Physician Partners of America’s settlement highlights significant risks facing False Claims Act defendants who received Paycheck Protection Program funds.

An April 2022 US Department of Justice (DOJ) settlement suggests that False Claims Act (FCA) defendants who received Paycheck Protection Program (PPP) funds can face additional FCA liability based on certifying compliance with the law as part of the PPP loan application process. The settlement agreement resolved a series of whistleblower FCA actions against Physician Partners of America (PPOA) alleging overbilling and improper physician remuneration. DOJ additionally and independently alleged that PPOA, a Tampa-based healthcare management company, violated the FCA by falsely certifying compliance with the law in connection with its PPP loan application when, at the time of its PPP loan application, PPOA was engaged in the healthcare fraud at issue. In other words, DOJ used the receipt of emergency relief funds as a stand-alone basis for FCA liability — even though there was no clear nexus to the principal fraud nor any determination of wrongdoing at the time the certification was made.