Three former managers of the AIDS Healthcare Foundation filed a suit last week alleging the company paid employees and patients kickbacks for patient referrals in an effort to boost funding from federal health programs. Employees were paid $100 bonuses for referring patients with positive test results to its clinics and pharmacies. The lawsuit alleges kickbacks started in 2010 at the company's California headquarters and spread to programs in Florida and several other locations.
The Los Angeles-based company cares for more than 400,000 patients in 36 countries and is leading a mass testing initiative to identify and treat an estimated 25 million people who don't know they are infected, according to its website.
The referrals were key to the company's business model and touted by AHF President Michael Weinstein at a 2013 leadership summit, where the complaint alleges he specifically directed staff to immediately raise the patient financial incentive to $50 and to implement the incentive program nationally throughout the organization.
Weinstein said small incentives for linking people to services and keeping them there are "mainstays of public health interventions."
"Not only has AIDS Healthcare Foundation done nothing wrong, our pro-active approach to finding and linking HIV-positive individuals to lifesaving care and treatment is critical to stopping HIV in this country," Weinstein said in a statement.
He noted that the federal government and state of Florida formally declined to intervene in the legal action, which he says "speaks volumes about the merits of the case."
The lawsuit was originally filed last year, but an amended complaint was brought last week.
Former managers Jack Carrel of Louisiana, Mauricio Ferrer of Florida, and Shawn Loftis of New York filed the whistleblower complaint. According to their attorneys, the three were fired after notifying their supervisors about the company's alleged wrongdoing, even though their attorneys said they are protected under the False Claims Act.