There are many categories of healthcare fraud and abuse. This paper will limit its scope to only three categories namely: Medicaid false claims, kickbacks, and physicians’ self-referral.
Medicaid false claims
Medicaid false claims refer to a type of healthcare fraud in which an individual in the healthcare system makes an untrue claim while applying for payment or benefits from a government’s healthcare program (Armoni, 2000). For such fraud to hold, the individual in question must have the knowledge about the falsity as well as the willingness to make the false claim. There are four elements that must be proven by the government before convicting an individual of committing the fraud of Medicaid false claims. These four elements include statement of material fact, false representation, knowledge and willfulness, and knowledge of falsity (Altshuler, Creekpaum & Fang, 2008).
The element of statement of material fact refers to the existence of a false claim which has the potential of influencing a government healthcare agency to act in a manner that will benefit the convict. The element of false representation refers to the actual submission of a false claim to the federal government in the hope of reimbursement. This comprises of the actual billing to Medicaid for medical examinations and procedures that have never been executed; a false claim that a number of procedures were required as a result of accidents; submission of claims for patients who have never been medically examined; and submission of claims for services that have never been provided (Altshuler et al., 2008).
The penalties for persons found guilty of committing the fraud of Medicaid false claims are of three types. The first penalty involves monetary fines of amounts not greater than $25,000. The second penalty is the incarceration of persons found guilty of the crime for a term that does not exceed five years. Third, persons found guilty of making Medicaid false claims can be restricted or suspended from taking part in Medicaid and Medicare for a period of one year or less. It is also common for persons found guilty of the crime to receive three or two of the three penalties at a go. These penalties are provided under the Medicaid False Claims Statute which is the law responsible for combating this particular healthcare fraud (Altshuler et al., 2008).
Kickbacks
A kickback is a type of healthcare fraud that refers to the payment or receipt of any remuneration (either cash or in-kind) either directly or otherwise, in exchange for the prescription, purchase, or recommendation of any healthcare service, product, or treatment whose payment is made by any federally funded healthcare program such as Medicare or Medicaid (Altshuler et al., 2008). To convict suspects of committing this fraud, three elements must be proven by the government namely: knowledge and willfulness; solicitation or receipt of remuneration; and inducement or referral of business. The first element refers to the fact that the defendant knew that his actions were unlawful and that he was willing to engage in the act despite his knowledge. The second element refers to any exchange of something valuable (such as money) between the partners involved. The third element refers to the kickback’s potential of inducing another party to act in a manner that will favor the person giving the kickbacks (Department of Health and Human Services and Department of Justice, 2008).
The penalties for persons found guilty of committing the kickback fraud include fines of not more than $ 25,000; incarceration for a period not exceeding five years, or both; the limitation, restriction, or suspension of the violator from taking part in federal government healthcare programs such as Medicaid and Medicare; and civil remedies, for instance, fines. These penalties are provided by the Anti-Kickback Statute which is the law responsible for combating kickbacks in the healthcare sector (Altshuler et al., 2008).
Self-referral
A self-referral is a healthcare fraud that involves the act of physicians referring Medicare patients to medical laboratories which provide financial gains to the physicians. This fraud is one of the reasons behind the skyrocketing costs of health care in the United States (Armoni, 2000). Self-referral fraud has four elements that must be proven by the government before any conviction is made. The first element is the existence of a financial relationship (in form of ownership, investment, or compensation agreement) between a medical entity and the physician or his close family member. The second element is the referral which entails a request made for a certain health service for which payment is made by Medicare or Medicaid. The third element is the submission of a claim for services that have been referred illegally. The last element is the absence of an exception or safe harbor which entails the exceptions made by the government concerning this fraud.
The exceptions provided are of three categories and include: “exceptions applicable to both physician ownership or investment interests and compensation arrangements; exceptions for ownership or investment interests only; and exceptions for compensation arrangements only,” (Altshuler et al., 2008, p. 640). The penalties for committing self-referral include non-payment of filed claims; a refund of the money earned in the process; civil monetary fines of up to $100,000; and expulsion from participating in Medicare and Medicaid programs. These penalties are provided by the Omnibus Reconciliation Act (Stark) which is the law responsible for combating self-referrals.
Reference List
Altshuler, M., Creekpaum, J.K., & Fang, J. (2008). Health care fraud. The American Criminal Law Review, 45(2), 607-664.
Armoni, A. (2000). Healthcare information systems; challenges of the new millennium. Hershey, PA: Idea Group Inc.
Department of Health and Human Services and Department of Justice. (2008). Healthcare fraud and abuse control program annual report for FY 2007. Web.