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Most doctors bill their Medicare claims correctly. However, there are a few physicians – and their employers – who engage in upcoding and similar activities and risk the harsh penalties of the False Claims Act (FCA).

As many of our Michigan blog’s readers know, the Department of Justice (DOJ) last year increased the penalties that can be assessed under the FCA – a federal statute that dates back to 1863. In fact, the FCA was enacted during the Civil War to stem defense contractor fraud.

Today, the statute enables the federal government to pursue perpetrators of fraud, and it also allows private citizens to file lawsuits (called “qui tam” suits) on behalf of the government against those who’ve defrauded the government. The citizens who do so successfully are eligible to receive part of the recovery.

The Department of Justice says that in the fiscal year that ended Sept. 30 of last year, it received more than $2.2 billion in settlements and judgments in cases involving false claims and fraud.

According to the DOJ, there were 672 qui tam lawsuits filed in the 2020 fiscal year, and only 250 non-qui tam suits. The government recovered $545,330,030 in non-qui tam lawsuits and $1,686,124,824 in qui tam suits.

Both figures were down substantially from fiscal 2019’s non-qui tam ($844,282,697) and qui tam ($2,239,229,732) totals.

The independent pharmacy community’s wait began back in Michigan’s frigid  January when the U.S. Supreme Court decided it would take Rutledge v. the Pharmaceutical Care Management Association (PCMA). In October, the court heard arguments in the health care law dispute over whether states can regulate pharmacy benefit managers (PBMs).

With its recent unanimous decision, the court ended the wait by ruling that states may pass laws requiring PBMs to reimburse pharmacies for medications at a rate equal to – or higher than – the pharmacy’s wholesale cost.

The legal battle lines were drawn back in 2015 when Arkansas passed Act 900, a law requiring PBMs to increase reimbursement rates for prescription medications if the rates dropped below the pharmacy’s wholesale costs. The law also created a process by which pharmacies could challenge PBMs’ reimbursement rates.

In order to be able to participate in a preferred pharmacy network, some pharmacies would agree in contracts to accept unfavorable terms, such as below-wholesale reimbursements from PGMs. The Arkansas law was written to end the practice, but the PCMA (the trade association for major PBMs) argued in its lawsuit that the federal law known as ERISA (Employee Retirement Income Security Act) preempts state laws relating to ERISA-governed employee benef

Your primary duty is to care for your patient. Unfortunately, you aren’t given carte blanche to do so. Your care must fall within the lines of hospital and clinic rules. There are also state and federal regulations to which you must adhere, as well as your ethical obligations.

All of these factors can impede your ability to provide the type of care you feel your patient deserves. Sometimes, it can be tempting to flout the rules to help your patient get the treatment they need. Some medical professionals may perform an end-run around rules and regulations by engaging in a practice known as upcoding. While you may believe you are doing what is morally right, upcoding is considered a form of billing fraud. Upcoding could put your medical license at risk.

Upcoding can take a variety of forms. One example would be exaggerating a patient’s condition to help avoid an early discharge. Other examples may involve splitting one test into two or reporting symptoms that your patient hasn’t complained about to secure a medical test.

It can be easy to justify upcoding. What’s the harm in blurring the lines once in a while if it gets your patients the help they need? Is anyone even likely to notice an occasional bending of the rules?

Keep in mind it only takes one administrative audit or one instance of a colleague to report what you’re doing to find yourself in legal h