Fraud & Abuse

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The early days of the COVID-19 pandemic saw an unprecedented coming together of the health care industry to treat communities beset by a deadly virus that strained provider resources across the country.  But just as normalcy returns, enforcement arms of the federal government have announced action against bad actors who took advantage of the COVID-19 pandemic to implement fraudulent schemes designed to specifically exploit the pandemic.

In separate actions on May 26, 2021, the Fraud Section of the Department of Justice (DOJ) and Center for Program Integrity, Centers for Medicare & Medicaid Services (CPI/CMS) announced cases against multiple defendants who perpetrated a variety of COVID-19-related scams on federal healthcare programs.  The DOJ charged 14 defendants who are alleged to have defrauded the government of over $143 million in false billings in the aggregate, while the CPI/CMS began administrative proceedings against more than 50 providers who took advantage of CMS programs meant to increase care access during the pandemic.…
Continue Reading Combating COVID Crimes: First Wave of DOJ Enforcement Actions Target Fraudulent Schemes

The U.S. Department of Justice (the “DOJ”) recently settled whistleblower False Claims Act (“FCA”) allegations against The University of Miami (“UMiami”) for $22 million, which resolves claims from three separate lawsuits related to billing practices at UMiami’s off-campus hospital-based facilities (“Off-Campus Hospital Facilities”) and fraudulent claims for laboratory services.…
Continue Reading The University of Miami to Pay $22 Million to Settle Medicare False Claims Act Allegations

A recent Fourth Circuit decision, United States v. Mallory (988 F.3d 730), upheld damages and penalties for more than $100 million for violations of the Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)) (the “AKS”) and the False Claims Act (31 U.S.C. § 3729) by a blood testing laboratory and its contracted sales agents.  The Court held that commission payments made by the laboratory to its sales agents (sales companies that, in turn, hired and contracted salespeople to sell the laboratory blood tests), which were based on the percentage of revenue the sales agents generated for the laboratory through marketing services, constituted improper “remuneration” that intended to induce the sales agents to sell as many laboratory tests as possible. The defendants failed to show that the arrangements fit within an AKS Safe Harbor.…
Continue Reading Developments Regarding Commission-Based Compensation Arrangements with Independent Contractors