Waiver of Medicare copayments or deductibles could result in liability under the False Claims Act (FCA). A Medicare “deductible” is the amount a Medicare beneficiary must pay before Medicare pays for any items or services. Similarly, a copayment is the amount a Medicare beneficiary must pay before Medicare pays the remaining balance of a medical bill. The routine waiver of deductibles and copayments are unlawful because they result in violations of the Anti-Kickback Statute. Violations of the Anti-Kickback Statute are then actionable under the False Claims Act.
When a provider, practitioner, or supplier routinely waives Medicare copayments or deductibles, they are misstating the actual charge. For instance, suppose a practitioner, who claims $100 for a particular service, routinely waives the copayment of $20. The actual charge is $80, meaning Medicare should be paying 80 percent of $80 and not 80 percent of $100, a difference of $16. The misrepresentation results in Medicare paying an additional $16 each time the practitioner charges for this service.
Routine waiver of copayments or deductibles could result in violations of the Anti-Kickback Statute (AKS). The AKS makes it illegal to offer, pay, solicit, or receive anything of value as inducement to generate Medicare business. When a provider, practitioner, or suppler routinely waives Medicare copayments or deductibles, for reasons other than financial hardships, they may be violating the AKS by inducing patients to purchase their services or items.
Naturally, when Medicare overpays for any item or service, there are less Medicare funds available for needed services. Former Acting Assistant Attorney General Stuart F. Delery stated:
The Justice Department has longstanding concerns about kickbacks and the routine waiver of co-payments, because they can impose significant cost on federal health programs that are not medically justified.
One of the largest areas of FCA litigation is health care fraud. For example, since January 2009, the government has recovered $19.3 billion from health care fraud actions alone. The FCA contains a qui tam provision, which provides an avenue for ordinary citizens to aid the government in detecting and deterring health care fraud. Furthermore, the FCA both protects and rewards those brave individuals who step forward and report fraud. One way to detect health care fraud is to look at the marketing practices of the providers, practitioners, and suppliers. The following are seven marketing practices that could identify those who routinely waive Medicare deductibles and copayments.
• Advertisements stating “Medicare Accepted as Payment in Full,” “Insurance Accepted as Payment in Full,” or “No Out-Of-Pocket Expense.”
• Advertisements promising Medicare beneficiaries will receive “discounts.”
• Routine use of “Financial Hardship” forms, stating the beneficiary is unable to pay the copayment/deductible.
• Collection of copayments and deductibles only when the beneficiary has Medicare supplemental insurance coverage.
• Charges to Medicare beneficiaries that are higher than those made to other persons for similar services or items.
• Failure to collect copayments or deductibles for a specific group of Medicare patients for reasons unrelated to financial hardship.
• “Insurance programs” covering copayments or deductibles only for items or services provided by the entity.
Are you aware of fraud being committed against the federal government, or a state government? If so, the FCA can protect and reward you for doing the right thing by reporting the fraud. If you have any questions about whether you qualify as a whistleblower, you can contact a lawyer at Beasley Allen for a free and confidential evaluation of your claim. There is a contact form on our firm’s website, or you may email one of the lawyers on our whistleblower litigation team: Andrew.Brashier@beasleyallen.com, Archie.Grubb@beasleyallen.com, Larry.Golston@beasleyallen.com or Lance.Gould@beasleyallen.com. You can also call them at 800-898-2034.
Sources: 59 FR 65372-01, 1994 WL 702552 (F.R.)., U.S. Department of Justice
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