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Healthcare fraud: shaking the foundations

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Healthcare fraud: shaking the foundations

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healthcare fraud, False Claims ACt, nursing home fraud, cardiac stents fraudHealthcare fraud is big business, which costs the US Government and Americans huge dollars. There are several federal statutes that tie into making fraud a crime. These criminal statues include

  • Health care fraud
  • Theft or embezzlement in connection to health care
  • False statements relating to healthcare matters
  • Obstruction or criminal investigation of health care offense

    The False Claims Act requires the defendant to submit a claim or cause a claim to be submitted to the government that is false or fraudulent, knowing of its falsity and seeking payment from the Federal treasure. There may be damages. The penalties include a civil penalty from $5,500 to $11,000 per false claim and three times the amount of damages which the government sustained.

    Here is how nursing homes have gotten in trouble:
    The long term care provider makes payments for patient referrals. (In US ex rel Wall v. Vista Hospice Care, Inc, the court denied motion to dismiss the allegation that the hospice paid nursing home employees for patient referrals. March 2011).
    The long term care provider receives payments for referrals. (Mariner Health Care and SavaSenior Care paid $14 million to settle allegations they took kickbacks in exchange for renewing contracts with Omnicare, settled February 2010)
    Medical directors may be paid more than fair market value.

    What does the government expect of nursing homes?
    They want a partnership with Federal and State governments to detect and prevent misconduct.
    They want an ethical corporate culture.
    They expect an organization to ferret out wrongful conduct and non-compliant activity.
    They expect cooperation during investigations of an organization’s wrong doing.

    Based on handouts from Broad and Cassel, American Conference Institute, April 2011

    A few weeks ago I met a physician who told me of a fraudulent scandal at his hospital. A cardiologist was caught for performing stents on patients who were not true candidates for the procedure. He obtained a lot of money for doing the unnecessary procedures. This cardiologist was well-respected until the fraud was uncovered, and he lost his license to practice. The scandal rocked the hospital, damaged its reputation, and caused several people to leave their positions. The hospital is now for sale.

    The rippling effects of fraud and greed are far reaching. I know that as I prepare this blog post, someone is hatching a scheme to defraud or cheat or steal. If only the creativity associated with fraud was channeled into positive pathways.

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