False Claims Act compliance plan can help protect practice

Key Points

Perhaps the most important tool in the government's enforcement arsenal is the "whistleblowing" aspect of the False Claims Act (FCA). These qui tam (meaning "he who prosecutes for the king") provisions allow a private complainant, or relator, to initiate litigation in the name of the U.S. government to recover payments induced by fraud. As an incentive, the law allows the relator to receive up to 30 percent of the amount recovered by the government. These incentives have made many former employees wealthy and have been responsible for a dramatic increase in the number of cases brought under the FCA. In 1988, qui tam settlements and judgments constituted less than 2 percent of total FCA actions. By 2008, qui tam settlements and judgments accounted for 63 percent of FCA recoveries.

Any employee aware of irregular practices in an office is like a potential time bomb. Given this fact, how do you best protect your practice?

Given the complexity of the billing and coding system, it is likely that every practice occasionally will make billing errors. Efforts should be made to reduce these errors and rectify them when they occur. As important, these efforts should be carefully documented and should be the subject of a compliance program specifically tailored to the practice.

Many practices maintain compliance programs that gather dust on a shelf, their requirements unfulfilled. This reality can create the worst possible scenario for a practice, because the compliance program sets a de facto standard of review and scrutiny, and the failure to follow your own recognized standard can be used to demonstrate reckless disregard.

For this reason, your compliance program should not be overly ambitious or aspirational. It should include only practices that can and will be followed. These practices, at a minimum, should require the appointment of a compliance officer, provide information to employees concerning the need to avoid activities that could constitute fraud, and encourage employees and patients to file complaints with the practice if improper activities are suspected. The program also should allow for anonymous complaints and should have a detailed process for investigation. It is far better to learn of a problem from an employee or patient than from an FBI or Department of Health and Human Services agent. Periodic audits of a sampling of claims and charts should be included in the compliance program, with provisions for outside review in appropriate circumstances.

Training of staff also should be an integral part of any compliance program. This training should stress the importance of proper coding and the need to have chart documentation to support every claim. It also should address general billing matters as well as specific issues that relate to the individual practice. Training should be provided to new and experienced employees on a periodic, recurring basis.

The author is a health law attorney with Kern Augustine Conroy & Schoppmann in Bridgewater, New Jersey; Lake Success, New York; and Philadelphia. Malpractice Consult deals with questions about common professional liability issues. Unfortunately, we cannot offer specific legal advice. If you have a general question or a topic you'd like to see covered here, please send it to medec@advanstar.com
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