Fighting Allegations of Fraudulent Healthcare Referrals & Orders

Fighting Allegations of Fraudulent Healthcare Referrals & Orders

Being accused of healthcare fraud related to referrals or orders can be scary. But there are ways to defend yourself. This article talks about laws on referrals and kickbacks, what constitutes fraud, potential penalties, and strategies to fight allegations.

Laws on Referrals and Kickbacks

There are a few key laws that address fraud related to referrals and orders in healthcare:

• The Anti-Kickback Statute makes it illegal to knowingly and willfully solicit, receive, offer or pay remuneration (e.g. kickbacks) to induce referrals of federal healthcare program business.
• The Stark Law prohibits physicians from referring Medicare patients for certain designated health services to entities with which the physician or an immediate family member has a financial relationship.
• The False Claims Act imposes liability on any person who knowingly submits false claims to the government to obtain federal funds.

Violating these laws can lead to criminal, civil or administrative penalties. So it’s crucial to understand the rules and ensure full compliance.

What Constitutes Fraud

Some common fraudulent referral/order schemes include:

• Paying kickbacks for patient referrals
• Ordering excessive or unnecessary tests or procedures
• Upcoding services to increase reimbursements
• Billing for services not performed
• Self-referrals that violate Stark laws

Prosecutors look for patterns of abuse over time versus isolated incidents. But even one instance can trigger an investigation if large sums are involved.

Potential Penalties

If found guilty of healthcare fraud, penalties can be severe:

• Criminal fines up to $250,000 per count
• Imprisonment for up to 20 years
• Civil monetary penalties up to $50,000 per violation
• Treble damages under the False Claims Act
• Loss of medical license
• Exclusion from federal healthcare programs

These sanctions can essentially end a medical career. So defending against allegations is critical.

Fighting Allegations and Investigations

If facing an audit or investigation, key strategies include:

1. Consult an attorney – Getting expert counsel early is vital to understand risks and prepare an effective defense.
2. Cooperate – Respond to investigators in a timely, transparent manner. However, also invoke rights and avoid self-incrimination.
3. Review records – Thoroughly audit your own billing, notes, referrals etc. to identify any issues.
4. Justify decisions – Document the medical necessity and clinical reasoning behind referrals/orders.
5. Negotiate settlements – Seek compromise resolutions to avoid harsh judgments while minimizing penalties.

Other precautions against allegations include:

• Carefully structuring compensation arrangements to comply with fraud/abuse laws
• Conducting regular audits to catch any concerning patterns early
• Implementing a compliance program with training on referral/ordering policies
• Seeking advisory opinions on any questionable arrangements

References

Anti-Kickback Statute: https://oig.hhs.gov/fraud/docs/safeharborregulations/safefs.htm

Stark Law: https://oig.hhs.gov/fraud/docs/safeharborregulations/safefs.htm

False Claims Act: https://www.justice.gov/usam/criminal-resource-manual-645-health-care-fraud