Entities that provide goods and services to the federal government, including health care providers and life sciences companies, should take note of the new civil monetary penalty amounts applicable to False Claims Act ("FCA") violations. After much anticipation, the U.S. Department of Justice ("DOJ") issued an interim final rule on June 30, 2016 confirming speculation that the penalty amounts will increase twofold.

The new minimum per-claim penalty amount will increase from $5,500 to $10,781, and the maximum per-claim penalty amount will increase from $11,000 to $21,563. The DOJ penalty increase mirrors the penalty spike announced by the U.S. Railroad Retirement Board ("Railroad Board") in May of this year and discussed in our previous blog post.

The new penalty amounts will take effect August 1, 2016 and will apply to all violations that occurred after November 2, 2015.  This November date was the date that Congress passed the Bipartisan Budget Act of 2015 (the "Act"), which is the legislation that requires federal agencies that handle FCA cases to update their penalty amounts to adjust for inflation.

After this first adjustment, the Act allows DOJ and other federal agencies to make additional annual adjustments to penalty amounts based on the Consumer Price Index for Urban Consumers (CPI-U). Guidance on these annual adjustments is slated to be issued by the Office of Management and Budget this December.

If you would like to comment on this interim final rule, you must act quickly as the deadline for comments is August 29, 2016.

This post was written with assistance from Olivia Seraphim, a 2016 Summer Associate at Epstein Becker Green.

Back to Health Law Advisor Blog

Search This Blog

Blog Editors

Authors

Related Services

Topics

Archives

Jump to Page

Subscribe

Sign up to receive an email notification when new Health Law Advisor posts are published:

Privacy Preference Center

When you visit any website, it may store or retrieve information on your browser, mostly in the form of cookies. This information might be about you, your preferences or your device and is mostly used to make the site work as you expect it to. The information does not usually directly identify you, but it can give you a more personalized web experience. Because we respect your right to privacy, you can choose not to allow some types of cookies. Click on the different category headings to find out more and change our default settings. However, blocking some types of cookies may impact your experience of the site and the services we are able to offer.

Strictly Necessary Cookies

These cookies are necessary for the website to function and cannot be switched off in our systems. They are usually only set in response to actions made by you which amount to a request for services, such as setting your privacy preferences, logging in or filling in forms. You can set your browser to block or alert you about these cookies, but some parts of the site will not then work. These cookies do not store any personally identifiable information.

Performance Cookies

These cookies allow us to count visits and traffic sources so we can measure and improve the performance of our site. They help us to know which pages are the most and least popular and see how visitors move around the site. All information these cookies collect is aggregated and therefore anonymous. If you do not allow these cookies we will not know when you have visited our site, and will not be able to monitor its performance.