In an eagerly awaited ruling, the First Circuit on Tuesday said a major avenue for False Claims Act civil enforcement requires proof that kickbacks directly changed treatment decisions, a holding that creates a lopsided circuit split as well as significant challenges for the U.S. Department of Justice and the plaintiff’s bar.
At issue was a 2010 amendment, included in the Affordable Care Act, that said billing claims “resulting from” kickbacks are false under the FCA, which threatens triple damages and enormous penalties for every individual claim deemed false. Tuesday’s opinion, authored by U.S. Circuit Judge William J. Kayatta Jr., agreed with Regeneron that “to demonstrate falsity under the 2010 amendment, the government must show that an illicit kickback was the but-for cause of a submitted claim.”