Warding off false claims actions.(Guest Editorial)

Even though many physicians are concerned about protecting their practices from medical malpractice liability, action under the federal False Claims Act (FCA) is becoming much more likely and is a potentially more devastating threat to a physician's practice.

There are laws that provide specific penalties for medical fraud, but the federal government has increasingly relied upon the FCA to prosecute these cases. Employing a legal theory called false certification claims, the government can use the FCA to prosecute a physician for erroneously billed Medicare claims.

Associated fines are $5,500-$11,000 per claim plus triple the amount of damages that the government sustains because of false billing.

The FCA also contains a provision that lets private individuals who report billing errors to the government share in up to 30% of any recovery.

The lure of a potential monetary wind-fall leads to instances where employees who can report billing errors to the physician, and correct those practices, will instead go first to the government to report alleged wrongdoing.

The physician is then subjected to FCA litigation and forced to pay for defense fees or to attempt to settle the case rather than continue to litigate, whether engaged in fraudulent practices or not.

Small physician groups and solo practitioners are not immune from damages under the FCA and the fine per claim is not lessened simply because the practice is small.