2009 False Claims Act Amendments — Beware!
Do you know that new amendments to the False Claims Act were enacted on May 20, 2009?
If not, you need to know that the changes include important elements that could affect your practice.
Like the original False Claims Act (FCA), violations are subject to treble damages and mandatory penalties of $5,500 – $11,000 per claim.
The revised FCA authorizes over $260 million per year in additional funding to federal agencies to combat fraud involving federal assistance programs for fiscal years 2010 and 2011.
Changes within the amendments include:
- An original clause that stated claims must be paid or approved “by the Government” was modified; the phrase “by the Government” was removed. A claim now includes requests for funds to a contractor, grantee or other recipient, if the money requested “is to be spent or used on the Government’s behalf or to advance a Government program or interest”
- The “Reverse False Claims” section of the amended FCA contains key language related to how overpayments are identified and repaid, and the changes could be very challenging for health care entities.
Section 3729(a)(1): Any person who---(G) knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the Government, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government, is liable to the United States government for a civil penalty of not less than $[5,500] and not more than $[11,000]...plus three times the amount of damages...
“Obligation” means an established duty, whether or not fixed, arising from an express or implied contractual, grantor-grantee, or licensor-licensee relationship, from a fee-based or similar relationship, from statute or regulation, or from the retention of any overpayment...”
Liability under Section 3729(a)(1)(G) does not require a claim, a false statement or act of any kind, a quantified overpayment, any minimum threshold amount of overpayment, or an unreasonable delay in the return of an overpayment.
Thus, if a practice does not have an appropriate program for identifying and refunding overpayments, it could be liable under the amended FCA.
- Overpayments have a “double whammy” impact. First, overpayment violations can be applied to items that otherwise meet a false claims definition (i.e. reporting a service that was not performed) and those that were not otherwise considered a false claim (i.e. the carrier paid you incorrectly and you didn’t identify it and return the money).
- The amendment expands protection against retaliation to include “contractors and agents.” (This was previously limited to employment arrangements)
- As a result, billing or coding services or other contractors could potentially be protected if they bring forward a complaint.
- Although the amendments were enacted on May 20, 2009, they apply retroactively to any overpayments that existed at the time of amendment.
Thus, if a group has an overpayment on the books that they received prior to May 20, 2009 but have been “sitting on”, that could be considered a violation.
Feeling nervous yet?
Health care attorney Pat Hofstra advises: “Providers have an obligation to educate themselves with respect to legal and regulatory requirements pertaining to billing and a duty to assure that staff and contracted service providers, such as the provider's billing company, are compliant. Physicians can be held liable for the false claims of their employees and agents. Ignorance of the law or the actions of staff and contracted service providers is not an acceptable excuse. “
Take time now to review your practice’s current policies for overpayment identification and refund management.
- Generate your credit balance report by payor and review the contents.
- If you use a billing service, insist on receiving this report monthly.
- Review your policy on credit balance refunds and establish lines of responsibility. Waiting until the carrier asks for the money back is not good policy, and exposes your practice to risk if the claim relates to a government funded program.
If you find errors or overpayments that have not been processed, a qualified health care attorney can advise you on what actions are appropriate for your practice.
Learn more about the False Claims amendments and other essential practice management tips at an upcoming specialty workshop! Click below for upcoming dates and locations:
For more information visit www.karenzupko.com or call (312) 642-5616.
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