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Chapter 8. Cutting-Edge Topics in the FCA

By Patric Hooper,[1]Jordan Kearney,[2] and Alicia Macklin[3]

Like seemingly everything else in 2020, False Claims Act (FCA) enforcement and the development of FCA case law was heavily affected by the COVID-19 pandemic. With courts closed and much of the U.S. Department of Justice’s (DOJ) attention turned to COVID-19–related issues, much of the action on what were then the FCA’s cutting-edge topics stalled. Late in 2020, though, activity on these issues began to pick back up. This chapter covers three (non-COVID-19) topics that are likely to have a significant impact on enforcement and litigation going forward.

First, the chapter covers federal enforcement actions related to the opioid epidemic, which are important for compliance officers to note because of the increasing focus on individual prescribers and organizations.

Second, the chapter summarizes how federal courts have grappled with the U.S. Supreme Court’s decision in Azar v. Allina Health Services (Allina), which held that Medicare cannot change a “substantive legal standard” without notice and comment rulemaking.[4] This is important because of the frequency with which the Centers for Medicare & Medicaid Services (CMS) uses subregulatory guidance (including, among other things, Internet-Only Manuals, local coverage determinations, and preambles to final rules). The Allina decision materially affects potential FCA exposure for violation of subregulatory guidance in some situations and will likely require CMS to increasingly rely on regulations.

Finally, the chapter covers DOJ guidance and case law surrounding settlements of FCA actions over the objection of a qui tam relator (i.e., whistleblower). In an era of ever-increasing qui tam actions, often brought by for-profit, outsider relators, whether courts uphold DOJ’s moves to dismiss meritless cases stands to have a material impact on the risk profile for many providers.

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