Wednesday, January 17, 2018

Judge Overturns $350 Million Judgment Against Nursing Home

Lilly Hummel

Earlier this month a judge overturned a judgment of approximately $350 million in a False Claims Act case where a relator, which is a person who brings a lawsuit on behalf of the government, accused a nursing home operator of upcoding and failure to maintain care plans. See United States ex rel. Ruckh v. Rehabilitation, M.D.Fla. No. 8:11-cv-1303-T-23TBM, 2018 U.S. Dist. LEXIS 5148 (Jan. 11, 2018). 

A Florida federal judge found there was not evidence that the government would have declined payment if aware of alleged billing violations. He concluded that the “defendants argue persuasively that the relator failed to offer evidence of materiality, defined unambiguously and required emphatically by Universal Health Services, Inc. v. Escobar, 136 S. Ct. 1989 (2016). 

The court explained that the fact that the federal and state government continued to pay the defendants’ claims after learning of the allegations was fatal to the relator’s case.

This judgment continues a trend of courts taking the materiality requirements of Escobar seriously by looking at what the government did after it learned of the allegations underlying the alleged fraud. 

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