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What laws govern healthcare fraud and abuse?

The Centers for Medicare and Medicaid Services (CMS) take violations to healthcare laws very seriously. A conviction can come with hefty penalties that may include exclusion from federal healthcare programs, fines and, in severe cases, imprisonment.

These fines are significant. Data from 2016, shows fines ranged from $21,563 to $73,568 per violation.

How can providers avoid allegations of healthcare fraud and abuse? It is important to understand the law. There are many laws that govern this area, but the three key laws for healthcare fraud and abuse charges are:

  1. Federal False Claims Act. This law makes it illegal to knowingly submits false claims for reimbursement to Medicare and Medicaid.
  2. Anti-Kickback Statute. This law prohibits healthcare providers to use payments or other benefits to encourage the referral of federal healthcare program participants.
  3. Physician Self-Referral Law. This law makes it illegal for physicians to refer federally reimbursed patients for services to a facility where they themselves or a family member has a financial interest.

Lawmakers passed both the Anti-Kickback Statute and Physician Self-Referral Law with good intentions. The authors behind these laws likely intended to remove financial gain as a motivating factor for referrals. Unfortunately, these laws can also hinder the referral process and care coordination efforts.

Medical providers are further hindered by the fact that these laws are constantly evolving. These changes make it difficult for healthcare providers to remain current on applicable laws and regulations while also focusing on patient care. A single misstep could result in allegations of wrongdoing. Those who are accused of wrongdoing by a government agency are is wise to seek legal counsel to better ensure their legal rights are protected.