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Agencies get refunds after $2.4M settlement

By WILL ASTOR - 1/8/2013 3:36:33 PM

The state has inked a $2.4 million settlement with a medical-waste disposal company accused overcharging 1,000 New York publicly funded agencies, including several in the Rochester area, Attorney General Eric Schneiderman said Tuesday.

Stericycle Inc., a national biohazard waste removal firm based in the Chicago area, used pricing software that since 2003had periodically raised prices without telling clients of the increases, Schneiderman said. The 18 percent price hikes deliberately were imposed in increments designed to avoid notice, he said.

The scheme was exposed by a Stericycle employee who filed a whistleblower complaint in a Chicago federal court. Schneiderman’s office conducted a separate investigation in New York after learning of the federal complaint, he said. Agencies overcharged by the waste-disposal firm in New York included jails, volunteer ambulance companies, police departments, educational institutions and hospitals.

Some $820,000 of the settlement is to go to fully repay overcharged organizations. The four-figure and five-figure refunds are to be paid directly by Stericycle. The biohazard company also has agreed to stop imposing automatic price hikes.

Under the False Claims Act, the New York law Schneiderman invoked to spur the Stericycle investigation, Jennifer Perez, the former Stericycle worker who blew the whistle on the pricing scheme, is entitled to part of the settlement.

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