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Reporting False Claims

July 21, 2011

Question:

Jennifer,

The group I work for is submitting claims to Medicare but not adhering to applicable supervision requirements. What should I know about the ramifications of these actions and how would I report? Also, is there a financial incentive for me to report?

Thanks,

Dr. A

Answer:

Certainly the actions by the group, if inappropriate under Medicare guidelines would be reportable. Submission of claims to Medicare that are “false or fraudulent” is prohibited by the Federal (and State) False Claims act and creates liability for a civil penalty of not less than $ 5,000 and not more than $ 10,000, plus 3 times the amount of damages which the Government sustains because of the act of that person. See 31 USC § 3729.

To boil down the reporting options – you can report directly to the Office of the Inspector General (OIG) – and OIG makes it easy to report. You can do so online, via fax or mail, and also may be done anonymously. Reporting to OIG is not going to result in you receiving any financial benefit. The government requires you to do most of the work if you want to receive a benefit – by filing your own suit against the egregious party. Such a suit is called a Qui Tam action.

The gist of a Qui Tam is, you, the reporting party brings an action against the person(s)/entity(ies) submitting false claims, you notify the government you are bring the action before you notify the other party, and the government may, at its option, take over the case, or sit on the sidelines while you prosecute. Here, if you are successful, you may see a financial windfall. How much you get depends on how much effort you had to put in (supposedly) - if the Government proceeds with an action, the person who originally brought the action may receive between 15-25% of the proceeds of the action or settlement, whereas, if the Government does not proceed the person bringing the action may receive 25-30% of the proceeds of the action or settlement. Be advised that if you are bringing the action and you are convicted of criminal conduct arising from the false claims, you would be dismissed from the action and not receive any share of the proceeds.

Whether to report or proceed with an action is a difficult decision - one bereft with ramifications or on the flip side, possibly potential financial benefit. Certainly in the past few years there have been wildly successful Qui Tam cases where individuals have collected tens of millions of dollars for reporting.  However, those stories are few and far between from the actions that are abandoned by individuals or not investigated or resulted in "no charge" by the government. If you are considering reporting, speak with competent healthcare counsel first to make sure you have explored and adequately evaluated all options.

 

Copyright © 2011 by Kirschenbaum & Kirschenbaum, P.C.

All Rights Reserved. This email is provided for news and information purposes only and does not constitute legal advice or an invitation to an attorney-client relationship. While every effort has been made to ensure the accuracy of the information contained herein, Kirschenbaum & Kirschenbaum PC does not guarantee such accuracy and cannot be held liable for any errors in, any reliance upon this, or losses caused by the information. Under New York’s Code of Professional Responsibility, this material may constitute attorney advertising. Prior results do not guarantee a similar outcome.


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