Monthly Archives: January 2016

A Fair Competition Theory of the Civil False Claims Act

On December 4, 2015, the Supreme Court granted certiorari in Universal Health Services v. United States ex rel. Escobar, a fraud case that may reshape the future of $1.9 billion of annual healthcare fraud recoveries in the United States. Julio Escobar and Carmen Correa lost their daughter to a seizure while she was under the care of Universal Health Services.  Escobar and Correa subsequently learned that the staff caring for their daughter were not licensed or certified.  They filed a whistleblower action under the False Claims Act alleging that Universal Health had defrauded the government, which had paid for their daughter’s medical care.  Federal courts have expressed uncertainty as to whether Universal Health’s behavior legally constitutes fraud.  For example, one court has held that lying about a supervising physician’s credentials does not constitute fraud, while another court has held that lying about a physician provider does constitute fraud under the statute.  The Supreme Court’s decision may help clarify the presently convoluted fraud analysis.

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