A Virginia woman pleaded guilty on August 26, 2024, to one count of healthcare fraud and six counts of making false statements relating to healthcare matters. From June 2016 through October 2018, she engaged in a scheme to defraud the Virginia Department of Medical Assistance Services (DMAS), which administers Medicaid in the Commonwealth. She owned and operated a company providing healthcare services to Medicaid patients, but the company’s records were falsified, incomplete, and noncompliant with Medicaid requirements, including inflated time entries.
The company offered two types of care: personal and respite care, and mental health skill building services (MHSS). To comply with Medicaid regulations, personal care assessments must be completed by a registered nurse (RN), and mental health services assessments must be conducted by a licensed mental health professional (LMHP), such as a licensed clinical social worker (LCSW). From 2016 to July 2017, the defendant had an LCSW contractor. After that, she instructed her staff to forge the LCSW’s signature on assessments and certifications.
The company submitted forged documents to DMAS for over 35 patients, fraudulently billing and receiving over $740,000. Similar fraudulent activities were conducted for personal care and respite services, resulting in over $50,000 in fraudulent claims. An additional $480,000 was billed for patients without proper documentation or while they were in other care settings. The company also inflated billing times for mental health services.
As a result of these schemes, the defendant illegally obtained approximately $1,320,088. She is scheduled to be sentenced on January 10, 2025, and faces up to 10 years in prison.
Compliance Perspective
Issue
Medicaid service providers, in addition to a basic duty to bill honestly, are required to reliably document the services for which they claim reimbursement. Falsification of signatures and other documentation is a crime. It is also illegal for unlicensed staff to be operating outside of their scope of practice. Unlicensed individuals or those with a suspended license may not bill directly for treating Medicare and Medicaid patients, nor may their services be billed indirectly through an employer or a group practice. 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.
Discussion Points
- Review your policies and procedures related to documentation accuracy and compliance with Medicaid regulations. Ensure that all documentation practices meet the required standards, including proper completion of assessments by licensed professionals and accurate recording of service times. Make sure your policies explicitly address the prohibition against falsifying documents, such as signatures, and outlines the procedures for verifying the credentials of all staff involved in patient care and billing.
- Provide training to appropriate staff to ensure accuracy of all Medicaid billing and supporting documentation before claims are submitted. Document that these trainings occurred and file the signed document in each employee’s education file. Also train staff on scope of practice.
- Regularly conduct audits of documentation and billing to prevent and detect errors before they progress to a false claim. Immediately address any negative findings. Also periodically perform audits to ensure all staff are aware of the importance of identifying compliance and ethics concerns and their responsibility to report them to their supervisor, the compliance and ethics officer, or via the anonymous hotline.
*This news alert has been prepared by Med-Net Concepts, LLC for informational purposes only and is not intended to provide legal advice.*
