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Federal Regulations
214
FEDERAL REGULATIONS
Med-Lake Laboratory
Outline
OUTLINE
5 REGULATIONS TO KNOW:
1. FALSE CLAIMS ACT
2. ANTI-KICK BACK STATUTE
3. STARK
4. CIVIL MONETARY PENALTIES
5. EKRA
FALSE CLAIMS ACT (FCA)
The FCA makes it illegal to submit claims for payment to Medicare or Medicaid that you know or should know are false or fraudulent.
The FCA defines 'knowing' to include not only actual knowledge but also instances in which the person acted in deliberate ignorance or reckless disregard of the truth or falsity of the information.
Criminal penalties for submitting false claims can include imprisonment and criminal fines.
FALSE CLAIMS ACT
EXAMPLES
1. Claims for services that were not provided or were difference than claimed
2. Failure to comply with quality of care
- Express or implied certification of quality
-Provision of "worthless" care
3. Failure to comply with conditions of payment or relevant fraud and abuse laws
-Express or implied certification of compliance when submit claims (ex. cost reports or claim forms)
PENALTIES
PENALTIES
- Repayment plus interest
- Civil monetary penalties of $5,500 to $11,000 per claim
-3x damages
-Exclusion from Medicare and/or Medicaid
ANTI-KICKBACK STATUTE (AKS)
ANTI-KICKBACK STATUTE
The AKS is a criminal law that prohibits the knowing and willful payment of remuneration to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health programs unless transaction fits within a regulatory safe harbor. Remuneration includes anything of value such as cash, free rent, hotel stays, meals, and more.
"ONE PURPOSE TEST" - Anti-kickback statute applies if ONE purpose of the remuneration is to induce referrals even if there are other legitimate purposes.
EXAMPLES
Applies to any form of remuneration to induce or reward referrals for federal program business: money, gifts, perks, meals, trips, over or under payments, waivers, etc.
EXAMPLES
- Paying a referring physician more than fair market value for medical director or other services
- Charging a referring physician less than fair market value to use your space or equipment
- Hiring a referring physician to act as a consultant even though you really do not need one
- Sending a “thank you” gift to referring providers or their offices
- Giving gifts or other freebies to Medicare or Medicaid beneficiaries
- Waiving co-pays and deductibles or providing “insurance only” billing to Medicare or Medicaid beneficiaries without a showing of financial need
- Accepting free trips or other gifts from vendors or other providers to whom you refer
- Giving your attorney a generous appreciation gift because of the joy they bring to you
PENALTIES
PENALTIES CAN INCLUDE
- 5 years in prison
- $25,000 criminal fine
- $50,000 penalty
- 3x damages
- Exclusion from Medicare and/or Medicaid
Anti-Kickback violations can put you at risk to False Claim act penalties as well
SAFE HARBOR
- No liability if satisfy all the requirements of a safe harbor.
- Not required to fit within safe harbor because ultimate question is whether “one purpose” of remuneration is to induce or reward referrals.
- The closer you come to satisfying regulatory requirements, the safer you will be.
Examples of Exceptions and safe harbors
- Personal services contracts
- Leases for space or equipment
- Investments in group practice
- Investments in ASCs
- Sale of practice
- Recruitment
- Certain investment interests
STARK
Also known as
"Ethics in Patient Referrals Act"
If a physician (or their family member) has a financial relationship with an entity:
- the physician may not refer patients to that entity for designated health services, and
- the entity may not bill Medicare for such designated health services
UNLESS arrangement structured to fit within a regulatory exception.
This applies to referrals by physicians to entities with which physician (or their family member) has a financial relationship
- Direct relationship
- Indirect relationship
Financial relationship
- Ownership or investment: stocks, bonds, partnership, membership shares, loans, etc.
- Compensation: employment, contract, lease, payments, gifts, free or discounted items, etc.
STARK LAW
WHO DOES THIS APPLY TO?
Physicians can be:
- MDs
- DOs
- Oral surgeons
- Dentists
- Podiatrists
- Optometrists
- Chiropractors
Family members can be:
- Spouse
- Parent, child
- Sibling
- Stepparent, stepchild, step-sibling
- Grandparent, grandchild
- In-law
EXAMPLES
- Physician referrals to entities that the physician owns
- Compensation arrangements which pay physicians based on their referrals to others (e.g., “eat what you kill” for ancillary services)
- Paying physicians more than fair market value
- Paying physicians even though services are not provided or needed
- Giving physicians discounts or freebies (e.g., professional courtesies)
- Subsidizing physician practices
- Financial arrangements without a written contract
- Performing after a written contract has expired.
- Amending contracts within one year
- Leases that fail to satisfy lease safe harbors (e.g., “per click”, “on demand”, non-exclusive)
PENALTIES
- No payment for services provided per improper referral
- Repayment of payments improperly received within 60 days
- Civil penalties
- $15,000 per claim submitted
- $100,000 per scheme
May also constitute Anti-Kickback Statute violations and False Claims Act violations
CIVIL MONETARY PENALTIES LAW
CIVIL MONETARY PENALTIES
LAW
Prohibits certain specified conduct:
- Submitting false or fraudulent claims or misrepresenting facts relevant to services.
- Offering, soliciting, giving or receiving remuneration to induce referrals (i.e., kickbacks).
- Offering inducements to program beneficiaries.
- Offering inducements to physicians to limit services.
- Submitting claims for services ordered by, or contracting with, an excluded entity.
- Failing to report and repay an overpayment.
- Failing to grant govt timely access.
PENALTIES
- $10,000 for each item or service
- 3x amount claimed
- Repayment of amounts paid
- Exclusion from Medicare and Medicaid
Also a likely violation of the Anti-Kickback Statute
ELIMINATING KICKBACK RECOVERY ACT (EKRA)
EKRA is a federal statute that prohibits any and all transactions involving payment of compensation for patient referrals to recovery homes, clinical treatment facilities, and laboratories. Under the EKRA law, entities and individuals that offer, pay, solicit, or accept unlawful compensation can face prosecution regardless or the payer -public or private- from which the funds are originally derived.
EKRA differs from other laws such as Anti-Kickback Statute and Stark Law that only apply to specified government health care benefit programs.
Penalties for violation of the EKRA law can carry fines of up to $200,000 and up to 10 years in federal imprisonment.