Enforcement against false claims filed with federal health care programs continues to snare a number of testing clinics as demonstrated by the recent news that a clinical lab has come to terms with federal prosecutors over urine drug testing. MD Spine Solutions LLC, of Reno, Nevada, has agreed to pay up to $16 million to settle allegations that it performed unnecessary urine drug tests, a case brought to the attention of the courts not by a former employee, but by Omni Healthcare Inc., which has been active in the False Claims Act space, thus highlighting the hazards of third-party litigation to clinical lab operators.
The frequent calls for an expansion of telemedicine have come with relatively hushed advisories about the potential for fraud, concerns that have been borne out by an indictment recently returned by a federal grand jury in New Jersey. A company that presented itself as a provider of telemedicine services has been charged with filing $784 million in false claims for unnecessary durable medical equipment.
For the second time in less than 30 days, a company indirectly acquired by Abbott has settled with the U.S. government over alleged violations of the False Claims Act (FCA). In this instance, the now-defunct Arriva Medical LLC and its parent company Alere Inc. have agreed to pay $160 million to settle allegations that Arriva caused false Medicare claims to be filed for glucometers.
The U.S. Department of Justice (DoJ) has settled with two divisions of Abbott Laboratories of Abbott Park, Ill., over violations of the False Claims Act (FCA) in connection with devices alleged to have been defective. While neither claim recites a specific allegation against corporate executives with St. Jude Medical and Alere, the more conspicuous aspect of these agreements is that they are both directed toward activities that ceased in 2016, making clear that federal attorneys have long memories where problematic devices are concerned.
The Washington Legal Foundation’s (WLF) webinar on False Claims Act (FCA) litigation highlighted several developments in case law, including that non-relator FCA cases were up significantly in fiscal year 2020. However, Jay Stephens, an attorney with Kirkland & Ellis LLP, noted that Sen. Chuck Grassley (R-Iowa) has taken aim yet again at the materiality standard for false claims as spelled out in the Supreme Court’s Escobar, a move which if successful could amplify the federal enforcement focus on life science companies.
The latest global regulatory news, changes and updates affecting medical devices and technologies, including: DoJ settles with alleged DME fraudster; GAO: Veteran’s community centers had issues before pandemic.
The latest global regulatory news, changes and updates affecting medical devices and technologies, including: FDA formally posts testing advisory after town hall discussion; HHS finalizes regulatory review rule; Lab in California hit for three months of false claims; BVMed calls for German med tech strategy.
False Claims Act (FCA) litigation is one of the more potent weapons used to corral life sciences companies that stray out of legal bounds in the U.S. Jaime Jones, a partner in the Chicago office of Sidley Austin LLP, told BioWorld that Sen. Chuck Grassley (R-Iowa), long a legislative watchdog, has several notions about how the statute might be tweaked.
Drug and medical device manufacturers have several compliance matters to deal with under the False Claims Act (FCA), only one of which is the Anti-Kickback Statute (AKS). Nonetheless, the AKS might be a good area for members of industry to emphasize, given that it accounted for the vast majority of federal enforcement actions in fiscal year (FY) 2019, according to a new report by Gibson, Dunn & Crutcher LLP.
