DOJ Reaches Settlement with Provider Based on Chronic Care Management Coding

Recently, DOJ, the State of Florida, and the State of Minnesota reached a nearly $15 million FCA settlement to resolve allegations that a provider knowingly submitted claims for services related to the management of patients in assisted living facilities (“ALFs”), group homes, and memory care units that did not comply with applicable federal healthcare program (“FHCP”) requirements.  This settlement is one of the first FCA settlements involving chronic care management (“CCM”) codes.  See United States ex rel. Loscalzo v. Bluestone Physician Servs. of Florida, LLC, 2:20-cv-00295 (M.D. Fla).


Court Dismisses EMTALA-Based Qui Tam Over Relator’s Objections

DOJ recently secured dismissal of a qui tam complaint premised on alleged violations of EMTALA over the relator’s objections, with the district court affirming that DOJ satisfied the Polansky standard for Section 3730(c)(2)(A) dismissals by presenting a “reasonable argument.”  In this case, DOJ’s argument rested on perceived flaws in the viability of the relator’s legal theory, government litigation costs, and complex privilege issues that would need to be resolved during discovery.


Ninth Circuit Reboots FCA Suit Based on Radiologist Use of Certain Computer Monitors

A panel of the Ninth Circuit recently issued a 2-1 opinion reversing, in part, a district court’s dismissal of a False Claims Act case premised on a radiology facility’s use of non-medical grade computer monitors for diagnostic readings.  In reviving the case, the majority concluded that the relator sufficiently pled a false certification theory of fraud from which the court drew a “strong inference” that the radiology facility’s use of the computer monitors did not meet Medicare’s “reasonable and necessary” requirement because the allegedly technologically inferior monitors the radiologists used undermined the efficacy of their diagnostic readings.  The decision is notable because the majority relied on tenuous inferences to establish falsity, as detailed by the dissent, and a watered-down materiality analysis to establish materiality.


Court Dismisses Commercial Insurer’s Claims Premised on Conduct Covered by FCA Settlements

It is becoming increasingly common for private litigants to sue over conduct that was previously the subject of FCA actions.  In one such recent case, the defendants successfully defeated such a collateral suit, demonstrating that it was time-barred under the statutes of limitations.


Seventh Circuit Rejects Constitutional Challenge to FCA Judgment, Recognizes Circuit Split on Causation Requirement for AKS-Based Claims

In a recent decision, the Seventh Circuit acknowledged—but declined to pick sides in—a circuit split regarding the degree of causation required to establish FCA claims premised on AKS violations.  In the same opinion, the Seventh Circuit rejected an Eighth Amendment challenge to the amount of an FCA judgment.


DOJ Reaches Settlement with Nursing Home Provider Based on Alleged Abuse of COVID-19 Waiver

Last week, DOJ and the State of California reached a $7,084,000 settlement with a California-based nursing home chain and two executives for allegedly misusing a pandemic-era waiver program by routinely submitting claims to Medicare for nursing home residents that did not have a qualifying prior hospital stay.  This settlement is noteworthy because it is one of the first FCA settlements involving alleged abuse of this particular Centers for Medicare & Medicaid Services (“CMS”) COVID-19 waiver.  See United States and State of California ex rel. Bay Area Whistleblower Partners v. Renew Health Group, LLC, No. 2:20-cv-09472-CBM-AS (C.D. Cal. Oct. 14, 2020).


Sixth Circuit Affirms Orders Compelling Relator to Seek Government Consent to Dismiss Qui Tam Pursuant to Settlement Agreement

The Sixth Circuit recently confirmed that there is no per se bar on relators releasing previously filed FCA claims as part of a settlement agreement, although the government must still subsequently consent to the dismissal of such claims. See State Farm Mut. Auto. Ins. Co. v. Angelo, 95 F.4th 419 (6th Cir. 2024).


Court Finds That Qui Tam Relator Cannot Enforce 340B Program Statute

A recent decision from the Central District of California held that a qui tam relator cannot bring a False Claims Act (FCA) case against pharmaceutical manufacturers to enforce the 340B Drug Pricing Program’s (“340B Program”) statutory requirements.  See United States ex rel. Adventist Health System/West v. AbbVie, No. 21-cv-04249 (C.D. Cal. Mar. 18, 2024). The 340B Program is a federal program that requires pharmaceutical manufacturers to offer discounted prices, called a “ceiling price,” on applicable drugs to certain hospitals and clinics, referred to as 340B “covered entities.”  The relator, Adventist Health System/West, a covered entity under the 340B Program, alleged that the defendant pharmaceutical manufacturers failed to comply with the 340B Program’s requirements related to the “penny pricing” policy, which requires manufacturers to offer drugs at a penny if the ceiling price calculation results in a number at or less than a penny.






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