Under the provisions of the False Claims Act, the judge may now treble that $43 million and also award the government a penalty of at least $5,500 for each of the 64,575 false claims. In other words, the surgical product distributor is likely on the verge of having a judgment entered against it for more than $400 million.
Since False Claims Act jury trials are relatively rare, it is worth looking at the case to glean some details and takeaways.
Kickbacks Aren’t Just Monetary Payments but Can Comprise Other Items of Value.
Kickbacks are often thought of as money-based—either a set amount or a percentage. But the Anti-Kickback Statute applies to anything of value, given (a) knowingly and willfully, and (b) in return for referring a person or furnishing an item or service for which a Federal health care program (like Medicare) can pay.[2]
In the Minnesota case, the kickbacks came in the form of trips for physicians: to resorts,[3] hunting and fishing,[4] the college football national championship game,[5] and the Masters golf tournament,[6] often on private planes.[7] While it appears that sometimes the physicians paid some money to the distributor, those payments were allegedly “below fair market value” for the benefit.[8] For example, one flight aboard a private plane going on a hunting trip was billed to a physician for $185.73.[9]
The jury concluded that these trips violated the Anti-Kickback Statute, which in turn violated the False Claims Act.
False Claims Act...
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