Resources

Client Alerts, News Articles, Blog Posts, & Multimedia

Everything you need to know about BMD and the industry.

Supreme Court Issues Major False Claims Act Decision

Client Alert
June 5, 2023

Supreme Court Rules that Liability under the False Claims Act (FCA) Depends on the BELIEF of Defendant

The Supreme Court unanimously ruled Thursday, June 1, 2023 that liability in FCA suits depends on whether defendants believed their claims were false, not whether they had made an "objectively reasonable" interpretation of law or regulation. The decision rejects the recent attempts to shift the scienter element’s knowledge standard in FCA cases, clarifying instead that an assessment of a defendant's subjective beliefs about potential wrongdoing is required. In the opinion, Justice Thomas writes “…what matters for an FCA case is whether the defendant knew the claim was false. Thus, if respondents correctly interpreted the relevant phrase and believed their claims were false, then they could have known their claims were false.”

At oral arguments, the government asked the Court to preserve the relevance of subjective intent standard. The Government argued that following the Seventh Circuit’s precedent of “objectively reasonable” interpretation would undermine enforcement and incentivize individuals to come up with crafty, post-hoc arguments for why a claim it submitted was not false. The Court agreed, and its ruling allows the government to rely on deliberate ignorance or recklessness of the defendant instead of having to prove actual knowledge.

The FCA was passed under the Lincoln administration and underwent significant strengthening through a congressional amendment in 1986. Today, the FCA is one of the government's strongest anti-fraud statutes. It imposes liability on individuals and businesses that defraud and cause financial loss to the federal government. The FCA also provides the potential for rewards for whistleblowers who report such fraudulent activities. Since its amendment in 1986, the Department of Justice has successfully utilized the Act to secure settlements and judgments amounting to over $70 billion, mainly in healthcare and defense contracting cases.

The FCA plays a substantial role in balancing the power between the government and industry. Along with being used to combat health care fraud, the FCA serves as the government’s primary tool to redress false claims involving a multitude of other government operations and functions. In recent years, healthcare fraud has been the leading source of the Department’s FCA settlements and judgments, as the FCA has played a critical role in combatting the opioid epidemic and the growing issues surrounding the Medicare Advantage program. The number of FCA cases has increased over the past several years, and it is evident that governments on both the state and federal levels are becoming more aggressive in their use of the FCA to obtain recoveries.

FCA claims can be a source of concern and complexity for businesses when they find themselves as the subject of either a federal investigation or state investigation. Whenever there is government money at stake, there is a chance for an FCA claim. Since fraud in the healthcare industry can lead to rising healthcare costs, the government is keen on cracking down on such activity.  The unanimous ruling decidedly addresses with the FCA’s knowledge element, overturning the Seventh Circuit’s use of an "objectively reasonable" interpretation of law or regulation, and instead holding that an FCA case hinges on whether the defendant knew the claim was false.

Should you have any questions concerning the CMS Final Rule, please contact BMD President Matt Heinle at maheinle@bmdllc.com, BMD Vice President Amanda Waesch at alwaesch@bmdllc.com, or Healthcare Partner Bryan Meek at bmeek@bmdllc.com.

COVID-19Vaccine PolicyHealthcareHealth LawAmanda L. Waesch
Client Alert

Workers’ Compensation Claims and COVID-19

June 2, 2020Can one of my employees file a workers’ compensation claim if they claim that they contracted coronavirus at work? We get that question a lot. Yes, they can, but you should oppose any application for coverage if you receive one. Generally, the claim will not be granted unless the employee has a job that poses a special hazard or risk of exposure to the virus and the employee can prove that he or she contracted the virus at work.Client Alert

Ohio State Dental Board Implements Teledentistry Rules

May 26, 2020Ohio law defines “teledentistry” as the delivery of dental services through the use of synchronous, real-time communication and the delivery of services of a dental hygienist or expanded function dental auxiliary pursuant to a dentist’s authorization.[1] The law requires a dentist who desires to provide dental services through teledentistry to apply for a teledentistry permit from the Ohio State Dental Board (“OSDB”).[2] Pursuant to the mandate under Ohio Revised Code 4715.436, the OSDB is implementing the following teledentistry permit rules and requirements (to be set forth under Ohio Administrative Code Chapter 4715-23). These regulations, which were subject of a public hearing on February 19, 2020, are effective on May 30, 2020.Client Alert

HHS Addresses Drug Manufacturer Coupons on Out-of-Pocket Limits

May 25, 2020On May 7, 2020, the US Department of Health and Human Services (“HHS”) announced their Notice of Benefit Parameters for 2021 in which HHS addressed the application of prescription drug manufacturer copay coupons towards a patient’s out-of-pocket limit. Under this guidance, HHS will permit, but not require, plans and insurers to count direct support offered to enrollees by drug manufacturers (i.e., coupons) for specific prescription drugs toward the annual limits on cost-sharing, regardless of whether a generic equivalent is available.Client Alert

Important Updates, Deadlines, and Clarifications for the HHS Provider Relief Funds

May 22, 2020On May 20, 2020, HHS made important updates and clarifications regarding the General Distribution payments to providers. Between April 10, 2020 and April 24, 2020, HHS distributed an initial $30 billion to providers based on the provider’s 2019 Medicare fee-for-service receipts. These funds were distributed automatically and providers did not need to submit an application in order to receive these funds. The funds were originally touted as a “no strings attached” stimulus payment reserved for healthcare providers. But HHS issued a 10-page Terms and Conditions and required that providers sign an attestation confirming receipt of the funds and agreeing to the Terms and Conditions.Client Alert

Reopening & Social Media: Tips for Businesses

May 21, 2020As the country starts to reopen, businesses are under great pressure to keep employees and customers safe. Even if a business follows every reopening requirement, there will inevitably be scrutiny from within and outside the organization. And, in this world of social media, perception tends to become reality. Below are a few practical tips to avoid attracting negative press while restarting your business.
Older posts
Newer posts