HEALTHCARE
FRAUD & ABUSE
REVIEW 2021
10TH ANNUAL
A LOOK BACK … A LOOK AHEAD
ISSUES TO WATCH
NOTEWORTHY SETTLEMENTS
FALSE CLAIMS ACT UPDATE
STARK LAW/ANTI-KICKBACK STATUTE
MANAGED CARE/MEDICARE ADVANTAGE
PHARMACEUTICAL AND MEDICAL DEVICE DEVELOPMENTS
APPENDIX — 2021 NOTABLE SETTLEMENTS
ABOUT BASS, BERRY & SIMS
1
3
7
11
33
38
40
43
79
Hospitals and Health Systems
Hospice and Home Health
Skilled Nursing Facilities and Nursing Homes
Pharmaceutical and Device
Pharmacy Services
Laboratory, Pathology, Radiology and Diagnostics
Behavioral Health and Substance Abuse Treatment
Specialty Care and Other Provider Entities
Individual Providers
Other
HEALTHCARE FRAUD & ABUSE REVIEW 2021 BASS, BERRY & SIMS | 1
tam lawsuits under the False Claims Act (FCA) has continued to drive civil enforcement,
and the U.S. Department of Justice’s (DOJ) strike force model has been the main driver of
the government’s criminal enforcement efforts.
During 2021, we marked the 35th anniversary of the 1986 amendments to the FCA, which
reinvigorated that Civil War-era statute after a long period of dormancy. Over the last
10 years, the government has recovered more than $25 billion in civil fraud settlements
and judgments involving the healthcare industry, including $5 billion in FY2021.1 For their
part, qui tam relators have received nearly $4 billion in relator share payments, including
more than $200 million in FY2021, as a reward for their efforts in bringing healthcare
industry-related FCA lawsuits on behalf of the government during that same time period.
We also marked the fifth anniversary of the Supreme Court’s landmark decision in Universal
Health Services v. U.S. ex rel. Escobar.2 In that pivotal case, the Supreme Court addressed
the FCA’s materiality requirement, describing it as rigorous and demanding, and set forth
a number of nonexclusive considerations to guide the materiality inquiry. Those important
considerations primarily focus on the government’s actual conduct with respect to payment
of purportedly false claims.
Five years later, the Court’s discussion of materiality continues to have a profound impact
on the manner in which FCA allegations are pleaded in complaints, investigated by the
government and litigated by parties. The Court’s opinion has also been the impetus of
efforts to amend the FCA because of the
perception by certain lawmakers that
Escobar “has made it all too easy for
fraudsters to argue that their obvious
fraud was not material simply because
the government continued payment.”
3
No doubt, healthcare providers defending
against creative theories of FCA liability
urged by relators or the government where
the conduct at issue seemingly has had
little or no impact on the government’s
reimbursement decisions would disagree
with that sentiment.
Beyond the FCA’s materiality requirement,
key FCA issues – particularly those
involving FCA pleading standards and
the requirement of pleading and proving
1 https://www.justice.gov/opa/press-release/file/1354316/download; https://www.justice.gov/opa/pr/
justice-department-s-false-claims-act-settlements-and-judgments-exceed-56-billion-fiscal-year. During
that same time p eriod, the gove rnment has recove red more than $37 bi llion in total civi l fraud enforceme nt
settlement s and judgment s, includin g $5.6 in FY2021 .
2 https://www.law360.com/articles/1396615/where-fca-litigation-stands-5-years-after-escobar.
3 https://www.grassley.senate.gov/news/news-releases/senators-introduce-of-bipartisan-legislation-to-
fight-government-waste-fraud.
A LOOK BACK …
A LOOK AHEAD
We are pleased to bring you our 10th annual Healthcare Fraud
and Abuse Review. We began the Review a decade ago with
the intention of providing comprehensive coverage of the most
significant civil and criminal enforcement issues facing healthcare
providers each year. During that time, we have endeavored
to cover key enforcement initiatives, analyze important case
developments and document healthcare fraud settlements
across the industry and to present those topics in a readily
digestible format for our readers.
While the healthcare industry has dealt with a decade of unprecedented change and
challenges, the government’s healthcare fraud enforcement efforts have remained
consistent. To be sure, areas of enforcement focus have shifted from time to time in order
to address public health crises, fraud vulnerabilities within the healthcare industry or the
need to prioritize resources. But the foundation has remained the same. The filing of qui
The filing of qui tam
lawsuits under the False
Claims Act has continued to
drive civil enforcement, and
the U.S. Department of
Justice’s strike force model
has been the main driver of
the government’s criminal
enforcement efforts.
