Healthcare Fraud

The purpose of the qui tam provisions of the False Claims Act is to encourage private individuals who are aware of Healthcare Fraud to bring such information forward.

Healthcare Fraud can be found in all segments of the healthcare industry and in every geographical area of the country.

The three largest healthcare programs that the federal government funds are the Medicare Program, the Medicaid Program, and the TRICARE Program.

Medicare

In 1965, Title XVIII of the Social Security Act established the Medicare Program. Medicare is a system of healthcare cost reimbursement established by federal statute and regulations issued by HHS. Medicare helps pay for the costs of certain healthcare expenses for individuals 65 years of age or older.

Part A

Part A payments are made to institutional providers such as hospitals, skilled nursing facilities, home health agencies, etc. Payment is generally made under the Prospective Payment System (PPS). Part A False Claims Act violations include DRG upcoding, lack of medical necessity, and one-day stay violations.

Part B

Part B services provided by physicians, suppliers, and other healthcare providers are generally paid on the basis of a Medicare fee schedule. Under Part B, the Medicare beneficiary is responsible for any applicable deductible or co-insurance requirements. When services are covered under Part B, Medicare will use one of the two following methods of payment: (1) payment to the patient; (2) payment to the doctor (or supplier or other healthcare entity). This second method is known as the “assignment” method. Part B Medicare fraud includes:

    1. Billing for services not rendered or products not ordered;
    2. Misrepresenting services rendered or product provided (e.g. upcoding, inappropriate coding);
    3. Billing for medically unnecessary services;
    4. Falsifying records to meet or continue to meet the conditions of participation;
    5. Increasing units of service that are subject to a payment rate; and
    6. Laboratory unbundling.

Part C

Medicare beneficiaries may select a managed care plan certified under Medicare. Payments Medicare makes to the managed care plan replace the amounts Medicare otherwise would have paid under traditional Medicare.

Areas of Part C subject to fraud and abuse include: Inflated general and administrative costs, the intentional failure to pay providers or provide reasonable and necessary services to beneficiaries, and MCO and physician relationships that are driven by cost-containment at the expense of patient care.

 

Part D

See Part D Fraud.

 

Medicaid

Medicaid is a joint federal-state entitlement program that provides healthcare for low-income people. Each state’s Medicaid program is administered through a specific state entity, and the program itself is not always called “Medicaid” per se. For instance, in California, the program is called “Medi-Cal.” The state directly reimburses healthcare providers for services rendered, with the state obtaining the federal share of the payment from accounts which draw on funds of the United States Treasury. Medicaid is the second-largest healthcare program in the federal budget and the second-largest state spending item, surpassed only by elementary and secondary education.

Medicaid Fraud can take many forms, including:

    1. Billing for services not rendered or products not delivered;
    2. Billing for services or supplies not ordered;
    3. Misrepresenting services rendered or product provided e.g. Upcoding, inappropriate coding;
    4. Billing for medically unnecessary services – this includes furnishing services in excess of the patient’s needs, or furnishing a battery of diagnostic tests, where, based on the diagnosis, only a few were needed; it also includes misrepresenting the diagnosis to justify the services or products;
    5. Duplicate billing;
    6. Falsifying records to meet or continue to meet the conditions of participation; this includes the alteration of dates, the forging of physician signatures, and the adding of additional information after the fact;
    7. Increasing units of service;
    8. Billing procedures over a period of days when all treatment occurred during one visit i.e. split billing;
    9. Laboratory unbundling – in this scenario, tests and other services that are automatically performed as a panel, group or set, should be billed as a single service. When a provider breaks these services out of the bundled group and bills them individually, the provider is deemed to be “unbundling;”
    10. Unlawfully providing kickbacks to healthcare providers in exchange for referrals or prescriptions.

TRICARE

TRICARE (f/k/a CHAMPUS), is the component agency of the U.S. Department of Defense that administers and supervises the healthcare program for certain military personnel and their dependents. TRICARE contracts with a fiscal intermediary that receives, adjudicates, processes, and pays healthcare claims submitted to it by TRICARE beneficiaries or providers.

Fraud against the TRICARE program can take many forms, including:

    1. Billing for services not rendered or products not delivered;
    2. Billing for services or supplies not ordered;
    3. Misrepresenting services rendered or product provided (e.g. upcoding, inappropriate coding);
    4. Billing for medically unnecessary services – this includes furnishing services in excess of the patient’s needs, or furnishing a battery of diagnostic tests, where, based on the diagnosis, only a few were needed; it also includes misrepresenting the diagnosis to justify the services or products;
    5. Duplicate billing;
    6. Falsifying records to meet or continue to meet the conditions of participation; this includes the alteration of dates, the forging of physician signatures, and the adding of additional information after the fact;
    7. Increasing units of service;
    8. Billing procedures over a period of days when all treatment occurred during one visit i.e. split billing;
    9. Laboratory unbundling – in this scenario, tests and other services that are automatically performed as a panel, group, or set, should be billed as a single service. When a provider breaks these services out of the bundled group and bills them individually, the provider is deemed to be “unbundling;”
    10. Unlawfully providing kickbacks to healthcare providers in exchange for referrals or prescriptions.

Our Healthcare Fraud qui tam attorneys have the knowledge and experience to discuss in depth areas of Healthcare Fraud, including: Stark law violations, pharmaceutical kickbacks, pharmaceutical fraud, medical device fraud, and medical equipment fraud.

  • Healthcare Fraud Contact Form – short intake form for potential clients to complete about healthcare fraud.
  • Anti-Kickback Statute – describes the law prohibiting payment of kickbacks in exchange for referrals.
  • Stark Statute – describes the law prohibiting physicians from making referrals of patients to entities in which physicians have business relationships.
  • Home Healthcare Fraud – describes fraud schemes under the Home Healthcare Reimbursement scheme.
  • Ambulance Fraud – describes fraud schemes applicable to ambulance providers.
  • SNF Fraud – describes healthcare fraud common to skilled nursing facilities.
  • LTACH Freud– describes healthcare fraud common to long term acute care hospitals.

REAL PEOPLE making real change Meet Some of our Heroes

Joe Strom

Johnson & Johnson
$184 Million

Joe Strom contacted us in 2005. We were very grateful that he did. We immediately formed an all-star legal team and a process to stop a very harmful pharmaceutical marketing strategy. It was this process we set into motion that ultimately returned hundreds of millions of dollars to the U.S. Treasury, and a portion of that, very well-deserved, into Joe’s bank account.

Joe told us a very troubling story about the off-label promotion of a pharmaceutical drug for patients who already suffered from chronic heart failure.

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Bruce A. Moilan Sr.

$27 Million

Bruce Moilan was a seasoned hospital systems expert by the time he contacted our Firm. At the time he decided to file his qui tam lawsuit, he was employed by South Texas Health System as a System Director for Materials Management. In this position, he oversaw $24 million in annual purchases of supplies and equipment and helped determine budget, reduction and cost analysis throughout the contract bidding and negotiations process. His job was to insure proper implementation for purchasing, receiving and management of inventory, for McAllen Hospitals, L.P.

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Kathleen Hawkins

Dignity Health
$37 million

Kathleen Hawkins, RN MSN, had been employed by Defendant, Catholic Healthcare West (CHW) for approximately 6 years when she decided she had had enough of trying to change the hospital system from within.

CHW, a California not-for-profit corporation that operated hospitals in California, Arizona, and Nevada, was at the time the eighth largest hospital system in the nation and the largest not-for-profit hospital provider in California.

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"I collaborated with Nolan, Auerbach and White on a broad variety of cases where whistleblowers stepped forward to disclose tactics employed by large companies to influence physicians' medical decision-making in patient care. They provide ample resources to not only optimize their client cases, but in doing so consistently leverage best medical evidence to further patient safety and resource utilization.”

— Fred Polsky M.D., Former Medical Director, CMS Zone 7 Integrity Contractor

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