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Are Allegations of Lack of Medical Necessity in False Claims Act Cases a Basis for Settlement or Trial?

By Jacqueline C. Wolff

Health care fraud and False Claims Act cases continue to generate a significant source of funds for the Federal Government. During Fiscal Year 2017, the Federal Government won or settled over $2.4 billion in health care fraud judgments and settlements, most of which went into the Medicare Trust or Treasury.

Although, when announcing its focus, the government listed opioid pill mills, ambulance services and other high profile targets, a review of settlements in False Claims Act cases over the last year suggests other, less attention grabbing, targets; that is hospices, rehab services, acute care facilities, specialty labs and other providers dealing with particularly compromised patient populations where treatment options are not always clear. What these settlements often have in common is that the underlying complaints allege that the services that were rendered and reimbursed lacked medical necessity.

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