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Healthcare billing practices are under increased scrutiny

In July 2014, a federal jury found a Texas businessman guilty of 15 counts of health care fraud. The jurors found that the man had directed the billing coders at his hospital to illegally change diagnoses in up to $1.1 million worth of claims to Medicare. The businessman could face up to 20 years in prison when he is sentenced, likely next year, according to the Dallas Morning News.

In August 2014, the U.S. Department of Justice announced that a Tennessee-based health care system would pay $98 million to settle claims of improper billing. It alleged that the hospital system admitted patients when it was not medically necessary to do so and billed Medicaid, Medicare and Tricare, the military insurance program. About $9 million will be used to settle similar claims at a medical center in Laredo, Texas.

These are just two examples of cases of Medicare and Medicaid fraud in the news in recent months. For years, the Centers for Medicare and Medicaid Services (CMS), the federal Department of Justice and state regulators have been cracking down on perceived billing problems at hospitals, medical suppliers and medical facilities throughout the nation. In recent months, CMS has further increased scrutiny at diagnostic facilities and medical practices that bill Medicaid and Medicare.

According to an article in The Hospitalist, the federal government is instituting stricter interventions and higher penalties aimed at stopping careless billing by providers it says routinely overcharge for services. CMS could also take advantage of a law change that allows it to publicly report federal payments to individual providers.

Our health law attorneys have seen an increase in investigations of billing practices of the physicians and health care providers we represent. Our clients may receive a subpoena or civil investigative demand for medical records. Investigators compare medical charts with billing records to determine whether services were actually provided, properly billed or coded and medically necessary. It's an extensive and costly investigation.

For health care providers, the increasing scrutiny of billing practices makes having an effective compliance program even more important. A properly created and followed compliance program can help prevent billing problems and uncover problems that do arise sooner.

· Hendershot, Cannon, Martin & Hisey, P.C., is a Texas-based law firm that creates compliance programs and represents clients in health care fraud investigations nationwide. For more information, visit our page on compliance program effectiveness.

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