinmoy Centres International for his “dedication to international development charities."[ citation needed ]
The Chicago Sun-Times called Resnick's book, Bust: How I Gambled and Lost a Fortune, Brought Down a Bank-and Lived to Pay for It, [11] “entertaining.” [12] The Milwaukee Journal Sentinel called it a “wild ride.” [13]
Resnick is the author of numerous articles and editorials, including
The False Claims Act of 1863 (FCA) is an American federal law that imposes liability on persons and companies who defraud governmental programs. It is the federal government's primary litigation tool in combating fraud against the government. The law includes a qui tam provision that allows people who are not affiliated with the government, called "relators" under the law, to file actions on behalf of the government. This is informally called "whistleblowing", especially when the relator is employed by the organization accused in the suit. Persons filing actions under the Act stand to receive a portion of any recovered damages.
Walgreen Company, doing business as Walgreens, is an American company that operates the second-largest pharmacy store chain in the United States, behind CVS Health. It specializes in filling prescriptions, health and wellness products, health information, and photo services. It was founded in Chicago in 1901, and is headquartered in the Chicago suburb of Deerfield, Illinois. On December 31, 2014, Walgreens and Switzerland-based Alliance Boots merged to form a new holding company, Walgreens Boots Alliance. Walgreens became a subsidiary of the new company, which retained its Deerfield headquarters and trades on the Nasdaq under the symbol WBA.
In common law, a writ of qui tam is a writ through which private individuals who assist a prosecution can receive for themselves all or part of the damages or financial penalties recovered by the government as a result of the prosecution. Its name is an abbreviation of the Latin phrase qui tam pro domino rege quam pro se ipso in hac parte sequitur, meaning "[he] who sues in this matter for the king as well as for himself."
CVS Caremark is the pharmacy benefit management subsidiary of CVS Health, headquartered in Woonsocket, Rhode Island.
Omnicare, Inc. is an American company working in the health-care industry. It was established in April 1981 as a spinoff of healthcare businesses from Chemed and W. R. Grace and Company. It is currently a pharmacy specializing in nursing homes. In 2015, Omnicare was acquired by CVS Health.
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CVS Health Corporation is an American for-profit healthcare company that owns CVS Pharmacy, a retail pharmacy chain; CVS Caremark, a pharmacy benefits manager; and Aetna, a health insurance provider, among many other brands. The company is the world's second largest healthcare company, behind UnitedHealth Group. In 2023, the company was ranked 64th in the Forbes Global 2000.
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Health care fraud includes "snake oil" marketing, health insurance fraud, drug fraud, and medical fraud. Health insurance fraud occurs when a company or an individual defrauds an insurer or government health care program, such as Medicare or equivalent State programs. The manner in which this is done varies, and persons engaging in fraud are always seeking new ways to circumvent the law. Damages from fraud can be recovered by use of the False Claims Act, most commonly under the qui tam provisions which rewards an individual for being a "whistleblower", or relator (law).
Pharmaceutical fraud is when pharmaceutical companies engage in illegal, fraudulent activities to the detriment of patients and/or insurers. Examples include counterfeit drugs that do not contain the active ingredient, false claims in packaging and marketing, suppression of negative information regarding the efficacy or safety of the drug, and violating pricing regulations.
A kickback is a form of negotiated bribery in which a commission is paid to the bribe-taker in exchange for services rendered. Generally speaking, the remuneration is negotiated ahead of time. The kickback varies from other kinds of bribes in that there is implied collusion between agents of the two parties, rather than one party extorting the bribe from the other. The purpose of the kickback is usually to encourage the other party to cooperate in the scheme.
United States v. GlaxoSmithKline was a case before the United States District Court for the Eastern District of Pennsylvania. Robert J. Merena was one of the first who filed claims against SmithKline Beecham Clinical Laboratories on November 12, 1993. The complaints alleged that GlaxoSmithKline, which operated a system of clinical laboratories, adopted myriad complicated procedures for the purpose of defrauding state and federal healthcare programs, in particular Medicare and Medicaid. The U.S. Justice Department publicly praised Robert Merena for his "cooperation and support" in helping the government collect the largest settlement ever involving a whistle-blower lawsuit. The SmithKline settlement is considered to be one of the largest whistleblower assisted recoveries in the history of the United States.
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