Health Care Fraud and Abuse Laws to Know

By scoutadmin - January 11, 2016

It comes as no surprise to many that we are seeing more and more cases of health care fraud and abuse in recent news headlines.

Since the medical climate has changed so much in lieu of government intervention, health care  professionals and patients alike are more fearful of the future.

As a result of the rampant uncertainties within the industry, a small number of individuals are committing health care fraud to take advantage of the changing policies regarding insurance reimbursement and medical programs.Even those who don't intend to break the law can get caught up in a touchy situation if the wrong thing is said or acted upon during a patient/doctor visit.

If you're a medical professional, there are certain health care fraud and abuse laws that you should be aware of to avoid making a decision or mistake that could have career-changing ramifications.

Here are six laws that can help you stay ahead of the curve with recent changes in health care fraud prevention.

The False Claims Act

Generally speaking, the False Claims Act is a federal law that establishes liability when a person or company attempts to defraud government health programs or insurance companies.

For example, this law would be used in court to penalize a doctor who attempted to file a claim for an ankle break instead of an ankle sprain because the insurance company pays out more for the ankle break.

Although this is just one example of making a false claim, there are many other ways to break this law, such as double-billing the patient, billing for tests that have not been performed and forging physician signatures.

Under this law, private citizens are able to sue when false claims are made.

The Anti-Kickback Statute

In the worldwide business community, it's typically frowned upon to reward a company or individual for pulling the strings to grant your company government-allocated funds (also known as a kickback). The Anti-Kickback Statute was enacted to prevent this from happening within the medical industry.

For example, this law would prevent a doctor from paying a government official to put that doctor's name on the top of the list for a federal neurology grant.

Individuals on both sides of the kickback can be both prosecuted and heavily fined in order to ensure that damages to patients and/or government programs are vindicated.

The Physician Self-Referral Law

Referrals are widespread throughout the medical industry, as many patients will often require two or three visits to various physicians before the true problem is addressed.

It's also no secret that many doctors will refer patients to medical professionals who are connected to the same private corporation or insurance company.

However, the referral becomes a crime when the referring doctor has a financial stake in the office he just sent his patient to. 

The Physician Self- Referral Law prevents a doctor from referring his patient to another facility that he or she owns for particular designated health services, such as lab tests and physical therapy. It also prevents that same doctor from presenting said referral claims to Medicare.

The Exclusion Authorities

There are certain individuals and companies that are given the authority to participate in federal health care programs like Medicare and Medicaid. The Exclusion Authorities are those who are denied participation in these health care programs under certain guidelines.

The Patient Protection and Affordable Care Act contains several provisions that expand the Office of Inspector General's authority to exclude, providing more clarity to the existing law.

For example, those who have a history of patient abuse or neglect and those with certain prior convictions can now be excluded from said government programs under the Inspector General's supervision.

The Civil Monetary Penalties Law

While the False Claims Act exists to penalize individuals for misrepresenting medical events, the Civil Monetary Penalties Law ensures that civil financial compensation occurs when these medical events are misrepresented.

In other words, a case of filing a false claim can also fall under the category of the Civil Monetary Penalties Law if the fraud committed has civil implications.

Misappropriating health care program funds for personal spending, for example, is one way to break this law.

Other infractions could include: setting up reimbursement for an entity that is excluded from such benefits, presenting any claim that is fraudulent and soliciting reimbursement for the referral of a federal or state health program.


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