April 2020

On February 25, the U.S. District Court for the Western District of Tennessee dismissed a relator’s qui tam False Claims Act (FCA) suit alleging that the defendants had continued the “exact scheme” previously alleged in U.S. ex rel. Deming v. Jackson-Madison Cty. Gen. Hosp., et al. involving allegations of medically unnecessary cardiac testing and procedures.

The defendants in U.S. ex rel. Maur v. Cmty. Health Sys., Inc., et al., represented by Bass, Berry & Sims and others, moved to dismiss the relator’s action on two grounds.  First, the defendants argued that the FCA’s public disclosure bar prohibited the relator’s action as the lawsuit raised substantially the same allegations as those publicly disclosed in the Deming action and subsequent press releases related to that lawsuit.  Second, the defendants maintained that the relator had failed to plead any FCA claims with the requisite particularity under Federal Rule of Civil Procedure 9(b).  The district court granted the defendants’ motions and dismissed the relator’s action on both grounds.Continue Reading Public Disclosure Bar and Pleading Deficiencies Doom Tennessee FCA Case

As developments related to COVID-19 continue to unfold, Bass, Berry & Sims attorneys are monitoring the situation and providing guidance through a series of video chats entitled, “COVID-19 Compliance Conversations.”

In this episode, Lindsey Fetzer and John Kelly provide a brief overview of compliance considerations related to conducting internal investigations remotely. Watch the video…

The Tenth Circuit recently affirmed the dismissal of a declined qui tam False Claims Act lawsuit filed against Lawrence Memorial Hospital (LMH) by a former LMH employee, reasoning that the materiality inquiry focuses on the likely reaction of the Government. In U.S. ex rel. Janssen v. Lawrence Memorial Hospital, 949 F.3d 533 (10th Cir. 2020), the relator alleged that over a period of years LMH engaged in two fraud schemes:

  1. LMH falsified patient arrival times submitted to Medicare under certain programs that tied compensation to quality-of-care metrics; and,
  2. LMH falsely certified compliance with a requirement under the Deficit Reduction Act that it educate employees with detailed information about the False Claims Act.

Continue Reading Tenth Circuit Strictly Enforces Materiality Requirement to Nix FCA Lawsuit

This is the second post of a two-part discussion of recent developments related to the materiality standard set forth by the Supreme Court in Universal Health Services v. U.S. ex rel. Escobar.  Read our previous post, which covered appellate court decisions and key decisions related to government knowledge and payment.

Courts Take Differing Approaches to the Significance of Government Intervention Decisions

In assessing the False Claims Act’s (FCA) materiality element, courts have increasingly taken divergent approaches to analyze the significance of the government’s decision about whether to intervene in a qui tam action.

In several 2019 decisions, district courts held that the government’s decision to intervene in a qui tam action was relevant – even if not dispositive – to the materiality analysis under Escobar.  In U.S. ex rel. Longo v. Wheeling Hospital, Inc., for instance, the U.S. District Court for the Northern District of West Virginia found that the government’s decision to intervene in the very qui tam action before it “strongly militate[d] in favor of materiality.”  And in U.S. ex rel. Arnstein v. Teva Pharmaceuticals USA, Inc., the U.S. District Court for the Southern District of New York explained that the government’s decision to intervene in “a factually similar case” in the same district “provide[d] strong evidence that AKS [Anti-Kickback Statute] violations were material to the Government’s payment decisions,” even though the government had not intervened in the case before the court.Continue Reading Escobar’s “Rigorous” Materiality Standard: Recent Developments – Part Two

Despite the mounting pressures on healthcare entities related to the COVID-19 (coronavirus) pandemic and recent announcements of regulatory waivers and flexibility in particular areas, regulators are still showing interest in the enforcement of federal requirements for life safety and emergency and infectious disease control preparedness for long-term care facilities.

OIG Medicaid Nursing Home Life Safety and Emergency Preparedness Reviews

On March 23, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) updated its Work Plan in response to the COVID-19 pandemic. Please see this post for more information about all of the OIG Work Plan updates. One of the areas that the OIG Office of Audit Services will focus on is Medicaid Nursing Home Life Safety and Emergency Preparedness Reviews.

OIG’s rationale for focusing on this is, in part, because the patient population in long-term care (LTC) facilities is especially vulnerable to COVID-19 and other disease outbreaks. The focus of the audit is LTC facilities’ compliance with federal requirements for life safety and emergency preparedness, as well as 2019 Centers for Medicare & Medicaid Services (CMS) expanded guidance on emerging infectious disease control.Continue Reading Increased Oversight of Long-Term Care Facilities Related to COVID-19

The financial relief programs enacted by the Coronavirus Aid, Relief, and Economic Security (CARES) Act stand ready to provide crucial financial support to people and businesses impacted by the novel coronavirus (COVID-19) pandemic and the resulting economic downturn.   These new federal programs recognize the scale of the challenges presented by the COVID-19 outbreak.

While decisions made by companies seeking CARES Act or similar relief may not be scrutinized today, we are likely to see a wave of COVD-19-related criminal and civil enforcement actions in the coming months and years.  Impacted individuals and businesses should remember that the urgent need for relief does not eliminate the importance of compliance or the likelihood of significant regulatory oversight in the future.

More specifically, applicants for CARES Act relief must certify or attest to certain facts relevant to their eligibility to participate in the CARES Act’s various programs.  Because false certifications or attestations potentially expose an applicant to liability under the federal False Claims Act (FCA), it is critical that impacted individuals and entities take reasonable steps to ensure the accuracy of information and certifications contained in any applications for federal aid.Continue Reading The CARES Act and Risk of FCA Exposure

From the Bass, Berry & Sims Blog Network
From the Bass, Berry & Sims Blog Network

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