False positive usage policy violation when working with medical/virology repository

Description

When working with a private repository (virology-dashboard) — a legitimate medical team communication dashboard for uploading, processing, and searching virology laboratory reports — Claude Code repeatedly refuses to respond with the following error:

API Error: Claude Code is unable to respond to this request, which appears to violate our Usage Policy (https://www.anthropic.com/legal/aup). Please double press esc to edit your last message or start a new session for Claude Code to assist with a different task. If you are seeing this refusal repeatedly, try running /model claude-sonnet-4-20250514 to switch models.

Context

• The repository is a healthcare dashboard with OCR capabilities, bulk upload support, and patient test history tracking
• There is no malicious intent — this is a standard medical/healthcare software project
• The error appears to be triggered by medical/virology terminology in the codebase or prompts
• The refusal is persistent and blocks normal development workflow

Expected behavior

Claude Code should be able to assist with legitimate medical/healthcare software projects, including those involving virology lab report processing.

Steps to reproduce

1. Have a repository dealing with virology laboratory report processing
2. Ask Claude Code to help with the codebase (e.g., debugging, feature work)
3. Receive repeated usage policy violation errors

Workarounds attempted

• Starting new sessions
• Rephrasing prompts
• Switching models as suggested by the error message