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Category Archives: State & Federal Audits, Investigations & Litigation

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Supreme Court Examines Boundaries of Antitrust Immunity

Posted in Antitrust, State & Federal Audits, Investigations & Litigation

On October 14, 2014, the US Supreme Court heard oral arguments in North Carolina State Board of Dental Examiners v. FTC, a Fourth Circuit decision upholding an FTC finding that the North Carolina State Board of Dental Examiners did not qualify for antitrust immunity after excluding non-dentists from providing teeth-whitening services. The question under consideration… Continue Reading

Front End Changes and, Again, More DIR Columns

Posted in Payors & PBMs, Pharma & Medical Devices, Pharmacies, Reimbursement, State & Federal Audits, Investigations & Litigation

Since the beginning of the Medicare Part D program, CMS has introduced many reporting mechanisms for trying to understand drug pricing, price concessions, and the cost of providing services to Part D members.  The tool CMS has turned to most often is the direct and indirect remuneration (“DIR”) report.  The stated purpose of DIR reporting… Continue Reading

Life Care Centers Seeks Sixth Circuit Review of Decision Allowing Statistical Sampling/Extrapolation in FCA Case

Posted in Fraud & Abuse, Long-term Care/Skilled Nursing Facilities, State & Federal Audits, Investigations & Litigation

Written by Larry Freedman, Samantha Kingsbury, and Ellyn Sternfield  Last week, we posted about U.S. District Court Judge Harry Mattice’s September 29th ruling that government attorneys could extrapolate from a small sample of patient admissions to over 50,000 patient admissions (and over 150,000 claims) by Life Care Centers of America, Inc. (a nursing home operator) to try to… Continue Reading

The Supreme Court Continues to Punt on False Claims Cases

Posted in Clinical Trials & Research/FDA, Fraud & Abuse, Pharma & Medical Devices, State & Federal Audits, Investigations & Litigation

The first day of the Supreme Court term saw it decline, without comment, certiorari on two cases raising issues of liability and the sufficiency of pleading under the federal False Claims Act (FCA).  I first wrote about the case of U.S. ex rel. Ge v. Takeda in August 2013, when the U.S. had appealed a… Continue Reading

Federal Judge Rules to Allow Extrapolation on More Than 50,000 Patient Admissions in FCA Case

Posted in Fraud & Abuse, Long-term Care/Skilled Nursing Facilities, State & Federal Audits, Investigations & Litigation, Uncategorized

Written by:  Ellyn L. Sternfield and Samantha P. Kingsbury Last week, a Tennessee federal district court judge ruled that government attorneys can extrapolate from a small sample of billing statements to over 50,000 patient admissions by Life Care Centers of America, Inc. (a nursing home operator) to try to hold Life Care Centers liable under the… Continue Reading

Antitrust Article Examines FTC’s Recent Scrutiny of Quality of Care Efficiency Defenses in M&A Activity

Posted in Antitrust, Health Care Reform, Hospitals & Health Systems, Mergers, Acquisitions & Other Transactions, State & Federal Audits, Investigations & Litigation, Uncategorized

Written by: Stephanie D. Willis Dionne Lomax and Helen Kim, our colleagues in the Antitrust Practice, have authored an article in Competition Policy International’s September 2014 edition of the Antitrust Chronicle observing that, even in the wake of the Affordable Care Act, which is intended to encourage efficiencies in health care delivery to improve health care quality overall, the… Continue Reading

A Cautionary Tale for Companies With Potential False Claims Act Exposure

Posted in Fraud & Abuse, State & Federal Audits, Investigations & Litigation

Written by: Heidi Lawson and Danny Harary A False Claims Act suit can be a company’s worst nightmare, as it may potentially result in large settlements and awards on account of the statute’s trebled damages provision.  However, the nightmare for AmerisourceBergen was compounded by the fact that the company’s insurer, ACE, denied coverage for the claim… Continue Reading

Department of Justice Criminal Division Will Increase its Review of False Claims Act Cases for Criminal Prosecution

Posted in Fraud & Abuse, State & Federal Audits, Investigations & Litigation

Written by Laurence J. Freedman and Samantha P. Kingsbury On Wednesday, during a speech before the Taxpayers Against Fraud Education Fund conference in Washington, D.C., Leslie R. Caldwell, Assistant Attorney General for the Department of Justice’s (DOJ) Criminal Division, announced that her office will be stepping up its review of False Claims Act (FCA) qui… Continue Reading

Upcoming Webinar on September 23, 2014: What Your Company Needs to Know to Protect Itself from FCPA Liability

Posted in Fraud & Abuse, Pharma & Medical Devices, State & Federal Audits, Investigations & Litigation

Please join us on September 23rd, 2014 at 1:00 p.m. for a webinar where we’ll discuss the recent statements from the Department of Justice and the U.S. Securities and Exchange Commission describing the susceptibility of pharmaceutical and medical device companies in regards to FCPA enforcement. Key questions that will be addressed include: Why does the… Continue Reading

Prescription Drugs: Refocusing the False Claims Act Microscope on the Rest of the Transaction

Posted in Fraud & Abuse, Payors & PBMs, Pharma & Medical Devices, Pharmacies, State & Federal Audits, Investigations & Litigation

Written by:  Tara E. Swenson Over the last decade, it has often felt as though the pharmaceutical industry has been the government’s and whistleblowers’ main, and at times only, target for False Claims Act (“FCA”) investigations.  While manufacturers are likely not out from underneath the microscope, it seems as though the lens may have shifted… Continue Reading

Acute Care Hospitals Settle FCA Lawsuits for $98 Million

Posted in Fraud & Abuse, Hospitals & Health Systems, State & Federal Audits, Investigations & Litigation

Written by Brian Dunphy and Larry Freedman Community Health Systems, Inc. (CHS) and Community Health Systems Professional Services Corporation, together a national owner and operator of acute care hospitals, and 119 of their hospitals, agreed to pay $98 million to settle seven False Claims Act (FCA) lawsuits filed by qui tam relators around the country.  The… Continue Reading

Federal Court Rejects Relator’s Swapping Allegations in False Claims Act Case

Posted in Clinical Laboratories, Fraud & Abuse, Hospitals & Health Systems, Long-term Care/Skilled Nursing Facilities, Physicians, State & Federal Audits, Investigations & Litigation

This week a federal district court in Ohio ruled in favor of Mobilex USA (Mobilex), the country’s largest mobile medical imaging company, on a motion for summary judgment in a False Claims Act (FCA) suit filed by a former employee, Kevin P. McDonough.  McDonough accused Mobilex of underpricing imaging services supplied to Medicare Part A beneficiaries so that… Continue Reading

New Massachusetts Law Targets Self-Referrals of Clinical Laboratory Services

Posted in Clinical Laboratories, Fraud & Abuse, State & Federal Audits, Investigations & Litigation

The Fiscal Year 2015 budget for the Commonwealth of Massachusetts, which was signed into law earlier in the week, included a broad prohibition on clinical laboratory self-referrals.  This legislation (the “Bill”) originally proposed by the Attorney General’s office was intended to combat self-referral arrangements between clinical laboratories and sober houses under common ownership, but it extends beyond such… Continue Reading

Corporate Practice of Medicine: An Old Doctrine Breathing New Life

Posted in Hospitals & Health Systems, Payors & PBMs, Physicians, State & Federal Audits, Investigations & Litigation

Written by: Bridgette A. Wiley Many states prohibit or limit the corporate practice of medicine (CPOM), either through statute or common law.  These states generally bar a business corporation from practicing medicine or employing a physician to provide professional medical services.  As a matter of public policy, the CPOM doctrine intends to ensure that medical… Continue Reading

D.C. Circuit Affirms That Internal Investigation May Be Protected By the Attorney-Client Privilege

Posted in Fraud & Abuse, State & Federal Audits, Investigations & Litigation

A recent decision from the D.C. Circuit Court of Appeals reaffirmed that a company’s internal investigations—if structured properly—are protected from disclosure in litigation by the attorney-client privilege. As discussed in Mintz Levin’s Employment Matters blog, the court’s decision In re: Kellogg, Brown, and Root, Inc. has significant practical application, especially for health care companies, which… Continue Reading

OCR Confirms that Medical Records Should Not be Left in the Driveway

Posted in Hospitals & Health Systems, Mergers, Acquisitions & Other Transactions, Physicians, Privacy & Security/HIPAA/HITECH, State & Federal Audits, Investigations & Litigation

Written by:  Dianne J. Bourque The most recent Office for Civil Rights (“OCR”) HIPAA enforcement action serves as an important reminder to health care providers of the security risks associated with a mishandled medical records custody transfer and the risks of leaving paper records in the driveway.  The enforcement action and ensuing settlement – an… Continue Reading

Can a Relator Be Held Liable for Using Confidential Company Documents to Support a Qui Tam Case?

Posted in Fraud & Abuse, State & Federal Audits, Investigations & Litigation

Last week, the U.S. District Court for the Eastern District of Pennsylvania issued a decision in Walsh et al. v. Amerisource Bergen Corp. et al denying the Relator’s motion to dismiss a counterclaim that alleged the Relator breached a confidentiality agreement by filing the underlying qui tam case.  Although courts have differed on whether enforcing confidentiality agreements runs counter to… Continue Reading

Five Lessons from OCR’s Reports to Congress on Breaches and HIPAA Rules Compliance

Posted in Privacy & Security/HIPAA/HITECH, State & Federal Audits, Investigations & Litigation, Uncategorized

Written by: Stephanie D. Willis and Dianne J. Bourque Last week, the HHS Office of Civil Rights (OCR) released two reports required by the Health Information Technology for Economic and Clinical Health (HITECH) Act: (i) the Annual Report to Congress on Breaches of Unsecured Protected Information (Breach Report); and (ii) the Annual Report to Congress on HIPAA Privacy,… Continue Reading

Lessons to Be Learned from FCA Defendant Who Provided Attorney Work Product to OIG

Posted in Fraud & Abuse, State & Federal Audits, Investigations & Litigation

Health care companies and their counsel handling health care fraud investigations or False Claims Act (“FCA”) cases should consider the potential strategic implications of a decision compelling an FCA defendant to produce attorney work product to a relator.  United States ex rel. Garbe v. Kmart Corp., No. 3:12-cv-00881-MJR-PMF, 2014 U.S. Dist. LEXIS 73261 (S.D. Ill…. Continue Reading

Keeping Legal Advice In-House: Protecting the Attorney-Client Privilege

Posted in Clinical Laboratories, Hospitals & Health Systems, State & Federal Audits, Investigations & Litigation

Written by Bridgette A. Wiley Because health care companies operate in such a heavily regulated environment, the advice of legal counsel is integral to ensuring compliance with applicable laws and regulations.  Fortunately the attorney-client privilege generally protects legal advice from disclosure to regulatory agencies, enforcement authorities, and opposing parties in litigation, including whistleblowers in False… Continue Reading

Mintz Levin’s Health Care Qui Tam Update

Posted in Fraud & Abuse, Hospitals & Health Systems, Pharma & Medical Devices, Physicians, State & Federal Audits, Investigations & Litigation, Uncategorized

Mintz Levin’s most recent Qui Tam Update authored by our Health Care Enforcement Defense Practice provides a broad overview of 58 recently unsealed health care–related qui tam cases, with an in-depth look at four cases, including an off-label marketing settlement and a notable decision applying the Rule 9(b) requirements for pleading fraud to a claim… Continue Reading

CMS Releases Physician Medicare Billing Data

Posted in Fraud & Abuse, Health Care Reform, Payors & PBMs, Pharma & Medical Devices, Physicians, Reimbursement, State & Federal Audits, Investigations & Litigation

Written by: Thomas S. Crane, Kimberly J. Gold and Ellyn L. Sternfield The U.S. Department of Health and Human Services (HHS) announced on April 9th  a “historic” release of Medicare payment data to provide consumers with “unprecedented transparency on the medical services physicians provide and how much they are paid.”  The Centers for Medicare and… Continue Reading

Supreme Court Declines to Settle False Claims Circuit Split

Posted in Fraud & Abuse, Pharma & Medical Devices, State & Federal Audits, Investigations & Litigation, Uncategorized

Written by:  Ellyn L. Sternfield With its March 31, 2014 denial of certiorari in U.S. ex rel. Nathan v. Takeda, the U.S. Supreme Court declined to wade into the ongoing debate over the degree of particularity with which a false claims relator must plead a violation of the federal Civil False Claims Act. The District… Continue Reading

After Arkansas Supreme Court Reverses $1.2 Billion Medicaid False Claims Verdict, Will State Attorneys General Rethink the Use of Private Counsel?

Posted in Fraud & Abuse, Pharma & Medical Devices, State & Federal Audits, Investigations & Litigation

Written by: Ellyn L. Sternfield On March 20, 2014, the Arkansas Supreme Court reversed a $1.2 billion judgment against Johnson & Johnson and its related companies over alleged Medicaid fraud stemming from the off-label marketing of the drug Risperdal.  This decision comes on the heels of the January 28, 2014 reversal by the Louisiana Supreme… Continue Reading