Annals of Health Law
READY OR NOT
requirement by removing both the “to get” and “by the government”
language from Section 3729(a)( 2) (now § 3720(a)( 1)( B), as amended). 187
Consequently, FERA replaced the intent requirement with a lesser
“materiality” requirement. Now, all that is required to fall within the
bounds of the FCA’s reach is for one to “knowingly make, use, or
cause to be made or used a false record or statement material to a false or
fraudulent claim.” 188 “Material” is now statutorily defined as “having a
natural tendency to influence, or be capable of influencing, the payment or
receipt of money or property.” 189 So, as applied to a provider submitting
false quality data to satisfy VBP requirements, the FCA would introduce
liability risks if the claim-related information provided to CMS was
material to claim reimbursement to earn an incentive payment (or to avoid
negative reimbursement adjustment).
The materiality provision’s reach is all-encompassing: quality data
submitted to CMS to satisfy the requirements of the government’s VBP
programs would always be “material” to the reimbursement since the
quality data’s purpose is to determine the provider’s reimbursement.
Moreover, the data submitted would routinely meet the materiality standard
pursuant to the statute as such information would always “tend to
influence” and would otherwise always be “capable of influencing” the
government’s decision to reimburse the provider.
2. FERA Expands Provider Overpayment Obligations for FCA “Reverse
As noted, CMS has announced that audits of provider records will be
conducted to ensure that payments were legitimately earned. 190 In fact, in
its 2012 Work Plan, the OIG set forth a new auditing agenda that includes a
focus on overpayments of Medicare inpatient and outpatient
reimbursements to acute care hospitals. The Work Plan states that the
Providers, Pepper Hamilton LLP (June 30, 2009), available at
187. Rhoad, supra note 91, at 6; Nadler, supra note 91, at 30. This left what the Allison
Engine Court cautioned is tantamount to an “almost boundless . . . all-purpose antifraud
statute.” 533 U.S. at 669, 672.
188. § 3729(a)( 1)(G) (emphasis added).
189. § 3729(b)( 4); see also New False Claims Act Amendments Strengthen Significant
Impact Health Care Entities and Their “Obligations” Regarding Overpayments, CROWELL
MORING LLP (May 28, 2009), available at http://www.crowell.com/
NewsEvents/AlertsNewsletters/all/New-False-Claims-Act-Amendments-Significantly-Impact (explaining “[a]lthough ‘materiality’ has long been considered an implied
requirement to establish FCA liability by most courts, this statutory change now inserts the
requirement into the black letter law itself.”).