CMS Fraud Definition - ANSWER Making false statements or misrepresenting facts to ob-
tain an undeserved benefit or payment from a federal healthcare program
CMS Abuse Definition - ANSWER An action that results in unnecessary costs to a federal
healthcare program, either directly or indirectly
CMS Examples of Fraud - ANSWER Billing for services and/or supplies that you know
were not furnished or provided, altering claim forms and/or receipts to receive a higher pay-
ment amount, billing a Medicare patient above the allowed amount for services, billing for
services at a higher level than provided or necessary, misrepresenting the diagnosis to justify
payment
CMS Examples of Abuse - ANSWER Misusing codes on a claim, charging excessively for
services or supplies, billing for services that were not medically necessary, failure to maintain
adequate medical or financial records, improper billing practices, billing Medicare patients a
higher fee schedule than non-Medicare patients
False Claims Act - ANSWER Any person is liable if they knowingly present or cause to be
presented a false or fraudulent claim for payment or approval; knowingly makes, uses, or
causes to be made or used, a false record or material to a false or fraudulent claims
Current False Claims Act penalties - ANSWER $5,500-$11,000 per claim
When does the False Claims Act allow for reduced penalties? - ANSWER If the person
committing the violation self-discloses and provides all known info within 30 days, fully co-
operates with the investigation, and there is no criminal prosecution, civil action, or adminis-
trative action regarding the violation
1
,Qui Tam or "Whistleblower" provision - ANSWER If an individual (known as a "relator")
knows of a violation of the False Claims Act, he or she may bring a civil action on behalf of
him or herself and on behalf of the U.S. government; the relator may be awarded 15-25% of
the dollar amount recovered
Stark or Physician Self-Referral Law - ANSWER Bans physicians from referring patients for
certain services to entities in which the physician or an immediate family member has a di-
rect or indirect financial relationship; bans the entity from billing Medicare or Medicaid for
the services provided as a result of the self-referral
Anti-Kickback Law - ANSWER Similar to the Stark Law but imposes more severe penalties;
states that whoever knowingly or willfully solicits or receives any remuneration in return for
referring an individual to a person for the furnishing or arranging of any item or service for
which payment may be made in whole or in part under a federal healthcare program or in
return for purchasing, leasing, ordering, or arranging for or recommending purchasing, leas-
ing, or ordering any good, facility, service, or item for which payment may be made in whole
or in part under a federal healthcare program is guilty of a felony
Penalty for violating the Anti-Kickback Law - ANSWER Up to $25,000 fine and/or impris-
onment of up to 5 years
Stark Law vs. Anti-Kickback Law - ANSWER Anti-Kickback applies to anyone, not just phy-
sicians; the Anti-Kickback Law requires proof of intention and states that the person must
"knowingly and willfully" violate the law.
Exclusion Statute - ANSWER Under the Exclusion Statute, a physician who is convicted of
a criminal offense—such as Medicare fraud (both misdemeanor and felony convictions), pa-
tient abuse and neglect, or illegal distribution of controlled substances—can be banned from
participating in Medicare by the OIG. Physicians who are excluded may not directly or indi-
rectly bill the federal government for the services they provide to Medicare patients.
List of Excluded Individuals/Entities (LEIE) - ANSWER Produced and updated by the OIG;
provides information regarding individuals and entities currently excluded from participation
in Medicare, Medicaid, and all other federal healthcare programs; sorts excluded individuals
2
,or entities by the legal basis for the exclusion, the types of individuals and entities that have
been excluded, and the states where the excluded individual resided at the time they were
excluded or the state in which the entity was doing business
Civil Monetary Penalties Law - ANSWER The Social Security Act authorizes the HHS to
seek civil monetary penalties and exclusion for certain behaviors. These penalties are en-
forced by the OIG through the Civil Monetary Penalties (CMP) Law. The severity of penalties
and monetary amounts charged depend on the type of conduct engaged in by the physician.
A physician can incur a CMP in the following ways: Presenting or causing claims to be pre-
sented to a federal healthcare program that the person knows or should know is for an item
or service that was not provided as claimed or is false or fraudulent.Violating the Anti-Kick-
back Statute by knowingly and willfully (1) offering or paying remuneration to induce the re-
ferral of federal healthcare program business, or (2) soliciting or receiving remuneration in
return for the referral of federal healthcare program business. Knowingly presenting or caus-
ing claims to be presented for a service for which payment may not be made under the Stark
law
Amount of civil monetary penalties - ANSWER Range from $10,000-$50,000 per violation
and an assessment of up to 3 times the amount of the over-payments
Reverse False Claims section of the False Claims Act - ANSWER Final section that provides
liability where a person acts improperly to avoid paying money owed to the government
Examples of fraud/misconduct subject to the False Claims Act - ANSWER Falsifying a
medical chart notation; submitting claims for services not performed, not requested, or un-
necessary; submitting claims for expired drugs; upcoding and/or unbundling services; sub-
mitting claims for physician services performed by a non-physician provider without regard
to Incident-to guidelines
Exceptions to the Stark Law - ANSWER General exceptions to both ownership and com-
pensation arrangement prohibitions (in-office ancillary services); general exceptions related
only to ownership or investment prohibition for ownership in publicly traded securities and
mutual funds (services furnished by a rural provider); exceptions related to other compensa-
tion arrangements (personal services arrangements and rental of office space and equip-
ment)
3
, Office of the Inspector General (OIG) - ANSWER Detects and prevents fraud, waste, and
abuse and improves efficiency of HHS programs; most resources are directed toward the
oversight of Medicare and Medicaid, but also extend to the Centers for Disease Control and
Prevention (CDC), National Institutes of Health (NIH), and the Food and Drug Administration
(FDA)
OIG Work Plan - ANSWER Published annually; lists the various projects that will be ad-
dressed during the fiscal year by the Office of Audit Services, Office of Evaluation and Inspec-
tions, Office of Investigations, and Office of Counsel to the Inspector General; summarizes
new and ongoing reviews and activities that OIG plans to pursue during the next fiscal year
and beyond
Why should an auditor know what is in the OIG Work Plan for the current year? - AN-
SWER It allows an auditor to inform providers and facilities of services or issues of which
to be especially mindful in the coming year; may be helpful in forming the scope of an audit
for a provider or facility or may influence recommendations given to a practice
Corporate Integrity Agreements - ANSWER Required by the OIG s a condition of not seek-
ing exclusion from participation when an individual or entity seeks to settle civil healthcare
fraud cases; typically last 5 yrs but can be longer; most have the same core requirements
along with specific steps for the individual or entity that are related to the conduct that led
to the settlement
Core requirements in CIAs - ANSWER Hiring a compliance officer/appointing a compli-
ance committee; developing written standards and policies; implementing a comprehensive
employee training program; retaining an independent review organization (IRO) to conduct
annual reviews; establishing a confidential disclosure program; restricting employment of
ineligible persons; reporting overpayments, reportable events, and ongoing investiga-
tions/legal proceedings; providing an implementation report and annual reports to the OIG
on the status of the entity's compliance activities
Independent review organization (IRO) - ANSWER Acts as a 3rd party medical review re-
source that provides objective, unbiased audits and reports
4
tain an undeserved benefit or payment from a federal healthcare program
CMS Abuse Definition - ANSWER An action that results in unnecessary costs to a federal
healthcare program, either directly or indirectly
CMS Examples of Fraud - ANSWER Billing for services and/or supplies that you know
were not furnished or provided, altering claim forms and/or receipts to receive a higher pay-
ment amount, billing a Medicare patient above the allowed amount for services, billing for
services at a higher level than provided or necessary, misrepresenting the diagnosis to justify
payment
CMS Examples of Abuse - ANSWER Misusing codes on a claim, charging excessively for
services or supplies, billing for services that were not medically necessary, failure to maintain
adequate medical or financial records, improper billing practices, billing Medicare patients a
higher fee schedule than non-Medicare patients
False Claims Act - ANSWER Any person is liable if they knowingly present or cause to be
presented a false or fraudulent claim for payment or approval; knowingly makes, uses, or
causes to be made or used, a false record or material to a false or fraudulent claims
Current False Claims Act penalties - ANSWER $5,500-$11,000 per claim
When does the False Claims Act allow for reduced penalties? - ANSWER If the person
committing the violation self-discloses and provides all known info within 30 days, fully co-
operates with the investigation, and there is no criminal prosecution, civil action, or adminis-
trative action regarding the violation
1
,Qui Tam or "Whistleblower" provision - ANSWER If an individual (known as a "relator")
knows of a violation of the False Claims Act, he or she may bring a civil action on behalf of
him or herself and on behalf of the U.S. government; the relator may be awarded 15-25% of
the dollar amount recovered
Stark or Physician Self-Referral Law - ANSWER Bans physicians from referring patients for
certain services to entities in which the physician or an immediate family member has a di-
rect or indirect financial relationship; bans the entity from billing Medicare or Medicaid for
the services provided as a result of the self-referral
Anti-Kickback Law - ANSWER Similar to the Stark Law but imposes more severe penalties;
states that whoever knowingly or willfully solicits or receives any remuneration in return for
referring an individual to a person for the furnishing or arranging of any item or service for
which payment may be made in whole or in part under a federal healthcare program or in
return for purchasing, leasing, ordering, or arranging for or recommending purchasing, leas-
ing, or ordering any good, facility, service, or item for which payment may be made in whole
or in part under a federal healthcare program is guilty of a felony
Penalty for violating the Anti-Kickback Law - ANSWER Up to $25,000 fine and/or impris-
onment of up to 5 years
Stark Law vs. Anti-Kickback Law - ANSWER Anti-Kickback applies to anyone, not just phy-
sicians; the Anti-Kickback Law requires proof of intention and states that the person must
"knowingly and willfully" violate the law.
Exclusion Statute - ANSWER Under the Exclusion Statute, a physician who is convicted of
a criminal offense—such as Medicare fraud (both misdemeanor and felony convictions), pa-
tient abuse and neglect, or illegal distribution of controlled substances—can be banned from
participating in Medicare by the OIG. Physicians who are excluded may not directly or indi-
rectly bill the federal government for the services they provide to Medicare patients.
List of Excluded Individuals/Entities (LEIE) - ANSWER Produced and updated by the OIG;
provides information regarding individuals and entities currently excluded from participation
in Medicare, Medicaid, and all other federal healthcare programs; sorts excluded individuals
2
,or entities by the legal basis for the exclusion, the types of individuals and entities that have
been excluded, and the states where the excluded individual resided at the time they were
excluded or the state in which the entity was doing business
Civil Monetary Penalties Law - ANSWER The Social Security Act authorizes the HHS to
seek civil monetary penalties and exclusion for certain behaviors. These penalties are en-
forced by the OIG through the Civil Monetary Penalties (CMP) Law. The severity of penalties
and monetary amounts charged depend on the type of conduct engaged in by the physician.
A physician can incur a CMP in the following ways: Presenting or causing claims to be pre-
sented to a federal healthcare program that the person knows or should know is for an item
or service that was not provided as claimed or is false or fraudulent.Violating the Anti-Kick-
back Statute by knowingly and willfully (1) offering or paying remuneration to induce the re-
ferral of federal healthcare program business, or (2) soliciting or receiving remuneration in
return for the referral of federal healthcare program business. Knowingly presenting or caus-
ing claims to be presented for a service for which payment may not be made under the Stark
law
Amount of civil monetary penalties - ANSWER Range from $10,000-$50,000 per violation
and an assessment of up to 3 times the amount of the over-payments
Reverse False Claims section of the False Claims Act - ANSWER Final section that provides
liability where a person acts improperly to avoid paying money owed to the government
Examples of fraud/misconduct subject to the False Claims Act - ANSWER Falsifying a
medical chart notation; submitting claims for services not performed, not requested, or un-
necessary; submitting claims for expired drugs; upcoding and/or unbundling services; sub-
mitting claims for physician services performed by a non-physician provider without regard
to Incident-to guidelines
Exceptions to the Stark Law - ANSWER General exceptions to both ownership and com-
pensation arrangement prohibitions (in-office ancillary services); general exceptions related
only to ownership or investment prohibition for ownership in publicly traded securities and
mutual funds (services furnished by a rural provider); exceptions related to other compensa-
tion arrangements (personal services arrangements and rental of office space and equip-
ment)
3
, Office of the Inspector General (OIG) - ANSWER Detects and prevents fraud, waste, and
abuse and improves efficiency of HHS programs; most resources are directed toward the
oversight of Medicare and Medicaid, but also extend to the Centers for Disease Control and
Prevention (CDC), National Institutes of Health (NIH), and the Food and Drug Administration
(FDA)
OIG Work Plan - ANSWER Published annually; lists the various projects that will be ad-
dressed during the fiscal year by the Office of Audit Services, Office of Evaluation and Inspec-
tions, Office of Investigations, and Office of Counsel to the Inspector General; summarizes
new and ongoing reviews and activities that OIG plans to pursue during the next fiscal year
and beyond
Why should an auditor know what is in the OIG Work Plan for the current year? - AN-
SWER It allows an auditor to inform providers and facilities of services or issues of which
to be especially mindful in the coming year; may be helpful in forming the scope of an audit
for a provider or facility or may influence recommendations given to a practice
Corporate Integrity Agreements - ANSWER Required by the OIG s a condition of not seek-
ing exclusion from participation when an individual or entity seeks to settle civil healthcare
fraud cases; typically last 5 yrs but can be longer; most have the same core requirements
along with specific steps for the individual or entity that are related to the conduct that led
to the settlement
Core requirements in CIAs - ANSWER Hiring a compliance officer/appointing a compli-
ance committee; developing written standards and policies; implementing a comprehensive
employee training program; retaining an independent review organization (IRO) to conduct
annual reviews; establishing a confidential disclosure program; restricting employment of
ineligible persons; reporting overpayments, reportable events, and ongoing investiga-
tions/legal proceedings; providing an implementation report and annual reports to the OIG
on the status of the entity's compliance activities
Independent review organization (IRO) - ANSWER Acts as a 3rd party medical review re-
source that provides objective, unbiased audits and reports
4
