Supreme Court issues decision in False Claims Act case

The Supreme Court today said the False Claims Act is not “an all-purpose antifraud statute” or “a vehicle for punishing garden-variety breaches of contract or regulatory violations.” In a decision in Universal Health Services Inc. v. United States and Massachusetts ex rel. Julio Escobar and Carmen Correa, the Court rejected the government’s and plaintiff’s expansive view that a case may be brought based on noncompliance with any requirement in statute, regulation or contract so long as the defendant knew the government could refuse payment were it aware of the violation. “As the Court recognized, hospitals and others who bill the government are ‘subject to thousands of complex statutory and regulatory provisions,’” said AHA Senior Vice President and General Counsel Melinda Reid Hatton. “The Court went on to impose a rigorous test to determine which of the myriad rules and regulations governing health care providers actually matter when the government decides to pay a claim. The FCA only comes into play when a rule or regulation actually matters.” AHA and others filed a friend-of-the-court brief in the case. AHA members today received a Special Bulletin with more information.