With the OIG’s May 30, 2025, announcement that they are seeking $454.4 million in funding to fight healthcare fraud, healthcare providers can expect increased governmental scrutiny despite Trump’s budget cutbacks and staff layoffs.  The OIG justifies its budget request by pointing out that for every $1 invested, there is an expected return of $11 in government recoveries and receivables, which fuels the Trump administration’s fight on fraud, waste, and abuse in health care. What this means for health care providers is intensified scrutiny and likely use of AI as a tool to evaluate big data to identify potential false claims, fraud, outliers, etc. Considering the OIG’s 90-page new General Compliance Guidance, healthcare providers’ self-policing strategies and internal audits are more important than ever as the heat turns up on alleged fraud and false claims.

The landscape of diversity, equity, and inclusion (DEI) in healthcare is undergoing a seismic shift following recent executive orders (EO) issued by President Donald J. Trump. The order, titled "Ending Illegal Discrimination and Restoring Merit-Based Opportunity," aims to eliminate DEI initiatives within federal government agencies and private companies contracting with the government. This policy shift presents significant legal and operational challenges for healthcare providers, particularly those relying on federal funding.

It may seem like hair-splitting, but including the wrong diagnostic codes for malnutrition on hospital inpatient claims – using codes for severe malnutrition in place of other forms of malnutrition – is a costly mistake. The estimated overpayment as a result of these coding errors is a reported $1 billion. Because the payment error rate was so high at a colossal 31%, Medicare-Severity Diagnosis Related Group ("MS-DRG") applicable entities must take note and prepare for a marked increase in Department of Health and Human Services Office of Inspector General ("OIG") audits for these coding practices. The Centers for Medicare & Medicaid Services ("CMS") also plans to implement review practices for malnutrition coding on a sample of inpatient claims. The increased payer audits will result in severe financial damage for hospitals and other MS-DRG applicable entities if they do not mitigate coding and documentation risks.

This article appeared in the December edition of MD-UPDATE, available at  http://www.md-update.com/wp-content/uploads/2018/12/MD-Update-Issue-118/#?page=8

Billing for medical services is never easy. Despite attempts by the Centers for Medicare & Medicaid Services (“CMS”) to simplify the rule regarding “incident to” billing for Medicare services, it remains misunderstood by a large swath of providers. This proves problematic, as incorrect billing practices may lead to overpayments and False Claims Act violations. Billing for “incident to” services is an important mechanism to reflect the actual value of mid-level services provided under the specific plan of a physician. When properly followed, the “incident to” rules allow physicians to bill for services provided by non-physician practitioners as if they were performed by the physician at physician reimbursement rates. Additionally, the non-physician provider can be an employee, an independent contractor or even a leased employee, provided that they are supervised by a physician and the requirements are met. Because of the confusing nature of allowing a physician to bill for services he or she did not directly provide to the patient, serious landmines exist that can create problems if the rules are not scrupulously followed and documented.

In December, the Centers for Medicare and Medicaid Services (“CMS”) released its “Supplementary Appendices for the Medicare Fee-for-Service 2015 Improper Payments Report,”[1] an annual compilation of statistics from investigations into overpayments and other instances of fraud, waste and abuse in Medicare payments. What should shock Kentucky providers is that Kentucky has the seventh highest percentage of projected overpayments at 15.4%, or $897.7 million.[2] More than one out of every seven Medicare fee-for-service payments made in the Commonwealth is projected to be an overpayment in 2015, yet many of these problems could have been avoided by following one simple rule: document claims properly.

On Tuesday, we discussed the history and basic elements of a violation of the False Claims Act. Today’s post will explore the penalties and enforcement of the Act.

The federal False Claims Act (“FCA”)[1] casts an incredibly long shadow, covering every transaction between the federal government and a private party seeking payment from it. Enacted at the height of the Civil War in 1863, the law was designed to keep military suppliers honest in their dealings with a government already strapped from fighting a war. Since then, the FCA has served as an almost nuclear deterrent to those who would attempt to defraud the government when requesting payment for services. In 2014, the Department of Justice managed to recover $5.69 billion under the law. False claims in federal healthcare programs accounted for $2.3 billion of that figure, which makes the FCA, as well as its interaction with other laws such as the Affordable Care Act, fraught with difficulty for unwary healthcare providers.