Fifth Circuit ruling clarifies no FCA liability for good-faith coding disputes

The U.S. Court of Appeals for the Fifth Circuit held that a mere difference of opinion on medical coding, without evidence of deliberate ignorance or reckless disregard, does not establish the scienter required for False Claims Act liability. The case involved a dispute over the appropriate billing level for evaluation and management services. The court distinguished between honest coding disagreements and fraudulent intent, reinforcing that good-faith compliance efforts matter. This ruling provides legal clarity for practices navigating ambiguous coding guidelines, particularly around E/M level selection and modifier usage. It does not change compliance obligations but underscores the importance of documented coding policies and ongoing education to demonstrate good faith.