Healthcare Fraud Enforcement and the DOJ’s Greatest Hits

Healthcare Fraud Enforcement and the DOJ’s Greatest Hits


In 2014, the Department of Justice obtained $2.3 billion in healthcare fraud recoveries and 2015 will be another significant year for False Claims Act enforcement – particularly as it relates to hospitals and associated providers.  Like a band playing fan favorites on tour, in 2015 the DOJ will continue to focus on the enforcement trends that topped the charts in recent years, such as:

  • Patient Status and “Short-Stays” – The government has focused a great deal of resources on the investigation of allegedly improper inpatient stays of Medicare and Medicaid beneficiaries, typically  inpatient stays of two days or less, and often times relate to specific diagnoses such as chest pain, transient ischemic attacks and syncope.  The government is likely to expand this focus, examining inpatient stays following certain procedures typically performed on an outpatient basis. 
  • Stark – After obtaining a $270 million judgment against Tuomey Health System in 2013 and an $85 million settlement with Halifax Hospital Medical Center in 2014, there’s no reason to think that the government’s (and relator’s) focus on Stark will wane. Whistleblowers have big-dollar incentives to bring Stark cases in hopes that the government will intervene, and litigate them even if the government doesn’t. For its part, the government has keen interest in the development of the case law in this complicated area, and will likely monitor – and possibly participate – in a higher percentage of these cases than it otherwise would.  
  • Cardiac Procedures – Cardiac procedures, particularly cardiac stenting, performed in the hospital setting have long been an enforcement, and  the DOJ has taken the position that coronary arteries require a 70% or greater blockage in order to justify the placement of a cardiac stent.  The government is increasingly looking to recoup allegedly improper payments in addition to filing criminal charges against culpable individuals, and hospitals need to be aware of their relationships with clinics and other physician practices. FCA settlements in these areas can open the door to ancillary litigation, that can have serious adverse reputational harm that can go well beyond that caused by the government investigation or settlement.  

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