The False Claims Act: The Department Of Justice Continues Aggressive Investigations

SEPTEMBER 8, 2016

The False Claims Act

The False Claims Act (FCA), passed by Congress in 1862, is a federal law that aims to prohibit individuals, companies and contractors from defrauding federal governmental programs. The FCA has been amended several times in its 100 plus year history, and as it now stands it generally prohibits:

  • Knowingly making a false claim for payment
  • Knowingly making false statements or using false records to make a fraudulent claim
  • Conspiring to violate the FCA
  • Falsely certifying the type or amount of property used by the government
  • Certifying receipt of property on a document without knowing the accuracy
  • Knowingly buying government property from an unauthorized officer of the government
  • Knowingly making or using a false record to avoid or decrease an obligation to the government

Penalties imposed by the FCA include a civil penalty ranging between $5,500 and $11,000 per each false claim as well as triple the amount of the government's damages.

Nicknamed the "Lincoln Law" because it was enacted during President Lincoln's presidency, the law has no doubt experienced several amendments and changes throughout the years.

2016 WILL LIKELY SEE CONTINUED RECOVERY FOR THE DOJ UNDER THE FCA

Last year, the Department of Justice (DOJ) sought and obtained over $3.5 billion in settlements and judgments from cases involving fraud under the FCA. Current trends indicate that the DOJ is likely to see similar recoveries in 2016.

Experts point to several items assisting the DOJ in these significant crackdowns. For example, the government investigators can analyze a small sampling of suspicious activities on a local level, and then, if the company is operating on a larger scale, the investigators can apply their findings on a larger scale where similar facts and conditions present themselves. Essentially, this allows the DOJ to cast a wide net with fewer resources. As you may imagine, this particular strategy has been the point of lawsuits as many claim that this method lowers the government's burden of proof. So far, courts have sided with the DOJ.

Additionally, the DOJ mandates that, per the Affordable Care Act (ACA), overpayments must be remitted no longer than 60 days after a medical provider is put on notice of the overpayment. The DOJ recently clarified that the clock begins to run as soon as the entity is given notice.

A few of the other issues bolstering DOJ lawsuits under the FCA include the fact that an entity can be investigated for false claims if they submitted the claim in violation of any Medicare rule even if the entity did not certify the claim. Additionally, physician compensation remains under scrutiny where it appears that hospitals and physicians are collaborating with respect to the value and volume of referrals.

THE DOJ INCREASINGLY TARGETS INDIVIDUALS UNDER THE FALSE CLAIMS ACT

The DOJ targets not only large entities under the FCA, but individuals as well. Recently, the DOJ has incentivized corporations to name individual employees contributing to the fraud in exchange for corporation credits. Individuals risk not only penalties and fines through the FCA, but disciplinary action and potential loss of licensure as well. If you are being investigated for fraudulent claims, you need an experienced attorney dedicated to the defense of licensed professionals. With a proven successful record for favorable client results, Frances Cullen, P.C. will aggressively defend your license in the event of an investigation. Call us today!