Introduction: Five laws for new physicians to know

There are no balloons, handshakes or smiles when the Office of the Inspector General at the U.S. Department of Health and Human Services welcomes new physicians. There is instead a dry, fairly formal listing of “the five most important Federal fraud and abuse laws that apply to physicians”:

• False Claims Act
• Anti-Kickback Statute
• Physician Self-Referral Law (Stark law)
• Exclusion Authorities
• Civil Monetary Penalties Law

“As you begin your career, it is crucial to understand these laws not only because following them is the right thing to do, but also because violating them could result in criminal penalties” and more, the OIG says. The “more” includes fines, exclusion from Medicare and Medicaid and the loss of your medical license.

The False Claims Act

The OIG notes that it’s illegal to submit claims to Medicare or Medicaid that you know – or should know – are false or fraudulent. Penalties for violating the False Claims Act can mean fines of up to three times the amount the programs lost due to your false claims, plus $11,000 per claim you filed.

That means that if Doctor A filed 100 false Medicare claims for $1,000 each, the loss to that program would be $100,000. That means Doctor A could be fined up to $300,000, plus an additional $1,100,000 for his violations.

If Doctor A’s false claims were the results of kickbacks or were made in violation of the Stark law, there can be additional liability under the Anti-Kickback Statute or Stark law.

The OIG also points out that under the civil False Claims Act, the government does not need to prove or show that Doctor A had a specific intent to defraud. The Act says Doctor A violated the law if he had actual knowledge or if he acted in deliberate ignorance or with reckless disregard of the falsity or truth of the information submitted to the government.

Whistleblower provision

The law also contains this kicker: if an individual files a lawsuit on behalf of the United States, that whistleblower can be entitled to a percentage of any recovery. In Doctor A’s case, that would mean a percentage of the $1,400,000 he paid.

The OIG says “whistleblowers could be current or ex-business partners, hospital or office staff, patients, or competitors.”

Last, but certainly not least, there’s also a criminal False Claims Act with penalties that can include prison and fines.

We’ll go over more of the five laws new physicians (and all other doctors) should know in upcoming posts to our Michigan Health Care Legal Blog. Please check back.