Cadwalader, Wickersham & Taft LLP

Health care providers will often try to negotiate and receive fair, commercially reasonable business terms with vendors and suppliers, to both better serve their patients and improve their “bottom line.” Yet when it comes to services reimbursed by the government — be it Medicare, Medicaid, or TRICARE — what exactly those terms are and how they are structured could affect whether a provider and vendor negotiate themselves into liability under the False Claims Act. Last…
Two federal appellate-court decisions handed down in the past few weeks have generated much speculation about whether “medical necessity” determinations underlying Medicare or Medicaid claims can now be considered “objectively false” — despite conflicting medical-expert opinions — and actionable under the False Claims Act (FCA). The most recent opinion was issued on July 9, 2018, in United States ex rel. Polukoff v. St. Mark’s Hospital (“Polukoff”).  Polukoff involved two cardiac surgical procedures reimbursed by Medicare,…
On June 11, 2018, the United States Court of Appeals for the Sixth Circuit sustained a complaint against a home health care agency alleging that the agency had violated the False Claims Act (FCA) by submitting numerous claims to the Medicare program, even though the agency had not timely received the requisite physician certifications of the need for the services billed‑for. United States ex rel. Prather v. Brookdale Senior Communities, Inc., 892 F.3d 822 (6th Cir.
Earlier this month, the federal District Court for the Northern District of Illinois, in U.S. ex rel. Derrick v. Roche Diagnostics Corp., sustained a whistleblower, or qui tam, complaint under the False Claims Act filed by a discharged employee of a manufacturer of glucose-testing products, and brought against the manufacturer and a Medicare Advantage (managed care) plan, asserting violations of the anti-kickback statute. The whistleblower alleged that the manufacturer (Roche Diagnostics) had compromised an…
In an important break with the majority of case precedents, the United States Court of Appeals for the Fifth Circuit, reversing the District Court below, held that a Medicare provider, facing a $7.6 million recoupment for alleged overpayments, can file suit in federal court and seek an injunction against ongoing recoupments, even though the provider had not yet fully exhausted its administrative remedies. Family Rehabilitation, Inc. v. Azar, U.S.C.A., 5th Cir. March 27, 2018.…
The U.S. Attorney for the Southern District of Florida recently intervened in a whistleblower lawsuit brought under the federal False Claims Act, alleging fraudulent billing by a pharmacy reimbursed by the federal government. (U.S. ex rel. Medrano v. Diabetic Care Rx, LLC, No. 15-cv-62617, S.D. Fla.) What makes this case significant is that the U.S. Attorney has also named a private equity (PE) firm as a defendant. This attempted extension of False Claims Act…
Northern District of Ohio Judge Dan Polster, boldly asserting that he would attempt to resolve the opioid crisis because federal, state and local governments had failed to do so — presided over a wide-ranging status conference on January 11 in the opioid MDL assigned to him. In November 2017, a panel of federal judges decided to combine the more than 100 separate actions filed by various local government agencies against the pharmaceutical industry into a…
On October 19, 2017, the United States District Court for the Northern District of Illinois, in the case of MedPro Health Providers, LLC v. Hargan, dismissed a home care agency’s suit — without deciding the merits of the agency’s challenge to a Medicare contractor’s determination to suspend the agency’s Medicare payments.  Noting that the delay in adjudication was “unfortunate,” the District Court nevertheless held that the home care agency had to exhaust its administrative remedies…
Last week, President Trump declared the opioid crisis a public health emergency. The President’s opioid Commission has now issued its final report with recommendations on how to combat the country’s drug crisis. While both important, neither have a significant impact on law enforcement efforts to address the crisis. That impact will likely come from public reaction to reports suggesting that a 2016 law stripped the Department of Justice (“DOJ”) and Drug Enforcement Administration (“DEA”)…
Tom Price is out as Secretary of the U.S. Department of Health and Human Services (“HHS”).  Mr. Price announced his resignation on September 29th as he faced more questions and increasing scrutiny over his use of taxpayer-funded private planes.  While Mr. Price’s departure from HHS will impact some aspects of the Trump Administration’s health care agenda, health care enforcement and compliance issues are bi-partisan in support and therefore less volatile. Under Inspector General Daniel Levinson,…