On July 19, 2019, Myriad Genetics disclosed a $9.1 million settlement agreement to resolve a False Claims Act (FCA) qui tam lawsuit alleging that it engaged in a scheme to fraudulently bill Medicare for certain hereditary cancer tests.

Notably, the qui tam relator in the case was not a Myriad corporate insider, but rather a medical director for Palmetto GBA, the Medicare Administrative Contractor (MAC) responsible for overseeing the program through which Myriad’s tests are covered by Medicare.  In this way, the settlement illustrates the often overlooked risk that individuals other than conventional corporate whistleblowers—including even government employees or employees of government administrative contractors—may serve as FCA relators.


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There are a number of key issues that will drive the government’s enforcement efforts in the coming year and that will have a significant impact on how healthcare fraud matters are pursued by relators asserting FCA claims and are defended on behalf of healthcare providers.  In the previous weeks, we have examined these issues in greater depth and why healthcare providers should keep a close eye on these issues.  This week, we examine the Fourth Circuit’s upcoming appellate consideration of the use of statistical sampling to establish falsity under the FCA.

In 2014, the district court’s opinion in U.S. ex rel. Martin v. Life Care Centers of America rejected a motion to exclude the government’s expert testimony regarding the intended use of statistical sampling to establish liability over an extrapolated universe of claims.  Since that time, a number of other district courts have considered the issue of whether such evidence may be used to establish liability by either the government or relators.  See U.S. ex rel. Paradies v. Aseracare, Inc., 2014 U.S. Dist. LEXIS 167970 (N.D. Ala. Dec. 4, 2014) (denying motion for summary judgment and noting that “[t]he Government has statistical evidence regarding all of the Government’s universe of 2,181 claims. Statistical evidence is evidence.”); U.S. ex rel. Guardiola v. Renown Health, 2015 WL 5123375 (D. Nev. Sept. 1, 2015) (issuing discovery ruling regarding the underlying data universe relevant to relator’s use of statistical sampling); U.S. ex rel. Ruckh v. Genoa Healthcare, LLC, 2015 WL 1926417 (M.D. Fla. Apr. 28, 2015) (granting relator’s motion to admit expert testimony based on statistical sampling that had not been undertaken by relator as of the date of the motion).


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On October 16, 2015, Tuomey Healthcare agreed to pay more than $74 million to resolve a $237 million judgment in a long-standing FCA matter that had threatened to bankrupt the nonprofit hospital. The action, styled U.S. ex rel. Drakeford v. Tuomey Healthcare Systems, Inc., No. 05-2858 (D.S.C.), involved FCA allegations that Tuomey employed and