New settlement signals future government tactics
The record $486 million settlement between Fresenius Medical Care and the U.S. government may signal health care providers how the government is now pursuing some fraud investigations, says health care attorney Eugene Tillman with Reed, Smith, Shaw & McClay in Washington, DC.
According to Tillman, the first set of issues surrounds false documentation to support medical necessity. "What is interesting here is that you had a long-standing issue about whether the intradialythic parenteral nutrition coverage criteria are too restrictive or whether the durable medical equipment regional carriers are interpreting them too narrowly."
Tillman says there have been numerous denials and appeals, but that this case extends well beyond those cases. "What is alleged here," he explains, "is manufacturing medical necessity documentation, including information that was false and known to be false."
The second area Tillman highlights involves intradialythic parenteral nutrition (IDPN) administration kits. He says disputes frequently surface over whether a carrier is properly interpreting the law and guidance or is being unduly restrictive. "At the root of the allegation is basically not a statute and not a regulation, but a directive from a carrier," asserts Tillman.
He suggests that even when providers are dealing with directives they must be cautious. "The fact that it involves a carrier guideline is not going to immunize you from potential liability, including criminal liability."
Tillman also points to the government's interpretation of IDPN bag hanging fees. He says it has been debated for years whether bag hanging fees are appropriate. But he says in this case the government is focusing on what they consider a manipulation of numbers. "The underlying issue here that is raised in the context of a conspiracy charge is whether the payment of a bag hanging fee to a dialysis provider is a kickback in order to induce the dialysis provider to use the IDPN company that is offering the bag hanging fee."
"What is interesting is the government comes very close to acknowledging that a payment [from] an IDPN supplier to a dialysis facility would be proper so long as it is based on the actual cost that the dialysis facility incurred in supporting the delivery of the IDPN," he adds.