With the passing of the Affordable Care Act in 2010, provisions were made to add an additional $350 million to all federal fraud and abuse programs in an effort to increase scrutiny of claim payments. The federal government, along with the Department of Health and Human Services, created a detailed plan to decrease government spending mainly due to fraud and abuse within the Medicare program.
Multiple laws and regulations have been put in place to fight these abuses, and it’s important for physician practices to understand these regulations, which can be costly for noncompliance. Violations of any part of the healthcare law can result in criminal penalties, loss of medical license, stricter civil fines and exclusion from the federal healthcare programs, as well as new requirements for providers to return any overpayment within 60 days.
More than ever, it is vital that providers be knowledgeable about the regulatory programs that oversee and enforce these guidelines. Regardless of the practice size or the specialty, all providers must be aware of the guidelines that have increased auditing rules and guidelines.
Several government entities oversee audits, and monitor for fraud and abuse in physician practices. These entities have different processes, structures and goals to ensure compliance to standards within government and payer standards. Enforcement of these laws is carried out by various agencies, including the Department of Justice, the Department of Health and Human Services, the Office of Inspector General (OIG) and the Centers for Medicare and Medicaid Services.
The OIG, which is the enforcement agency of the HHS, lists the five most important fraud and abuse laws applicable to physicians as: the False Claims Act (FCA); Anti-Kickback Statute; Physician Self-Referral Law, also known as the Stark Law; Exclusion Statute; and the Civil Monetary Penalties Law. It’s vital for providers and their staff to understand what is included in these laws in order to avoid violations.
False Claims Act [31 U.S.C. §3729–3733]
The civil FCA generally protects the government from being overcharged or charged with procedures that are not medically necessary. This law works in conjunction with other fraud and abuse laws. If a claim results from a kickback or is made in violation of the Stark Law, it may be considered false or fraudulent, which would create liability under the civil FCA, as well as the Stark Law.
Fines for filing a false claim can add up to three times the programs’ loss, which is defined by the Agency, plus $11,000 per claim filed. Keep in mind, under the civil FCA, each item or service billed to Medicare counts as a claim so the fines can add up quickly. On the other hand, criminal penalties are applicable to the FCA which includes imprisonment and criminal fines.
Anti-Kickback Statute [42 U.S.C. §1320a-7b(b)]
The Anti-Kickback Statute is a criminal law that prohibits knowing and willful remuneration for patient referrals or generation of payable services by federal healthcare programs (e.g., drugs, supplies or healthcare services for Medicare or Medicaid patients). Remuneration or compensation includes anything of value, such as cash, free rent, expensive hotel accommodations, meals or excessive compensation for medical management, partnership or consultations.
