The Department of Justice (“DOJ") announced in a Dec. 3 press release that it obtained more than $3.5 billion from False Claims Act (“FCA”) cases in FY 2015, $2.8 billion of which was recovered in whistleblower lawsuits filed under the qui tam provisions of the FCA, and $1.9 billion of which was recovered from healthcare companies and providers in cases alleging medically unnecessary or inadequate services, the payment of illegal kickbacks in exchange for referrals, or overcharging for goods and services paid for by federal health care programs. 

Significantly, one of the biggest hauls in 2015 came in a case where the government declined to intervene. In June 2015, a federal judge in Texas entered a $663 million judgment against the manufacturer of a highway guardrail safety system in a non-intervened FCA case alleging that the company sold its guardrails to the government without disclosing changes made in 2005. The judgment represented a trebling of the jury’s $175 million verdict, plus an additional $138 million in civil penalties of $8,250 for each of the 16,771 false certifications the company made in connection with claims for payment. 

As this case makes clear, declination by the government no longer signals victory for FCA defendants. Given the growing confidence and sophistication of relators’ counsel and the increasingly mammoth recoveries being obtained in FCA cases, one can expect a continued surge not only in the filing of whistleblower suits, but in the prosecution of those cases even in the absence of DOJ intervention. 

The DOJ’s press release also reinforces that although total recoveries may be down from 2015, health care fraud remains fertile ground for both qui tam and non-qui tam FCA lawsuits.