U.S. ex rel. Orgnon v. Chang — Feb. 2016 (Summary)

FALSE CLAIMS ACT

U.S. ex rel. Orgnon v. Chang
No. 3:13-cv-144-JAG (E.D. Va. Feb. 19, 2016)

The United States District Court for the Eastern District of Virginia granted a physician group practice’s motion to dismiss with prejudice, but denied the motions to dismiss filed by a physician and a health system, in a False Claims Act suit brought against them. The suit was brought by a medical coder and a physician who alleged that the defendants submitted false claims to federal and state agencies for unnecessary breast exams, which the agencies paid because the physician defendant falsely indicated the patients’ presenting problems. In dismissing the claims against the group practice where the physician defendant previously worked, the court determined that no facts were alleged indicating that the group practice had actual knowledge of the allegedly false billing practices. On the other hand, the court declined to dismiss the claims against the health system, finding that all elements of a False Claims Act claim were alleged, including that the health system had actual knowledge of the fraudulent conduct since they had performed an investigation into the conduct. The court, similarly, concluded that the claims against the physician defendant could proceed.