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Article Summary

The Centers for Medicare & Medicaid Services (CMS) recently announced proposed rules intended to combat repeat offenders and encourage individuals with information about wrongdoing to come forward. CMS seeks to expand its authority to revoke a provider’s enrollment in Medicare based on a pattern of submitting claims for services that fail to meet Medicare requirements.

This article by TELG managing principal R. Scott Oswald and TELG principal David L. Scher was published by Bloomberg BNA Health Care Fraud Report on December 11, 2013. The full article is .

Excerpted from:

Bloomberg BNA Health Care Fraud Report

Proposed CMS Rules Present a New Threat to Habitual Health Care Fraud Offenders

The Federal Bureau of Investigation estimates that health-care fraud costs our nation $80 billion annually, and every year we hear about pharmaceutical makers and health-care providers settling allegations of fraud for hundreds of millions of dollars.

In the last few years, we have also seen settlements exceeding $1 billion, including an eye opening $3 billion settlement with GlaxoSmithKline (GSK) in July 2012(16 HFRA 509, 7/11/12). Many companies are repeat offenders, settling multimillion dollar claims year after year. Indeed, GSK paid $750 million in 2010 to settle criminal and civil claims relating to the manufacture and sale of adulterated drugs. Other repeat offenders include giants Pfizer, Inc. and Novartis Pharmaceuticals, Corp.

For many organizations, fraud settlements with the government seem like a cost of doing business, and the government is taking notice.

On April 29, the Centers for Medicare & Medicaid Services announced proposed rules intended to combat repeat offenders and encourage individuals with information about wrong doing to come forward. Under the new rules, the CMS proposed to expand its authority to deny or revoke a provider’s or supplier’s enrollment in Medicare based on a pattern or practice of submitting claims for services that fail to meet Medicare requirements or any felony conviction.

The CMS is also seeking significant changes to the existing Incentive Rewards Program (IWP) by increasing the maximum reward for whistleblowers from $1,000 to $9.9 million. The agency received 120 comments during the comment period, which closed on June 28, and it should be well on its way to preparing the final rule.

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