"The nation’s largest provider advocacy group will intervene next month in a pivotal court case testing whether the federal government can use statistical sampling in assessing fines under the federal anti-fraud statutes.
Last year, Agape Senior Housing agreed to settle a whistleblowers’ fraud claims under the False Claims Act by paying $2.5 million. But the government, which had declined to intervene in the case, rejected the settlement. The Department of Justice claimed that, based on a statistical sample of the allegedly fraudulent claims, the case was worth at least $25 million. Agape appealed, and now the case is being briefed in the U.S. Court of Appeals for the Fourth Circuit, which has jurisdiction of the mid-Atlantic from Maryland …show more content…
“Whether the government can prove liability and damages under the False Claims Act has become a critically important issue in a growing number of cases, particularly in the health care/Medicare context,” Wrabley tells Provider. “If sampling is permitted as a substitute for actual proof of fraud, the government will be allowed to make claims against tens, or even hundreds, of thousands of false claims without ever actually proving any of the particulars of those supposed frauds.”
The U.S. Department of Justice, along with other government entities, has promised to take a bold, aggressive line against health care fraud in the late days of President Obama’s administration. And the False Claims Act, which dates back to the Civil War, allows for penalties of up to treble the damages for each count of fraud. Until now, though, the burden was on the government to prove each allegation. Allowing for statistical sampling could push the already expensive cost of litigation through the roof.
“Given the draconian penalties available under the statute,” Wrabely says, “the potential exposure for providers is …show more content…
Late last year, Deputy Attorney General Sally Yates circulated a memo instructing the Department of Justice’s civil and criminal lawyers that “fighting corporate fraud” is “a top priority.”
For many observers, the now-notorious “Yates Memo” is what Washingtonians call a game-changer.
“We’re seeing an exponential growth in False Claims Act investigations by the Department of Justice, and providers should have a plan in place,” says Aaron Danzig, a former federal prosecutor who now defends health care companies at Arnall Golden Gregory. “They need to have an idea of what to do if, or—unfortunately—when, they get a visit.”
Earlier this year, Kindred Healthcare paid $133 million to settle claims that its subsidiaries had padded their Medicare bills. Last year, HCR ManorCare announced that it was facing a False Claims Act suit, saying that its efforts to cooperate had been rebuffed.
A court ruling that allows for statistical sampling will make it all the harder for providers to absorb and address allegations of fraud, Wrabley
Last year, Agape Senior Housing agreed to settle a whistleblowers’ fraud claims under the False Claims Act by paying $2.5 million. But the government, which had declined to intervene in the case, rejected the settlement. The Department of Justice claimed that, based on a statistical sample of the allegedly fraudulent claims, the case was worth at least $25 million. Agape appealed, and now the case is being briefed in the U.S. Court of Appeals for the Fourth Circuit, which has jurisdiction of the mid-Atlantic from Maryland …show more content…
“Whether the government can prove liability and damages under the False Claims Act has become a critically important issue in a growing number of cases, particularly in the health care/Medicare context,” Wrabley tells Provider. “If sampling is permitted as a substitute for actual proof of fraud, the government will be allowed to make claims against tens, or even hundreds, of thousands of false claims without ever actually proving any of the particulars of those supposed frauds.”
The U.S. Department of Justice, along with other government entities, has promised to take a bold, aggressive line against health care fraud in the late days of President Obama’s administration. And the False Claims Act, which dates back to the Civil War, allows for penalties of up to treble the damages for each count of fraud. Until now, though, the burden was on the government to prove each allegation. Allowing for statistical sampling could push the already expensive cost of litigation through the roof.
“Given the draconian penalties available under the statute,” Wrabely says, “the potential exposure for providers is …show more content…
Late last year, Deputy Attorney General Sally Yates circulated a memo instructing the Department of Justice’s civil and criminal lawyers that “fighting corporate fraud” is “a top priority.”
For many observers, the now-notorious “Yates Memo” is what Washingtonians call a game-changer.
“We’re seeing an exponential growth in False Claims Act investigations by the Department of Justice, and providers should have a plan in place,” says Aaron Danzig, a former federal prosecutor who now defends health care companies at Arnall Golden Gregory. “They need to have an idea of what to do if, or—unfortunately—when, they get a visit.”
Earlier this year, Kindred Healthcare paid $133 million to settle claims that its subsidiaries had padded their Medicare bills. Last year, HCR ManorCare announced that it was facing a False Claims Act suit, saying that its efforts to cooperate had been rebuffed.
A court ruling that allows for statistical sampling will make it all the harder for providers to absorb and address allegations of fraud, Wrabley