Provider groups urge Supreme Court to overturn FCA decision

More than a dozen organizations submitted amicus briefs to the Supreme Court last week, imploring the justices to overturn a False Claims Act (FCA) decision that relies on a broad interpretation of "implied certification," according to case updates on SCOTUSblog.

The high court agreed to review Universal Health Services v. Escobar this year, a case that is expected to resolve longstanding questions surrounding the theory that all federal regulations are considered a condition of payment, even if they aren't explicitly stated as such. In this specific case, which payers and attorneys will be watching closely, federal and state prosecutors have said claims submitted by a mental health provider are classified as FCA violations because the company employed unlicensed counselors.

Among the organizations that have submitted briefs so far, the American Hospital Association--along with the Association of American Medical Colleges and the Federation of American Hospitals--argued the implied certification theory "lowers the bar as to what constitutes 'fraud' to include payment requests that contain no false information," and "raises clear issues of fundamental fairness."

The provider groups added that FCA claims should be limited to claims that are knowingly ineligible for payment based on the federal government's reimbursement conditions. Although FCA recoveries in healthcare dropped $400 million last year, statistics show that whistleblower claims still account for the majority of recoveries.  

The American Medical Association wrote in its brief that a broad interpretation of FCA liability has created opportunities for whistleblowers to bring frivolous claims. The FCA, the organization argued, should not be used to resolve grievances with a product or service. The American Health Care Association and the National Center for Assisted Living echoed similar concerns, writing that under the current interpretation, "the mere act of submitting a facially truthful payment claim somehow makes an implicit, unsigned certification of compliance with countless statutory and regulatory provisions."

The National Association of Criminal Defense Lawyers (NACDL) added that a decision on this civil matter could influence how courts interpret criminal FCA claims. NACDL argues that the original intent of FCA regulations limits claims to those that are "an express precondition of payment." A broader interpretation of FCA text has led to prosecutors to bring claims beyond the scope of the written intent of the law, the group wrote.

To learn more:
- here's the SCOTUSblog post
- read the AHA amicus brief
- see the AMA brief
- read the AHCA/NCAL brief
- here's the NACDL amicus brief

Related Articles:
Fraud trends: FCA cases, physician pay will loom large in 2016
Supreme Court to hear FCA case on 'implied certification
Supreme Court decision expands False Claims Act liability for providers
False Claims Act recoveries drop nearly 40 percent in 2015

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