The U.S. Supreme Court is now in its summer recess and we anecdotally have heard of Justice “sightings” in Europe and beyond. This last session of the Court addressed many issues capturing both the political and popular imagination. Less headline-grabbing and relatively modest in length (at only nine pages) was Justice Clarence Thomas’ opinion for a unanimous Court in Cochise Consultancy, Inc. et al. v. U.S. ex rel. Hunt. (587 U.S. ____ (2019)) It directly impacts our healthcare compliance practice here at Nossaman by interpreting the statute of limitations for a False Claims Act (“FCA”) case so as to stretch it as long as possible.
A Civil Investigative Demand, often referred to as a CID, is a pre-litigation mechanism used to collect information and evidence for use in civil false claims act and other investigations. CIDs are typically lengthy documents, broadly drafted, invasive, and even frightening. In the past decade since the passage of the Fraud Enforcement and Recovery Act of 2009, CIDs have been issued at exponentially higher rates than in years past, and have become more comprehensive and more aggressive.
While this post will focus on Department of Justice CIDs in federal health care cases, CIDs are ...
Last Thursday, a jury in federal district court in St. Louis handed down a verdict in a False Claims Act (FCA) case that presents a laundry list of the challenges which can arise in a FCA case. This one includes kickback allegations, Stark issues, both state and federal claims, individual liability, civil-criminal cooperation, a criminal indictment (later dropped), and even family law. The defendants are neurologist, Dr. Sonjay Fonn, and his fiancee of nine years, Deborah Seeger, as well as their respective medical practice and medical device distributorship.
The verdict found ...
The Anti-Kickback Statute
Those in the business of providing healthcare services to Medicare and Medicaid beneficiaries are all too familiar with the federal Anti-kickback Statute (AKS). Among other dreadful sanctions, it imposes criminal penalties on those individuals or entities that knowingly and willfully offer, pay, solicit, or receive remuneration in order to induce or reward the referral of business reimbursable under federal healthcare programs. A violation of the AKS is a felony punishable by fines of up to $25,000 and imprisonment for up to five years. An offense may also result in the imposition of civil monetary penalties, government program exclusion, and liability under the federal False Claims Act. The U.S. Department of Health and Human Services (HHS) has the authority, however, to protect certain provider arrangements and payment practices under the AKS. To that end, HHS has established safe harbors in various areas. While compliance with a safe harbor is not mandatory, healthcare providers and others may voluntarily seek to comply with safe harbors so that they may have substantial assurance that their business practices do not violate the AKS.
A New Safe Harbor
On January 20, 2017, a new safe harbor became available for local transportation services furnished by healthcare providers to Medicare and Medicaid beneficiaries.  The safe harbor protects an offer of free or discounted local transportation services when paid for by an eligible entity. An eligible entity may be a direct provider of healthcare services or one that arranges for the provision of healthcare services to patients, such as a health plan or clinically integrated network. The definition of an eligible entity excludes organizations that primarily supply healthcare items rather than services, such as a durable medical equipment suppliers or pharmacies. However, entities that primarily provide services, but also provide items, such as a hospital, may provide patients with transportation to the hospital for items or services provided by the hospital (such as for obtaining items at the hospital’s on-site pharmacy).
The safe harbor is available for two types of transportation. First, the safe harbor protects an offer to provide transportation of an established patient to or from an eligible entity for medically necessary items or services. An established patient is a person who has contacted the eligible entity to schedule an appointment or had a previous appointment with the eligible entity furnishing the transportation.
Second, the safe harbor protects certain types of shuttle services that are generally available to the public, as well as patients on a non-discriminatory basis.
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