A former owner of a home visiting physician company in suburban Chicago, who was previously convicted of theft from the Medicare program, has been ordered by a federal judge to pay more than $25 million in damages and penalties as the result of more than 4,000 violations of the False Claims Act. In 2017, the United States had intervened in a sealed whistleblower lawsuit that had been brought against him and other defendants in 2013, and filed its own complaint-in-intervention against the owner, his wife, and their companies alleging that they had violated the federal False Claims Act by knowingly submitting claims for Medicare payments for services not rendered, services that were not medically necessary, and services that were “upcoded” to a higher level reimbursement than was appropriate or provided.
The allegations included that the defendants had submitted thousands of claims for a Medicare service called care plan oversight, which they knew had not been provided. Care plan oversight is a covered Medicare service, where a physician who has certified a plan of care for a home health patient spends an additional 30 minutes in a calendar month performing certain oversight functions that are not related to the certification itself or a face-to-face visit with the patient, which are separately billed.
Also in 2017, the owner was charged in a related criminal case alleging care plan oversight fraud. That case resolved in a guilty plea on August 22, 2019, when the owner pleaded guilty to one count of theft or embezzlement in connection with a healthcare benefit program. In his plea, the owner specifically admitted that the Medicare program paid the company approximately $523,600 from 2011 through June 2015 as the result of 4,367 false claims for the care plan oversight service that he, as the owner and authorized official of the business, knowingly caused to be submitted although he knew that care plan oversight service had not been rendered. He also admitted that he instructed others to create false documentation to support those false claims for care plan oversight.
On March 24, 2023, Chief US District Judge Rebecca R. Pallmeyer granted summary judgment to the United States regarding the care plan oversight false claims in its civil case, holding that the owner and his company were liable under the False Claims Act for those false care plan oversight claims to Medicare based upon the owner’s earlier guilty plea and his admissions within the plea agreement. On March 28, 2023, the court entered judgment against the owner and his company in the amount of $25,589,300, made up of $1,570,800 in treble damages and $24,018,500 in civil penalties.
Compliance Perspective
Issue
It is illegal to submit claims for payment to Medicare or Medicaid that you know or should know are false or fraudulent. Filing false claims may result in fines of up to three times the programs’ loss plus $11,000 per claim filed. Under the civil False Claims Act, each instance of an item or a service billed to Medicare or Medicaid counts as a claim, so fines can add up quickly. Facility staff should be knowledgeable in how to report suspicious billing practices. A nonretaliatory environment for reporting suspicious billing practices is mandatory for all facilities.
Discussion Points
- Review your policies and procedures for preventing and reporting a false claim and for conducting a Triple Check Process to verify accuracy of Medicare claims. Ensure that your policies are reviewed at least annually and updated when new information becomes available.
- Train all staff upon hire and at least annually on your compliance and ethics policies and procedures and on what can be considered a false claim. Provide training to appropriate staff on the Triple Check Process for ensuring accuracy of all Medicare billing and supporting documentation before claims are submitted. Document that these trainings occurred and file the signed document in each employee’s education file.
- Periodically perform audits to ensure all staff are aware of compliance and ethics concerns and understand their responsibility to report any potential compliance and ethics violations to their supervisor, the compliance and ethics officer, or via the anonymous hotline. Audit to ensure that the Triple Check Process is being followed each month before claims are submitted to Medicare, and that any identified irregularities are corrected.
*This news alert has been prepared by Med-Net Concepts, LLC for informational purposes only and is not intended to provide legal advice.*
