False Claims Act

Are Bad Mules to Blame for the False Claims Act? 

The False Claims Act (FCA) was passed by Congress in 1863.  Some historians say it was in response to a man who sold the Union Army decrepit mules, horses and provisions, another says it originated from a man who sold uniforms, yet never delivered.  In 1986 this law was amended adding civil penalties.  The False Claims Act is one of the cornerstones of the government anti-fraud and abuse prosecutions.

Recent changes to the law under the Patient Protection and Affordable Care Act (PPACA) and the Fraud Enforcement Recovery Act (FERA) have provided additional funding for investigations, strengthened the current criminal and civil statues, make the failure to return overpayments a violation, and clarified that any claim found to be in violation of the anti-kickback status is also in violation of the FCA.

It is under the Qui Tam provision of the law that “whistleblowers” can receive a portion of the civil penalties levied against an organization.  The phrase Qui Tam is an abbreviation of the Latin phrase “qui tam pro domino rege quam pro se ipso in hac parte sequitur”, meaning "[he] who sues in this matter for the king as [well as] for himself." 

A major factor in the government’s success has been the whistleblower.  The person or person(s) who bring forth the suit can share in the government's recovery. When private whistleblowers bring frauds to the attention of the government, they can receive bounties in the millions of dollars. Publicity concerning these awards motivates otherwise reluctant informants to bring additional fraud to light, and increases public awareness.

Examples of healthcare related prosecutions under FCA include:  up-coding, unbundling, ghost billing, double billing, and billing for medical unnecessary services.  This is not an exhaustive list; there are many other instances that can land physicians in the courtroom.

Protecting yourself against Qui Tam suits begins with a thorough understanding of your current compliance situation, creating policies and procedures to deal with suspected improper claims before they become “false” and being prepared to internally investigate and correct any situations that are reported to you.