“The American Medical Association argues in its brief that imperfect compliance is not the same as fraud”

Healthcare organizations across the Country, including the American Medical Association, are joining the Supreme Court case Universal Health Services v. United States ex rel Escobar, the outcome of which could heavily impact the healthcare regulatory environment and its relation to the False Claims Act. The Supreme Court is charged with determining the validity of “implied certification”, a legal theory under the False Claims Act that has wavering recognition at the federal appeals court level. Implied Certification, often used by the government and whistleblowers, alleges that providers submit false claims by failing to follow certain regulations and as such are liable under the False Claims Act.

The AMA argues that, “the healthcare regulatory environment is especially complex, making it particularly inappropriate to use the hammer of (False Claims Act) liability to punish noncompliance.” On the other hand, many argue that implied certification is an important aspect of the False Claims Act because it holds healthcare organizations accountable for not completing necessary due diligence.

Provident will continue to monitor the outcome of the case. In the interim, healthcare organizations should review their compliance programs and policies and procedures to ensure providers are working within regulatory limitations.