Whistleblowers Not Needed for False Claims Act Enforcement
March 1, 2023
By Greg Freeman
EXECUTIVE SUMMARY
The Department of Justice (DOJ) is continuing its focus on False Claims Act violations. The government is using its own data analysis in addition to responding to whistleblowers.
- Healthcare organizations should conduct their own audits of data the DOJ might use to find violations.
- Genetic and urine testing remain a focus of DOJ investigations.
- The government is scrutinizing the use of COVID-19 relief funds.
The federal government can detect False Claims Act violations without alert from a whistleblower, a development that could lead to a greater risk of investigations for healthcare organizations.
Based on the volume of recoveries from previous years, enforcement of the False Claims Act remains strong, says Dayna C. LaPlante, JD, shareholder with Polsinelli in Chicago.
“One interesting trend that we are starting to see on the defense side is that the number of cases and investigations being brought by the DOJ not associated with any private whistleblower is increasing,” LaPlante says. “DOJ announced back in 2021 that it would essentially prioritize bringing false claims cases not necessarily associated with a private whistleblower. We’re starting to see that come to fruition.”
The government is using its own sophisticated data analytics to identify potential False Claims Act cases without the help of a private whistleblower or an insider who may be at a healthcare provider, LaPlante explains. For example, risk managers and compliance officers should know the government may be investigating and analyzing their claims data.
“A provider’s own internal monitoring of these things certainly seems prudent. It’s just better to identify a potential compliance issue on the front end and address it proactively than have to address it reactively because the government is running data analytics on your claims filings and has knocked on your door because you’re an outlier.”
Even though the government does not need to wait for an insider to bring a potential False Claims Act violation to their attention, it is limited to what data they can pull and analyze. That may include referral patterns, holding outliers, and other data that are specific to the claims submitted from providers.
“I think that will help guide the government in determining the types of cases that they bring. We may see an uptick or continuing focus on the same traditional theories of liability that we’ve seen before, related to billing for unnecessary services, services not provided, duplicative services, or upcoding on those services,” LaPlante says. “That may be something that the government can predict through and identify through the data that it’s pulling.”
Looking at Testing, COVID-19 Funds
Other trends expected to continue are related to certain service lines. In recent years, there has been an uptick in settlements related to genetic testing and urine drug testing.
“I expect that enforcement will continue. Whether you’re a provider that actually has a lab rendering the services like genetic tests or urine drug tests, or you’re a provider that is ordering and referring the services out, I think that is one area where providers should be vigilant,” LaPlante says. “The government is watching those specific service lines.”
Another False Claim Act enforcement area relates to COVID-19. Enforcement actions are filed and settled based on COVID-19 testing, certain vaccination programs that were implemented in the beginning of the pandemic, and the necessity of vaccines given to people who qualified for those programs during shortages, LaPlante explains.
Paycheck Protection Program funding and Cares Act funding cases will continue as well. “A lot of money was given out during the COVID-19 pandemic, and now the government is hyperfocused on determining if those funds were secured in a compliant manner,” LaPlante says. “They’re using the False Claims Act to enforce the law on any fraudulent statements that were submitted in order to secure those types of funding.”
LaPlante also notes the DOJ is continuing to focus on the implementation of compliance programs. An effective compliance program is a way to defend against potential violations or allegations of false claims or other fraud, but the government also is focusing on the use of compliance programs in negotiating settlements of False Claims Act cases as well as in negotiating corporate integrity agreements.
“Hopefully, having effective compliance programs will prompt more favorable results for providers even in the face of False Claims Act violations,” LaPlante says.
SOURCE
- Dayna C. LaPlante, JD, Shareholder, Polsinelli, Chicago. Phone: (312) 463-6348. Email: [email protected].
The federal government can detect False Claims Act violations without alert from a whistleblower, a development that could lead to a greater risk of investigations for healthcare organizations. The government is using its own sophisticated data analytics to identify potential False Claims Act cases.
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