Akin Gump Defeats False Claims Act Suit Alleging Medicare Advantage Fraud, Illegal Retaliation

(Washington, D.C.) – A team from Akin Gump obtained a dismissal of a False Claims Act (FCA) qui tam suit against CoxHealth in the United States District Court for the Western District of Missouri.

The case against Cox, a large health system operating in southern Missouri, was brought by a physician formerly employed by the company who alleged it had defrauded the Medicare Advantage (MA) program and unlawfully retaliated against him by not renewing his employment contract when he questioned the purported unlawful activity.

MA pays health plans a per-member, per-month base payment that can be enhanced if the patient is diagnosed with specific medical conditions that demonstrably increase the costs of care. The former employee (the relator) argued that Cox paid “kickbacks” to physicians to induce them to perform no-cost preventive care examinations of patients in the hope that the physician would diagnose the patient with a condition that would thereby increase payment.

The district court accepted Akin Gump’s argument that, unlike traditional Medicare, MA does not generally prohibit preventive care exams (and, in fact, encourages them) and no kickbacks were paid in violation of the Medicare Anti-Kickback Statute because MA does not compensate Cox or the physician for providing the preventive care exam. The court also concluded that, since Cox engaged in lawful conduct, it could not have known the relator was engaging in protected activity to advance an FCA action when he merely questioned what Cox knew to be lawful conduct.

The Akin Gump team was led by health care and life sciences partner Robert Salcido. He was joined by senior counsel Catherine Creely and associate Maureen McDonald.

Akin Gump Strauss Hauer & Feld LLP is a leading international law firm with more than 1,000 lawyers and advisors in offices throughout the United States, Europe, Asia and the Middle East.

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