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Affordable Care Act Repeal May Affect Charges Under False Claims Act

The newly elected Trump Administration has indicated repeal of the Affordable Care Act is one of its top priorities. But full repeal of the law could throw False Claims Act reporting provisions into doubt.

Three ACA provisions directly affect the False Claims Act: easing of the government’s burden of proof under the anti-kickback statute (AKS); the so-called 60-day rule requirement to report and return Medicare and Medicaid overpayments; and weakening of the public disclosure bar requirements.

The ACA includes two amendments to the anti-kickback statute. The first change is that a claim for services provided in violation of the AKS violates the FCA as well. (H.R. 3590, 111th Cong. § 6402(f)(1) (2010)) Prior to this change, the AKS was of limited value to the government when cases were brought under a theory of implied or express certification. The second amendment to the AKS reduces the intent standard under the AKS: “With respect to violations of this section, a person need not have actual knowledge of this section or specific intent to commit a violation of this section.” Previous holdings had determined that the AKS required a showing that the defendant knew of the AKS and specifically intended to violate the AKS.

Before the ACA, the FCA’s public disclosure bar divested courts of jurisdiction over allegations of publicly disclosed transactions unless the plaintiff was an “original source” of the information. The ACA weakened the public disclosure bar by implementing three significant changes.

First, the amended statute provided that the government had discretion to waive the public disclosure bar. Second, the statute provided that only federal criminal, civil, or administrative proceedings in which the government or its agent is a party, and only congressional, Government Accountability Office, or other federal reports, hearings, audits or investigations trigger the public disclosure bar. Third, a relator now can qualify for the original source exception to the public disclosure bar if he or she has “knowledge that is independent of and materially adds to the publicly disclosed allegations or transactions.” Previously, the original-source exception to the public disclosure bar required both direct and independent knowledge of the information on which allegations are based. These new provisions significantly narrowed the public disclosure bar and theoretically allowed more qui tam cases to move forward, although courts have struggled with the statute’s meaning. (United States ex rel. Judd v. Quest Diagnostics Inc., No. 14-3156 (3d Cir. Aug. 26, 2015)

It is difficult to predict how the repeal of the ACA will change FCA jurisprudence on these aspects of the law given their implementation over the past six years and the way they have been dealt with by courts since the law was passed.

Robert B. Vogel, MD, JD
Retinal Ophthalmologist at Piedmont Eye Center, Lynchburg VA;
Attorney, Overbey Hawkins & Wright, PLLS, Lynchburg, VA;
Adjunct Professor, Humanities and Bioethics, Liberty University School of Medicine, Lynchburg, VA.


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