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The Federal False Claims Act… … and how it affects You (as impacted by the Deficit Reduction Act of 2005) Updated 11/20/06 Purpose of Presentation • To provide a general overview of the Federal False Claims Act • To provide information to Tulane University Faculty and Staff Employees about their rights to protection under the Deficit Reduction Act of 2005 • To describe Tulane University’s policies and procedures for detecting and preventing fraud, waste, and abuse As Medicare and Medicaid programs grow increasingly complex, laws and regulations governing them become more complicated, and require increasing organizational resources to ensure compliance with their requirements. • This comes at a time when these programs become more strained by the health care needs of retiring baby boomers. • Nearly 36 million (86%) of today’s beneficiaries receive benefits paid as fee-for-service • Over 1 billion claims are paid each year to over 1 million providers • In 2004, more than $1 trillion went to Medicare, Medicaid, and Social Security programs These figures illustrate the government’s need for enhanced diligence in identifying and targeting fraudulent activities and recovering funds under the False Claims Act. The Medicaid Program • originated in 1965 to ensure health care coverage and services for low-income and financially needy people • is administered by the states, but is jointly funded by federal and state governments • reimburses providers directly for services to its beneficiaries The state’s fraud control units investigate Medicaid fraud and abuse issues. The Medicare Program • was established in 1965 by Title XVIII of the Social Security Act • is a federally-funded health insurance program for citizens 65 or older, and persons with long- term disability or end-stage renal disease • consists of four parts, for various health care items and services Medicare Part A • provides coverage for institutional providers • generally pays under the Prospective Payment System (PPS), but may also reimburse institutional providers (including hospitals) for services they provide under Part B such as hospital outpatient services • is financed through payroll taxes paid by employees and employers through FICA, by self-employed individual contributions, and the Railroad Retirement Board • currently makes payment through contracted insurance companies (Fiscal Intermediaries), but will move to a new contracting model, Medicare Administrative Contractor (MAC) by 2011 Medicare Part B • covers services provided by suppliers: physicians, nurse practitioners, home health care, ambulance, clinical and diagnostic labs, durable medical equipment • bases payment on Medicare fee schedules developed by the Centers for Medicare and Medicaid Services • carries a deductible and co-insurance paid by the beneficiary • is financed through premiums paid by enrollees, general revenue, and interest earned on the Part B trust fund • payments are generally made by contracted insurance companies (carriers), which will be replaced with the MAC contracting model Medicare Part C • was originally established in 1997 as “Medicare Choice” to offer managed care services to Medicare beneficiaries • was amended in 2003 to become “Medicare Advantage”, and beneficiaries receive Part A and Part B services through enrollment in a managed care organization (HMOs, PPOs) • may also include wellness and preventative health programs • is financed by payments made by CMS to Medicare Advantage contractors that would have otherwise been paid under Parts A and B to providers and suppliers Medicare Part D • is a prescription drug benefit for Medicare beneficiaries, added as of January 1, 2006 • includes coverage for outpatient prescription drugs, prescribed biological products, insulin (including supplies), and vaccines • is administered by private Prescription Drug Plans • is financed by premiums paid by Medicare beneficiaries • generally carries a deductible, co-insurance, and a monthly premium Medicare and Medicaid programs are administered by the Centers for Medicare and Medicaid Services (CMS), which provides operational direction and policy guidance to health care providers and suppliers. Find them online at www.cms.gov. The Office of Inspector General (OIG), within the Department of Health and Human Services, is charged with oversight of the Medicare program, and investigates suspected fraud and abuse. It imposes civil monetary penalties and administrative actions, including program exclusion, against health care providers for fraud and abuse misconduct; and refers cases of fraud to the Department of Justice and other federal agencies for further criminal and/or civil action. The Federal False Claims Act 31 USC § 3279 The False Claims Act • is a federal statute that covers fraud involving any federally funded contract or program (including Medicare and Medicaid) • is commonly known as the “Lincoln Law” because it was first enacted to counter fraudulent activities involving military procurement during the Civil War • establishes liability for any person who knowingly presents or causes to be presented a false or fraudulent claim to the U.S. government for payment The term “knowingly” is defined to mean that a person, with respect to information: • has actual knowledge of falsity of information in the claim • acts in deliberate ignorance of the truth or falsity of the information in a claim • acts in reckless disregard of the truth or falsity of the information in a claim The act does not require proof of specific intent to defraud the government. Health care providers can be prosecuted for a wide variety of conduct that leads to the submission of fraudulent claims to the government, such as knowingly making false statements, double-billing for items or services, billing for services never performed, falsifying records, or otherwise causing a false claim to be submitted. For purposes of the False Claims Act, a “claim” includes any request or demand for money that is submitted to the U.S. government or its contractors. • Health care providers and suppliers who violate the False Claims Act can be subject to civil monetary penalties ranging from $5500 to $11000 for each false claim submitted. • Providers and suppliers can also be required to pay 3 times the amount of damages sustained by the government. • If a provider or supplier is convicted of a False Claims Act violation, the OIG may seek to exclude him/her/it from participation in federal health care programs. Examples of Health Care Fraud: • Billing for services not rendered or goods not provided • Falsifying certificates of medical necessity and billing for services not medically necessary • Billing separately for services that should be a single service (un- bundling) • Falsifying treatment plans or medical records to maximize payments • Failing to report overpayments or credit balances • Duplicate billing • Unlawfully giving health care providers inducements in exchange for referrals • Physician billing for services provided by interns, residents, and fellows in a teaching hospital Qui Tam “Whistleblower” Provisions • Designed to encourage individuals to report misconduct involving False Claims Act • Allows any person with actual knowledge of allegedly false claims to the government to file a lawsuit on behalf of the government • Resulted in more than $1.4 billion in settlements and judgments in 2004-2005 • Recovered $1.1 billion through “whistleblower” lawsuits Qui Tam Procedure: The whistleblower must file his/her lawsuit on behalf of the government in a federal district court, and kept “under seal” (confidential) during governmental review and investigation of the allegations • Rights of Parties: • Awards to Qui Tam If the government Whistleblowers: determines that the lawsuit If the lawsuit is successful, has merit and decides to and certain legal intervene, the prosecution of requirements are met, the the lawsuit will be directed whistleblower may receive by the Department of an award ranging from 15 Justice. If the government to 30 percent of the amount decides not to intervene, the recovered, and may be whistleblower may continue entitled to reasonable with the lawsuit on his or her expenses for bringing the own. lawsuit. Furthermore…. • The False Claims Act entitles whistleblowers to additional relief, including employment reinstatement, back pay, and any other compensation arising from retaliatory conduct against the whistleblower for filing an action under the False Claims Act or committing other lawful acts in a False Claims Act action. The Deficit Reduction Act of 2005 offered an incentive to states to enact their own False Claims Act requirements. At present, only a handful of states has enacted their own. LOUISIANA IS ONE OF THEM! Maintains a “hotline” for reporting incidents involving Billing Practices and Procedures and other fraudulent activity. Call 504-988-5142 to report violations. Tulane University Code of Conduct Compliance with Federal Law for Billing and Reimbursement of Health Care Services This Code of Conduct evidences the commitment of Tulane University (“Tulane”) and its employees, agents, and contractors to full compliance with all laws and regulations regarding billing for health care services. Tulane is committed to ensuring that billing to and reimbursement from the Medicare program, Medicaid program, and all other federal health care programs is in compliance with the regulations and guidance for billing such programs. It is Tulane’s policy to educate our employees, agents and contractors about the provisions of the federal and state laws that prohibit the submission of false claims and false statements as well as about the whistleblower protections contained in these laws and the role that these laws play in detecting and preventing fraud, waste, and abuse. Tulane University Code of Conduct • Applicability • This Code of Conduct applies to all Tulane employees, agents and contractors, however, health care providers and individuals supporting health care providers are more likely to encounter the situations described in this Code of Conduct. Those employees, agents and contractors who provide health care services, are members of Tulane University Medical Group, or who provide administrative, managerial, financial or other support for Tulane’s health care functions should ensure that they fully understand this Code of Conduct. Tulane University Code of Conduct • State and Federal Laws • Both federal and Louisiana law prohibit Tulane from knowingly presenting a false or fraudulent claim to Medicare, Medicaid, or other federal health care programs. Federal law defines a “false claim” as knowingly presenting false or fraudulent claims for payment or making or using a false record or statement to receive payment for a claim. Louisiana law defines a “false or fraudulent claim” as a claim that a health care provider (or his agent) submits knowing the claim to be false, fictitious, untrue, or misleading in regard to any material information. Examples of false claims could include billing for services not rendered or goods not provided, falsifying certificates of medical necessity, falsifying medical records, unauthorized use or unauthorized assignment of provider billing numbers, and failing to report overpayments or credit balances. All of the data elements that must be included in submissions for reimbursement from Medicare, Medicaid and other federal health care programs must be accurate. Violations of these federal and state laws can subject Tulane to significant fines and penalties. Tulane University Code of Conduct • Protection of Whistleblowers • The federal and state laws contain certain protections for “whistleblowers” who alert the appropriate governmental authority of a violation of the false claims acts. Under these laws, any person with actual knowledge of an allegedly false claim, including employees, agents and contractors, may, under certain conditions, become a whistleblower under these statutes and is free to notify the appropriate state or federal governmental authorities if he/she does not believe that Tulane is responding appropriately when notified about potential violations. Employers are prohibited from taking adverse or retaliatory action against a whistleblower who in good faith notifies the appropriate governmental authority of an alleged violation. Whistleblowers may also be entitled to relief, including employment reinstatement, back pay, and other compensation arising from retaliatory conduct against the whistleblower. Tulane University Code of Conduct • Tulane’s Policies and Procedures • Tulane University is committed to promoting ethical practices and to preventing and detecting fraud, waste, and abuse. Tulane systematically reviews its compliance with the rules and regulations of Medicare, Medicaid, and other federal payors. Tulane also has in place compliance procedures for audits, personnel training and continuing education. Tulane’s compliance personnel regularly apprise themselves and the organization of current state and federal statutory and regulatory developments to ensure that Tulane is compliant with the rules governing federal and state health care programs claims submissions. • In addition, Tulane relies on its employees to notify it of any potential inaccurate billing so that we are not accused of violating the laws that prohibit the submission of false claims to the government. Tulane makes it a part of the duty of all employees to assist it this commitment to accurate billing by reporting any potential improprieties without fear of retaliation. Tulane employees may report potential billing violations directly to their supervisor or to the “hotline” maintained by Tulane for this purpose, which can be reached at 504-862-8698. Alternatively, information on the hotline and reporting any potential improprieties can be found at http://www.tulane.edu/%7Eaudit/hotline.shtml. Download the test at , http://tulane.edu/counsel/upco/upload/Quiz.pdf answer the questions, and fax it to the University Privacy and Contracting Office, 504-988-7777. Completion of this material is MANDATORY, and carries one (1) Compliance Training Unit credit.
"The Federal False Claims Act"