November 2009
Amendment to the federal False Claims Act
To improve the enforcement of recovery of funds lost to fraudulent claims and activities, Congress amended the federal False Claims Act (FCA), 31 U.S.C.A. §§ 3729 - 3733, effective May 20, 2009. This amendment, a part of the Fraud Enforcement and Recovery Act (FERA), impacts providers, among others, who may have been overpaid by a government program including:
- The Federal Employee Program (FEP)
- Medicaid
- Medicare
- Medicare Advantage
- Medicare Part D
- TRICARE
Some sections of the amendment have a retroactive effective date of June 7, 2008.
A few notable changes to the FCA are listed below:
- Intent - Formerly, the FCA required proof of intent to get a false claim paid. This provision has been revised, and now a person can be found liable if he or she "knowingly makes, uses or causes to be made or used a false record or statement material to a false or fraudulent claim."
- Knowingly means that a person, with respect to information, has actual knowledge of information, acts in deliberate ignorance of the truth or falsity of information, or acts in reckless disregard of the truth or falsity of information.
- Material is defined as "having the natural tendency to influence or being capable of influencing the payment or receipt of money or property."
- Recipient of claim - The FCA formerly applied only to a claim presented to an officer or employee of the government. Now, the amendment also attaches liability if a false or fraudulent claim is presented to an agent of the government or a government contractor (e.g., if a provider's office submits a fraudulent claim to a government program such as Regence MedAdvantage or FEP).
- Obligation to repay - It is a FCA violation if a provider knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the government. An obligation includes an established duty arising from the retention of an overpayment.
- Expanded conspiracy provision - The amended FCA no longer applies only to conspiracy to get a false claim paid, but now includes conspiracy to violate any substantive provision of the FCA.
- Expanded whistleblower protection - This provision now extends to employees, contractors and agents attempting to stop or report an FCA violation.
- Liability for cost of recovery - A new provision was added imposing strict liability on FCA violators for the costs incurred by the government to recover penalties and damages.
- Extends statute of limitations for the government - If a private person brings a lawsuit for violation of the FCA, the government can intervene in that lawsuit. For statute of limitations purposes, the government's complaint shall "relate back" to the original filing date of the lawsuit.
The penalties for violating the FCA remain the same. A person who violates the FCA could be liable to the government for $5,000 to $10,000 per violation, plus three times the amount of damages the government sustains because of the violation.
We support the government's efforts to recoup funds paid on false or fraudulent claims, as well as inadvertent overpayments. We encourage you to review your billing practices to ensure all claims are submitted accurately.
Learn more about the Fraud Enforcement and Recovery Act (FERA).
If you are a Regence MedAdvantage provider and have not already done so, we encourage you to complete the Medicare compliance training today.
Note: This article is intended as general information only, and is not intended to serve as legal advice or as a substitute for legal counsel.