On November 15, 2023, the U.S Department of Justice (DOJ) announced a $45.6 million consent judgment (Settlement) with six skilled nursing facilities (SNFs), as well as the owner of the SNFs and its management company which managed the SNFs, to resolve alleged violations of the False Claims Act (FCA) tied to medical director arrangements violating the Anti-Kickback Statute (AKS). The Settlement is notable for its inclusion of the owner and the management company in addition to the SNFs, which indicates DOJ’s interest in scrutinizing the actions of individuals and management entities in connection with problematic arrangements under federal fraud and abuse laws.Continue Reading DOJ Settlement Targets Owner and Management Company in Addition to Post-Acute Care Facilities
On June 26, 2023, Connecticut Governor Ned Lamont signed into law Public Act 23-129: “An Act Concerning Liability for False and Fraudulent Claims” (the Act). The Act expands application of Connecticut’s False Claims Act (CFCA) to all claims for money or property to the state of Connecticut (except as expressly provided in the CFCA) and accordingly expands the scope of conduct covered by the CFCA. The Act does so by removing the current limitation on the CFCA’s applicability to only state-administered health or human services programs. The Act took effect July 1, 2023.Continue Reading Connecticut Expands Applicability of State False Claims Act
This post is co-authored by Seth Orkand, co-chair of Robinson+Cole’s Government Enforcement and White-Collar Defense Team.
On June 1, 2023, the U.S. Supreme Court issued a unanimous opinion in the highest-profile False Claims Act (FCA) case for many years, concluding that a party’s subjective belief as to whether it overcharged Medicare and Medicaid…
On December 27, 2022, the Centers for Medicare & Medicaid Services (CMS) released a proposed rule (Proposed Rule) which proposes certain policy and technical changes to Medicare regulations, including a notable change to the current standard under the “60-Day Rule” for identifying a Medicare overpayment. Specifically, CMS indicated that it is proposing to (i) “adopt by reference” the federal False Claims Act’s (FCA) definitions of “knowing” and “knowingly” as governing when an overpayment is identified, and (ii) eliminate the “reasonable diligence” standard that has been in place, but subject to challenges, for a number of years.Continue Reading No More Reasonable Diligence? CMS Proposes to Change Standard for Identifying Medicare Overpayments to Align with False Claims Act
On January 27, 2020, the Department of Justice (DOJ) announced a $145 million settlement with Practice Fusion Inc., an electronic health records (EHR) software company that resolves parallel criminal and civil investigations involving allegations of kickbacks, false claims, and non-compliance with federal EHR program requirements. We previously discussed a preliminary settlement in this case here, and in announcing the finalizing of that settlement the DOJ has shed more light on the allegedly improper conduct at issue. According to the DOJ, this is the first criminal action ever brought against an EHR company, and the “unique” deferred prosecution agreement (DPA) imposed by the DOJ against Practice Fusion that seeks “to ensure acceptance of responsibility and transparency as to” underlying conduct may reflect a new approach to settlements with corporate health care defendants.
Continue Reading DOJ Announces Settlement with EHR Company to Resolve Criminal and Civil Kickback Investigations Tied to Opioid Prescribing
On January 21, 2020, the Department of Justice (DOJ) announced a $3 million settlement with Patient Services, Inc. (PSI) to resolve allegations of False Claims Act (FCA) violations. The DOJ alleged that PSI enabled three pharmaceutical companies to pay kickbacks to patients by funneling money to patients taking drugs manufactured by those same pharmaceutical companies. In addition to the $3 million, PSI has entered into a three-year integrity agreement with Health and Human Services’s Office of the Inspector General. The settlement involved no determination of liability.
Continue Reading DOJ Reaches Settlement with Patient Assistance Foundation Resolving Allegations of FCA Violations
On November 26, 2019, the Department of Justice (DOJ) announced a $26.67 million settlement with a laboratory testing corporation, Boston Heart Diagnostics Corporation (Boston Heart). The settlement resolves allegations of False Claims Act (FCA) violations related to alleged payments for patient referrals in violation of the Anti-Kickback Statute (AKS) and the Physician Self-Referral Law (PSR Law) – commonly known as the Stark Law – and other improper billing.
Continue Reading DOJ Announces $26.67 Million Settlement with Laboratory to Resolve FCA Allegations
On November 15, 2019, the Department of Justice (DOJ) announced it had reached a settlement with Sutter Health (Sutter) and Sacramento Cardiovascular Surgeons Medical Group Inc. (Sac Cardio) to resolve alleged violations of the Physician Self-Referral Law (PSR Law), commonly known as the Stark Law. Sutter is a California-based health services provider; Sac Cardio is a Sacramento-based practice group of three cardiovascular surgeons. The total settlement in excess of $46 million includes $30.5 million from Sutter to resolve allegations of an improper financial relationship specific to compensation arrangements with Sac Cardio. Sac Cardio has agreed to pay $506,000 to resolve allegations of duplicative billing associated with one of these compensation arrangements. Separately, the settlement includes another $15,117,516 from Sutter to resolve self-disclosed conduct principally concerning the PSR Law.
Continue Reading DOJ Announces Physician Self-Referral (Stark) Law Settlement in Excess of $46 Million with California Health System and Surgical Group
On September 4, 2019, the Department of Justice (DOJ) announced a $15.4 million settlement with pharmaceutical company Mallinckrodt ARD LLC (Mallinckrodt) to resolve alleged violations of the Anti-Kickback Statute (AKS) in two whistleblower suits filed under the False Claims Act (FCA). The settlement addresses allegations of AKS violations between 2009-2013 by sales representatives of a company later acquired by Mallinckrodt via the “wining and dining” of physicians to induce Medicare prescriptions of that company’s drug. Interestingly, the settlements do not cover related allegations within those FCA suits that Mallinckrodt improperly used a patient assistance foundation to “pay illegal kickbacks in the form of copay subsidies” for the same drug.
Continue Reading Government Continues to Closely Scrutinize Pharmaceutical Marketing Practices
“A mere difference of opinion between physicians, without more, is not enough to show falsity.”
In a 3-0 decision issued September 9, 2019, the U.S. Court of Appeals for the Eleventh Circuit affirmed a three-year-old district court ruling in United States v. AseraCare, Inc. that a Medicare claim for hospice services cannot be deemed false under the False Claims Act (FCA) based on a difference in clinical judgment. This decision – apparently the first circuit-level determination of the “standard for falsity [under the FCA] in the context of the Medicare hospice benefit” – will affect all hospice providers, as the Department of Justice (DOJ) and whistleblowers will not be able to rely on disagreements between physician opinions as the basis for establishing falsity under the FCA. Instead, the Eleventh Circuit instructs that a claim for hospice reimbursement “cannot be “false” – and thus cannot trigger FCA liability – if the underlying clinical judgment does not reflect an objective falsehood.” The Eleventh Circuit’s decision emphasizes that reasonable differences of opinion between physician reviewers of medical documentation are not sufficient to suggest that the judgments concerning a particular patient’s eligibility for Medicare’s hospice benefit, or any claims submitted based on such judgments, are false for purposes of the FCA.
Continue Reading Eleventh Circuit Endorses Objective Falsehood Standard for False Claims Cases Concerning Physician Judgment of Hospice Eligibility