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Insight and commentary on qui tam law in Oregon

Common schemes exposed by whistleblowers in False Claims Act cases

Healthcare edition
October 30, 2023

The False Claims Act (FCA) is a federal law in the United States that allows individuals to bring lawsuits on behalf of the government against individuals and entities that defraud government programs. In the context of healthcare, there are several common schemes that have been subject to FCA enforcement actions. Here are 10 different common healthcare-related False Claims Act schemes:

  1. Billing for Unnecessary Medical Services: Healthcare providers bill for services or procedures that were not medically necessary, often to increase their reimbursement from government healthcare programs like Medicare or Medicaid.
  2. Upcoding: This scheme involves deliberately using codes for more expensive services or treatments than what was actually provided to patients in order to receive higher payments.
  3. Phantom Billing: Healthcare providers submit claims for services or tests that were never actually performed, effectively “phantom billing” the government for non-existent services.
  4. Kickbacks: Healthcare providers and entities offer or receive illegal kickbacks in exchange for patient referrals, which can lead to overutilization of services and increased costs to government healthcare programs.
  5. Unbundling: Instead of billing for a bundled set of services, providers unbundle them into separate claims to maximize reimbursement from government programs.
  6. Off-Label Promotion: Pharmaceutical companies promote their drugs for uses that have not been approved by the FDA, which can lead to false claims for reimbursement when the drug is prescribed for these unapproved uses.
  7. Stark Law Violations: Physicians and healthcare providers refer patients for services or tests to entities with which they have a financial relationship, which is prohibited under the Stark Law. This can result in false claims when billing for these services.
  8. Falsifying Medical Records: Healthcare providers may alter or falsify medical records to support false claims for services or treatments that were never actually provided to patients.
  9. Double Billing: Submitting multiple claims for the same service or treatment, often by exploiting coding errors or oversights, to receive payment from multiple sources.
  10. Substandard Care: Providing substandard or unsafe healthcare services to patients, leading to false claims when providers bill for services that do not meet the required standards of care.

It’s important to note that the False Claims Act plays a crucial role in detecting and prosecuting healthcare fraud, which can lead to substantial penalties for individuals or entities found guilty of engaging in these schemes. Healthcare fraud not only harms the government but also jeopardizes patient safety and the integrity of the healthcare system.