Medicaid/Medicare Fraudulent Billing Qui Tam Cases
False Claims Act (“FCA”) qui tam claims involving Medicaid/Medicare health care fraud vary, depending on the level of care needed and provided. Common types of fraudulent claims often involve allegations of total neglect or no services, worthless services, inadequate and inferior services, and products, and aggressive patient treatment. Other areas of healthcare fraud schemes involve misrepresentation of credentials, upcoding of services, unbundling of services, and misrepresentation of patient data or populations. A more in-depth discussion of the types of fraudulent billing healthcare qui tam cases follows.
1. TREATMENT ISSUES
There are five potential areas in which qui tam cases arise in the area of treatments for which Medicare or Medicaid claims are submitted.
A. Total Neglect or No Services Provided
The most obvious case of FCA liability imposed on a physician for billing fraud occurs when they submit claims for services that were not provided. For example, a physician submitted reimbursement claims to the insurance company or Medicare for medical procedures they never performed in order to benefit from kickbacks. The government sued to recover for payment of thirty-one false claims fraud schemes, and the court found them liable.
B. Worthless Services
A healthcare provider may also be liable for submitting claims for services rendered if the services are so deficient that there was no medical value. For example, suppose in providing a multitude of services, a nursing home or home health aide failed to properly feed a patient resulting in an overall deterioration of health, serious illness, or death. In that case, a court could find the value of all services to be worthless.
C. Inadequate Services
Many reported medical/Medicare fraud schemes involving inadequate care are accomplished by denying tests or services at facilities that are paid per diem. Although the services may not be considered worthless, they may be severely deficient, entitling the government to some reimbursement for its expenditures. For example, Medicare may pay a nursing home facility per diem for each patient regardless of the medical equipment needed or services provided. By ordering fewer tests, using fewer supplies, employing less staff, and reducing referrals to specialists, the nursing home facility is providing inadequate services to increase its profits. These tactics violate the Nursing Home Reform Act, the Social Security Act, and Medicare/Medicaid laws. When a nursing home is paid on a per diem basis for each Medicare patient, the nursing home implicitly agrees to follow the standards of care in the Medicare and Medicaid statutes and to provide adequate care in a manner that maintains or enhances the quality of life of its residents. If the nursing home provides inadequate care and submits a reimbursement claim for its residents, the nursing home is submitting a false claim in violation of the FCA.
D. Standard of Care
Statutes and regulations governing Medicare, Medicaid, Social Security programs, as well as nursing homes require healthcare providers to meet the quality of care standards. A health care provider’s failure to meet these standards may result in exclusion from the program and substantial monetary damages. In addition, a provider may fall short of these standards when patients are subjected to unreasonable risks due to a provider’s failure to take proper preventative measures. For example, a long-term psychiatric facility’s inability to prevent patients from being subjected to a risk of physical and mental harm may expose the facility to FCA liability because it failed to meet the adequate standard of care.
E. Aggressive Treatment
Aggressive patient treatment usually results when a physician orders patient referrals for unnecessary services and medical tests. A provider can dramatically increase its profits for multiple procedures if it is reimbursed for each unnecessary test or service rendered rather than being paid per-diem.
2. MISREPRESENTATION OF CREDENTIALS
Another area of medical billing fraud cases in the health care system occurs when a healthcare provider submits a false claim to health insurance providers under the FCA for misrepresenting the credentials of the person that provided the services. These cases typically involve a provider representing to the government that someone eligible for reimbursement provided the service when it was actually performed by a person precluded from reimbursement. Cases involving misrepresentation of credentials may involve a wide variety of factual scenarios, including providing reimbursement claims with incorrect provider identification numbers (“PIN”), billing for services rendered by an unlicensed physician, or falsely representing that a teaching physician was present for procedures provided by a university’s medical school in accordance with applicable Medicare regulations.
3. UPCODING OR IMPROPER CODING OF GOODS AND SERVICES
When submitting a claim for Medicare reimbursement to the government, the claimant must provide documentation and medical records that support the claim. Appropriate documentation typically involves correctly coding certain services to enable the government to reimburse the healthcare provider at the proper rate. Coding accuracy is a major concern for all physician offices, clinics, and hospitals because incorrect coding can have severe financial and even criminal consequences. As a result, healthcare providers, such as hospitals and physician groups, will often contract with outside vendors to perform coding and billing services. The physicians send a copy of their charts to the vendors, which, in turn, code the services or procedures performed and submit a claim for reimbursement to Medicare. If the vendor submits reimbursement claims for a higher billing code than what is justified by the physician’s charts, then the vendor may be liable for submitting false claims.
4. BUNDLING AND UNBUNDLING PROCEDURES
The term “bundling” refers to coding related medical services as one inclusive procedure, in contrast to submitting claims for separate services. For example, a laboratory testing facility may bundle the codes and, therefore, the cost of a procedure that analyzes several components at once. The Center for Medicare and Medicaid Services provides some guidelines to providers for which services and goods should be bundled in a document called the Hospital Manual. The Hospital Manual requires healthcare providers to combine these types of services into a single claim for reimbursement. Therefore, bundling services is simply the method healthcare providers should use to bill Medicare. It is not an FCA violation. However, many providers will initially bundle services to receive reimbursement for the one inclusive procedure but then submit another claim in which the same procedure has been unbundled into separate procedures to receive a second reimbursement on the same services. This is termed “unbundling” and can “double” the reimbursement collected from Medicare for services or procedures performed. This double billing technique may lead to liability under the FCA.
5. MISREPRESENTATION OF PATIENT DATA – POPULATIONS
Many physicians provide services for patients either in a nursing home, via telemedicine, where the patient resides, or in the physician’s office. Due to complex interactions between nursing homes and physicians, billing inaccuracies frequently occur that could translate into false claims.
For more information and case citations, please see “Federal False Claims Act and Qui Tam Litigation,” published by Law Journal Press (2010).
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You should be aware that qui tam claims are subject to a Statute of Limitations. The area of limitations periods is complex. There are also first to file rules, public disclosure bars, original source issues, and varying limitations in pursuing retaliation claims. If you wish to pursue your claims, you should promptly seek the opinion of an attorney regarding the merits of your qui tam claim and the applicable statute of limitations.