The False Claims Act is a broad federal statute that covers a wide range of activities involving the submission of reimbursement claims under Medicare, Medicaid, Tricare, and other health care benefit programs. For this reason, it is one of the federal government’s most potent weapons for prosecuting health care providers. It is crucial for providers in all segments of the health care industry to have a clear understanding of the types of acts and omissions that can lead to civil or criminal charges.
Note that we said acts and omissions. For many health care providers, one of the greatest risks is not that they will do something that triggers False Claims Act liability, but that they will fail to do something that was necessary in order to comply with federal law.
This is because most health care providers are not criminals – even though the federal government may seem to think otherwise at times. Rather, most health care providers do their best to comply with the Centers for Medicare and Medicaid Services’ (CMS) billing regulations, the Anti-Kickback Statute, and all of the other authorities that apply to their businesses and practices. It is when they overlook an obligation that they get into trouble with the Department of Health and Human Services (DHHS) Office of Inspector General (OIG) or the U.S. Department of Justice (DOJ).
False Claims Act Risks for Health Care Providers
So, what are some of the biggest False Claims act risks for health care providers? Based upon years of experience representing providers in federal health care fraud investigations, some of the most common allegations in these investigations include:
1. Illegal Kickbacks and Referral Fees
While illegal kickbacks and referral fees may more commonly be thought of as violations of the Anti-Kickback Statute, health care providers that offer, pay, solicit, or accept unlawful forms of “remuneration” can be charged with False Claims Act violations as well. Importantly, while a particular transaction may qualify for “safe harbor” protection under the Anti-Kickback Statute or its regulations, this does not necessarily mean that it will be immune from prosecution under the False Claims Act.
2. Health Care Fraud Conspiracies
Similar to the False Claims Act, the federal conspiracy statutes are extremely broad. And if a conspiracy leads to an overpayment from Medicare, Medicaid, Tricare, or other federal health care benefit program, the conspiracy could also lead to charges under the False Claims Act. Examples of practices that could potentially lead to conspiracy and False Claims Act charges include (but are not limited to):
- Working with a patient or other health care provider to bill Medicare for services or medications that are not medically necessary;
- Entering into an agreement to pay unlawful kickbacks or referral fees; and
- Making unlawful use of patients’ health care information in order to bill Medicare, Medicaid, or Tricare.
3. Billing and Coding Violations
Billing and coding violations are easily among the most-common allegations in False Claims Act investigations targeting legitimate health care providers. Not only can billing and coding errors lead to audits and recoupment demands, but they can also lead to civil – and potentially criminal – charges under the False Claims Act.
Examples of billing and coding violations that can trigger a False Claims Act investigation include:
- Submitting the wrong billing code (including “upcoding” a service or item);
- Billing for a service or item that CMS does not consider “medically necessary;”
- Billing for services or items individually instead of at their bundled rate;
- Billing for services rendered by an unaffiliated provider who is not licensed or who has been excluded from federal program participation; and
- Billing in violation of updated Medicare, Medicaid, or Tricare regulations.
“Knowing” Versus “Intentional” False Claims Act Violations
In order to constitute a violation of the False Claims Act, an act or omission must be committed, “knowingly.” However, the False Claims Act also includes an “intent” standard. And while challenging evidence that a violation was committed knowingly can mean the difference between liability and no liability, challenging evidence of intent can mean the difference between civil and criminal charges.
Despite employing a “knowing” standard for civil liability, the False Claims Act still presents a substantial risk for health care providers who do their best to comply with the federal health care benefit program guidelines. This is because prosecutors with the OIG and DOJ can infer “constructive knowledge” from various forms of activity and inactivity. For example, simply having a question about the validity of a reimbursement request and allowing it to be submitted can potentially be enough to trigger False Claims Act liability. Even if you did not actually know about a violation, if you should have known about the violation, then you may be exposed to civil penalties under the False Claims Act.
Similarly, federal prosecutors pursuing criminal charges will often seek to infer intent from the circumstances surrounding federal health care program billing activities as well. For example, repeated violations, or violations that appear to be a part of a conspiracy, are particularly likely to spur a criminal investigation. Federal prosecutors may also seek to obtain copies of emails, patient records, and billing files in order to prove a scheme or artifice to defraud.
Learn More about Your False Claims Act Investigation
The consequences of being targeted in a False Claims Act investigation can be severe. If you have been contacted by the DOJ or if DHHS agents have shown up at your door, you need to take appropriate steps to protect yourself immediately. To learn more, we encourage you to read:
- 5 Things You Need to Know About the Federal False Claims Act
- Civil Investigative Demands & The False Claims Act
- False Claims Act & Qui Tam Defense
- How to Dismiss a Whistleblower Case under the False Claims Act
- What You Should Do When You Are Under a False Claims Act Investigation
Contact False Claims Act Defense Attorney, Dr. Nick Oberheiden
If you are concerned about your potential exposure under the False Claims Act, we urge you to contact us immediately for a free and confidential case assessment from defense attorney, Dr. Nick Oberheiden. To schedule an appointment as soon as possible, call (888) 519-4897 or submit a request online now.