Unnecessary medical care provided to patients, often referred to as a lack of medical necessity, can result in false claims being submitted to government programs, like Medicare or Medicaid. It can also expose patients to unnecessary treatment and potential harm.
What Is Lack of Medical Necessity?
Medical necessity is an important requirement for government claims that protects patients and helps prevent government fraud. Government programs generally do not cover healthcare items or services that are not reasonable and necessary for diagnosing or treating an illness or injury.
A lack of medical necessity may involve a treatment, test, procedure, drug, medical device, hospital admission or level of care that is not supported by the patient’s condition, medical record or applicable coverage requirements.
Whether care is medically necessary can depend on the individual patient and the relevant clinical facts. A disagreement between medical professionals does not, by itself, establish that healthcare fraud occurred.
When Can Lack of Medical Necessity Violate the False Claims Act?
Submitting a claim for medically unnecessary care does not automatically establish a False Claims Act violation. The False Claims Act may apply when a healthcare provider knowingly submits, or causes someone else to submit, a false claim for government payment. It may also apply when a provider knowingly uses a false record or statement that is material to a claim.
Under the False Claims Act, acting “knowingly” includes having actual knowledge, deliberately ignoring whether information is true or acting with reckless disregard for its truth or falsity. The law does not require proof of a specific intent to defraud.
Appellate courts have addressed whether healthcare providers’ false representations that treatment is medically necessary can support False Claims Act cases. A physician’s determination of medical necessity can be false if the physician does not believe it, knows facts that preclude it or recklessly disregards whether it is true.
False Claims Act liability can include three times the government’s damages and civil penalties for false claims.
What Are Common Examples of Medically Unnecessary Care?
Whistleblowers have helped stop many instances of unnecessary medical care. Whistleblower cases have alleged a lack of medical necessity involving many types of healthcare providers, including hospitals, skilled nursing facilities and hospice programs.
Examples of conduct that may raise medical necessity concerns include:
- Inpatient hospital admissions that are not supported by the patient’s condition or medical record
- Tests, surgeries or other procedures ordered without a documented clinical need
- Drugs, medical devices or equipment provided when applicable medical criteria are not met
- Hospice services provided to patients who do not meet eligibility requirements
- Therapy or other services provided more frequently or intensively than a patient’s condition supports
How Have Whistleblowers Exposed Medically Unnecessary Care?
One high-profile whistleblower case involved hundreds of hospitals that allegedly implanted electronic heart devices before the end of a waiting period required by Medicare to determine whether a patient’s heart could recover from a heart attack or bypass surgery without the device.
More than 500 hospitals in 43 states paid over $280 million to settle the allegations. Two of the lead government prosecutors in the case, one from the US Attorney’s Office in Miami and another from the US Department of Justice, have since joined Phillips & Cohen to represent whistleblowers.
How Can Whistleblowers Report Medically Unnecessary Care?
Healthcare professionals and others who are aware of unnecessary medical care provided to Medicare or Medicaid patients may be able to report the suspected fraud by filing a whistleblower, or “qui tam,” lawsuit under the False Claims Act.
A qui tam lawsuit is filed on behalf of the United States and initially remains under seal while the government investigates the allegations and decides whether to intervene. Because timing, prior public disclosures and other legal requirements can affect a potential case, individuals should consult a whistleblower attorney before deciding how to report suspected fraud or disclose confidential information.
What False Claims Act Rewards and Protections May Be Available?
An eligible whistleblower may receive a portion of the government’s recovery when a qui tam case succeeds. The False Claims Act generally provides whistleblowers with 15% to 25% of the recovery when the government intervenes and 25% to 30% when the government declines to intervene, and the whistleblower successfully pursues the case. The amount depends on the circumstances and applicable statutory requirements.
The False Claims Act also protects qualifying employees, contractors and agents from retaliation for lawful efforts to stop potential violations. Available relief may include reinstatement, twice the amount of back pay and compensation for certain damages. Learn more about whistleblower rewards and protection from retaliation.
Speak With a False Claims Act Whistleblower Attorney
If you are aware of unnecessary medical care being provided to Medicare or Medicaid patients and would like to understand your options for reporting it, contact Phillips & Cohen for a free and confidential consultation.