Planned Parenthood Defrauded Taxpayers of Millions Claims Reinstated Lawsuit

From LifeSiteNews
By James Tillman

The U.S. Court of Appeals for the Ninth Circuit is reinstating Gonzalez v. Planned Parenthood of Los Angeles, a case alleging that Planned Parenthood defrauded taxpayers of tens of millions of dollars by overbilling government programs for birth-control pills and similar items.

Jay Sekulow, Chief Counsel of the American Center for Law and Justice (ACLJ), whose attorneys are handling the case, said that although "this case is by no means over, winning this appeal means we have gotten the federal claim over the threshold hurdles and can now get down to the heart of this case: the alleged fraud.”

Victor Gonzalez, a former Chief Financial Officer for Planned Parenthood of Los Angeles (PPLA), had filed his suit on Dec. 19, 2005, shortly after he was fired, allegedly for voicing concerns about PP's illegal accounting practices.

According to Gonzalez, Planned Parenthood had been billing California's Department of Health Services (DHS) at their "usual and customary" rates for oral contraceptives, rather than at the lower "acquisition cost" rates since at least 1997; this was despite the fact that the DHS had repeatedly instructed the Planned Parenthood Affiliates of California (PPAC) to seek reimbursement for drugs solely at the acquisition cost.

This means Planned Parenthood may have charged the DHS as much as 12 times the purchase price of some drugs.

An audit report issued by the California Department of Health Services (DHS) found that such overbilling by the Planned Parenthood of San Diego and Riverside Counties (PPH) cost the state over $5.2 million for the audit period.

Actual overbilling by all Planned Parenthood affiliates in California was almost certainly much higher: the audit examined only periods between 2002 and 2004 for only one of nine separately incorporated Planned Parenthood affiliates in California, each of which engaged in the practice.

According to some sources, the state may have been defrauded of more than $180 million in all.

Planned Parenthood, however, managed to use allies in the state legislature to push AB2151 into law, which permitted PP clinics to continue their practice legally. Gov. Schwarzenegger signed AB2151 on September 28, 2004.

Because the state's medical-assistance programs are supported by federal funds, however, PP's fraud fell beneath the jurisdiction of the federal False Claims Act (FCA), which forbids government contractors from submitting "false or fraudulent" claims for payment.

Furthermore, beneath the FCA, private individuals may bring suit against organizations that have defrauded the government and recover a fraction of the fraudulently obtained funds as their reward.

Attorneys representing Planned Parenthood had convinced U.S. District Court Judge Howard to dismiss Gonzalez's suit on October 30, 2008 on the grounds that he was not an "original source" as the FCA requires.

The ACLJ, a conservative legal advocacy organization focusing on Constitutional law, entered the field as the case was appealed.

"The question on appeal was whether the former PP employee is a proper whistleblower under the False Claims Act,” said Sekulow. “We contended that the answer is ‘Yes,’ and now a three-judge panel of the Ninth Circuit has unanimously agreed with us.”

"This is an important victory. But the legal fight is sure to continue," he continued.

Circuit Judges Alfred Goodwin, Mary Schroeder, and Raymond Fischer ordered the case reopened on July 2. The case names as defendants each of the Planned Parenthood affiliates in California, in addition to the Planned Parenthood Affiliates of California, PP’s political action group that helped push for AB2151.

Planned Parenthood is well known for attempting to maximize profits through unethical means, such as by pushing profitable abortions and promoting their highly controversial "telemed" chemical abortions. According to the pro-life group Operation Rescue, Planned Parenthood routinely overbills insurance companies for such "telemed" abortions.