Department of Justice Recovers $2.2 Billion in False Claims Act Recoveries for 2022
The healthcare and life science industries should be aware of the recent increase in False Claims Act (“FCA”) or “whistleblower” cases. In fiscal year 2022, the Department of Justice (“DOJ”) recovered $2.2 billion under the FCA. In 2021, the DOJ recovered approximately $5.6 billion.
The relatively low dollar recovery for 2022 should not be misread as a reduction in whistleblower cases. The total number of new qui tam matters filed across all sectors is on the rise. Moreover, while the DOJ may have recovered less money than in previous years, the DOJ settled cases more, noting that the government and whistleblowers were party to 351 settlements and judgments in 2022.
There was a drop in the number of new qui tam matters where Health and Human Services (“HHS”) is the primary client agency. However, between the Department of Defense and others, HHS is still the primary client agency with the most filings of new qui tam matters, all in the health care sector.
Additionally, FCA settlements in healthcare maintain the highest dollar amounts per case. Money recovered from the healthcare sector comprises 80%, or $1.8 billion, of FCA recoveries for 2022.
The DOJ’s healthcare recoveries stem from a myriad of scenarios. One of the DOJ’s noted priorities is unnecessary services and substandard care. Of note is a recovery of $2.05 million from a pharmacy to resolve allegations that it submitted false claims for prescription medications which the pharmacy switched from lower cost to higher cost medications without documented need and/or valid prescriptions. Additionally, the DOJ has focused on unnecessary drug testing. Unlawful kickbacks also continue to be a priority for the DOJ. Specifically, Biogen Inc., a drugmaker, settled for almost $900 million in September 2022 and resolved allegations that it increased product sales by disguising kickbacks to physicians as speaker honoraria, speaker training fees, consulting fees, and meals.
Health care sector qui tam cases continue to pose a risk of increased scrutiny and enforcement actions to providers as well as all stakeholders within the distribution chain.
How Frier Levitt Can Help
Frier Levitt defends stakeholders in the pharmaceutical distribution chain against government and whistleblower allegations. The firm helps clients avoid risky behavior that is subject to FCA scrutiny. We develop compliance plans and propose conservative arrangements consistent with the complex web of healthcare law. Take proactive measures and contact Frier Levitt to speak with an experienced healthcare regulatory attorney for more information or to arrange for a review of your practice’s current compliance plan.