Private enforcement

Causes of action

What private causes of action may citizens or other private bodies bring to enforce a healthcare regulation or law?

The federal False Claims Act (31 USC section 3729, et seq) (FCA) and state law equivalents allow a private citizen (called a relator or whistle-blower) to file suit on behalf of the United States. FCA claims typically allege that another person or entity has submitted false claims to the federal government (or state government, if the suit is filed under a state false claims provision). These suits are referred to as qui tam actions. In FCA qui tam cases, the federal government, represented by the US Department of Justice (DOJ), may decide to take over (or intervene in) the suit or decline to intervene. In the latter circumstance, the whistle-blower may still proceed to litigate the suit on behalf of the United States. In addition to intervening or declining to intervene, the United States can also move to dismiss qui tam cases. The United States may elect to dismiss a matter, for example, where it believes that a qui tam action has the potential to create undesirable legal precedent.

Framework for claims

What is the framework for claims of clinical negligence against healthcare providers?

There are no federal laws that establish the framework for a clinical negligence claim. Such claims are typically filed under state law. Each state, in turn, has its own legal framework for negligence claims, but such claims typically include the following elements: (1) the provider owed a professional duty to the patient; (2) the provider breached that duty; (3) the breach caused an injury to the patient; and (4) resulting damages. If a plaintiff is successful in a negligence claim, the amount of damages to be awarded is decided by the finder of fact (often a jury), but legal limits may apply. Providers, in turn, typically carry malpractice insurance to help pay for the cost of defending (and, if applicable, losing) such claims.

Seeking recourse

How and on what grounds may purchasers or users of pharmaceuticals or devices seek recourse for regulatory and legal infringements?

A private individual who purchases or uses a drug or device and wants to seek recourse for regulatory or legal infringements can file a complaint or report relating to the product (eg, an adverse event report) or its labelling (eg, regulatory misconduct report) with the US Food and Drug Administration (FDA), a state regulatory agency or attorney general. A private individual (sometimes referred to as a whistle-blower or relator) may also file a qui tam suit under the federal False Claims Act (31 USC section 3729, et seq.), asserting claims on behalf of the United States. Healthcare providers that purchase and use drugs or devices on patients may also report adverse events or regulatory misconduct to the FDA.

Compensation

Are there any compensation schemes in place?

DOJ administers three compensation programmes, each applicable in very specific circumstances and created by different pieces of legislation: the National Childhood Vaccine Injury Act of 1986, the Radiation Exposure Compensation Act and the James Zadroga 9/11 Health and Compensation Act of 2010.

Class and collective actions

Are class actions or other collective claims available in cases related to drugs, devices and provision of care?

Class actions are not used in governmental enforcement proceedings but may be pursued by private parties (called plaintiffs). To proceed on behalf of a class, a plaintiff must show that the case turns on common issues of fact and law that affect numerous similarly situated claimants, but can be resolved for all claimants through common proof, without requiring individualised findings. Examples of drug, device or healthcare class actions include patient claims that the cost of drugs or care was improperly inflated due to regulatory violations, or shareholder claims that non-disclosure of regulatory violations inflated share prices. Insurers and patients often bring antitrust class actions claiming that wrongful enforcement of pharmaceutical patent rights excludes competitors and inflates drug prices. Conversely, claims alleging harm from defective drugs or devices typically require patient-specific proof of injury and are not pursued as class actions.

Review

Are acts, omissions or decisions of public and private institutions active in the healthcare sphere subject to judicial or administrative review following a complaint from interested parties?

Not applicable.

Whistle-blowers

Are there any legal protections for whistle-blowers?

The federal False Claims Act (31 USC section 3729, et seq) includes a provision that protects whistle-blowers (also called relators) who are employees, contractors or agents of the entity against which they have filed a qui tam action from retaliation by that entity. The Dodd-Frank Wall Street Reform and Consumer Act and the Sarbanes-Oxley Act also protect whistle-blowers who report potential wrongdoing by public companies. State law equivalents, which vary by jurisdiction, may include similar provisions.

Does the country have a reward mechanism for whistle-blowers?

The federal False Claims Act (31 USC section 3729, et seq) awards whistle-blowers (also called relators) a percentage of amounts recovered by the United States as a result of the qui tam action. If the United States declines to take over (or intervene in) the suit, the whistle-blower may still proceed with the suit on behalf of the United States, and, in such cases, is entitled to between 25 and 30 percent of any recovery. If the United States does intervene, the whistle-blower’s share is between 15 and 25 per cent. State law equivalents to the federal False Claims Act may include similar provisions. The Dodd-Frank Wall Street Reform and Consumer Act also provides awards to whistle-blowers.

Are mechanisms allowing whistle-blowers to report infringements required?

Generally speaking, healthcare companies and providers are not required by law to provide mechanisms that allow whistle-blowers to report infringements. It is nevertheless considered to be best practice from a compliance perspective (and it is strongly recommended by relevant regulatory agencies) that healthcare companies and providers establish hotlines or other mechanisms that allow employees or other whistle-blowers to anonymously report compliance concerns or violations.

Law stated date

Correct on

Give the date on which the information above is accurate.

14 August 2020.