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First three steps when business is accused of an FCA violation

Those who receive notification of a False Claims Act (FCA) violation are wise to take the matter seriously. The United States Department of Justice (DOJ) is known to aggressively pursue these allegations and, if possible, will push for criminal charges. In a recent example, the feds were able to build a case against 15 Texas doctors. The feds built such a strong case that the physicians, when faced with the evidence, decided it best to settle the matter for almost $3 million and move on.

The case serves as a reminder to take the allegations seriously. But what does that mean? What should a healthcare professional do when faced with these allegations? The following three steps are generally the best initial course of action.

#1: Review the FCA

Allegations of a violation of the FCA essentially mean the government believes your business filed for false payment. A common example are allegations a physician practice billed Medicare for medically unnecessary services or procedures.

The penalties for a violation are harsh. If the government can build a successful case, the business would need to pay a civil penalty that ranges from $5,000 to $10,000 for each violation in addition to treble damages. Treble is a legal term that basically means triple the government’s damages. As we saw in the example noted above, these penalties can quickly add up to large amounts.

The government generally needs to establish that the accused intentionally defrauded the government. The court will require the government establish this “knowing” element, which is defined broadly to include one of the following:

  • Actual knowledge.
  • Deliberate ignorance of the truth or falsity of the information.
  • Reckless disregard of the truth or falsity of the information.

These types of cases can result from a government audit or from a qui tam, or whistleblower, case.

#2: Review the allegations

It is important to review the government’s claims. Gather applicable evidence to help build a defense to the allegations, such as patient records.

#3: Get help

This is a very complex law. Lawmakers have amended the law many times since its original enactment in 1863. Federal courts have issued conflicting interpretations of the application of the statute. It is generally best to take steps to protect your business’ interests by hiring a professional who is experienced with fighting back against these types of claims.

Attorney John Rivas is responsible for this communication