False Claims Act in Healthcare
The False Claims Act (FCA) in healthcare (also called the ‘Lincoln Law’), is a federal law that imposes liability on persons and companies who defraud governmental programs. It is the federal government’s primary litigation tool in combating fraud against the government.
The federal False Claims Act makes it illegal to:
- ‘Knowingly’ present, or cause to be presented, a false or fraudulent claim for payment to the federal government.
- ‘Knowingly’ make, use, or cause to be made or used, a false record or statement to get a false or fraudulent claim paid or approved by the government.
- Conspire to defraud the government by getting a false or fraudulent claim allowed or paid.
- Have possession, custody, or control of property or money used or to be used by the government and, intending to defraud the government, either will fully conceal the property or deliver or cause to be delivered less property than the amount for which the person receives a certificate or receipt.
- Authorize the making or delivering of a document that certifies receipt of property used or to be used by the government and, intending to defraud the government, make or deliver the receipt without completely knowing the information on the receipt is true.
- ‘Knowingly’ buy or receive as a pledge of an obligation or debt, public property from an officer or employee of the government or member of the Armed Forces who may not lawfully sell or pledge the property.
- ‘Knowingly’ make, use, or cause to be made or used, a false record or statement to conceal, avoid, or decrease an obligation to pay or transmit money or property to the government.
Understanding terminology: ’Knowingly’
‘Knowingly’ includes acting not only with actual knowledge but also with deliberate ignorance or reckless disregard of the facts. To impose liability, it is not necessary for the court to find a specific intent to defraud. Simply presenting a false claim is a violation, even if the claim has not been paid and no money has been expended. The federal government may impose fines of up to $11,000 per claim and treble damages (i.e., three times the amount of actual damages) for federal False Claims Act violations.
Defining Fraud
Fraud is defined as ‘knowingly’ and will fully executing, or attempting to execute, a scheme or artifice to defraud any health care benefit program or to obtain, by means of false or fraudulent pretenses, representations, or promises, any money or property owned by, or under the custody or control of, any health care benefit program. The federal False Claims Act widens the definition to also include reckless conduct, ‘deliberate ignorance’ of the truth or falsification of information, and ‘reckless disregard’ of the truth or falsity of the information.
Examples for Fraud Billing
- False or fabricated filings of claims.
- Billing for goods and services never delivered or rendered. This includes billing for no-shows or cancelled appointments.
- Billing for more services than provided.
- Up coding of services. This includes, but is not limited to, billing for new or premium durable medical equipment (DME), prosthetics/orthotics, or supplies while substituting substandard or inexpensive DME.
- Billing for services performed by a lesser-qualified person, unless permitted by your contract, state laws and regulations, and/or CMS guidelines.
- Misrepresentation of services rendered, diagnosis, place of service, date of service, and/or provider to justify reimbursement.
- Billing for non-covered services as covered services.
- Medical documentation not supportive of, or inconsistent with, the service being billed.
- Falsifying certificates of medical necessity, plans of treatment, and medical records to justify the payment. This includes the fabrication and recreation of medical records.
- Double billing to gain duplicate payment (e.g., billing two insurers the full amount without disclosing Coordination of Benefits (COB) information).
- Altering a claim form to obtain a higher payment amount.
- Unbundling services, e.g., billing separately for a panel of tests when a single test was requested.
- Billing procedures over a period of days or weeks when the actual treatment occurred during a single visit (i.e., split billing).
- Improper coding practices, e.g., misuse of CPT codes.
- The acceptance of, or failure to return, monies paid on claims known to be false, fabricated, or received in error.
- Kickbacks or schemes that involve collusion between a provider and a member.
- Members providing false information for potential gain.
- Billing an elective hospital admission as if it were an emergency.
Defining Abuse
Abuse is defined as any provider or member practice that is inconsistent with sound or established fiscal, business, insurance, or medical practices. Each incident need not be intentional to be considered abuse. Consistent patterns of abuse may be indicative of fraud.
Examples of Abuse or Improper Billing
- Medical documentation that does not support the services billed.
- Excessive charges for services or supplies.
- Failure to collect deductibles, coinsurances, and co-pays.
- High utilization of procedures that are not medically necessary.
- Providing experimental services, or services or treatments that fail to meet professionally recognized standards.
- Requesting preauthorization under a network location and billing under an out-of-network location.
- An entity performing such acts may include a practitioner, a hospital, an agency, an organization, or any other institutional provider, employee(s) of a provider, group of providers, billing service, member, or person in a position to file a claim for health benefits.
You can refer Office of Inspector General website to understand False Claims Act in Healthcare for every state. Medical Billers and Coders (MBC) is a leading medical billing company providing complete medical billing and coding services. We can assist you in receiving accurate reimbursements while complying with state and federal billing guidelines. To know more about our medical billing and coding services, email us at: info@medicalbillersandcoders.com or call us at: 888-357-3226.
