Assignment:
Discussion Question Background:
Implied False Claims Case: We studied the Federal False Claims Act (FFCA) in class and in the textbook. In a recent decision (Universal Health Services v. US), the US Supreme Court developed a controversial new legal theory to increase FFCA scrutiny against health care fraud. The Court recently held that a theory of "implied certification" - which assumes that health care providers are fully compliant with federal regulations when they submit reimbursement claims - is an allowable basis for recovery under FFCA. The case involved a mental health clinic whose Medicaid reimbursement claims were deemed false because the services rendered did not comply with current federal regulations.
The requests for reimbursement stated that the provider and the services were in compliance with all applicable regulations. Justice Clarence Thomas, speaking for the unanimous majority, stated that this new theory of FFCA liability requires two conditions: (1.) the provider's claims make representations about the services provided when requesting payment and 2.) the provider's noncompliance with regulations makes those representations and claims "misleading half-truths." This is very similar to the "reckless disregard of the truth" standard discussed in class as you may recall. This decision is very controversial and has been bitterly opposed by the health care industry.
Discussion Question:
SOX requires every CEO and CFO of a publicly traded company to personally certify the fairness and accuracy of an organization's financial statements under threat of civil liability and criminal prosecution.
- Do you believe the government should similarly require every provider submitting a claim for payment from the federal government to provide a certification that the claim is fair, accurate, and in compliance with federal law and regulations?
- The violation of this certification could automatically allow FFCA qui tam proceedings allowing a relator to recover treble (triple) damages from the provider for making false claims against the government?
- What are the advantages and disadvantages of adopting this procedure?