However, the only claims for payment identified in the second amended complaint are ones covered by Medicaid, a program administered by the Department of Health and Human Services through the Health Care Financing Administration. Therefore, only Medicaid regulations or requirements will be considered. Also, because federal funds are disbursed through state Medicaid programs, statutes and regulations governing state programs are pertinent. To obtain funding, a state must have a plan for medical assistance. Each state must have a fraud detection program, and the state plan must provide for exclusion of persons who have committed fraud or abuse.
Abuse means provider practices that are inconsistent with sound . . .
The Court finds no merit in CPC's arguments that it could not knowingly violate such vague standards. FCA cases cited by the government involving contractors who furnished inferior goods are inapposite, but they provide a useful analogy. In the Court's view, however, a problem of measurement should not pose a bar to pursing an FCA claim against a provider of substandard health care services under appropriate circumstances. The Court declines to hold that these allegations, if proved, cannot form the basis of an FCA claim. CPC provides no legal authority for its argument that the Medicaid program's internal enforcement scheme is the government's exclusive remedy when a provider fails to meet appropriate quality of care standards.