A federal appeals court has reversed an $11 million false claims judgment against diagnostic imaging company MedQuest Associates, ruling that its use of unapproved physicians to monitor patient tests and use of an outdated billing code did not equal Medicare fraud, according to a Thomson Reuters report.
The 6th U.S. Circuit Court of Appeals in Cincinnati reversed a ruling by a district court in Tennessee, which concluded in 2011 that Alpharetta, Ga.-based MedQuest had submitted false claims to Medicare. That decision was based on a whistleblower's 2006 lawsuit, which the Department of Justice later joined.
The complaint alleged that two MedQuest facilities in Tennessee allowed physicians who were not properly designated to monitor medical procedures and also continued to use the billing code for an individual physician after the company purchased his practice, according to the report.
The appeals court found MedQuest's "infractions" were unlikely to cause Medicare to deny claims for payment and would therefore not amount to claims under the False Claims Act, according to the report.
The panel said the "bluntness of the [False Claims Act's] hefty fines and penalties makes them an inappropriate tool for ensuring compliance with technical and local program requirements" such as the supervision requirement at issue in the case, according to the report.
The panel also said the requirements were not conditions necessary for payment, but rather to participate in the Medicare program. Thus, MedQuest's alleged actions do not merit a claim under the False Claims Act, according to the report.
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The 6th U.S. Circuit Court of Appeals in Cincinnati reversed a ruling by a district court in Tennessee, which concluded in 2011 that Alpharetta, Ga.-based MedQuest had submitted false claims to Medicare. That decision was based on a whistleblower's 2006 lawsuit, which the Department of Justice later joined.
The complaint alleged that two MedQuest facilities in Tennessee allowed physicians who were not properly designated to monitor medical procedures and also continued to use the billing code for an individual physician after the company purchased his practice, according to the report.
The appeals court found MedQuest's "infractions" were unlikely to cause Medicare to deny claims for payment and would therefore not amount to claims under the False Claims Act, according to the report.
The panel said the "bluntness of the [False Claims Act's] hefty fines and penalties makes them an inappropriate tool for ensuring compliance with technical and local program requirements" such as the supervision requirement at issue in the case, according to the report.
The panel also said the requirements were not conditions necessary for payment, but rather to participate in the Medicare program. Thus, MedQuest's alleged actions do not merit a claim under the False Claims Act, according to the report.
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