This month the Department of Justice brought a “first of its kind” action against two pharmacies, their owner, and three pharmacists for allegedly dispensing and billing Medicare for prescriptions in violation of both the Controlled Substances Act (CSA) and the False Claims Act (FCA). See United States v. Oakley Pharmacy, Inc., et al., No. 2:19-cv-00009 (M.D. Tenn). The action, seeking both injunctive relief and civil...
For those who pay close attention to FCA settlements, the January 22 press release from the United States Attorney for the Southern District of New York of a $60 million settlement against Walgreens related to its Prescription Savings Club (“PSC”) program should not come as a complete surprise. In an earlier press release, almost two years ago to the day, the Southern District of New...
The Justice Department announced in a recent press release that it obtained more than $2.8 billion in settlements and judgments from cases involving fraud and false claims against the government. The vast majority of this amount—$2.1 billion—came from lawsuits filed by whistleblowers, or “relators” suing on behalf of the government, under the qui tam provisions of the False Claim Act (“FCA”). Included in the qui...
A divided panel of the U.S. Court of Appeals for the Sixth Circuit again revived an FCA suit against home-health services providers premised on the providers’ alleged improper procurement of physician medical necessity certifications supporting Medicare claims. In United States v. Brookdale Senior Living Communities, Inc., — F.3d —-, 2018 WL 2770598 (6th Cir. June 11, 2018), a nurse alleged she was hired by several...
Rejecting the views of the Fourth and Tenth Circuits, the Eleventh Circuit held the FCA’s three year statute of limitations period in § 3731(b)(2) applies to a relator’s claim even when the United States declines to intervene, and in so doing held it is the knowledge of a government official, not the relator, that triggers the three year limitations period, rejecting the contrary view of...
Federal scrutiny of charities that assist patients with accessing prescription drugs has increased with rising prescription drug prices. Some prescription drug charities receive funding from medical providers or drug manufacturers, which can raise questions about whether the charities’ funders are using the charities to generate improper recommendations or referrals. In December 2017, the U.S. Department of Health and Human Services Office of Inspector General rescinded a...
In recent weeks, the United States Department of Justice (“DOJ”) issued two memoranda that might change the calculus of False Claims Act (“FCA”) cases. The memoranda at a minimum provide organizations with new—or at least invigorated—defenses to qui tam actions and civil enforcement matters. First, on January 10, Michael Granston, Director of DOJ’s Civil Frauds section, issued a memorandum encouraging DOJ trial attorneys to consider dismissing...
If the government does not take action and continues to pay for Medicare/Medicaid claims after it learns of non-compliance related to the claims, is the non-compliance material to the government’s decision to pay? This is a question being answered in the negative by courts across the country, who have concluded that the government (or a qui tam relator) is not able to proceed under a...
Until very recently, no case existed in which FCA liability arose from a violation of the Health Insurance Portability and Accountability Act (“HIPAA”). But in United States v. America at Home Healthcare and Nursing Services, Ltd., Judge John Robert Blakely of the United States District Court for the Northern District of Illinois, Eastern Division, allowed an FCA claim premised on a HIPAA violation to survive...
The False Claims Act authorizes civil penalties between $10,781 to $21,563 per false claim, as well as three times the amount of damages which the government sustains (i.e. treble damages). The Eighth Amendment provides that “[e]xcessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted.” The Supreme Court of the United States has recognized that a statutory penalty constitutes...
