Does Your Practice Accept Medicare or Medicaid? You Need a Fraud, Waste, and Abuse Compliance Plan

Illinois healthcare providers already face substantial challenges in delivering high-quality care to their patients. When you accept patients insured by Medicare or Medicaid, you also assume the additional legal obligation to ensure that you submit accurate reimbursement claims to the government. We are not simply talking about double-checking your bills for typos; you need a written compliance plan to identify and prevent fraud, waste, and abuse.

What Laws Apply to My Practice?

The Office of the Inspector General (OIG) at the U.S. Department of Health and Human Services is the federal agency responsible for dealing with Medicare fraud, waste, and abuse. More precisely, the OIG enforces enforces the following four federal laws in this area:

  • False Claims Act (FCA): If you “knowingly” file a false or fraudulent reimbursement claim with Medicare or Medicaid, you may be fined up to three times the government’s losses plus an additional $11,000 per claim under the FCA. In this context, a “knowing” violation does not have to be intentionally fraudulent. A medical practice may be sued under the FCA if it was simply reckless or deliberately ignorant with respect to compliance. In some cases, health care providers may be charged with criminal violations of the FCA and sentenced to prison.
  • Anti-Kickback Statute: We normally associate bribery and kickbacks with crooked politicians. If you accept “anything of value” in exchange for referring a Medicare patient or recommending a medically unnecessary service, you can be charged with a crime under the federal Anti-Kickback Statute.
  • Stark Law: Also known as the “Physician Self-Referral Law,” this statute forbids doctors from referring patients to another healthcare entity where the doctor (or a member of their immediate family) has a financial relationship. For example, if you refer a Medicare patient to a testing lab where you a part owner, that violates the Stark Law, unless a legally designated exception applies to the situation.
  • Exclusion Statute: The OIG has the legal authority to exclude healthcare providers from accepting Medicare or Medicaid patients if they are found guilty of fraud, waste, and abuse. Under this Exclusion Statute, your own practice may sanctioned if you contract or subcontract with an excluded person or entity.

Your Compliance Obligations as a Small Practice

In 2000, the OIG implemented a new compliance program specifically designed for “individual and small group physician practices.” This regulation requires each provider to take the following steps to identify and reduce instances of waste, fraud, and abuse:

  • conduct periodic internal audits;
  • develop written and standards and procedures for the practice;
  • designate a “compliance officer” to monitor compliance with these standards and procedures;
  • train all staff on following the standards and procedures;
  • investigate alleged violations and promptly disclose any incidents to the OIG;
  • develop “open lines of communication” between all staff to help prevent errors or fraud; and
  • enforce strict disciplinary standards consistent with the practice’s written guidelines.

Not every healthcare practice needs to “fully” implement all of these components. A compliance program must be tailored to each provider’s size and available resources. This is why it is important to work with an experienced healthcare lawyer who understands the intricacies of Medicare and OIG regulations. Jackson LLP’s attorneys are licensed in Illinois and Wisconsin, and our initial consultation is free. Call our office today at (312) 985-6484 or click the button below to schedule your call with a member of our legal team.

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