Delay in Return of Overpayments Leads to False Claims Act Suit

July 23, 2014 By

The generally accepted wisdom is to move expeditiously to investigate and return federal health care program overpayments once you become aware of them.  Now we know the potential downside of failing to do so even when all overpayments are eventually returned.

Late last month the United States Attorney’s Office filed a false claims act complaint in intervention against Continuum Health Partners.  The complaint seeks treble damages, civil penalties and costs.

Relevant facts:

  • From early 2009 to late 2010, due to a computer glitch, defendant submitted improper claims to Medicaid for additional payments for services
  • September 2010  New York state comptroller notified defendant of a small number of these claims improperly billed to and paid by Medicaid
  • February 2011 defendant became aware of much larger batch of improper claims totally over $1,000,000 that may have been submitted to and paid by Medicaid
  • Defendant repaid improper claims in dribs and drabs eventually repaying everything by March 2013 – 300 improper claims were repaid only after the Government issued a Civil Investigative Demand to defendant regarding payment of these claims in June 2012

“Continuum thus intentionally or recklessly failed to take the necessary steps to timely identify the claims affected by the software issue or to timely reimburse DOH for those affected claims that resulted in overbilling to Medicaid.”

For more information about this case or for assistance with reporting overpayments please contact Greg Montgomery.

Filed Under: Medicaid, Overpayment

OIG Launches New Online Submission Process for the Self-Disclosure Protocol

July 9, 2013 By

On July 8th, the Office of Inspector General (OIG) launched a new online submission process for the Self-Disclosure Protocol (SDP).  The SDP allows health care providers to voluntarily identify, disclose, and resolve instances of potential fraud involving federal health care programs, including Medicare and Medicaid.   The OIG has stated that individuals and entities that utilize the SDP will pay a lower amount of damages for violations than would normally be required in resolving a government-initiated investigation.

You can access the online submission process here.

The OIG hopes that the online submission tool for the SDP will streamline the process for providers that want to resolve violations without the time and expense of a government-directed investigation.  With that said, we suggest that providers have an attorney analyze any potential SDP issues prior to completing the online form.  As always, the health law attorneys at OMW are happy to help.

For more information about the SDP online submission process please contact Casey Moriarty.

Filed Under: Compliance, Medicaid, Medicare, OIG, Overpayment Tagged With: , , ,

Whistleblowers Expected to Receive $2.8 Million in Settlement of Stark Based False Claims Act Lawsuit

May 7, 2013 By

The Department of Justice recently announced a settlement with Adventist Health System/West under which the Department of Justice and the state of California will collect $14.1 million in settlement of False Claims Act allegations.  The lawsuit was initially filed by private individuals as whistleblowers who will receive a significant portion of the settlement.  There was no determination or admission of liability.

According to the announcement, the lawsuit alleged that Adventist Health improperly compensated physicians at one of its facilities by transferring assets to the physicians at less than fair market value and by compensating physicians for teaching services at rates contended to be above fair market value.  These payments to physicians were alleged to violate the Stark law and anti-kickback laws.

In commenting on the settlement, a representative of the Office of Inspector General observed:

“Payouts by hospitals and clinics – as the government alleged in this case – raise substantial concerns about physician independence and objectivity.  Taxpayers and vulnerable patients rightfully expect such payments to be investigated and pursued.”

As part of its on-going quarterly lunch time webinar series, the Ogden Murphy Wallace Healthcare Practice Group will provide a presentation on self-disclosure options and avoidance of state and federal False Claims Act liability in its June 4, 2013 webinar (to register click here).  If you have questions regarding self-disclosure and overpayments in general please contact Greg Montgomery.

Filed Under: Anti-Kickback/Stark, Compliance, False Claims Act, Overpayment

False Claims Act Recoveries Top $14.2 Billion

May 2, 2013 By

On May 1, 2013, the  Department of Justice announced a settlement with two Montana hospitals that added $3.95 million to its recoveries under the False Claims Act.  According to the announcement, with this additional recovery,  the Department of Justice has used the False Claims Act to recover more than $14.2 billion in federal healthcare payments since January, 2009.

Once again, allegations of hospital-physician financial relationships that violated the Stark law prohibition against self-referral were the stated basis for the allegations of False Claims Act liability.  In this case, according to the announcement, it was alleged that the hospitals paid incentive compensation to certain physicians in a manner that took into consideration the value or volume of the referrals by the physicians to the hospital by improperly including certain designated health services in the formula for calculating physician incentive compensation.

This situation was voluntarily disclosed by the hospitals.  In this regard, an OIG representative was quoted as commenting:

 “There is an expectation that corporations providing services to Medicare and Medicaid beneficiaries adhere to the provisions of the Stark Law.  I applaud St. Vincent Healthcare and Holy Rosary Healthcare for recognizing their potential liability in this matter and making a disclosure”

As part of its on-going quarterly lunch time webinar series, the Ogden Murphy Wallace Healthcare Practice Group will provide a presentation on self-disclosure options and avoidance of state and federal false claims act liability in its June 4, 2013 webinar (to register click here).  If you have questions regarding self-disclosure and overpayments in general please contact Greg Montgomery.

Filed Under: Anti-Kickback/Stark, Compliance, False Claims Act, Hospitals, Medicare, Overpayment, Stark

CMS PROPOSES TO INSPIRE MORE WHISTLE BLOWING

April 25, 2013 By

In a recently published proposed rule, CMS and HHS propose to substantially increase financial rewards available to individuals who report information regarding individuals or entities engaging in acts or conduct that are subject to Medicare sanctions.  The existing reward incentive program offers 10% of the amount of overpayment recovered or $1000 whichever is less.  Under the proposed rule, the reward could take a substantial jump up to 15% of $66,000,000, equaling $9,900,000.

 

CMS explains that under the existing reward incentive program which has been in effect since July 1998, only 18 rewards have been paid in a total amount of less than $16,000 and less than $3.5 million in overpayments have been collected.  It notes that after the IRS increased the rewards available under its rewards program in 2006, it has collected almost $1.6 billion and paid approximately $193 million in rewards.  CMS also tips its hat to the success of the whistle blower provisions of the False Claims Act, noting that rewards under this Act range from 15% to 30% of amounts recovered.

 

CMS estimates that with the proposed rule in place annual recoveries will increase by $24.5 million.  There will, however, be no whistle blower double dipping.  While conduct may entitle a whistle blower to recover under both the False Claims Act and the Reward Incentive Program, whistle blowers are going to have to pick only one whistle.  Regardless of which whistle is chosen, the bottom line is that with this new rule more individuals are going to be looking much harder at the conduct of providers and entities that seek payment for services and supplies from Medicare.

 

As part of its on-going quarterly lunch time webinar series, the Ogden Murphy Wallace Healthcare Practice Group will provide a presentation on self-disclosure options and avoidance of state and federal false claims act liability in its June 4, 2013 webinar.  If you have questions regarding these updated protocols or self-disclosure and overpayments in general please contact Greg Montgomery.

 

Filed Under: Compliance, Medicare, Overpayment Tagged With: ,