DOJ Concludes Medicare Billing Investigation and Issues Press Release: Medicare Billing Company Will Pay $500,000 to Settle False Claims Allegations

US-SUP-CTThis week the United States Department of Justice (DOJ), through the United States Attorney for the Southern District of New York, Richard S. Hartunian, announced a settlement with Medical Reimbursement Systems, Inc. (MRI) of DOJ’s allegations that MRI submitted false claims to the Federal TRICARE Program in violation of the Federal False Claims Act (FCA). According to the DOJ investigation, MRI falsely presented claims to TRICARE as “HPSA” claims. MRI paid $500,000 to resolve the issue with DOJ.

Healthcare Law and Medical Billing

TRICARE is a Federal health care program for about 9.5 million beneficiaries that include active duty service members, National Guard and Reserve members, retirees, as well as the families of such. “HPSA” stands for Health Professional Shortage Areas, which (like sister Medically Underserved Areas known as “MUAs”) are designations based upon Federal standards applied by the United States Health and Human Services (HRSA).

Generally speaking, a HPSA is a federally designated geographic area that meets criteria for a primary care health professional shortage area. HPSAs may include urban and rural geographic areas, population categories, and particular facilities with shortages of health professionals. A HPSA designation carries certain economic advantages. One such advantage is that physicians who provide covered services to a HPSA can receive bonus payments (ten percent above standard Medicare reimbursement) for some services rendered to Medicare beneficiaries. In order to get the higher reimbursement, the billing entity must certify that the subject services were rendered in qualifying for HPSA.

MRI is a Massachusetts-based company that provides billing and receivables management services, including coding, billing and collections, auditing, third-party contract negotiation and fee schedule development services for hospital-based providers. DOJ contends that MRI agreed in 2009 to provide its billing services to a Watertown, New York physician practice in exchange for a percentage of net collections from the practice. According to the DOJ, an MRI employee informed MRI’s vice-president in 2009 that MRI was incorrectly billing TRICARE for the practice as HPSA-eligible, because the practice was not in a particular geographic area required to support HPSA eligibility, warning, “We need to stop billing this before we get in trouble.” Nevertheless, according to the DOJ, MRI continued the incorrect billing for several years, in violation of the FCA.

Healthcare Regulatory Compliance

DOJ commended MRI, however, for accepting responsibility, which included not only the payment but specific compliance-oriented steps, such as appointment of a new compliance office, billing training for staff, and related efforts, which DOJ described as “forward-looking compliance measures to assure adequate systems are in place to facilitate and promote ethical and legal conduct.” In pursuing and resolving the matter, the government also underscored its continued commitment to finding and addressing healthcare fraud and abuse, declaring: “This civil settlement demonstrates the continued commitment of the Defense Criminal Investigative Service, partnering with the Defense Health Agency and the United States Attorney’s Office for the Northern District of New York, to protect military members and their families and every other American taxpayer from those who seek to exploit our nation’s healthcare programs, including TRICARE.”

Healthcare fraud and abuse remains a top priority for federal law enforcement, to curb over utilization of healthcare that comprises patient care and/or burdens federal taxpayers. Fraudulent billing of Medicare has been an enormous financial burden for the federal government in recent years. Accordingly, it is critical for all healthcare providers, big and small, to ensure they have in place, and adhere to, effective healthcare regulatory compliance systems, both to be compliant with the law and to demonstrate their good faith intention to be.

Georgia Business and Health Care Law Firm

If your medical practice or health care business has questions regarding this blog post, or Medicare or health care fraud issues, contact us at (404) 685-1662 (Atlanta office), (706) 722-7886 (Augusta office), or to schedule a consultation.

*Disclaimer: Thoughts shared here do not constitute legal advice.

Source: Department of Justice Press Release

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