The Centers for Medicare and Medicaid Services (CMS) published a “roadmap for physicians” to submit proper claims for reimbursement. The guide, which walks through pertinent fraud and abuse laws and certain best practices for physicians, in turn provides manufacturers a helpful, convenient compliance tool as well.
The Federal False Claims Act (FCA) protects the Federal Government from being overcharged or sold substandard goods or services . The FCA imposes civil liability on any person who knowingly submits, or causes to be submitted, a false or fraudulent claim to the Federal Government . The “knowing” standard includes acting in deliberate ignorance or reckless disregard of the truth or falsity of the information related to the claim . An example may be a physician who knowingly submits claims to Medicare for medical services not provided . Civil penalties for violating the FCA may include fines of up to three times the amount of damages sustained by the Government as a result of the false claims plus $11,000 per claim filed . Under the Federal criminal statutes, FCA criminal penalties for submitting false claims may include fines, imprisonment, or both.
The Anti-Kickback Statute makes it a criminal offense to knowingly and willfully offer, pay, solicit, or receive any remuneration to induce or reward referrals of items or services reimbursable by a Federal health care program . Where a provider offers, pays, solicits, or receives unlawful remuneration, the provider violates the Anti-Kickback Statute . Remuneration includes anything of value such as cash, free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies . If an arrangement, however, satisfies certain regulatory safe harbors, it may not implicate the Anti-Kickback Statute . Civil penalties for violating the Anti-Kickback Statute may include penalties of up to $50,000 per kickback plus three times the amount of kickback . Criminal penalties for violating the Anti-Kickback Statute may include fines, imprisonment, or both
The Physician Self-Referral Law (Stark Law) prohibits a physician from making a referral for certain designated health services to an entity in which the physician (or an immediate member) has an ownership/investment interest or with which he or she has a compensation arrangement, unless an exception applies. Penalties for physicians who violate the Stark Law may include fines as well as exclusion from participation in all Federal health care programs.
The Criminal Health Care Fraud Statute prohibits knowingly and willfully executing, or attempting to execute, a scheme or artifice in connection with the delivery of or payment for health care benefits, items, or services to: Defraud any health care benefit program; or Obtain (by means of false or fraudulent pretenses, representations, or promises) any of the money or property owned by, or under the custody or control of, any health care benefit program. Penalties for violating the Criminal Health Care Fraud Statute may include fines, imprisonment, or both.
The Exclusion Statute requires OIG to impose exclusions from participation in all Federal health care programs on health care providers and suppliers who have been convicted of: 1. Medicare fraud, as well as any other offenses related to the delivery of items or services under Medicare; 2. Patient abuse or neglect; 3. Felony convictions for other health care-related fraud, theft, or other financial misconduct; or 4. Felony convictions for unlawful manufacture, distribution, prescription, or dispensing of controlled substances. OIG also has discretion to impose permissive exclusions on a number of other grounds. Excluded physicians may not bill directly for treating Medicare and Medicaid patients, nor may their services be billed indirectly through an employer or a group practice.
The Civil Monetary Penalties (CMP) Law imposes CMPs for a variety of health care fraud violations, and different amounts of penalties and assessments may be authorized based on the type of violation at issue . Penalties range from $10,000 to $50,000 per violation . CMPs can also include an assessment of up to three times the amount claimed for each item or service, or up to three times the amount of remuneration offered, paid, solicited, or received
In addition to outlining the various fraud and abuse laws, CMS provides insight into a number of areas of physician practice. The guide includes information on physician relationships with payers; physician relationships with other providers; and physician relationships with vendors.
CMS provides recommendations about a number of common situations involving industry-physician interaction. These are reprinted below.
CMS states: Many drug and biologic companies provide physicians with free samples that the physicians may give to patients free of charge. It is legal to give these samples to your patients for free, but it is illegal to sell the samples. The Federal Government prosecutes physicians for billing Medicare for free samples. If you choose to accept samples, you will need reliable systems in place to safely store the samples and ensure that samples are not commingled with your commercial stock.
“Some pharmaceutical and device companies use sham consulting agreements and other arrangements to buy physician loyalty to their products,” states CMS. “As a practicing physician, you may have opportunities to work as a consultant or promotional speaker for the drug or device industry.”
“ For every financial relationship offered to you, evaluate the link between the services you can provide and the compensation you will receive.” CMS recommends that physicians “test the propriety of any proposed relationship by asking the following questions”:
- Does the company really need your particular expertise or input?
- Does the company’s monetary compensation represent a fair, appropriate, and commercially reasonable exchange for your services?
- Is it possible the company’s monetary compensation is for your loyalty so you will prescribe its drugs or use its devices?
“If your contribution is your time and effort or your ability to generate useful ideas and the payment you receive is fair market value compensation for your services without regard to referrals, then, depending on the circumstances, you may legitimately serve as a bona fide consultant,” states the guide. “If your contribution is your ability to prescribe a drug or use a medical device or refer your patients for particular services or supplies, the proposed consulting arrangement likely is one you should avoid as it could violate fraud and abuse laws.”
Academic Institutions – and the Myriad of Conflict-of-Interest Disclosures
Academic institutions also may impose various restrictions on the interactions their faculty members or affiliated physicians have with industry. Many of the relationships discussed in this document are subject to conflict-of-interest disclosure policies. Even if the relationships are legal, you may have an obligation to disclose their existence. Rules about disclosing and managing conflicts of interest come from a variety of sources, including grant funders, such as states, universities, and the National Institutes of Health, and from the Food and Drug Administration (FDA) when you submit data to support marketing approval for new drugs, devices, or biologics. If you are uncertain whether a conflict exists, ask someone. You always can apply the “newspaper test” and ask yourself whether you would want the arrangement to appear on the front page of your local newspaper.
Continuing Medical Education
You are responsible for your Continuing Medical Education (CME) to maintain state licensure, hospital privileges, and board certification. Drug and device manufacturers sponsor many educational opportunities for physicians. It is important to distinguish between CME sessions that are educational in nature and sessions that constitute marketing by a drug or device manufacturer. If speakers recommend use of a drug to treat conditions for which there is no FDA approval or use of a drug by children when the FDA has approved only adult use, you should independently seek out the empirical data that support these recommendations. NOTE: Although physicians may prescribe drugs for off-label uses, it is illegal under the Federal Food, Drug, and Cosmetic Act for drug manufacturers to promote off-label uses of drugs. VI. Compliance Programs
CMS also outlines the basics of Open Payments and how physicians can register with the system in order to review any payments attributed to them.
By outlining its expectations for physicians, CMS provides a useful guide for companies to understand the appropriate ways to engage with healthcare providers.