For The Defense, February 2012 - DRI Today
For The Defense, February 2012 - DRI Today
For The Defense, February 2012 - DRI Today
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Government Enforcement and Corporate Compliance<br />
In Search of a More<br />
Flexible Approach<br />
Uneven Practices<br />
in False Claims<br />
Act Settlements<br />
By Aaron M. Danzig<br />
How the OIG insists on<br />
onerous settlement terms<br />
and fails to consider<br />
its own guidance.<br />
In many cases, an accusation of misconduct under the<br />
False Claims Act (FCA) is a debilitating blow to a health<br />
care provider whether or not the provider actually violated<br />
the law. At best, an accusation will harm a provider’s rep-<br />
utation and generate significant legal fees.<br />
At worst, the government will exclude a<br />
provider from participating in federally<br />
funded health care programs, and depending<br />
on how much the provider relies on<br />
those programs, the provider potentially<br />
can lose its entire livelihood. <strong>For</strong> these reasons,<br />
many companies targeted by the U.S.<br />
Department of Justice (DOJ) and the U.S.<br />
Department of Health and Human Services<br />
Office of Inspector General (OIG) feel pressured<br />
to consent to settlement agreements<br />
rather than risk trials.<br />
Such settlement almost always includes<br />
a corporate integrity agreement (CIA)<br />
requiring a company to undertake onerous,<br />
expensive monitoring. A CIA generally<br />
requires a company to hire an independent<br />
monitor to ensure compliance over a<br />
period of time and to foot the bill. In rare<br />
instances, the OIG will agree to a certification<br />
of compliance agreement (CCA) in lieu<br />
of a CIA, which is generally less comprehensive,<br />
intrusive, and expensive. This article<br />
explores the OIG’s tendency to impose<br />
CIAs routinely on companies in FCA settlements<br />
and argues that the OIG should more<br />
flexibly consider other options including<br />
CCAs and settlements that don’t include<br />
specific compliance agreements at all.<br />
Most False Claims<br />
Act Cases Settle<br />
<strong>The</strong> FCA prohibits corporations from submitting<br />
false claims for reimbursement of<br />
services to the Medicare or the Medicaid<br />
programs. 31 U.S.C. §3729 (2010). <strong>The</strong> FCA<br />
includes a citizen lawsuit provision that<br />
allows whistleblowers to bring false claims<br />
allegations to the government’s attention;<br />
the government may choose to intervene<br />
or let the whistleblower continue with his<br />
or her lawsuit individually. 31 U.S.C. §3730<br />
(2010). <strong>The</strong> government also may choose<br />
to dismiss a lawsuit altogether. 31 U.S.C.<br />
§3730(c)(2)(A). However, the government<br />
has little incentive to do that, so it rarely<br />
happens. Sharon Finegan, <strong>The</strong> False Claims<br />
Act and Corporate Criminal Liability: Qui<br />
Tam Actions, Corporate Integrity Agree-<br />
■ Aaron M. Danzig is a partner in Arnall Golden Gregory LLP’s Litigation Group. From the firm’s Atlanta office, he chairs the<br />
Government Investigations and Special Matters Practice Team. His practice focuses on white collar criminal defense, internal<br />
corporate investigations, corporate compliance and governance matters, and business and intellectual property litigation. He is a<br />
member of <strong>DRI</strong> and its Government Enforcement and Corporate Compliance Committee.<br />
54 ■ <strong>For</strong> <strong>The</strong> <strong>Defense</strong> ■ <strong>February</strong> <strong>2012</strong>