Acting Assistant Attorney General Brian M. Boynton provided remarks on February 17, 2021 at the annual Federal Bar Association’s Qui Tam Conference. The remarks include the U.S. Department of Justice’s (DOJ) ongoing enforcement priorities related to the federal False Claims Act (FCA).
Mr. Boynton highlighted six areas of fraudulent conduct that DOJ will be particularly focused on.
Rightfully, the first priority Mr. Boynton highlighted was fraud related to the significant funds earmarked for COVID-19 pandemic relief. Congress has made $659 billion of relief available to the U.S. Small Business Administration (SBA) through the CARES Act and the PPP loan program. Eligible small businesses can access these funds to help weather the economic crisis brought about by the COVID-19 pandemic.
For those funds to be rapidly dispersed to needy businesses, red tape and other administrative safeguards were minimized, making the program ripe for fraudulent behavior. “The vast majority of the funds distributed under these programs have gone to eligible recipients. Unfortunately, however, some individuals and businesses applied for – and received – payments to which they were not entitled,” Boynton explained.
Boynton further explained that the FCA is the tool to combat this type of fraud, stating, “The circumstances of the current pandemic may be novel, but the inevitable fraud schemes it will produce will in many cases resemble misconduct that the False Claims Act has long been used to address.”
Our Atlanta whistleblower attorneys have received many reports of fraud against these federal programs. Undoubtedly, they will continue given the amount of money earmarked and the speed at which funds were disbursed.
The opioid crisis is not new, but it is certainly ongoing. As Boynton pointed out, ending in May of 2020, the U.S. recorded 81,000 overdoses, the highest number in a 12-month period the nation has seen.
As such, DOJ is focused on targeting pharmaceutical companies who market opioids using false statements, pay kickbacks to increase opioid prescriptions, and target providers who are prescribing opioids unnecessarily.
All such schemes that are liable under the FCA and have been fraudulent behaviors in the healthcare arena that the FCA has been used to combat for years.
Fraud Targeting Seniors
The DOJ is also prioritizing fraud against U.S. seniors who are a vulnerable patient group with high utilization of health care services. The focus is on fraud schemes that revolve around providing unnecessary or substandard care, and in some instances, no care at all.
Boynton highlighted that the DOJ has a number of ongoing cases and investigations focused on nursing homes providing substandard care to seniors.
Electronic Health Records
Another focal point of the DOJ’s enforcement priorities is fraud involving electronic health records, which are intended to streamline care delivery but can be abused.
For example, Boynton highlighted a recent case settled against athenahealth, Inc. In an 18.25 million dollar settlement, the U.S. alleged that athenahealth, a health records technology provider, paid kickbacks to help generate sales of its particular product. These kickbacks allegedly included paid trips to the Masters golf tournament, trips to the Kentucky Derby, and monetary lead generation fees to existing customers for referring new customers.
The FCA is the tool to combat violations of the anti-kickback statute in the healthcare industry as well as pharmaceutical companies who use these types of blatant kickbacks to increase prescriptions.
Because of the COVID-19 pandemic, the Centers for Medicare & Medicaid Services (CMS) has relaxed its regulations and guidelines related to telehealth visits. CMS expanded its utilization – and therefore Medicare’s reimbursement – for telehealth consultations.
The DOJ anticipates ongoing enforcement in this arena due to an increase in abuse. Boynton highlighted a recent settlement of a telehealth fraud scheme in which a Florida-based businesswoman pleaded guilty to criminal charges and agreed to a civil FCA settlement of $20.3 million for setting up dozens of durable medical equipment (DME) companies under fake names.
The companies allegedly submitted fake claims to Medicare and the VA after telehealth visits where doctors were being paid kickbacks to approve DME prescriptions. In these instances, no telehealth visit actually occurred.
Finally, Boynton stated that the DOJ anticipates seeing an increase in FCA enforcement in the arena of cybersecurity. Citing the increase in cyber attacks against federal government agencies, the DOJ anticipates an increased reliance on private cybersecurity as necessary to combat these attacks. This increases the possibility of federal agencies paying for more substandard cyber-security measures than what was promised or paid for.
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Mr. Boynton’s remarks on DOJ’s enforcement priorities have several themes. One, the COVID-19 pandemic is going to be a major focus. Both because of the billions of dollars of relief aid to small businesses and the way health care is being delivered during the pandemic.
Fraud against the SBA and similar programs to help small businesses will be a priority, as well as fraud that targets seniors in the form of fake telehealth visits. Second, technology and its increased use regarding health care data as well as the increased use of technology to safeguard federal agency data are ripe for the DOJ’s focus.