In this post, I will be focusing on the intersection of off-label communications with government enforcement of health care fraud through the False Claims Act. Over the past eight years, the U.S. Department of Justice (“DOJ”) has been particularly aggressive in using the False Claims Act to pursue recoveries from individuals, health care providers, and drug manufacturers that participate in federal health benefit programs. In fact, from 2009 to 2016, DOJ collected $19.3 billion from health care False Claims Act settlements and judgments, with $2.5 billion recovered in fiscal year 2016, alone. (More DOJ false claims statistics can be found here.) DOJ’s enforcement efforts are not solely targeted against garden variety billing fraud, but also involve claims arising from alleged violations of health care regulatory requirements. Among other things, the DOJ has been targeting claims for reimbursement for off-label uses of regulated products. DOJ’s aggressive policy of holding manufacturers accountable for off-label claims under the False Claims Act is entirely consistent with FDA’s stance on off-label communications as described in the January memo. However, recent court interpretations of off-label communications as protected First Amendment speech, as well as interpretations of the causality component of False Claims Act claims, have apparently caused DOJ to reconsider its strategy with respect to such cases. Continue Reading The Past, Present, and Future of Government Regulation of Off-Label Communications – Part 5

Earlier this month, Mintz Levin’s Health Care Enforcement Defense Group published its most recent Health Care Qui Tam Update that looks at 23 health care-related qui tam cases unsealed in June 2017. The Update provides an in-depth analysis of six cases in which the government intervened, and discusses why these cases are notable in the health care industry.

The Update also provides a summary of the trends revealed in these recently unsealed cases:

  • The cases identified were filed in federal district courts in 18 states, including four filed in the active Middle District of Florida.
  • Of the cases identified, the federal government intervened, in whole or in part, in eight cases and declined to intervene in 13. There were two cases in which the intervention status could not be determined from the case docket.
  • The entities named in the qui tam actions included outpatient medical providers, laboratory testing companies, inpatient hospitals, and medical supply companies.
  • In all but three cases, the relators were current or former employees of the defendants.
  • Once again, there were long delays in unsealing these cases, with an average time under seal of just over two years and four months. And one case had been under seal for almost nine years.

Click HERE for the full Update and to find our key takeaways from the cases discussed.

On August 17, 2017, the U.S. Department of Justice (DOJ) announced that it had reached a $465 million false claims settlement with Mylan, the manufacturer of EpiPen, over the company’s alleged underpayment of Medicaid Drug Rebates for EpiPen. The settlement amount and terms were generally announced by Mylan in October 2016 – but back then DOJ refused to confirm the settlement.

Back in October 2016, we theorized that the announced “settlement” was likely a handshake deal, not yet reduced to writing and not signed off on by the necessary parties.  It’s not surprising that it would take ten months to finalize a health care false claims settlement.  In Ellyn’s government days, she worked cases that took years, not months, to get from handshake deal to announced settlement.

And in reviewing the EpiPen settlement and related unsealed documents, there were things we expected to see in the settlement; admittedly we are grizzled veterans when it comes to false claims settlements.  But there were some things about this settlement that raised our eyebrows. So we will (briefly) recap how we got here and the settlement terms, and discuss the four things that surprised us about this settlement.  Continue Reading The Four Things That Surprised Us in the EpiPen False Claims Settlement

A court in the Southern District of New York (“SDNY” or the “Court”) recently released an important decision applying the Supreme Court’s landmark Escobar ruling to a qui tam action involving percentage fee arrangements for billing agents.  Among other claims, the City of New York (“the City”) and its billing agent, Computer Sciences Corporation (“CSC”) allegedly used an illegal incentive-based compensation arrangement for CSC’s services when billing New York Medicaid for services provided to eligible children under New York’s Early Intervention Program (“EIP”).   EIP provides “early intervention services” to certain children with development delays using federal funds provided under the Individuals with Disabilities Education Act.  EIP allows municipalities like the City to pay providers directly for EIP services and then seek reimbursement from other payors, like third party payors and New York Medicaid.

Continue Reading Implied False Certification Theory Fails in FCA Case Against Billing Agent

Last week, Mintz Levin’s Health Care Enforcement Defense Group published a new Qui Tam Update, which analyzes 21 health care-related False Claims Act qui tam cases unsealed in May 2017, and the findings include:

  • long delays in unsealing remain the norm;
  • relators overwhelmingly consisted of current and former employees (and physicians); and
  • the most common alleged violation was billing fraud (which was claimed in two-thirds of the 21 unsealed cases).

Also of note in this Update:

  • The targeted entities in these 21 cases included outpatient medical and psychological providers, laboratory testing companies, inpatient hospitals, and home health care providers.
  • Of the 21 cases, the government intervened, in whole or in part, in seven cases and declined to intervene in 10.  (Intervention status could not be determined from the docket in four cases.)
  • The cases were filed in 17 different courts (including the Central District of California, the District of South Carolina, the Eastern District of Michigan, and the Northern District of California).

This Update provides in-depth analysis of three of the unsealed cases, which involve allegations regarding (1) “up coding” by a hospital that allegedly billed routine transport as emergency transport, which was reimbursed at a higher rate; (2) billing for medically unnecessary tests that purported to identify susceptibility to opioid addiction and engaging in a kickback scheme; and (3) processing prior authorization requests for MCOs using automated procedures to expedite processing and circumvent medical necessity determinations, resulting in submission of false claims.

Continuing its annual tradition, the U.S. Department of Justice (“DOJ”) and the U.S. Department of Health and Human Services (“HHS”) announced last week the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force.  As part of the national health care fraud takedown, the government charged 412 defendants with approximately $1.3 billion in alleged fraud. In addition to these charges, HHS Office of Inspector General (“OIG”) is in the process of excluding 295 health care providers from participating in federal health care programs.

Continue Reading DOJ and OIG Announce Largest Ever National Health Care Fraud Takedown; Focus on Opioids

Earlier this month, the Office of the Inspector General for the Department of Health and Human Services (“OIG”) published its Semiannual Report to Congress covering the period from October 1, 2016 to March 31, 2017.  The report describes OIG’s work and accomplishments during the 6-month reporting period. Like other OIG reports, including the annual OIG Work Plan, the report gives a good indication of priority areas for OIG and can help guide compliance priorities for providers.  Below are some highlights of the report in the following focus areas: Continue Reading OIG Publishes Semiannual Report to Congress

The latest installment in the ongoing saga over EpiPen Medicaid Drug Rebates came on May 31, 2017, when Senator Charles Grassley issued a press release stating that between 2006-2016 taxpayers may have overpaid for EpiPen by as much as $1.27 billion, “far more” than the announced-but-never-confirmed or finalized $465 million DOJ settlement with Mylan.

To understand what the latest news means in the ongoing saga over EpiPen Medicaid Drug Rebates, it is important to understand how we got here.   And why at the end of the day, the information Senator Grassley included in the May 31, 2016 release may be less important than the information he hinted at but omitted from the release. Continue Reading The Latest in the Epipen Medicaid Drug Rebate Saga – Where Are We Now?

On May 17, 2017 the American Bar Association convened its 27th National Institute on Health Care Fraud.  I have attended many of the past annual meetings, and always enjoy the presentations and the opportunity to network with colleagues from all sides of the aisle.  And I always come away with a few nuggets to share with those who did not attend.

Here are my seven top takeaways from this year’s Institute. Continue Reading Seven Takeaways from the ABA National Institute On Health Care Fraud

Last week, the Department of Justice (DOJ) entered into a $34 million settlement with Mercy Hospital Springfield (“Hospital”) of Springfield, Missouri, and its affiliate Mercy Clinic (“Clinic”). The settlement resolves an allegation that the Clinic violated the Stark Law by compensating twelve Clinic physicians in a manner that took into account the volume and value of the physicians’ referrals to the Hospital’s infusion center.  The U.S. contended that the defendants’ Stark Law violations caused their reimbursement claims to Medicare for infusion services to violate the False Claims Act. Continue Reading Hospital and its Clinic Agree to $34 Million Settlement to False Claims Act Allegation that Compensation to Oncologists Violated the Stark Law