Every year a minimum of $4.3 trillion is spent on healthcare in the United States, of which an estimated $60 billion is attributable to fraud and abuse. In order to combat this, HIPAA established the Healthcare Fraud and Abuse Control Program (HCFAC). Both federal and state laws exist to reduce healthcare fraud and abuse, and financial and/or criminal penalties can be imposed.
With unethical billing practices being number one in healthcare fraud and abuse, there are also other recognized areas that have resulted in diverse laws, codes, and standards. Thus, ongoing internal fraud audits along with healthcare fraud and abuse training for all staff is essential for healthcare facilities.
Understanding Federal Laws Aimed at Curbing Healthcare Fraud and Abuse
According to the DHHS’ Office of the Inspector General (OIG), the following are the six key federal laws aimed at deterring healthcare fraud and abuse that you should know:
- The False Claims Act (FCA) – 31 U.S.C. § § 3729-3733 This federal law prohibits the submission of a false claim to the government in connection with a reimbursement. Some examples of false claims include billing for services that were not provided, double billing for goods or services, and “upcoding” or billing under a code that offers more reimbursement than is appropriate.
- The Anti-Kickback Statute (AKS) – 42 U.S.C. § 1320a-7b(b). The federal AKS prohibits the offer, payment, or receipt of anything of value to induce (or in return for) the referral of a patient or service that is reimbursable under any federal healthcare program. “Safe harbors” may be deemed as an exception to the AKS if specific legal parameters are met.
- The Physician Self-Referral Law (or the Stark Law) – 42 U.S.C. § 1395nn. This federal law prohibits self-referral arrangements, when a physician refers patients to entities in which the physician or their family members has a financial relationship, unless it meets the criteria and exceptions laid out under the law. These exceptions need to be met before the referral occurs. More information about the law and the ‘financial relationship’ terminology is taught in our updated healthcare fraud and abuse course.
- The Exclusion Authorities (also called Exclusion Statute) – 42 U.S.C. § 1320a-7. The DHSS’ OIG is legally required to exclude from participation in all federal healthcare programs (such as Medicare) individuals and entities convicted of a variety of specified types of criminal offenses. The OIG has the discretion to exclude from participation individuals and entities on diverse other grounds. In addition, this law specifies that healthcare facilities and medical providers are responsible for not employing or contracting with excluded individuals and entities.
- The Civil Monetary Penalties Law – 42 U.S.C. § 1320a-7a. The OIG may seek civil monetary penalties and sometimes exclusion for a variety of conduct. Amounts are based on the type of violation at issue.
- Criminal Health Care Fraud Statute – 18 U.S.C. 1347. This statue makes it a federal crime to defraud or fraudulently obtain money from a health care benefit program.
Policies and Documentation of Employee Fraud and Abuse Training
A violation of state law pertaining to healthcare fraud and abuse can result in federal legal action. Employee fraud and abuse training needs to include a focus on current state laws as well as federal laws. If a complaint is filed to a governmental entity of suspected fraud or abuse by that facility or its employees, maintaining documentation of continuous fraud and abuse training with detailed descriptions of the training program may result in a lessened penalty if a related governmental investigation occurs resulting in a violation.
Visit our Healthcare Fraud and Abuse product page to learn more about our training program, and to register your staff for the course.