The Department of Justice has issued new guidance on how nursing facilities can obtain greater leniency in cases where they are accused of violating the False Claims Act.
Such claims have soared in recent years, with healthcare providers paying $2.5 billion in 2018. On Tuesday, the DOJ suggested that companies can decrease their damages by complying with prosecutors.
“False Claims Act defendants may merit a more favorable resolution by providing meaningful assistance to the Department of Justice — from voluntary disclosure, which is the most valuable form of cooperation, to various other efforts,” Assistant Attorney General Jody Hunt said in a statement.
Providers might earn leniency under the FCA, for instance, by cooperating with an ongoing investigation or undertaking remedial response measures after a violation has been issued. DOJ officials emphasized that nursing facilities would be rewarded for their participation, even after an inquiry has been launched. They also may receive extra credit by preserving relevant documents and information that goes beyond business practices or legal requirements, the DOJ noted.
Legal experts cautioned that providers are still likely to be forced to pay up, despite the added leniency, and that the benefits of cooperation are uncertain.
“It talks a lot about what cooperation is and isn’t, but it doesn’t talk very much about what you’re going to get,” Craig Margolis, a partner at Arnold & Porter Kaye Scholer, told Bloomberg. “The guidelines seem to assume that you’re still going to be a defendant and that you’re still going to eat a False Claims Act settlement in some form or fashion.”
The False Claims Act has become an increasingly pressing concern for skilled nursing operators. The number of determinations against healthcare institutions increased from 291 in 2008 to 506 last year. Big name industry providers such as Genesis and Signature have doled out payouts worth tens of millions of dollars for allegedly violating the act in recent years.
