Fired AIDS Healthcare Foundation Staff Files Suit, Claiming Illegal Kickbacks

Three former AIDS Healthcare Foundation, Inc., (AHF) employees have filed federal and Florida state whistleblower claims earlier this month against the organization for illegal patient referral kickbacks. AHF is the largest HIV/AIDS medical provider in the U.S. and has additional programs in 36 countries. The suit alleges that AHF defrauded federal health programs, including Medicare, Medicaid and Health and Human Services HIV/AIDS grant programs, of at least $20 million a year in false claims since 2010.

The plaintiffs -- Jack Carrel of Louisiana, Mauricio Ferrer of Florida and Shawn Loftis of New York -- filed the complaint in the U.S. District Court for the Southern District of Florida on April 3. All held management positions at AHF until they notified their supervisors about the company's unlawful practices -- at which point, the press release issued by one of the firms representing them alleges their jobs were terminated.

The complaint asserts that AHF's care model rewarded employees and patients for referrals to its services -- including testing, clinical, pharmacy and insurance service centers. By generating more and more of what the suit calls false referrals, AHF was able to get monetary compensation from federal and state funders for services delivered. The plaintiffs claim the practice began in California, where AHF has its headquarters, before spreading to other states, including Florida, where the claim was filed and where AHF has a substantial presence.

The complaint contends that this "'Linkage' -- or the referral of HIV-positive patients into AHF's constellation of services -- was AHF's 'holy grail' and the key to its business model," including payments of $100 to employees for linking patients who tested HIV positive to AHF's own linkage coordinators.

Furthermore, according to the complaint, the model was handed down directly from AHF President Michael Weinstein. The complaint states that, at AHF's 2013 Leadership Summit, Weinstein "personally advocated for 1) increased testing to raise HIV 'positivity' rates; 2) improved 'linkage' of patients to and retention in AHF medical care; and 3) the payment of financial incentives to patients for the purpose of inducing self-referrals to AHF medical care. He specifically directed staff to raise the patient financial incentive to $50 immediately and to implement the incentive program nationally throughout the AHF organization."

The company's general counsel, Tom Myers, says that the company did not give kickbacks and has not done anything illegal, according to CBS News. He said AHF would continue to care for thousands of patients living with HIV around the U.S. while fighting the claims.

Weinstein and AHF have figured prominently in the media and in community debates in the HIV community, most recently for their steadfast opposition to pre-exposure prophylaxis (PrEP) -- which has included an advertising campaign discouraging its use as a public health intervention -- and AHF's support for a Los Angeles County law to mandate condom use in the pornographic film industry.

AHF points out that the case was originally filed in Federal Court in Florida in June of 2014, and that both the federal government and the state of Florida turned it down:

"The fact that the Federal Government and the State of Florida have each already formally declined to intervene in the legal action brought on behalf of three former AHF employees speaks volumes about the merits of the case," Weinstein said in an official statement.

Weinstein also emphasized that AHF's core mission is to reduce the number of people living with HIV who are not in regular care and treatment, which is currently estimated to be about 60% of the U.S. HIV-positive population.

He added, "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's statement says that AHF looks forward to rebutting the charges in court.

Mathew Rodriguez is the community editor for and You can follow him on Twitter at @mathewrodriguez, like his Facebook page or visit him on his personal website.