The US Department of Justice (DOJ) Antitrust Division issued a Business Review Letter (BRL) on January 15 in response to a proposal by the American Optometric Association (AOA) and AOAExcel GPO, LLC to expand their group purchasing arrangement. The AOA includes approximately 27,000 doctors of optometry (plus optometry staff and students) who compete with one another and nonmember optometrists and ophthalmologists to provide optometric services. AOA members also compete with other retail and online stores and vertically integrated providers who offer optometric products. In an effort to help their members better compete with these online and retail stores and vertically integrated manufacturers, the parties plan to expand their group purchasing arrangement to include optometric products for resale to customers. The proposed expansion would cover optometric products including eyeglass lenses and frames and contact lenses. The DOJ, in reviewing the details of the proposal, concluded that it presently does not intend to challenge the parties’ group purchasing arrangement in light of certain competitive safeguards within the structure of the expanded arrangement.
In this LawFlash, our white collar litigation and government investigations team unpacks the fiscal year 2019 False Claims Act (FCA) recovery statistics recently announced by the US Department of Justice. At $2.6 billion in recoveries, 2019 marked the 10th consecutive year that healthcare industry recoveries exceeded $2 billion. To that end, the team addresses the largest recoveries involving healthcare and notes that “enforcement, mostly driven by qui tam filings, remains robust.”
We hosted a very informative Fast Break session last week on complex FCA issues. If you weren't able to join, the session was led by Katie McDermott and Matt Hogan, who are both authorities in False Claims Act (FCA) litigation. Understanding the complex dynamics for dealing with both the US Department of Justice (DOJ) and qui tam relators, Katie and Matt led us through the minute details of relator litigation, declined qui tams, and partial interventions, just to name a few things.
Among the overarching issues we discussed, coming on the heels of the US Supreme Court’s Cochise decision, is the Court’s seemingly renewed interest in the FCA and the possibility of statutory amendments to the FCA to balance out many of the, as Katie termed it, “procedural inequities” that now exist when a healthcare organization is an FCA defendant. Katie and Matt also discussed recent DOJ pronouncements about their FCA enforcement procedures and priorities, highlighting that the FCA remains the most significant overarching risk area for healthcare stakeholders.
We had a really fun and insightful edition of our Fast Break webinar series in June. If you didn’t get a chance to join in, the session featured Jonelle Saunders and Jake Harper discussing recent compliance guidance issued by the US Department of Justice (DOJ). Jonelle explained the reasons why the DOJ issued the guidance, how the guidance works, and some practical tips for healthcare providers in assessing their own compliance programs. The guidance can have a major impact on settlement dynamics for defendants in False Claims Act (FCA) cases and other matters, so it is important to understand the DOJ’s thinking on compliance.
We finally got to appear on camera for this Fast Break, which was an interesting experience (although a little more nerve-wracking than usual). It gave us the chance to better interact with our attendees, who asked some great questions on the topic.
Did you catch our most recent edition of Fast Break? If not, we had an awesome extended session with Michele Buenafe on May 16 that was also part of our annual Technology May-rathon series. Michele described how the FDA is treating various types of software and hardware that may have healthcare functions as well as certain clinical decision support systems. Michele discussed some of the new and innovative ways that the FDA is trying to regulate—perhaps with a lighter hand—various AI and software systems that have historically had challenges with FDA oversight.
DOJ’s enforcement policy for the False Claims Act (FCA) has largely been static for 30 years or maybe since the forgotten 1998 Holder memo that set out guidelines to assure the FCA was not recklessly deployed for provider billing mistakes. In the last year or so, however, the policy guidance has been astonishing, insightful, and suggests a new attitude is afoot. First, we had the popularly described “Granston Memo” in 2018 on the criteria for seeking dismissal of declined whistleblower suits, which is now part of the Justice Manual and, in fact, there has been an increase in DOJ dismissals as there should be in this practice area.
In its updated guidance issued on Tuesday, the US Department of Justice Criminal Division places effectiveness at the epicenter of its factors to be utilized when evaluating a company’s compliance program in the context of a criminal investigation.
The US Department of Justice (DOJ) published updated guidance on April 30 on factors prosecutors should consider when analyzing the effectiveness of a corporate compliance program to prevent or detect fraud and other misconduct. The “Evaluation of Corporate Compliance Programs” updates guidance previously released on February 8, 2017, and provides companies with increased clarity on the government’s evaluation of corporate compliance programs.
This is the first formal guidance issued by the DOJ’s Fraud Section since the confirmation of the new US Attorney General.
In recent remarks, Assistant US Attorney General Brian A. Benczkowski emphasized that the US Department of Justice remains serious about fighting corporate fraud and corruption, and noted that transparency in its criteria for prosecution is a key tool for both DOJ and private sector companies. Stressing the importance of effective compliance programs, he noted that companies are more likely to implement such programs when it is clear what conduct DOJ will credit or penalize.
The Federal Bar Association's Qui Tam Section held a terrific two-day conference in Washington, DC, on February 28 and March 1, attended by over 200 False Claims Act (FCA) practitioners presenting government, defense, and relator perspectives on current FCA practice. Shout-out to our litigation partners Wendy West Feinstein and Rebecca Hillyer who participated on a panel discussing the FCA and opioids and other pharmaceutical products, and our colleagues Katie McDermott and Jonelle Saunders who attended the program.