Health Care Fraud Enforcement in 2018, and 2019 Predictions

Two years into the Trump administration, the federal and state governments continue to affirm their commitment to ferreting out health care fraud. In fact, in fiscal year 2018, the U.S. Department of Justice obtained $2.88 billion in settlements and judgments from civil fraud and False Claims Act cases. Of this, over $2.5 billion (i.e., almost 90 percent) was generated from health care-related matters with qui tam relators remaining the principal driver of the DOJ’s FCA enforcement efforts. A review of 2018 trends in health care fraud enforcement will serve as a significant predictor of the ongoing and potentially new DOJ policy initiatives for 2019. …

DOJ Continues to Shift Department Policy Due to Granston and Brand Memoranda

Two significant guidance documents were made public in 2018 that suggest how the DOJ has, and will be, reevaluating its policy on two key areas of enforcement actions under the FCA. …

DOJ Remains Focused on Individual Accountability in Corporate Investigations, But Differentiates Between Criminal and Civil Cases

In a November 2018 speech, Deputy Attorney General Rod Rosenstein announced changes to the DOJ’s policy concerning individual accountability in corporate cases, which had most recently been addressed in the September 2015 memorandum issued by then-Deputy Attorney General Sally Yates.[6] While reiterating the DOJ’s commitment to pursuing individual accountability, the newly announced revisions indicate that the DOJ seeks to ease away from some of the strict rules on cooperation credit introduced by the Yates memo, and grants prosecutors some flexibility in resolving civil and criminal enforcement matters. …

Focus on Liability of Institutional Owners and Board Members

Last year also saw cases emerge in which the federal government has taken action against not only members of the senior management team but also members of boards of directors and institutional investors (e.g., private equity firms). In addition to DOJ attorneys, some courts have demonstrated comfort in subjecting private equity stakeholders and boards of directors to potential liability under FCA causes of action. …