The FCA continues to be the federal government's primary civil enforcement tool for investigating allegations that healthcare providers or government contractors defrauded the federal government. In the coming weeks, we will take a closer look at recent legal developments involving the FCA. This week, we examine the requirement that a relator plead and prove that a defendant acted with the requisite level of knowledge to establish an FCA claim and evaluate how courts have evaluated this issue in recent cases.
In U.S. ex rel. Saldivar v. Fresenius Medical Care Holdings, Inc., 2015 WL 7293156 (N.D. Ga. Oct. 30, 2015), the district court granted Fresenius's motion for summary judgment, holding that no reasonable jury could find that Fresenius acted "knowingly." The relator alleged that Fresenius violated the FCA by impermissibly billing Medicare for overfill in medication vials. The district court explained—in a 108-page opinion—that the relator could not prove that Fresenius knew its billing for overfills was impermissible or that it acted with deliberate ignorance or reckless disregard as to whether such billing was permissible. The district court focused on whether Fresenius had actual knowledge that it should not seek Medicare reimbursement for overfills. Key to this analysis were the facts that: (1) Fresenius relied on counsel in determining whether to bill Medicare and the law was silent on this issue during the relevant time period; (2) Fresenius and its counsel believed that many companies had billed for overfills and that the government knowingly reimbursed those companies for years; (3) Fresenius was very serious in its efforts to comply with Medicare rules and regulations; and (4) Fresenius had previously disclosed its overfill billing to the government, but was never warned that its actions were improper.
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