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DOJ Cuts Bait in High-Profile Statistical Sampling FCA Case

On Thursday, AseraCare, a national hospice care provider, announced that it had settled a long-standing Medicare billing dispute with the DOJ, a case that has garnered nationwide attention in healthcare since 2008. At issue was statistical sampling, and the use of statistics to prove liability.

Statistical sampling is nothing new in FCA investigations, but these methods are typically used to establish damages. But in AseraCare, the Government was using statistical sampling to prove liability, i.e., that the claims submitted were actually false. The Government’s theory was only the first of many unusual aspects of this case, which included an actual trial (rare in FCA cases), later split into two distinct trials, with one focused on falsity and the other on knowledge of falsity, as well as the district judge remanding the case sua sponte after deciding that the jury instructions were in error.

AseraCare actually settled the case for $1 million—a far cry from the original $200 million sought by DOJ. The resolution is not only a win for AseraCare, but welcome news for hospice providers as well as healthcare providers across all aspects of Medicare. Chiefly important, while on appeal, the Eleventh Circuit squarely addressed the controversial issue of statistical sampling and held that this method—i.e., a difference of reasonable physician’s opinions regarding medical treatment—could not by itself establish liability.

The case is U.S. ex rel. Paradies v. AseraCare Inc. et al., 2:12-cv-00245, in the U.S. District Court for the Northern District of Alabama.

© Polsinelli PC, Polsinelli LLP in California

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Brian F. McEvoy, Polsinelli PC, Atlanta, white collar criminal defense lawyer, health care fraud matters attorney
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Brian McEvoy is an accomplished litigator with a well-earned reputation for working tirelessly to achieve the best outcomes for clients and for thinking creatively and strategically to resolve difficult problems with efficiency and professionalism. Brian is a former federal prosecutor with a practice focus on white collar criminal defense and a special emphasis in health care fraud matters. During his service as a federal prosecutor, he received special commendation from the Department of Health and Human Services by receiving the Inspector General's Integrity Award for...

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As a shareholder in the Government Investigations practice, Brian Rafferty leverages a distinguished background serving as Chief of the Criminal Division of the United States Attorney’s Office for the Southern District of Georgia. In his more than ten years of experience as a federal prosecutor, Brian oversaw and managed some of the most high-profile and complex investigations in the Southern District of Georgia. Before his work as a federal prosecutor, Brian was a partner at white collar criminal litigation boutique in New York, where he represented individuals in government investigations.  Brian draws upon his deep understanding of the inner workings of enforcement authorities to represent clients facing regulatory and criminal enforcement actions. Leveraging his extensive experience and sound judgment, Brian constructs comprehensive strategies to defend entities and individuals facing government investigations and enforcement proceedings.

Brian focuses his practice on defending clients in a multitude of white collar defense, internal investigations and complex federal litigation matters. He provides prospective guidance to mitigate and ensure compliance with applicable state and federal laws and regulations. His work spans an array of industries with a particular focus on health care fraud, government contracting, and financial industries.

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When a client turns to William Ezzell, they can expect an attorney keenly focused on learning who they are and what they do. He is genuinely passionate about understanding the intricacies unique to each client’s business, and how they view the world from their perspective. William combines this passion with his diverse practice history to further a collective goal: the best possible outcome. As a member of the firm’s Government Investigations and White Collar Defense Group, William devotes the majority of his practice to representing companies and individuals faced with...

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