David X. Sullivan, the United States Attorney for the District of Connecticut, announced that Mercer (US), LLC has agreed to a civil settlement over allegations of overbilling the Defense Health Agency (DHA). The consulting company, which operates an office in Hartford, paid more than $450,000 to resolve claims related to billing practices for work performed by certain employees and subcontractors.
The DHA manages TRICARE’s health benefits program for service members and their families. To support its managed care and pharmacy services contracts, DHA sought expertise from outside the Department of Defense. This led to a competitive bidding process for Health Plan Innovative Support (HPIS) services under the General Services Administration’s Professional Services Schedule.
In April 2020, DHA entered into a Blanket Purchase Agreement with Mercer for HPIS services. Under this agreement, Mercer was tasked with providing personnel qualified in designing TRICARE programs. The BPA specified labor categories with defined education and experience qualifications along with corresponding hourly billing rates.
From May 7, 2020, through August 2, 2023, it is alleged that Mercer billed DHA at higher labor rates than justified by the educational background or experience levels of 11 employees involved. Upon investigation, Mercer disclosed these discrepancies to the government.
To settle claims under the Contract Disputes Act and common law theories such as breach of contract and unjust enrichment, Mercer paid $456,796.50 to the government.
The investigation was conducted by the Defense Criminal Investigative Service with assistance from the Defense Contract Audit Agency Operations Investigative Support Division. Assistant U.S. Attorney Sarah Gruber handled this matter.
