Part A False Claim Act
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Hypothesis: According to the theory of false claim act liability commonly referred to as “implied false certification” when defendant submits claim, it impliedly certifies compliance with all conditions of payment. The implied false certification theory ca be a basis for liability
Federal Civil False Claims Act (FCA) The civil FCA, 31 United States Code (U.S.C.) Sections 3729–3733, protects the Federal Government from being overcharged or sold substandard goods or services. The civil FCA imposes civil liability on any person who knowingly submits, or causes the submission of, a false or fraudulent claim to the Federal Government. The terms “knowing” and “knowingly” mean a person has actual knowledge of the information or acts in deliberate ignorance or reckless disregard of the truth or falsity of the information related to the claim. No specific intent to defraud is required to violate the civil FCA. Examples: A physician knowingly submits claims to Medicare for medical services not provided or for a higher level of medical services than actually provided. Penalties: Civil penalties for violating the civil FCA may include recovery of up to three times the amount of damages sustained by the Government as a result of the false claims, plus financial penalties per false claim filed. Additionally, under the criminal FCA, 18 U.S.C. Section 287, individuals or entities may face criminal penalties for submitting false, fictitious, or fraudulent claims, including fines, imprisonment, or both
Settlement Based on Electronic Health Records Incentive Program (real-life Case)
On May 31, 2019, the DOJ announced that Coffey Health System in Kansas agreed to pay $250,000 to settle claims that they violated the False Claims Act. The Coffey Health System operates a 25-bed critical access hospital located in Burlington, Kansas. The DOJ alleged that Coffey Health System falsely attested that it conducted and/or reviewed security risk analyses in accordance with the requirement under the electronic health records (EHR) incentive program in 2012 and 2013. The DOJ specifically alleged that the Coffey Health System (Violation) falsely attested that they satisfied the measures of requirements for analyzing and addressing security risk to electronic health records.
Compliance to minimize exposure risks
A new fact sheet issued by the Centers for Medicare & Medicaid Services (CMS) explains hospital payment adjustments under the Medicare Electronic Health Record (EHR) Incentive Program.
Eligible hospitals that failed to demonstrate meaningful use of EHRs for calendar year 2016 are subject to a payment adjustment for fiscal year (FY) 2018, which began Oct. 1. Payment adjustments are applied as a reduction to the hospital Inpatient Prospective Payment System (IPPS) percentage increase for FY 2018. Eligible hospitals that failed to attest will see a 75 percent decrease to the FY 2018 IPPS annual payment update.
CMS has contacted hospitals that did not meet meaningful use requirements or file a timely hardship exception and are therefore subject to the penalty in FY 2018. The fact sheet contains additional information on hardship exceptions, which are granted on a case-by-case basis in four categories: infrastructure; new eligible hospitals; unforeseen circumstances; or EHR vendor issues.
An eligible hospital demonstrates meaningful use by successfully attesting through either the CMS Medicare EHR Incentive Programs Attestation System (https://ehrincentives.cms.gov/hitech) or through its state’s Medicaid EHR Incentive Program attestation system
Part B Anti- Kickback Statute or stark Law
Hypothesis: Prohibit medical providers from paying or receiving kickbacks, remuneration or anything of value in exchange for referrals of patients who will receive treatment paid for by the government healthcare programs such Medicare and Medicaid.
Under Federal law and federal state laws- The AKS, 42 U.S.C. Section 1320a-7b(b), makes it a crime to knowingly and willfully offer, pay, solicit, or receive any remuneration directly or indirectly to induce or reward patient referrals or the generation of business involving any item or service reimbursable by a Federal health care program, When a provider offers, pays, solicits, or receives unlawful remuneration, the provider violates the AKS, The Physician Self-Referral Law, 42 U.S.C. Section 1395nn, often called the Stark Law, prohibits a physician from referring patients to receive “designated health services” payable by Medicare or Medicaid to an entity with which the physician or a member of the physician’s immediate family has a financial relationship, unless an exception applies.
Financial Arrangements with Emergency Room Physicians
On April 30, 2019, the DOJ announced that a former CEO of Health Management Associates (HMA) agreed to pay $3.46 million to resolve false billing and kickback allegations. This settlement resolved allegations that the hospital former CEO caused HMA to knowingly submit false claims to government healthcare programs by admitting patients that could have been treated on a less costly, outpatient basis. The settlement also resolved allegations that the hospitals CEO caused HMA to pay remuneration to emergency department physicians in return for referrals, This settlement resolves allegations that the former CEO of this hospital chain caused HMA to pressure emergency department physicians to increase inpatient admissions by recommending admission without regard to medical necessity. The DOJ also alleged that the former hospital chain CEO caused HMA to pay remuneration to EmCare, a physician staffing company, to recommend admission when patients should have been treated on an outpatient basis. The DOJ also alleged that the former HMA CEO caused HMA to make certain bonus payments to EmCare emergency department physicians and tied EmCare’s retention of existing contracts and receipt of new contracts to increase admissions of patients who came to the emergency department, HMA and EmCare have already resolved their liability to the government related to these allegations. In September 2018, HMA entered into a civil settlement under which it paid $61.8 million to the government. HMA also entered into a non-prosecution agreement with the criminal division’s fraud section under which it paid $35 million.
Violation- False billing, HMA to knowingly submit false claims to government healthcare programs by admitting patients that could have been treated on a less costly, outpatient basis. also violation of physician in return of referrals.
Compliance with Stark Law and Anti-Kickback Policies and Procedures
Policies, procedures, and practices available to help health care organizations remain compliant with both the Stark Law and the AKS. The most overarching way organizations can maintain compliance with these laws is by ensuring their compliance programs are effective and operating as recommended by the Department of Health and Human Services Office of Inspector General (OIG). In the OIG’s Compliance Program Guidance documents¹, there are seven key elements of an effective compliance program including: Implementing written policies, procedures and standards of conduct, Designating a compliance officer and compliance committee, Conducting effective training and education, Developing effective lines of communication, Conducting internal monitoring and auditing, Enforcing standards through well-publicized disciplinary guidelines, Responding promptly to detected offenses and undertaking corrective action, The most notable of these elements as it relates to compliance with the Stark Law and the AKS is implementing written policies, procedures and standards of conduct. By following necessary policies and procedures for these laws, health care organizations can avoid instances of improper referrals and other remuneration fraud or abuse.
Medicare Learning Network 2022 Publication: Medicare Fraud and Abuse PDF
Resources. (n.d.). Breazeale, Sachse & Wilson – Attorneys at Law | Baton Rouge & New Orleans, Louisiana Law Firm |. https://www.bswllp.com/false-claim-act-cases-and-settlements-involving-hospital-financial-relationships-with-referring-physicians
CMS releases fact sheet on EHR penalties. (n.d.). America’s Essential Hospitals. https://essentialhospitals.org/policy/cms-releases-fact-sheet-on-ehr-penalties/
How to comply with stark law and anti-kickback policies and procedures. (2021, February 2). Strategic Management Services, LLC. https://www.compliance.com/resources/how-to-comply-with-stark-law-and-anti-kickback-policies-and-procedures/
Health executives have a code of ethics and policy statements that guide their behavior. The American College of Health Care Executives is the most visible Code of Ethics for HCO managers. Health providers have other professional codes.
Your post this week will answer the question: Does management have a different code than health providers and how can this be resolved?
Structure of your post.
1. Examine one (specific) portion of the code provided by ACHE.org.
2. Describe one (specific) portion of the code used by a health professional you select.
3. Cite the portion of the ACHE and health professional code but do not quote them. Use your own words.
4. Comment on how the two codes may differ in nature. Compare and contrast.
5. Do you anticipate any circumstances or situations that will require resolution? Will the current pandemic, unequal distribution of health services, or biotech advances that may emerge in the years to come?
6. What will help to resolve a dilemma?
Assigned reading materials:
· American College of Healthcare Executives (2021). ACHE code of ethics. Retrieved from
· Gaines, K. (2020).Nursing Code of Ethics-Summary