A healthcare provider and its owners consented to a $2 million judgment against them in US District Court after admitting to violations of the False Claims Act, announced US Attorney Josh Hurwit on January 17, 2024. The fraud scheme involved using vulnerable or inexperienced medical staff to submit or cause to be submitted false claims to federal healthcare programs like Medicare, Medicaid, and Tricare. Through the agreement to pay $2 million, the defendants also resolved, without admitting, additional allegations that they violated the Controlled Substances Act, the Anti-Kickback Statute, and fraudulently obtained Paycheck Protection Program (PPP) loans.
According to a Complaint filed by the United States in December 2023, the provider hired vulnerable, compromised, and inexperienced medical staff who were then pressured into providing unnecessary and worthless care, which resulted in false claims being submitted to federal healthcare programs. For example, the owners ordered a hungover and impaired practitioner to provide medical care to unsuspecting patients. The Complaint also alleged that they pressured practitioners to prescribe controlled substances, entered into an unlawful kickback scheme with a third-party laboratory, and falsely certified information in order to obtain forgiveness of a PPP loan worth more than $750,000.
“Providers who cheat federal healthcare programs and put financial gain before the needs of patients must be rooted out at every turn,” said Steven J. Ryan, Special Agent in Charge with the US Department of Health and Human Services, Office of Inspector General (HHS-OIG). “HHS-OIG will continue to work with our law enforcement partners to address this kind of abuse, and will not stop protecting American patients, communities, and taxpayers from such conduct.”
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.*
