Nolan Auerbach & White are experienced Hospital Fraud Lawyers helping courageous whistleblowers.
Learn more about your rights or to get help as a COVID-19 uninsured program whistleblower, or contact us below to speak with an experienced attorney.
COVID-19 relief laws passed in March and April of 2020 resulted in congressional appropriation of approximately $2.6 trillion to fund response and recovery efforts. Of the four laws passed in this time, it was the CARES Act that provided the bulk of assistance — over $2 trillion in emergency assistance and healthcare response for businesses and others affected by COVID-19. Secondarily, the Paycheck Protection Program and Health Care Enhancement Act, enacted in April 2020, provided additional appropriations for small business loans, grants to healthcare providers, and funds for COVID-19 testing.
As it relates to Government Healthcare Fraud specifically, the four COVID-19 relief laws appropriated more than $250 billion to HHS to address various components of the public health response. This response includes various funding to hospital systems and other providers, including skilled nursing and home health entities.
Outside of HHS, for example at the U.S. Department of Defense, COVID-19 healthcare spending was also robust. According to federal procurement data, examples of goods procured within the two categories of “medical and surgical equipment” and “hospital and surgical clothing” included billions for ventilators and personal protective equipment, such as N95 respirators and gloves. “Services” were also purchased, including billions of dollars spent on biomedical research and development, including vaccination development. Federal agencies are tracking contract obligations in response to COVID-19 through the use of a National Interest Action code in the Federal Procurement Data System-Next Generation.
Through the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Paycheck Protection Program and Health Care Enhancement Act (PPPCHE), the federal government has allocated $175 billion in payments to be distributed through the Provider Relief Fund (PRF). Healthcare Fraud exists where the healthcare provider knowingly misrepresents, either that:
Compliance with the above very general terms and conditions should include the provision of an accounting system that tracks line items and profit centers that could even remotely be involved in its COVID-19 expenses or reimbursements, either directly or indirectly.
The CARES Act expansion opened the doors to easy COVID-19 fraud opportunities. Whistleblowers should be on the lookout for hospital systems that coerce or otherwise inappropriately cause Coders and other healthcare providers to code every discharge possible, as either a COVID-19 case or presumptive COVID-19 case, in order to receive additional funds.
The CARES Act provided hospitals with an increased payment for COVID-19 patients through a Medicare hospital inpatient prospective payment system adjustment. The increase was accomplished through a 20% increase in the diagnosis-related group (DRG) weighting factor for patients with a COVID-19 diagnosis. As a result, the potential for a wave of hospital upcoding for inpatient admissions resulting from false COVID-19 diagnoses are not surprising.
At issue are claims submitted with diagnosis code U07.1, COVID-19, applicable to positive COVID-19 and presumptive COVID-19 diagnoses. Additional ICD-10-CM used for reporting encounters related to “possible COVID-19 exposure” include:
203.818: (Encounter for observation for suspected exposure to other biological agents ruled out)
220.828 (Contact with and (suspected) exposure to other viral communicable diseases)
211.59 (Encounter for screening for other viral diseases)
Other opportunities for Healthcare Fraud arising from the CARES Act include an ability for acute care hospitals to transfer patients into alternative care settings. Specifically, Section 3711 waived the inpatient rehabilitation facility three-hour rule, which required that a beneficiary be expected to participate in at least three hours of intensive rehabilitation at least five days per week to qualify for admission. The section also allows long-term care hospitals (LTCHs) to maintain their LTCH designation even if more than 50 percent of their cases are less intensive. This provision also, to date, has paused the current LTCH site-neutral payment methodology.
Further, the CARES Act waived the requirement that inpatient rehabilitation facilities (IRFs) patients attend three hours of therapy per day or 15 hours per week. The act likewise waived the requirement that LTCHs have no more than 50 percent of Medicare cases paid at the “site-neutral” (or IPPS) rate, along with the application of the lower, site-neutral rate to qualifying LTCH cases.
The CARES Act additionally expanded the existing Medicare Accelerated and Advance Payment Program (APP) by allowing qualified providers and suppliers to request advance lump-sum or periodic payments on future Medicare billing.
These increases and waivers have taken away time and quality limitations designed to deter fraud, and as a result, there is increased opportunity to violate the False Claims Act. Click below for more information about coverage and payment for COVID-19 testing and care:
Kathleen Hawkins, RN MSN, had been employed by Defendant, Catholic Healthcare West (CHW) for approximately 6 years when she decided she had had enough of trying to change the hospital system from within.
CHW, a California not-for-profit corporation that operated hospitals in California, Arizona, and Nevada, was at the time the eighth largest hospital system in the nation and the largest not-for-profit hospital provider in California.
Joe Strom contacted us in 2005. We were very grateful that he did. We immediately formed an all-star legal team and a process to stop a very harmful pharmaceutical marketing strategy. It was this process we set into motion that ultimately returned hundreds of millions of dollars to the U.S. Treasury, and a portion of that, very well-deserved, into Joe’s bank account.
Joe told us a very troubling story about the off-label promotion of a pharmaceutical drug for patients who already suffered from chronic heart failure.
Bruce Moilan was a seasoned hospital systems expert by the time he contacted our Firm. At the time he decided to file his qui tam lawsuit, he was employed by South Texas Health System as a System Director for Materials Management. In this position, he oversaw $24 million in annual purchases of supplies and equipment and helped determine budget, reduction and cost analysis throughout the contract bidding and negotiations process. His job was to insure proper implementation for purchasing, receiving and management of inventory, for McAllen Hospitals, L.P.