Increased False Claims Act Penalties Make Compliance More Important Than Ever

Recently, the Federal Government enacted legislation to adjust False Claims Act (the “FCA”) penalties to increase based upon inflation each year. The new minimum penalty per claim under the FCA is $10,781, and the maximum is $21,563. The minimums apply to any claim submitted for services provided to a Medicare or Medicaid beneficiary (even, for example, a $5.00 laboratory service).

With health care providers already punch-drunk from overzealous compliance investigations and overpayment audits, the result of these penalty increases is a Medicare and Medicaid landscape fraught with even more risk. If a provider violates the Stark Law or the Anti-Kickback Statute, the government believes that any claims filed by the provider related to the violation (even technical violations) are “false claims” subject to FCA enforcement. Thus, careful compliance has never been more important.

For providers, the strategy remains the same: “preventative care” will keep the practice healthy. All health care providers, regardless of size, should: (i) establish and adhere to a strong compliance program; (ii) work closely with counsel to evaluate and maintain the program; (iii) take swift action when an issue arises; and (iv) have all arrangements reviewed by counsel for compliance with applicable health care laws.