Overview
This issue of McDermott’s Healthcare Regulatory Check-Up highlights key regulatory and enforcement activity for March 2025. This month features:
- Noteworthy enforcement actions demonstrating that the Anti-Kickback Statute (AKS) remains a significant source of compliance risk.
- A proposed rule from the Centers for Medicare & Medicaid Services (CMS) that would materially modify various components of the Affordable Care Act (ACA) implementing regulations.
- A revised statement of organization from the Office of Inspector General (OIG) signaling potential changes in how the OIG Office of General Counsel engages in AKS and other enforcement and policymaking in the future.
Read below an overview for this month’s regulatory and enforcement activity roundup. For a deeper dive, subscribe to the newsletter to get our detailed analysis of all updates.
Click each heading below for a sneak peek of related content.
Notable Cases, Settlements, and Related Agency Activity
Jury Finds No Liability in “Usual and Customary” Pricing Case That Set SCOTS Scienter Standard
Fourteen years after the False Claims Act (FCA) case against Supervalu, Inc., was filed in the US District Court for the Central District of Illinois, a jury found that the plaintiffs had not proved damages to either the federal or state government caused by Supervalu’s pharmaceutical pricing system.
Clinical Research Facility Owners Plead Guilty to Conspiracy to Commit Wire Fraud
Two owners of a clinical research company in Florida that conducted clinical trials of prospective new drug treatments on behalf of drug sponsors seeking approval from the US Food and Drug Administration (FDA) pleaded guilty to conspiracy to commit wire fraud.
Providers, Lab Marketers Agree to Pay More Than $1.9 Million to Settle AKS Allegations
Four medical practices and a marketing company agreed to pay more than $1.9 million to resolve alleged violations of the federal FCA and AKS.
Medical Device Company Will Pay Up to $14.25 Million to Resolve Alleged FCA, State Law Violations Related to Vision Testing
A medical device company based in Pennsylvania agreed to pay up to $14.25 million to resolve allegations that it violated the federal FCA and various state laws by allegedly knowingly submitting, or causing others to submit, false claims for payment to Medicare and Medicaid in connection with certain vision testing services.
DC District Court Rejects Pharmaceutical Company’s Attempt to Limit AKS Scope
A pharmaceutical company lost at summary judgment in its challenge to an OIG advisory opinion in the US District Court for the District of Columbia.
CMS Regulatory Updates
CMS Publishes Marketplace Integrity and Affordability Proposed Rule
On March 10, 2025, CMS released its first proposed rule under the Trump administration, the Marketplace Integrity and Affordability Proposed Rule.
CMS Announces Second Round of Medicare Drug Price Negotiation Program
Beginning March 1, 2025, CMS will begin the second round of the Medicare Drug Price Negotiation Program, which gives Medicare the ability to directly negotiate the prices of certain drugs with manufacturers.
OIG Updates
OIG Issues FY 2024 Medicaid Fraud Control Unit Report
The annual report highlights OIG recovery actions in 2024. Highlights include 1,151 convictions for patient abuse and neglect and fraud; 1,042 individuals or entities excluded from federally funded programs; 493 civil settlements or judgments; and $1.4 billion recovered.
OIG Report: MACs Did Not Consistently Meet Medicare Cost Report Oversight Requirements
On March 18, 2025, CMS published the results of an audit that reviewed individual Medicare Administrative Contractors’ (MACs) compliance with the Medicare cost report oversight requirements for fiscal years 2019 through 2021.
OIG Report: Medicare, Medicaid Payments Are at Risk of Diversion Through Electronic Funds Transfer Fraud Schemes
On March 6, 2025, OIG published a report that found that Medicare and Medicaid payments are at risk of diversion through a scheme in which fraudulent actors pretend to be hospital providers and submit incorrect electronic funds transfer (EFT) information to MACs and state Medicaid programs.
HHS Office of General Counsel Issues Revised Statement of Organization Signaling Expansion of Authority
On March 14, 2025, the US Department of Health and Human Services (HHS) issued a revised statement of organization for the Office of the General Counsel (OGC).
Other Notable Developments
Proposed Massachusetts Laws Would Impact Healthcare Transaction Notice Requirements, PPM Structures
Three proposed laws would impact health transaction notice requirements in Massachusetts. All three of these laws were referred to the Senate and House committees for further consideration on February 27, 2025.
Health Plan Wins Ruling on $2 Billion in Alleged Medicare Overpayments
A health plan claimed a major victory on March 4, 2025, when a court-appointed special master found that DOJ did not have sufficient evidence to support a billion-dollar fraud case against the plan regarding overpayments for patients on Medicare Advantage plans.
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