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Courts are grappling with unique questions in the context of managed care programs in False Claims Act (FCA) cases. But are they getting it right? Two questions trending in courts relate to: (1) materiality under the FCA when purported conduct does not directly impact the amount of government payment (but only the amount of payment from the privately-operated managed care plan), and (2) falsity and materiality related to diagnosis codes that were correct. Both these questions are disputed and the subject of government overreach, despite that the answers should be clear. We are watching several cases in this space.

Was the Conduct Material to a Government Payment Decision?

One question courts have been asked is, can claims submitted to managed care plans that do not impact government payment be actionable under the FCA? We do not see how such claims could be considered actionable under a proper interpretation of Escobar. Most courts agree, however the Department of Justice (DOJ) continues to pursue such cases under the FCA.

Background to Materiality Inquiry in MA Cases

The FCA imposes civil liability on any person or entity who knowingly presents, or causes to be presented, a false or fraudulent claim for payment by the federal government. 31 U.S.C. § 3729(a)(1)(A) (2022). For liability to attach, the false claim must be material to the government’s decision to pay (i.e., the government would not have paid or likely would not have paid the claim had it...

Read Full Story: https://www.natlawreview.com/article/managed-care-fca-are-courts-getting-it-r...