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Obamacare Improves Government

This blog was provided by whistleblower attorney Tony Munter. His qui-tam and whistleblower website can be found here.

Obamacare gives the government leverage to fight fraud

The lawyers who do False Claims Act litigation are talking about obscure provisions of the Patient Protection and Affordable Care Act (Obamacare).

Will the implementation of the law bring more reforms to the healthcare industry? Will it mean more collections under the False Claims Act?

Well here’s one provision that has a few of us thinking about it: (1) MEDICARE.–Section 1862 of the Social Security Act (42 U.S.C. 1395y), as amended by subsection (g)(3), is amended by adding at the end the following new subsection: ‘(o) SUSPENSION OF PAYMENTS PENDING INVESTIGATION OF CREDIBLE ALLEGATIONS OF FRAUD.– ”(1) IN GENERAL.–The Secretary may suspend payments to a provider of services or supplier under this title pending an investigation of a credible allegation of fraud against the provider of services or supplier, unless the Secretary determines there is good cause not to suspend such payments.

See, Patient Protection and Affordable Care Act Public Law 111-148 Section 6402.

This means if a plaintiff filed a False Claims Act case and the government supported the case, or even if there is just a finding that case involves “credible allegations” the Department of Health and Human Services suspend payments to a provider while the government investigates the allegations.

That is leverage. No private litigant would ever have such leverage in the health care arena, but this is the government’s money after all. So, if the government decides they want to pursue a case of Medicare fraud they can settle the case, and if the provider does not want to settle, well they can fight in court but while they fight they would not be able to charge Medicare for any services they provide to patients.

Of course, providers who get paid by Medicare usually are dependent on Medicare for a significant portion of their business. There are few providers in a position to fight this kind of authority.

I’m sure there will be people of all stripes upset when the government exerts this kind of control over services provided in healthcare. Really though, what do you expect? If there is a credible allegation of fraud, is the government supposed to continue doing business with the organization? Would you?

Why should the government be in any worse position than anyone else contracting for a service? Although this sounds like a very tough remedy, and it is, there is a difference between a credible allegation of fraud and a credible allegation of just not doing your job very well. Just not doing your job very well is not actionable under this part of Obamacare. Fraud means that somebody has to have presented the government with evidence of, for example, services being charged, but not being performed or services being charged which are not medically necessary. Fraud is a strong allegation to make and the government has to have some basis to determine that the allegations are “credible.”

This is new and greater leverage for lawyers and plaintiffs who want to pursue a case under the Federal False Claims Act. We hope it will promote rapid settlements of these kinds of cases, if the defendants know they will lose their entire Medicare stream of business while they wait for an investigation and try to go to Court.

In addition, when there are safety concerns, as there can be in an allegation of Medicare fraud the ability of the government to act with such force may be justified.

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