Federal courts continue upholding sampling tactic in FCA actions

A federal court this week upheld the tactic of using “statistical samples” to prove alleged False Claims Act violations, echoing other recent decisions in similar whistleblower complaints.

The U.S. District Court for the Middle District of Florida on Tuesday told Consulate Health Care (formerly La Vie Rehab) that it could not block the use of statistical sampling as evidence that it allegedly upcoded claims for rehabilitation services in 53 skilled nursing facilities, according to Bloomberg News.

A former La Vie employee told the court she had witnessed “flagrant upcoding” of Medicare, Medicaid and TRICARE claims at La Vie facilities when she worked at two locations in 2011.

Statistical sampling involves taking a “representative sample” of submitted claims alleged to be upcoded and comparing them to the total amount of claims submitted during the time period when infractions were said to occur.

Two similar cases last year also resulted in courts sanctioning the use of statistical sampling. In April, a federal appeals court ruled that a government contractor may justifiably calculate the amount a provider owes for Medicare overpayments by conducting a limited audit and then extrapolating from those findings. And in October, a high-profile False Claims Act case against Life Care Centers of America involving alleged unnecessary therapy billing also endorse the practice.