November 01, 2015 Health Law

The FCA and Fraudulent Opinions of Medical Necessity

The courts have recognized False Claims Act (FCA) liability for submitting medically unnecessary claims under Medicare or Medicaid in certain situations, including where it can be proven that the defendant submitted a claim for a medically unnecessary item or service when the defendant knew those items and services were not medically necessary or where the defendant knowingly falsified medical records to make a medically unnecessary item or service appear medically necessary. However, the courts have generally concluded that claims based on nothing more than mere disagreement or second-guessing of a physician’s good faith and reasonable determination of medical necessity is not actionable. These courts reason that because the FCA requires a knowingly false statement of an objectively verifiable fact, a medical opinion on which physicians may reasonably disagree cannot give rise to liability. However, the pleading and proof requirements for these actions are not entirely settled, and the case law is not entirely consistent. This article examines key court decisions in this area.

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