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Civil Monetary Penalties Rules Updated

by | Jan 3, 2017 | Enforcement-lca, Essential, Lab Compliance Advisor

From - G2 Compliance Advisor One aspect of the Affordable Care Act (ACA) that is not likely to be repealed is the enhancement of penalties for Medicare and Medicaid fraud and abuse. That includes… . . . read more

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One aspect of the Affordable Care Act (ACA) that is not likely to be repealed is the enhancement of penalties for Medicare and Medicaid fraud and abuse. That includes the new Regulation on civil monetary penalties (CMPs) that the OIG adopted on Dec. 7. Here is a quick overview of the new rules and their potential impact on business.

1. CMPs Possible for More Offenses

Current rules authorize CMPs for six basic offenses; the new rules nearly double that total to 11, as summarized in the table below.

Offenses Justifying Imposition of CMPS—Before & After
Original CMP Offenses New CMP Offenses
  • Knowingly presenting or causing to be presented false claim for services
  • Knowingly giving or causing to be given false or misleading info reasonably expected to influence decision to discharge patient
  • Offering or giving remuneration to federal health care program beneficiary likely to influence receipt of reimbursable items or services
  • Arranging for reimbursable items or services with entity excluded from a federal health care program
  • Knowingly or willfully soliciting or receiving payment for referral of beneficiary
  • Using a payment intended for beneficiary for another use
  • Failure to grant OIG timely access to reasonably requested records
  • Ordering or prescribing while excluded when excluded person knows or should know that item/service may be paid for by federal health care program
  • Making false statements, omissions or misrepresentations in an enrollment or similar bid application to participate in federal health care program
  • Failure to report and return an overpayment
  • Making or using false record or statement that is material to a false or fraudulent claim

Practical Impact: Labs will be at greater risk of CMPs, particularly by the new overpayment offense. Under the new rules, failure to report and return overpayments within 60 days of identifying them can result in CMPs of up to $10,000 per item or service overpaid. The “per-service” language is especially scary for labs and other diagnostics providers that submit a high volume of low-value claims.

2. CMPs Will Be Higher

Change: Not only will it become easier to get fined but fine amounts will be higher due to “catch-up adjustments” for inflation.

2015 CMP Adjustments

CMP Offense Pre-Inflation Amount Post-Inflation Amount Percentage Increase
Offering remuneration to induce program beneficiaries to use particular providers $10,000 $15,024 50.24%
Employing or contracting with excluded individual $10,000 $14,718 47.17%
Knowing and willful solicitation, receipt, offer or payment for referring individual for service … paid for by federal health care program $50,000 $73,588 47.17%
Submitting or causing to be submitted claims in violation of anti-Kickback Statute or Stark Law $15,000 $23,863 59.09%

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