September 26, 2018 - Posts

Waiving Co-Pays and Deductible May Be Fraud

Why are Copay Waivers Unlawful?

 

A physician waiving a copay or deductible may seem like an innocuous and good-spirited act, however, this benevolence might really be a front for illegal and fraudulent activity against the federal government. Federal guidelines, issued by the Office of the Inspector General (OIG), state that routinely waiving a patient’s copay and deductible violates the False Claims Act (FCA) and the federal Anti-Kickback Statue.

 

The FCA protects the government from being overcharged or sold inferior goods and services from private entities. If a health care provider bills the government $100 for a particular service, but then waives the 20% copayment fee of $20, the actual charge of the service is $80. As a result, Medicare should be paying 80% of $80, and not 80% of $100- a difference of $16. A provider that does this routinely can cheat the government out of a lot of money over time.

 

Similarly, the Anti-Kickback statute specifies that it is illegal to routinely waive copays and deductibles, which Medicare and Medicaid programs require patients to pay themselves. This is known as “cost-sharing” and it helps ensure that everyone in the healthcare system – physicians and patients alike- is aware of the costs for different services and medicines. This makes patients better consumers, and when beneficiaries act rationally, and make sound decisions, Medicare avoids over utilization of unnecessary services or prescriptions.

 

A health provider can waive a copayment only after making an individual determination that the patient cannot afford to pay. Essentially, it cannot be a routine, systematic measure, but a case-by-case determination based on that individual’s ability to pay.

 

Cases Based on Unlawful Copayment Waivers:

 

Recently, there have been numerous large settlements with the FCA and healthcare providers involving co-pay waivers:

Since January 2009, the federal government has recovered $19.3 billion from health care fraud actions alone. The qui tam provision of the FCA allows ordinary citizens to help the government stop fraudulent activity. Those who step forward and assist the government are both protected and rewarded.

 

 

To learn more about our Whistleblower & Qui Tam practice click here. Our firm is located in Nashville, Tennessee, but we represent whistleblowers all around the country. Call us today at (615) 244 2202.

 


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