On February 1, 2022, Acting Assistant Attorney General for the DOJ Civil Division, Brian M. Boynton, announced that the Civil Division recovered over $5.6 billion in settlements and judgments under the False Claims Act (“FCA”) for fiscal year 2021. This is the second largest annual total in FCA history and a significant increase from the $2.2 billion recovered during fiscal year 2020. Detailed statistics on FCA recoveries from 1986 through FY 2021 are available here. (more…)
https://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.png00Scott D. Steinhttps://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.pngScott D. Stein2022-02-09 16:35:062023-09-11 12:23:00DOJ Statistics on FCA Recoveries Through FY 2021 Reveal Continued Focus on Healthcare and More Direct Government Enforcement
On January 21, 2022, the First Circuit affirmed the government’s request for dismissal of a whistleblower complaint alleging that several pharmaceutical companies had colluded to defraud Medicare Part D. The government, after declining to intervene, requested dismissal based on its finding that: (1) the suit would require “substantial expenditure of government resources”; (2) “many key aspects of [the relator’s] allegations [we]re not supported”; and (3) “allegations that [the relator] used the qui tam process to leverage his financial interests through securities trading . . . convince[d] the [g]overnment that [the relator was] not an appropriate advocate of the United States’ interests.” (more…)
https://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.png00Scott D. Steinhttps://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.pngScott D. Stein2022-02-02 12:02:152023-09-11 12:23:39First Circuit Joins Circuit Split on FCA Dismissal Authority, Finds Government Has Broad Authority to Dismiss FCA Cases
In a recent 2-1 decision, the Fourth Circuit joined every other circuit to have considered the issue in applying Safeco’s “reckless disregard” standard to legally false FCA claims based on alleged violations of ambiguous laws and regulations. Under Safeco, courts ask whether a defendant’s interpretation of the ambiguous law or regulation at issue was objectively reasonable and whether authoritative guidance might have warned the defendant away from that interpretation. The Fourth Circuit found that the Safeco standard “duly ensures that defendants must be put on notice before facing liability for allegedly failing to comply with complex legal requirements. Without such notice, defendants are not likely to receive due process.”
https://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.png00Jaime L.M. Joneshttps://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.pngJaime L.M. Jones2022-01-28 17:23:492023-09-11 12:24:33Fourth Circuit Applies Safeco to FCA Claims, Accuses CMS of “Maintaining Strategic Ambiguity” Around Medicaid Drug Rebate Program Requirements
Last week one of the first qui tam suits alleging manipulation of the billing rules for a type of remote patient monitoring was unsealed, following the relator’s voluntary dismissal. See United States ex rel. Mathurin v. Vector Remote Care LLC (Nov. 18, 2020 E.D.N.Y.). Relators not infrequently voluntarily dismiss their case when DOJ informs them that it lacks merit. Whatever the merits of this one, given the explosive increase in remote patient monitoring during the pandemic and the predicted future increases in these patient care modalities, we expect continued whistleblower activity focused on this space. Of course, such allegations will be met with substantial challenges to establishing that these kinds of issues in fact fail to comply with the applicable coverage and reimbursement criteria or render any claims materially false.
Yesterday HHS-OIG updated its Work Plan to add yet one more audit of potential misconduct relating to the COVID-19 pandemic. This project, titled Hospital’s Compliance With the Provider Relief Fund Balance Billing Requirement for Out-of-Network Patients, focuses on compliance with a clause in the Provider Relief Fund Terms and Conditions that restricts balance billing for COVID-19 patients. That clause states: [F]or all care for a presumptive or actual case of COVID-19, Recipient certifies that it will not seek to collect from the patient out-of-pocket expenses in an amount greater than what the patient would have otherwise been required to pay if the care had been provided by an in-network Recipient.” (more…)
https://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.png00Jaime L.M. Joneshttps://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.pngJaime L.M. Jones2022-01-21 11:17:122023-09-11 12:25:51OIG Will Audit Hospitals for Compliance with Provider Relief Fund Balance Billing Rule
The Eleventh Circuit recently held that the Eighth Amendment’s prohibition on excessive fines applies to monetary awards in non-intervened FCA actions—the first federal court of appeals directly to address the application of this constitutional protection in non-intervened cases. SeeYates v. Pinellas, No. 20-10276 (11th Cir.). However, the panel concluded that while the amount of the fine in this case was “very harsh,” it was not unconstitutionally excessive.
In Yates v. Pinellas, following the government’s declination, the district court imposed a total monetary award of $1,179,266.62 under the FCA based on the defendant’s submission of laboratory test claims to Medicare without a proper CLIA certificate. Specifically, the jury found that the defendant violated the FCA on 214 occasions and that the United States had incurred $755.54 in damages. The court then imposed treble damages of $2,266.62 and statutory minimum penalties of $5,500 for each of the 214 violations, or $1,177,000, for a grand total of $1,179,266.62. The defendant moved for remittitur, arguing that this amount constituted an excessive fine in violation of the Eighth Amendment. The district court rejected the argument. (more…)
https://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.png00Scott D. Steinhttps://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.pngScott D. Stein2022-01-19 12:04:432023-09-11 12:26:1511th Circuit Holds Eighth Amendment Applies to FCA Monetary Awards in Non-Intervened Cases
On January 7, 2022, a district court in the Western District of Kentucky dismissed DOJ’s implied false certification theory relating to allegedly medically unnecessary genetic tests, holding that the prosecutors failed to adequately plead materiality. In so holding, the court set forth a novel test for materiality that forecloses the government’s ability to argue that certain regulations are per se material based on the government’s characterization of them as conditions of payment. Instead, plaintiffs must still plead “specific facts regarding the effect of a violation of that regulation” to survive dismissal. (more…)
https://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.png00Jaime L.M. Joneshttps://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.pngJaime L.M. Jones2022-01-13 17:01:532023-09-11 12:26:36Court Concludes Government Agencies Cannot Categorize Regulatory Violations as Material as a Matter of Law
The 2015 Balanced Budget Act (BBA) requires that federal agencies make inflationary adjustments to civil monetary penalties on a yearly basis to account for inflation using calculations based on the Bureau of Labor Statistics’ Consumer Price Index. In recent years, these increases have occurred less frequently. But on December 13, 2021 the Department of Justice published a final rule that increases the civil penalties in False Claims Act actions for violations that that occurred after November 2, 2015, the date the BBA was enacted. (more…)
https://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.png00Scott D. Steinhttps://fcablog.sidley.com/wp-content/uploads/sites/5/2022/08/sidleyLogo-e1643922598198.pngScott D. Stein2021-12-15 09:06:472023-09-11 12:27:00DOJ Announces Increased Inflation-Adjusted False Claims Act Penalties
Categories
Courts
Archives
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.Ok
DOJ Statistics on FCA Recoveries Through FY 2021 Reveal Continued Focus on Healthcare and More Direct Government Enforcement
On February 1, 2022, Acting Assistant Attorney General for the DOJ Civil Division, Brian M. Boynton, announced that the Civil Division recovered over $5.6 billion in settlements and judgments under the False Claims Act (“FCA”) for fiscal year 2021. This is the second largest annual total in FCA history and a significant increase from the $2.2 billion recovered during fiscal year 2020. Detailed statistics on FCA recoveries from 1986 through FY 2021 are available here. (more…)
Scott D. Stein
Chicago
sstein@sidley.com
Megan Coggeshall
First Circuit Joins Circuit Split on FCA Dismissal Authority, Finds Government Has Broad Authority to Dismiss FCA Cases
On January 21, 2022, the First Circuit affirmed the government’s request for dismissal of a whistleblower complaint alleging that several pharmaceutical companies had colluded to defraud Medicare Part D. The government, after declining to intervene, requested dismissal based on its finding that: (1) the suit would require “substantial expenditure of government resources”; (2) “many key aspects of [the relator’s] allegations [we]re not supported”; and (3) “allegations that [the relator] used the qui tam process to leverage his financial interests through securities trading . . . convince[d] the [g]overnment that [the relator was] not an appropriate advocate of the United States’ interests.” (more…)
Scott D. Stein
Chicago
sstein@sidley.com
Matt Bergs
Chicago
mbergs@sidley.com
Fourth Circuit Applies Safeco to FCA Claims, Accuses CMS of “Maintaining Strategic Ambiguity” Around Medicaid Drug Rebate Program Requirements
In a recent 2-1 decision, the Fourth Circuit joined every other circuit to have considered the issue in applying Safeco’s “reckless disregard” standard to legally false FCA claims based on alleged violations of ambiguous laws and regulations. Under Safeco, courts ask whether a defendant’s interpretation of the ambiguous law or regulation at issue was objectively reasonable and whether authoritative guidance might have warned the defendant away from that interpretation. The Fourth Circuit found that the Safeco standard “duly ensures that defendants must be put on notice before facing liability for allegedly failing to comply with complex legal requirements. Without such notice, defendants are not likely to receive due process.”
(more…)
Jaime L.M. Jones
Chicago
jaimejones@sidley.com
Brenna E. Jenny
Washington, D.C.
bjenny@sidley.com
Matt Bergs
Chicago
mbergs@sidley.com
Remote Patient Monitoring Gains Qui Tam Attention
Last week one of the first qui tam suits alleging manipulation of the billing rules for a type of remote patient monitoring was unsealed, following the relator’s voluntary dismissal. See United States ex rel. Mathurin v. Vector Remote Care LLC (Nov. 18, 2020 E.D.N.Y.). Relators not infrequently voluntarily dismiss their case when DOJ informs them that it lacks merit. Whatever the merits of this one, given the explosive increase in remote patient monitoring during the pandemic and the predicted future increases in these patient care modalities, we expect continued whistleblower activity focused on this space. Of course, such allegations will be met with substantial challenges to establishing that these kinds of issues in fact fail to comply with the applicable coverage and reimbursement criteria or render any claims materially false.
(more…)
Jaime L.M. Jones
Chicago
jaimejones@sidley.com
Brenna E. Jenny
Washington, D.C.
bjenny@sidley.com
OIG Will Audit Hospitals for Compliance with Provider Relief Fund Balance Billing Rule
Yesterday HHS-OIG updated its Work Plan to add yet one more audit of potential misconduct relating to the COVID-19 pandemic. This project, titled Hospital’s Compliance With the Provider Relief Fund Balance Billing Requirement for Out-of-Network Patients, focuses on compliance with a clause in the Provider Relief Fund Terms and Conditions that restricts balance billing for COVID-19 patients. That clause states: [F]or all care for a presumptive or actual case of COVID-19, Recipient certifies that it will not seek to collect from the patient out-of-pocket expenses in an amount greater than what the patient would have otherwise been required to pay if the care had been provided by an in-network Recipient.” (more…)
Jaime L.M. Jones
Chicago
jaimejones@sidley.com
Brenna E. Jenny
Washington, D.C.
bjenny@sidley.com
11th Circuit Holds Eighth Amendment Applies to FCA Monetary Awards in Non-Intervened Cases
The Eleventh Circuit recently held that the Eighth Amendment’s prohibition on excessive fines applies to monetary awards in non-intervened FCA actions—the first federal court of appeals directly to address the application of this constitutional protection in non-intervened cases. See Yates v. Pinellas, No. 20-10276 (11th Cir.). However, the panel concluded that while the amount of the fine in this case was “very harsh,” it was not unconstitutionally excessive.
In Yates v. Pinellas, following the government’s declination, the district court imposed a total monetary award of $1,179,266.62 under the FCA based on the defendant’s submission of laboratory test claims to Medicare without a proper CLIA certificate. Specifically, the jury found that the defendant violated the FCA on 214 occasions and that the United States had incurred $755.54 in damages. The court then imposed treble damages of $2,266.62 and statutory minimum penalties of $5,500 for each of the 214 violations, or $1,177,000, for a grand total of $1,179,266.62. The defendant moved for remittitur, arguing that this amount constituted an excessive fine in violation of the Eighth Amendment. The district court rejected the argument. (more…)
Scott D. Stein
Chicago
sstein@sidley.com
Brenna E. Jenny
Washington, D.C.
bjenny@sidley.com
Meredith Greene Jalali
Chicago
meredith.jalali@sidley.com
Court Concludes Government Agencies Cannot Categorize Regulatory Violations as Material as a Matter of Law
On January 7, 2022, a district court in the Western District of Kentucky dismissed DOJ’s implied false certification theory relating to allegedly medically unnecessary genetic tests, holding that the prosecutors failed to adequately plead materiality. In so holding, the court set forth a novel test for materiality that forecloses the government’s ability to argue that certain regulations are per se material based on the government’s characterization of them as conditions of payment. Instead, plaintiffs must still plead “specific facts regarding the effect of a violation of that regulation” to survive dismissal. (more…)
Jaime L.M. Jones
Chicago
jaimejones@sidley.com
Brenna E. Jenny
Washington, D.C.
bjenny@sidley.com
Matt Bergs
Chicago
mbergs@sidley.com
DOJ Announces Increased Inflation-Adjusted False Claims Act Penalties
The 2015 Balanced Budget Act (BBA) requires that federal agencies make inflationary adjustments to civil monetary penalties on a yearly basis to account for inflation using calculations based on the Bureau of Labor Statistics’ Consumer Price Index. In recent years, these increases have occurred less frequently. But on December 13, 2021 the Department of Justice published a final rule that increases the civil penalties in False Claims Act actions for violations that that occurred after November 2, 2015, the date the BBA was enacted. (more…)
Scott D. Stein
Chicago
sstein@sidley.com
Catherine Stewart
Chicago
cstewart@sidley.com
Categories
Courts
Archives