Martin v. Hathaway, No. 22-1463 (6th Cir. 2023)
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The False Claims Act imposes civil liability for “knowingly present[ing], or caus[ing] to be presented, a false or fraudulent claim [to the government] for payment or approval,” 31 U.S.C. 3729(a)(1)(A). Individuals with knowledge of false claims may bring private qui tam lawsuits, on behalf of the government. The Act covers claims resulting from a violation of the Anti-Kickback Statute, 42 U.S.C. 1320a-7b(g), which prohibits medical providers from making referrals “in return for” “remuneration.”
Oaklawn Hospital is in Marshall, Michigan, which had two ophthalmologists. Oaklawn extended one of those doctors (Martin) a tentative offer to work at the hospital after hearing that the other doctor (Hathaway) planned to move his surgeries elsewhere. Hathaway told the hospital’s CEO that he wanted to continue working with Oaklawn and that Oaklawn hiring Martin would be the “death knell” of his practice. Oaklawn’s Board ultimately did not hire Martin.
Martin filed a qui tam action, alleging an illegal fraudulent scheme under the Anti-Kickback Statute and that claims for Medicare and Medicaid reimbursement resulting from the kickbacks violated the False Claims Act. The Sixth Circuit affirmed the dismissal of the suit, which essentially argued that Oaklawn’s rejection of Martin’s employment in return for Hathaway’s commitment to continue sending surgery referrals violated the Anti-Kickback Statute. The Martins have not plausibly alleged causation; the alleged scheme did not change anything. When Oaklawn decided not to establish an internal ophthalmology line, it simply left things where they were.
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