FALSE CLAIMS ACT RULING — A recent federal court ruling could shake up how cases are handled under the False Claims Act, which is often used to combat fraud in Medicare and Medicaid. The bulk of False Claims Act cases are brought by whistleblowers. Last week, U.S. District Judge Kathryn Mizelle, an appointee of former President Donald Trump, found that the whistleblower provisions are unconstitutional. While the decision only applies to the case, it could set the stage for the end of whistleblowers’ power to assert such claims. Legal experts expect the case to wind its way to the Supreme Court, where several conservative justices have signaled interest in taking up the issue. Whistleblower-initiated cases bring in billions a year to the U.S. “Although an outlier, this decision is significant,” said Gregory Saikin, partner at law firm BakerHostetler. “If upheld, it will materially alter the health care fraud and abuse landscape. [Whistleblowers] are DOJ’s eyes and ears into a provider’s organization. Without an incentive to report abuses, the number of FCA cases will certainly decrease.” Gordon Schnell, a partner at Constantine Cannon who specializes in representing whistleblowers, is skeptical that the decision will survive on appeal, adding that the whistleblower program has strong support from the Justice Department and Congress. “As well-written as the decision is, it suffers from a fundamental misunderstanding,” Schnell said. “It assumes the FCA provides whistleblowers with complete independence and unfettered authority to litigate these cases on behalf of the government … that is not true. The government, [through the Justice Department], has ultimate control.” Even if the Supreme Court were to find the FCA unconstitutional, Schnell doesn’t expect any meaningful impact on the ability of whistleblowers to report fraud because Congress or the Justice Department would quickly address the issue. HELENE FALLOUT CONTINUES — The impacts of Hurricane Helene are still being felt across the Southwest with scores of people cut off from access to medication and health services, forcing federal officials to pull out all the stops on aid programs. This weekend, HHS activated a program for uninsured residents of Tennessee and North Carolina — which saw some of the biggest destruction from the storm — to get a free 30-day supply of medications from participating pharmacies. The program also covers medical equipment, including wheelchairs, blood sugar monitors and vaccinations. In North Carolina, a factory that makes IV fluid for most of the nation’s hospitals is still not online after being damaged in the storm. Baxter International, which owns the factory, said Friday it didn’t have a timeline for reopening and has limited how much medical supplies, including saline, can be ordered from their supply. The FDA has said it’s working closely with Baxter to tap into their other manufacturing plants to limit supply disruptions.
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