Health Care:

Use of False Claims Act for Medicare Outpatient Claims Cases

B-279893: Published: Jul 22, 1998. Publicly Released: Aug 26, 1998.

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Pursuant to a congressional request, GAO addressed a number of issues concerning the Department of Health and Human Services' (HHS) and the Department of Justice's (DOJ) enforcement of the False Claims Act against hospitals submitting improper Medicare claims for outpatient services. GAO held that: (1) there was no evidence that errors hospitals made with respect to HHS' and DOJ's 72-hour rule were the result of unclear or ambiguous statutes, regulations, or guidance; (2) the law is reasonably clear in describing the conditions under which nonphysician outpatient services are not separately reimbursable; (3) advisory opinions do not appear to be necessary or helpful in clarifying the 72-hour rule; (4) since culpability under the False Claims Act depends on the state of mind of the person taking the action, advisory opinions--to the extent that they rely on assumptions concerning that person's knowledge or state or mind--might be meaningful; (5) there was no evidence that health care providers or hospitals have been singled out under the False Claims Act by HHS' and DOJ's joint project or have had a different standard applied to them; (6) the current practice of DOJ in effect takes materiality into account in settlements negotiated by the joint project under the False Claims Act; (7) this has been augmented by safeguards provided in recent DOJ guidance on False Claims Act enforcement in health care matters; and (8) these existing protections seek to strike a reasonable balance between protecting the rights of the subjects of investigations and those of the government.

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