Several important healthcare laws hold the potential for criminal liability if violated, chief among them being fraud and abuse statutes. The Anti-Kickback Statute prohibits improper financial inducements for patient referrals, while the False Claims Act imposes liability on anyone who defrauds governmental programs like Medicare.
Healthcare fraud is also specifically criminalized. Violating these laws through activities such as billing for services not rendered or concealing an ongoing fraud scheme can constitute a felony. The Stark Law bars certain self-referrals between physicians and designated health services entities.
Failure to comply with these federal statutes, which aim to uphold transparency and prevent corruption, may result in serious criminal penalties including imprisonment, steep fines, and exclusion from participation in Medicare and Medicaid programs. Strict adherence to healthcare compliance obligations is therefore essential for all industry stakeholders.
Healthcare Law and Criminal Liability for Patient Care
Providing care to patients involves complying with many healthcare laws and regulations. While these laws are meant to protect patients, they can also potentially lead to criminal liability for healthcare providers in some situations. Some of the key healthcare laws that providers must be aware of include:
The Anti-Kickback Statute
This statute prohibits healthcare providers from offering or receiving any form of remuneration in return for patient referrals or to induce the referral of federal healthcare program business. Violating this statute can result in criminal penalties such as imprisonment, fines, and exclusion from federal healthcare programs.
Stark Law
Also known as the Physician Self-Referral Law, it prohibits physicians from making referrals for certain healthcare services to entities with which the physician has a financial relationship unless an exception applies. Criminal penalties include fines, imprisonment, and program exclusion.
False Claims Act
The FCA imposes liability on people and companies that defraud governmental programs. One such program is Medicare. Under the FCA, a physician who knowingly submits a false claim or makes a false record to get a false claim paid by Medicare can face civil penalties and treble damages. Criminal penalties include imprisonment, fines, and exclusion.
Criminal Liability Is Possible for Health Care Fraud
Healthcare fraud involves intentionally submitting false claims to Medicare, Medicaid, or other health insurers. Some examples of fraudulent activities that could result in criminal liability include:
- Billing for services that were never actually rendered
- Billing for more expensive procedures than were performed
- Performing medically unnecessary services solely for financial gain
- Misrepresenting a non-covered service as a covered service
The Federal government takes healthcare fraud very seriously due to its high costs. According to a 2021 report from the HHS Office of the Inspector General, healthcare fraud costs the U.S. over $100 billion annually.
The main statutes under which healthcare fraud is prosecuted criminally are:
- False Claims Act: This allows civil and criminal prosecution of entities that knowingly submit false claims to the government.
- Anti-Kickback Statute: This makes it a felony to offer, pay, solicit, or receive bribes in exchange for patient referrals.
- Health Care Fraud Statute: Specifically criminalizes health care fraud schemes that affect federal health programs or private insurers.
If convicted of health care fraud, individuals can face stiff penalties such as imprisonment, fines, and exclusion from federal health programs like Medicare. Organizations are also at risk of exclusion and stiff financial penalties. Providers must take compliance seriously to avoid such serious criminal consequences.
Health Care Law Can Lead to Liability
There are a few main categories of individuals and entities that can face criminal liability under healthcare laws:
Physicians and other healthcare providers
As discussed previously, those who directly provide medical care and services to patients, such as physicians, nurses, physician assistants, etc. can face criminal penalties for violations such as healthcare fraud, false claims, anti-kickback violations, and others.
Healthcare executives
The corporate officers, managers, and directors of healthcare organizations are also at risk of criminal prosecution for healthcare law violations committed by the organization. They can be held responsible if found to have some role in unlawful conduct, such as concealing fraud.
Owners of healthcare businesses
The owners and investors of facilities and ancillary service providers are likewise subject to criminal liability if their businesses violate laws like the Anti-Kickback Statute through arrangements with physician referrals.
Billing company employees
Those who handle billing and coding functions for healthcare providers could face charges for knowingly submitting false claims, even if they don’t directly provide medical care.
Pharmaceutical and device company employees
Sales reps, marketers, and company leadership may be implicated in healthcare fraud related to improper marketing of drugs and medical products.
Conclusion
While healthcare laws are designed to uphold standards of patient care, providers could face criminal liability for activities deemed unlawful. Such as healthcare fraud, false claims, or kickbacks.
The Anti-Kickback Statute, Stark Law, False Claims Act, and other statutes specifically aim to prevent corruption and protect patients. However, non-compliance may result in imprisonment, steep fines, and exclusion from participation in government programs.
All roles within healthcare from physicians to executives and business owners must thoroughly understand complex compliance obligations. Remaining educated on health law duties helps ensure safe, ethical care delivery while avoiding criminal penalties.
Frequently Asked Questions
What type of law most often affects healthcare?
Fraud and abuse laws like the Anti-Kickback Statute and False Claims Act are among the most common healthcare laws that providers encounter. These are designed to prevent fraudulent activity and uphold integrity in the healthcare system. Violating these statutes can lead to serious criminal consequences like fines and imprisonment.
Who are the three persons who could potentially face criminal liability?
The three main types of individuals who could face criminal liability for healthcare law violations are:
- Physicians and other direct care providers
- Healthcare executives, managers, and officers
- Owners of healthcare businesses
What are some examples of activities that could result in criminal liability?
Some examples of activities that have commonly resulted in criminal prosecution include:
- Healthcare fraud schemes like billing for services not rendered
- Kickbacks paid for patient referrals in violation of anti-kickback laws
- Intentional falsification of medical records to facilitate fraudulent billing
- Concealment of ongoing fraud that the corporate leadership was aware of
- Improper promotional practices by pharmaceutical sales reps
