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In 2022, “[t]he government and whistleblowers were party to 351 settlements and judgments, the second highest number of settlements and judgments in a single year.” Notably, “health care fraud remained the leading source of False Claims Act settlements and judgments[.]” Insurers should be aware that an effort is underway in Congress to further boost FCA enforcement. The False Claims Amendments Act of 2023 (FCAA) would amend the FCA’s “materiality” requirement in a way that could pose challenges for managed care organizations.
Autoren: Michelle L. Cheng Daniel H. Ahn Steven D. Hamilton Zachary B. Kizitaff
Background
The FCA prohibits, in part, a misrepresentation of compliance with a statutory, regulatory or contractual requirement that is material to the government’s payment decision. See Universal Health Servs. v. United States ex rel. Escobar, 579 U.S. 176, 192 (2016). The FCA defines “material” as “having a natural tendency to influence, or be capable of influencing, the payment or receipt of money or property.” See 31 U.S.C. § 3729(b)(2)(4). The Supreme Court’s 2016 landmark decision in Escobar emphasized a “rigorous” approach to materiality because the FCA should not serve as a catchall anti-fraud statute or penalize minor breaches of contractual or regulatory provisions. The Court articulated several factors to determine materiality, including whether the government explicitly designated the requirement in question as a condition of payment;...
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