Effective wound care is critical for patients recovering from surgery or managing chronic or non-healing wounds. Advances in treatment have led to the development of skin substitutes—bioengineered or natural materials designed to promote healing by replacing or supporting damaged skin. While these innovations hold great promise for the future of wound care, they have also come under increased scrutiny by regulatory agencies and the Department of Justice (DOJ).Continue Reading Wound Care in the Crosshairs: Reimbursements Risks Amid Skin Substitute Fraud Investigations
Falsity
DOJ Settlement Highlights Customs, FCA Risks for Importers
On March 25, 2025, the U.S. Department of Justice (DOJ) announced an $8.1 million settlement in a civil case under the False Claims Act (FCA) related to alleged customs evasion by a California importer of wood flooring. The private whistleblower who reported the conduct received over $1.2 million in the matter. As we suggested in…
Fraud and Abuse Chapter of Health Law Handbook, 2024-2025 Edition
By Taylor Chenery, John Eason & Travis Lloyd on
We contributed to the Fraud and Abuse Chapter of the Health Law Handbook, 2024-2025 Edition. In the portion of our content, titled “Healthcare Fraud and Abuse Update,” we outlined regulatory developments, key court decisions and noteworthy settlements related to the Anti-Kickback Statute and Stark Law. Continue Reading Fraud and Abuse Chapter of Health Law Handbook, 2024-2025 Edition
Controlled Substances Act and False Claims Act Collide
By Garrah Carter-Mason & Brian Irving on
The United States recently intervened in a False Claims Act lawsuit accusing Rite Aid of defrauding federal healthcare programs by seeking reimbursement for opioids the pharmacy allegedly dispensed in violation of the Controlled Substances Act. Continue Reading Controlled Substances Act and False Claims Act Collide
Medicare Advantage Plan Highlights Distinction for FCA Purposes between Clinically Inaccurate Diagnoses and Clinically Accurate Diagnoses that Allegedly Violate Subregulatory Guidelines
By Lindsey Fetzer, Emily Fountain & Julia Tamulis on
In a September 2022 filing in U.S. ex rel. Osinek v. Kaiser Permanente, the Kaiser Permanente consortium defendants (Kaiser) highlighted the distinction between clinically inaccurate diagnoses (factual falsity) and clinically accurate but incorrectly coded diagnoses (legal falsity) and its relevance in False Claims Act (FCA) actions.
Continue Reading Medicare Advantage Plan Highlights Distinction for FCA Purposes between Clinically Inaccurate Diagnoses and Clinically Accurate Diagnoses that Allegedly Violate Subregulatory Guidelines
False Claims Act Fundamentals: What Is a False Claim?
The False Claims Act, despite its name, does not define what it means for a claim to be “false” or “fraudulent.” This post examines the primary ways courts have interpreted the False Claims Act’s falsity element and discusses common issues that arise concerning falsity.
Continue Reading False Claims Act Fundamentals: What Is a False Claim?
Fifth Circuit Affirms Criminal Healthcare Fraud Convictions of Hospice and Home Health Executives
By Brian Irving on
On March 24, the U.S. Court of Appeals for the Fifth Circuit affirmed the criminal healthcare fraud convictions of two individuals who ran a network of home health and hospice centers in Texas. According to the Fifth Circuit, the defendants operated a “reimburse-first-verify-later system” for nearly ten years, under which an estimated 70 to 85 percent of patients were ineligible for the care they received. The Fifth Circuit provided colorful examples to show that “many certifications were not borderline cases”:
Continue Reading Fifth Circuit Affirms Criminal Healthcare Fraud Convictions of Hospice and Home Health Executives
False Claims Act Fundamentals: Elements of the False Claims Act
By Molly Ruberg on
The False Claims Act, 31 U.S.C. § 3729, et seq. is the federal government’s primary and most effective tool for fighting fraud. This post provides an overview of the elements that plaintiffs must satisfy to establish liability under the False Claims Act and common defenses related to the elements.
Continue Reading False Claims Act Fundamentals: Elements of the False Claims Act
Supreme Court Declines to Weigh in on Key Falsity Question
By Matt Curley on
For several years, courts have wrestled with the question of whether subjective clinical decisions regarding the type and amount of treatment patients may need can be false for purposes of establishing False Claims Act (FCA) liability. The question of whether the FCA requires a showing of objective falsity has divided appellate courts in a number of recent high-profile cases.
For their part, practitioners have kept a close eye on whether the Supreme Court might bring much-needed clarity to this issue. On February 22, the Supreme Court declined to do so, denying a petition for certiorari with respect to the Third Circuit’s opinion in U.S. ex rel. Druding v. Care Alternatives.
In Druding, the relators, who were former employees of a hospice provider, filed a qui tam action alleging that the hospice provider submitted false claims by routinely certifying patients who were not terminally ill for hospice care. During the litigation, the relators’ expert examined the medical records of nearly 50 patients and concluded that the documentation did not support a certification of terminal illness for approximately 35% of those patients. The hospice provider produced its own expert who testified a physician could have reasonably concluded that the patients at issue were terminally ill and needed hospice care.Continue Reading Supreme Court Declines to Weigh in on Key Falsity Question
Key False Claims Act Cases in 2020
By Matt Curley & Brian Roark on
As 2020 draws to a close, we take a look back at a number of the most significant False Claims Act (FCA) cases of the prior 12 months. Although no blockbuster cases emerged, such as the Supreme Court’s 2016 decision in Escobar, there were a number of noteworthy cases that will have lasting impact on future FCA litigation. We discuss those cases briefly below. We expect to cover these cases and much more in our Healthcare Fraud and Abuse Review, which we will release in early 2021.
Materiality
U.S. ex rel. Janssen v. Lawrence Memorial Hospital, 949 F.3d 533 (10th Cir. 2020)
Background. In 2016, the Supreme Court held in Escobar that whether a defendant can be held liable under the FCA for violating a statute, rule, regulation, or contract provision turns, in part, on the elements of materiality and scienter, which the Court said are “rigorous” and “demanding.” Post-Escobar, courts have grappled with specific applications of these standards, with some courts appearing to apply them less “rigorously” than others.
Allegations. In U.S. ex rel. Janssen v. Lawrence Memorial Hospital, the relator primarily alleged that the defendant hospital falsified patient arrival times associated with certain CMS pay-for-reporting and pay-for-performance programs. The relator introduced proof that the hospital had knowingly falsified arrival times in patient records by recording actual arrival times on patient triage sheets but then entering later times in the medical record or delaying patient registration until after the administration of some tests.Continue Reading Key False Claims Act Cases in 2020