Malpractice or Fraud? The False Claims Act and Quality of Care - PDF document

Malpractice or Fraud? The False Claims Act and Quality of Care Issues Malpractice or Fraud? The False Claims Act and Quality of Care Issues Dan Mulholland Horty, Springer & Mattern False Claims Act Theories Based on Quality  Lack of medical necessity  “Worthless” services  Negligent or “substandard” care  Violation of regulations 1

Malpractice or Fraud? The False Claims Act and Quality of Care Issues Medical Necessity Medicare only pays for services that are “reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.” 42 U.S.C. § 1395y(a)(1)(A) Worthless Services “In a worthless services claim, the performance of the service is so deficient that for all practical purposes it is the equivalent of no performance at all.” Mikes v. Straus, 274 F.3d 687, 703 (2d Cir. 2001) 2

Malpractice or Fraud? The False Claims Act and Quality of Care Issues Negligent or Substandard Care “permitting qui tam plaintiffs to assert that defendants’ quality of care failed to meet medical standards would promote federalization of medical malpractice, as the federal government or the qui tam relator would replace the aggrieved patient as plaintiff.” Mikes v. Strauss, 274 F.3d 687, 701 (2d Cir. 2001) Violation of Regulations  Conditions of Payment? or  Conditions of Participation? 3

Malpractice or Fraud? The False Claims Act and Quality of Care Issues High-Risk Areas  Interventional cardiology  Spine implants  Home Health/DME/SNFs Anatomy of a Qui Tam Lawsuit  Complaint filed under seal by “whistleblower”  Government investigates  Settlement discussions  Intervention or declination  Suit continues with or without Government  Final settlement or judgment 4

Malpractice or Fraud? The False Claims Act and Quality of Care Issues FCA Damages  3X amount paid for false claims +  $5,500 to $11,000 per claim Corporate Integrity Agreement  Intensive training  Reports to OIG  Independent review organization  Compliance consultant  Peer review consultant  $$$$$$$! 5

Malpractice or Fraud? The False Claims Act and Quality of Care Issues Criminal Prosecutions  Physicians  Management Other Regulatory Headaches  Licensure  Hospital  Physicians  Patient Safety Authority  CMS  Accreditation 6

Malpractice or Fraud? The False Claims Act and Quality of Care Issues Patient Lawsuits  Malpractice  Class Actions Physician Lawsuits  Defamation  Interference with contracts 7

Malpractice or Fraud? The False Claims Act and Quality of Care Issues Should You Self-Disclose?  Department of Justice  Local U.S. Attorney  Main Justice in DC  OIG  PR challenge – how transparent should you be? How to Minimize Risk  Upgrade your peer review process  Review for medical necessity  Open lines of communication  Hospital peer review  Employed physician group  Compliance  Risk management  Take corrective action before problem gets out of hand 8