In a February 18, 2025 decision, the First Circuit joined the Sixth and Eighth Circuits in interpreting the “resulting from” provision of the AKS to mean but-for causation. Specifically the First Circuit held that, to establish that an AKS violation “resulted in” a false claim for FCA purposes, the government (or a qui tam relator) “must prove that the AKS violation was a but-for cause of the false claim.”1 Because the Third Circuit has taken a less demanding position—and depending on where other federal appellate courts land—this important issue may be headed to the Supreme Court for final resolution. Even in the absence of a Supreme Court ruling, however, the First Circuit’s decision has broad implications for ongoing and future FCA litigation.
Background
The FCA makes it unlawful to knowingly present, or cause to be presented, a “false or fraudulent claim” for payment or approval to the US government. Prior to 2010, many courts had concluded that an AKS violation could render a claim false for FCA purposes. Congress memorialized this proposition in 2010 in the Affordable Care Act (ACA). More specifically, Congress amended the AKS to provide that a Medicare, Medicaid or other federal health care program (FHCP) claim for items or services “resulting from” a violation of the AKS constitutes a “false or fraudulent claim” for purposes of the FCA.
Since that 2010 amendment, courts have wrestled with just what it means for a claim to have “resulted from” an AKS violation.
While courts generally have agreed that the AKS’s “resulting from” provision requires some kind of causal link between the prohibited remuneration and the items or services included in the claim for reimbursement, there has been a growing split among federal appellate courts regarding what degree of causation is required.
- The Third Circuit was the first federal appellate court to address this issue. It held that while there must be some “link” between the illegal remuneration at issue and the items or services included in the applicable claim for reimbursement, but-for causation is not required. Instead, the plaintiff simply must show that (i) an FHCP beneficiary was “exposed” to “an illegal recommendation or referral” with respect to certain items or services and (ii) a claim was then submitted to an FHCP for those items or services.2
- The Sixth and Eighth Circuits, by contrast, have held that “resulting from” requires a much greater nexus between the prohibited remuneration and the claim at issue. Specifically, these courts have held that the plaintiff must establish that “but for” the prohibited remuneration, the items and services included in the claim would not have been selected or ordered.3
To illustrate the difference between these two standards, consider the following hypothetical. For the past 10 years, Dr. Smith has prescribed Drug A for Helen Jones, a Medicare beneficiary, to treat her high blood pressure. On July 1, 2025, Manufacturer offers to pay Dr. Smith $10 every time she prescribes Drug A, in violation of the AKS. On August 1, 2025, (i) Dr. Smith once again prescribes Drug A for Ms. Jones; (ii) Ms. Jones fills the prescription at Pharmacy; and (iii) Pharmacy submits a claim to Medicare for the dispensed prescription (the August Claim).
Under the Third Circuit’s “exposure” theory of causation, every prescription for Drug A made by Dr. Smith after July 1, 2025 presumably would have been “exposed” to the AKS violation, meaning that these facts might be enough for the government to show that the August Claim “resulted from” the AKS violation. Under a “but-for” theory of causation, however, the government’s burden is higher. Why? Because it is not a given that but for Manufacturer’s offer of $10, Dr. Smith would not have prescribed Drug A for Ms. Jones on August 1, 2025; indeed, there is every indication she would have done so regardless of Manufacturer’s offer.
United States v. Regeneron Pharmaceuticals
On February 18, 2025, the First Circuit weighed in on this causation issue in United States v. Regeneron Pharmaceuticals.
Background
Regeneron is an AKS-predicated FCA action concerning donations made by Regeneron Pharmaceuticals, Inc. (Regeneron), a pharmaceutical company, to the Chronic Disease Foundation (CDF), a patient assistance foundation.
Regeneron manufactures Eylea, one of a limited number of drugs used to treat neovascular age-related macular degeneration (known as wet AMD). While Eylea is covered by Medicare Part B, it is expensive. The copayments due from Medicare beneficiaries can be cost-prohibitive, routinely exceeding $2,000 on an annual basis.
For several years, CDF operated a fund that provided copay assistance to Medicare beneficiaries who were prescribed wet AMD drugs (Wet AMD Fund). While Regeneron had no role in creating the Wet AMD Fund, it donated more than $60 million to it over the course of a few years.
In June 2020, the United States filed an FCA complaint against Regeneron in the US District Court for the District of Massachusetts. The government alleged that Regeneron structured its donations to CDF such that the foundation essentially served as a “conduit” for Regeneron to reimburse Medicare beneficiaries for Elyea copayments and induce physicians to prescribe Elyea, in violation of the AKS. The government contended that this AKS violation “resulted in” the submission of false claims to Medicare for Elyea prescriptions dispensed to beneficiaries who had received assistance from the Wet AMD Fund.
District Court Decision
In September 2023, the Massachusetts district court addressed the AKS’s “resulting from” condition in a ruling on cross motions for summary judgment.4
Regeneron argued that that the AKS’s “resulting from” condition imposed a but-for causation standard on the government—i.e., the government must prove that the AKS violation at issue “actually caused” the physician at issue “to provide different medical treatment” than the physician would have provided but for the AKS violation. The government, citing Third Circuit precedent, argued the government need prove only that (i) a particular patient was “exposed” to an AKS violation and (ii) their provider submitted a claim for reimbursement “pertaining to that patient.”
The district court rejected the government’s position, reasoning that the Third Circuit’s “exposure” standard was “divorced from the actual language” of the AKS and was “disconnected from long-standing common-law principles of causation.” Finding the analysis of the Sixth and Eighth Circuits more persuasive, the district court concluded that the AKS’s “resulting from” condition means but-for causation.
While the district court agreed with Regeneron that but-for causation is the appropriate standard, the court denied Regeneron’s motion for summary judgment on the ground that the government’s evidence was not “so flawed or incomplete as to every alleged false claim that judgment must necessarily enter for Regeneron.”
Ultimately, the district court denied both parties’ motions for summary judgment with respect to all FCA-related issues.5 Under these circumstances, the parties ordinarily would have needed to wait for a judgment on the merits before the issue of causation could be addressed on appeal. Given the circuit split on this issue, however, as well as the fact that determining the correct causation standard was pivotal to the outcome of the case, the district court sought and was granted an interlocutory review by the First Circuit.
First Circuit Decision
The First Circuit affirmed the district court’s judgment, holding “that to treat an AKS violation as a false or fraudulent claim under the FCA, the government must prove that the AKS violation was a but-for cause of the false claim.”
Citing to Supreme Court precedent, the First Circuit began by noting that in “the usual course,” the phrase “as a result of” imposes “a requirement of actual causality.” That said, as a matter of statutory construction, the court recognized that “resulting from” can be read to impose something other than but-for causation if there are “textual or contextual indication[s]” supporting that interpretation.6
The First Circuit quickly concluded there was no “textual” argument available, as there is nothing in the text of the AKS that “runs counter to the presumption that ‘resulting from’ calls for proof of but-for causation.” The First Circuit then turned to various “contextual” arguments offered by the government.7
AKS Causation Standard
The government first argued that since a violation of the AKS itself does not require “proof that the government would not have paid a claim but for the inducement of the offered kickback,” and the 2010 amendment to the AKS was “built on” that statutory scheme, the “resulting from” condition for FCA liability also should “require only that payments are meant to induce the provision of items or services and that those items or services are subsequently provided.”
The court found the government’s reasoning unpersuasive. While proof of causation is not required to establish AKS liability, the government had conceded that the 2010 amendment’s “resulting from” language requires proof of “some type of actual causality,” so “the premise that 2010 amendment’s causation requirement must track that of the AKS fails to get out of the starting blocks.”
The First Circuit added that “when Congress wants to make a violation of one statute or statutory section generate liability under another statute or section, it may or may not require proof of added elements not required to prove the predicate violation.” As such, “the mere fact that one liability is built on another says nothing about whether any additional elements are required to establish the subsequent liability.” Moreover, other federal laws illustrate that “if Congress wants to make a violation of one statute a per se violation of another, it can easily say so.”
At bottom then, the First Circuit concluded that the fact that causation is not required to establish AKS liability provides “little interpretative insight” with respect to “select[ing] among alternative forms of causation, one of which (but-for) is presumptively correct,” for FCA liability to attach.
The First Circuit further noted that “it is not unheard of for the same statute to impose different evidentiary burdens for related civil and criminal claims,” particularly where, as is the case here, the criminal AKS and civil FCA serve different purposes. The court reasoned that because criminal liability under the AKS exists “to protect patients from doctors whose medical judgments might be clouded by improper financial considerations,” it “makes sense for the AKS to criminalize even those kickbacks that do not ultimately cause a referral or purchase.” The FCA, by contrast, is intended “to provide for restitution to the government of money taken from it by fraud” and “creates a civil cause of action for multiple damages that can be initiated and prosecuted by private individuals without any affirmative approval by the government.” Under those circumstances, it “makes sense for the 2010 amendment to render a claim false (for FCA purposes) only when a kickback is the [but-for] cause of that claim’s submission to the government.”
Legislative History: Consideration of False-Certification Cases
The government’s second “contextual” argument was based on statutory history. The government emphasized that Congress passed the 2010 amendment “against a backdrop of false-certification cases,” in which many courts generally agreed that a defendant could be held liable under the FCA for falsely certifying compliance with the AKS when seeking payment from Medicare. The government argued that those cases “did not require proof of causation to demonstrate falsity under the FCA; a material misrepresentation of compliance with the AKS was enough.” The government further argued that “when Congress passed the 2010 amendment, it did not clearly intend to alter false-certification caselaw by imposing a but-for causation requirement.”
The First Circuit agreed with both of the government’s points, but concluded they were irrelevant for determining whether the AKS’s “resulting from” condition requires something other than but-for causation. In the First Circuit’s view, “claims under the 2010 amendment run on a separate track than do claims under a false-certification theory.” In other words, an AKS violation could support an FCA claim on the ground that (i) the provider submitting the claim had falsely certified it was in compliance with the AKS, and/or (ii) the claim resulted from an AKS violation. In all events, the court concluded, “[t]here is no reason to think that, because false-certification claims require no proof of causation, Congress therefore eschewed any actual causation requirement under the 2010 amendment.”
Legislative History: Statement by Bill Sponsor
The government next pointed to a floor statement by Senator Ted Kaufman, who sponsored the bill that originally included what became the 2010 ACA amendment to the AKS. Senator Kaufman asserted that the 2010 amendment would “ensure that all claims resulting from illegal kickbacks are ‘false or fraudulent,’ even when the claims are not submitted directly by the wrongdoers themselves.” As an example of the wrongdoing the amendment was meant to address, Senator Kaufman described a case in which a surgeon had received kickbacks from a medical device manufacturer to use its devices in his procedures. A court found that the hospital’s claims to Medicare for those procedures (including the devices used therein) were not false under the FCA because the hospital had no knowledge of the surgeon’s AKS violations; as such, the hospital had not made a false statement when it certified that, “to the best of [its] knowledge,” it was in compliance with the AKS. The government took the position that this illustrated that the “resulting from” language added by the 2010 amendment meant something other than but-for causation.
The First Circuit disagreed, concluding that Senator Kaufman’s statement was not “inconsistent with an interpretation of the 2010 amendment that imposes but-for causation.” Instead, the statement simply reinforces the fact that the 2010 amendment and false-certification theories provide different “pathway[s] to establish falsity in FCA actions based on AKS violations.”
Difficulty Proving But-for Causation
Finally, the government contended that it can “sometimes be difficult to prove why a doctor prescribed a particular drug.” Once again, the court found the government’s argument unpersuasive, noting that while “such proof may be more difficult to nail down in some cases,” “the same could be said about the requirement to prove other elements of a successful action under the FCA, such as scienter.”
The court also emphasized that it was not the case that “giving ‘resulting from’ its ordinary meaning” (i.e., but-for causation) would make it “so difficult to establish liability that the 2010 amendment would have no practical effect.” As the court had already discussed, “the 2010 amendment made it easier to bring an FCA action for damages by creating a pathway that does not require proof of a false certification.” Moreover, the government had shown in the Regeneron case that the but-for causation standard could be met. In its response to Regeneron’s motion for summary judgment, the government had taken the position that it had proffered enough evidence under a but-for causation standard to survive summary judgment, and the district court had agreed, at least with respect to some of the reimbursement claims.
Conclusion
For all of the above reasons, then, the First Circuit concluded that there was “no convincing ‘textual or contextual’ reason to deviate from the default presumption that the phrase ‘resulting from’ as used in the 2010 amendment imposes a but-for causation standard.” As a result, the First Circuit held that, “to demonstrate falsity under the 2010 amendment, the government must show that an illicit kickback was the but-for cause of a submitted claim.”
Take Aways
Providers should be heartened by the First Circuit’s ruling, and the growing number of appellate courts that have reached the same conclusion. These courts have held that the phrase “resulting from” is not surplusage. To the contrary, it is a separate, substantive, stand-alone element that must be proven in order to establish an FCA violation arising from an AKS violation. Further, these courts have concluded that the phrase means just what it says—i.e., simply because a physician received a kickback on Day 1 and ordered a particular item on Day 75 does not, in and of itself, establish that the claim for the item “resulted from” the kickback. More is required; specifically, proof that “but for” the kickback at issue, the physician would not have ordered the item at issue. For all of the reasons set forth in the First Circuit’s opinion, this is—and should be—a substantive and meaningful hurdle for the government or a whistleblower to overcome.
- United States v. Regeneron Pharmaceuticals, No. 23-2086 (1st Cir. Feb. 18, 2025). ↩︎
- United States ex rel. Greenfield v. Medco Health Sols., 880 F.3d 89 (3d Cir. 2018). ↩︎
- United States ex rel. Martin v. Hathaway, 63 F.4th 1043, 1052–55 (6th Cir. 2023); United States ex rel. Cairns v. D.S. Med. LLC, 42 F.4th 828, 834–35 (8th Cir. 2022). ↩︎
- The government moved for partial summary judgment on the issues of materiality, causation, and damages. Regeneron moved for summary judgment as to all claims. United States v. Regeneron Pharmaceuticals, No. 20-11217 (D. Mass. Sept. 27, 2023). ↩︎
- The district court did grant Regeneron’s motion for summary judgment on an unjust enrichment claim. ↩︎
- A “textual” indication is based on “the plain text of the statute’s causation language.” A “contextual” indication “is a signal of legislative intent derived from the text of the statute when read as a whole”— e.g., “if the text at issue, when read in the context of the statutory scheme as a whole, indicates that a but-for standard would undermine congressional intent.” ↩︎
- As illustrated below, some of the government’s arguments were based on legislative history. In its opinion, the First Circuit emphasized that, based on Supreme Court case law, a “contextual” indication is a form of statutory construction “derived from the text of the statute when read as a whole,” and may not necessarily permit consideration of legislative history. That said, for the sake of considering the government’s arguments, the First Circuit assumed that legislative history could be relevant evidence when performing a “contextual” analysis. ↩︎
