False Claims Act and Documentation Practices

In the fiscal year ending September 2022, settlements and judgements under the False Claims Act exceeded $2.2 billion, with $1.7 billion (77%) related to the healthcare industry.  Experts expect that these claims will continue to increase, particularly whistleblower, or qui tam, cases.  Potential damages are in the millions in these cases, and as in any litigation, much of the defense relies on complete documentation.

In a recent webinar presented by Sheppard Mullin, FCA claims In long-term care most often fall in the categories of poor (or no) documentation to support claims, provision of services that do not meet standards of care, kickbacks, improper disenrollment practices, upcoding, delays in discharge, improper sales or marketing arrangements, and lack of physician authorizations.  Other potential FCA areas for long-term care providers include failure to follow infection control protocols, inadequate staffing, and hospice services for patients who are not terminally ill.

In August 2023, the Third Circuit held that medical record keeping issues and documentation errors may be material under the False Claims Act in a hospice case appeal.  This opinion reinforces “how critical proper documentation and retention practices are.”  Audits conducted by Excelas relative to FCA cases involving hospice revealed red flags including:

  • No certification present or initial certification not performed in a timely manner
  • Subsequent recertifications not performed in a timely manner
  • Physician narrative statement not present or valid
  • No plan of care
  • Face to face requirements not met
  • No certification for dates billed

According to Beth Wilson, former Senior Counsel for a national healthcare network and current President of Excelas, poor, or no, documentation to support a claim is an obvious issue that cannot be undone.  However, in her experience, documentation often does exist, but the complete record has not been produced or there are other pages in a chart that can establish care, even if the primary document for that purpose was not completed.  For example, facilities may have hybrid medical records which include both paper and electronic documents, and may be using various systems which do not easily interface.  Treatment provided may be documented in various areas of the chart, including progress notes, nursing notes, therapy records, and other ancillary services documentation.  Ms. Wilson stresses that utilizing staff who are experienced in the complexities of record retrieval and legal nurses who analyze the content of medical records is central to supporting counsel in the defense of a false claims allegation.

Senior living providers can be proactive in avoiding FCA allegations by conducting audits of medical and related records to assess documentation quality, reveal gaps in documentation, assess documentation support for claim submissions, and implement improvement plans as necessary.  If faced with a false claim allegation, an early assessment and evaluation of the claim can allow for quick resolution.  Contact Excelas for a demonstration of tools to support providers and counsel in defending false claims allegations in long-term care.

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