Get the Advice and Representation You Need from an Experienced Georgia-Based Physician Defense Attorney

A Georgia-based physician defense attorney at our health law firm represents clinical laboratories and physicians in connection with federal fraud investigations concerning the provision of laboratory referrals. Our firm has offices in Atlanta and Augusta, Georgia, and we represent labs and physicians on a national basis in connection with issues associated with Medicare payment for lab services, including federal investigations.

Federal audits and investigations targeting clinical laboratories and physicians present substantial risks. While these inquiries are often civil in nature, they can lead to criminal charges in some cases. But, even in civil cases, targeted facilities and practitioners can face significant fines, liability for treble damages (three times the government’s actual losses), and the possibility of Medicare exclusion. Federal allegations can trigger ,professional licensing actions privilege, and credential actions, and employment-related actions as well. As a result, an informed and strategic defense is critical, and targeted facilities and practitioners need a highly experienced Georgia-based physician defense attorney on their side.

Physician, Laboratory Health Law Firm in Georgia

We provide advice and legal representation for healthcare providers, including physicians and labs, in responding to fraud investigations or other government inquiries. The OIG, federal law enforcement agencies and their contractors continue to view the identification of, recoveries for, and criminal prosecution of Medicare fraud as a top law enforcement priority. Many labs, physicians and medical practices will be the subject of federal fraud investigations and enforcement action the coming years.

To mitigate our clients’ risk in these cases, we take a proactive approach focused on resolving the government’s inquiry without formal charges whenever possible. This not only provides our clients with a certain outcome that avoids formal enforcement proceedings and litigation, but it also keeps our clients’ audits and investigations out of the public eye. We proactively address any ancillary concerns as well, including the potential for professional discipline and loss of credentials or privileges.

CMS and OIG Oversight of Clinical Laboratory Services

Medicare is the largest third-party payer of clinical laboratory services in the United States. The OIG has called for stronger oversight of labs and recommended that the Centers for Medicare & Medicaid Services (CMS) take appropriate action against over 1000 labs that OIG’s investigation revealed have engaged in what it deemed “questionable billing.” In a recent year, the OIG’s investigation and report utilized 13 measures to identify labs with questionable billing:

  1. high average allowed amount per claim,
  2. high average number of claims per beneficiary,
  3. high average allowed amount per beneficiary,
  4. high average number of claims per ordering physician,
  5. high average allowed amount per ordering physician,
  6. high percentage of claims for beneficiaries with no associated Part B services with the ordering physician,
  7. high percentage of claims for beneficiaries living more than 150 miles from the ordering physician,
  8. high percentage of duplicate lab tests,
  9. high percentage of claims with invalid ordering-physician numbers,
  10. high percentage of claims with ineligible ordering-physician numbers,
  11. high percentage of claims with compromised beneficiary numbers,
  12. high percentage of claims with compromised ordering-physician numbers, and
  13. compromised lab provider numbers.
  14. The OIG determined that 1,025 labs exceeded applicable thresholds for at least five out of the 13 measures of questionable billing. Those labs were allowed about $1 billion for lab services rendered in 2010, with an average allowed amount of $1 million. The OIG’s report also stated that “[a]lthough some of this billing may be legitimate, all labs that exceeded thresholds on five or more measures of questionable billing may warrant further scrutiny” and recommended enforcement action by CMS. 

CMS is expected to continue to pursue OIG recommendations as to labs that have been identified by OIG as having questionable billing practices and take appropriate action, which may include:

  • recouping improper payments to the lab
  • suspending payments to any lab with questionable billing
  • educating labs regarding best billing practices
  • exclusion from Medicare, and/or referring the lab to law enforcement for criminal investigation.

Additionally, CMS may review program strategies being implemented by Medicare Administrative Contractors (MAC), Medicare Zone Program Integrity Contractors (ZPICs), Recovery Audit Contractors (RACs), and the Fraud Prevention System specifically to monitor labs and lab claims. Further, physicians, physician groups and medical practices that refer patients to labs that are involved in questionable billing practices may be exposed to penalties based on compliance-related issues, such as STARK, the Federal Anti-Kickback Statute and/or various Medicare billing infractions.

Common Issues in Federal Clinical Lab Fraud Audits and Investigations in Georgia 

Federal audits and investigations targeting clinical laboratories and physicians can involve an extremely wide range of issues. When facing scrutiny from a MAC, RAC, ZPIC, the OIG, or any other federal authority, identifying the specific issues underlying the inquiry is a critical first step toward executing an effective defense strategy.

With this in mind, identifying the issues involved is one of our top priorities when a Georgia-based physician defense attorney represents clinical laboratories and physicians under scrutiny in federal audits and investigations. To do this, we engage with the auditing or investigating entity and work with our client to conduct an internal compliance and risk assessment. This tells us not only what the auditor or investigating agency is looking for but also what else it might find. Some of the issues we most commonly see in federal clinical lab fraud audits and investigations include:

Anti-Kickback Statute, Stark Law, and Eliminating Kickbacks in Recovery Act (EKRA) Violations

The Anti-Kickback Statute, Stark Law, and Eliminating Kickbacks in Recovery Act (EKRA) all apply to clinical laboratories and physicians who bill Medicare for testing and related services. Under these federal statutes, clinical laboratories and physicians are prohibited from forming financial arrangements and making (or receiving) payments that constitute referral fees paid out of Medicare-reimbursed funds. 

These statutes are extremely broad in scope, allowing the OIG and other federal authorities to pursue investigations in a wide range of circumstances. However, they are also subject to numerous exceptions and “safe harbors,” and, in many cases, presenting a successful defense will be a matter of demonstrating that one of these exceptions or safe harbors applies. For example, provided that they are structured and documented appropriately, transactions involving all of the following can potentially fall under an exception or safe harbor that insulates clinical laboratories and physicians from prosecution:

  • Discounts
  • Employment relationships
  • Fair market value compensation
  • Indirect compensation agreements
  • In-office ancillary services
  • Investment interests
  • Isolated transactions
  • Limited remuneration to a physician
  • Non-monetary compensation
  • Personal service agreements

Again, these are just examples. When representing clinical laboratories and physicians in investigations under the Anti-Kickback Statute, Stark Law, and AKRA, we meticulously scrutinize the circumstances involved to identify all applicable exceptions, safe harbors, and other defenses. Each Georgia-based physician defense attorney at our firm has extensive experience in this area, and we rely on this experience to help our clients execute targeted and strategic defenses.

Inadvertent Medicare Billing Violations

Clinical laboratories can face both audits and investigations as a result of inadvertently overbilling Medicare. Importantly, while the 13 factors listed above may indicate questionable billings, they are not necessarily evidence that a laboratory or physician has overbilled Medicare. However, these factors—among others—are highly likely to trigger scrutiny from auditors or federal authorities, and when facing scrutiny, laboratories, and physicians must be able to affirmatively demonstrate strict Medicare billing compliance to avoid recoupments, denials, and other penalties.

At Little Health Law, we have extensive experience representing laboratories, physicians, and other healthcare clients during Medicare audits and investigations. If your laboratory or practice is facing allegations of inadvertent Medicare billing violations, we can thoroughly assess these allegations and help you develop and execute an informed defense strategy. If your laboratory or practice is in full compliance, we can use the documentation that you have available to prove it. If you need to remedy inadvertent Medicare billing violations, a Georgia-based physician defense attorney at our firm can work to minimize the consequences of these violations on your (or your laboratory’s or practice’s) behalf.

Intentional Medicare Billing Fraud

We also assist laboratories and physicians with responding to allegations of intentional Medicare billing fraud. These allegations can expose laboratory owners and physicians to criminal prosecution, so an effective defense strategy is critical. A few examples of common allegations in these cases include:

  • Upcoding and Unbundling—Upcoding involves billing for a laboratory service or item at a rate applicable to a more expensive service or item, while unbundling involves billing separately for items or services that are subject to a reduced bundled rate.
  • Double-Billing Medicare and Other Payers – Double-billing Medicare and other payers is a common allegation in investigations targeting allegedly intentional billing fraud. Not only is there a strict prohibition on double-billing, but Medicare also has strict rules around when laboratories and providers can bill the government when other sources of reimbursement are available.
  • Phantom Billing—Phantom billing involves billing Medicare for laboratory items or services not actually provided to patients. Allegations of billing for phantom patients can also lead to criminal Medicare fraud charges.

When facing intentional Medicare billing fraud allegations, laboratory owners and physicians must make informed decisions about their defense strategies. For example, while disputing any purported evidence of intent may be enough to avoid criminal charges, acknowledging substantial Medicare billing compliance failures can still expose targeted entities and individuals to substantial liability. Acknowledging compliance failures could also create issues in subsequent disciplinary and credentialing proceedings as well. At Little Health Law, a Georgia-based physician defense attorney is aware of these risks and takes a comprehensive and forward-thinking approach to developing our clients’ defense strategies.

Violations of the Clinical Laboratory Improvement Amendments (CLIA)

Laboratories can face scrutiny from CMS and the U.S. Food and Drug Administration (FDA) for violating (or allegedly violating) the Clinical Laboratory Improvement Amendments (CLIA). As the FDA explains, “Under the CLIA program, clinical laboratories are required to have the appropriate certificate before they can accept human samples for testing. There are different types of CLIA certificates and regulatory requirements, based on the types and complexity of clinical laboratory tests a laboratory conducts.”

Non-compliance with the CLIA can expose laboratories to substantial penalties, and the FDA has ramped up its enforcement efforts targeting clinical laboratories in recent years. With this in mind, laboratory owners would be well-advised to review their facilities’ CLIA compliance policies and procedures, and those that are facing scrutiny under the CLIA should engage experienced counsel to communicate with CMS and the FDA on their behalf.

Clinical Laboratory Compliance Oversights and Failures

Clinical laboratories need to maintain robust compliance programs that address a wide range of complex federal statutory and regulatory obligations. Any compliance oversights or failures have the potential to trigger federal scrutiny, with this scrutiny potentially presenting risks for civil or criminal enforcement depending on the circumstances involved.

As outlined by the OIG, clinical laboratories’ core compliance obligations include (but are not limited to):

  • Adhering to standards of conduct designed to ensure compliance with all relevant federal regulations and prevent fraud, waste, and abuse;
  • Implementing procedural safeguards designed to ensure that clinical laboratories only bill Medicare for tests and other services that meet Medicare’s definition of “medical necessity;”
  • Ensuring the correct use of CPT, HCPCS, ICD-9CM, and other applicable billing codes while ensuring accurate billing calculations in all scenarios;
  • Ensuring that they do not improperly rely on standing orders from treating physicians (according to the OIG, “while laboratory compliance plans can permit the use of standing orders executed in connection with an extended course of treatment, the compliance plan should require the laboratory to monitor existing standing orders to ensure their continuing validity”);
  • Complying with all applicable Fraud Alerts issued by the OIG;
  • Engaging in “honest, straightforward, fully informative and non-deceptive marketing;”
  • Ensuring appropriate pricing and billing for physician profiles;
  • Maintaining all records required by applicable state and federal laws and regulations and,
  • Internal adherence to the laboratory’s compliance policies and procedures is required to ensure corporate integrity.

Potential Allegations, Charges, and Penalties Flowing from Federal Clinical Lab Fraud Audits and Investigations in Georgia

Federal audits and investigations targeting clinical laboratories and physicians can present several risks—including risks for administrative, civil, and criminal penalties. For example, depending on the circumstances involved, negative outcomes resulting from an audit or investigation may include:

  • Civil Enforcement Under the Anti-Kickback Statute, Stark Law, and/or EKRA – The Anti-Kickback Statute, Stark Law, and EKRA all include provisions for civil enforcement. Enforcement actions targeting clinical laboratories and physicians under these statutes can result in significant financial liability.
  • Criminal Enforcement Under the Anti-Kickback Statute – Along with provisions for civil enforcement, the Anti-Kickback Statute allows for criminal enforcement in appropriate cases as well. In criminal Anti-Kickback Statute enforcement cases, laboratory owners and physicians can face both fines and federal imprisonment.
  • Civil or Criminal Enforcement Under the False Claims Act – The False Claims Act allows for civil or criminal enforcement in cases involving the submission of “false or fraudulent claim[s]” to Medicare. While criminal enforcement is reserved for cases involving intentional violations, both civil and criminal False Claims Act cases can expose entities and individuals to substantial penalties.
  • Criminal Enforcement Under the Federal Healthcare Fraud Statute (18 U.S.C. Section 1347) – 18 U.S.C. Section 1347 makes it a federal crime to “knowingly and willfully execute[], or attempt[] to execute, a scheme or artifice—to defraud any healthcare benefit program.” When prosecuted under Section 1347, laboratory owners and physicians can face statutory fines and up to 10 years of federal imprisonment.
  • Criminal Prosecution for Conspiracy, Wire Fraud, or Federal Statutory Offenses – In criminal enforcement cases targeting unlawful referral fees and Medicare fraud in the clinical laboratory context, federal prosecutors routinely pursue charges for conspiracy, wire fraud, and other federal crimes. Similar to criminal healthcare fraud, these charges carry substantial fines and prison time.
  • Professional Licensing Action – As we mentioned above, federal audits and investigations will also trigger professional licensing action in many cases. Since the standards of culpability and burdens of proof differ between professional licensing actions and federal enforcement actions, physicians and others can face federal discipline even if an audit or investigation does not uncover sufficient evidence to substantiate federal charges.
  • Loss of Credentialing – Loss of credentialing is a concern for physicians and clinical laboratories targeted in federal audits and investigations as well. Along with Medicaid exclusion, audits and investigations can also present risks for loss of credentials with hospitals, private insurers and other entities.

This list is not comprehensive. If you are facing a clinical laboratory-related audit or investigation, a Georgia-based physician defense attorney at Little Health Law can help you understand the specific risks you are facing. If you choose our firm to handle the audit or investigation, we will get to work immediately, and we will focus our efforts on securing a favorable result that protects your laboratory or practice as cost-effectively as possible.  

5 Keys to a Successful Defense for Clinical Laboratories and Physicians Targeted in Audits and Investigations

For clinical laboratories and physicians targeted in federal audits and investigations, successfully defending against all allegations put forth is critical for avoiding unnecessary legal, financial, and professional consequences. We have the experience and insights needed to execute a successful defense, and if you need legal counsel for a federal inquiry, we encourage you to speak with a Georgia-based physician defense attorney at Little Health Law as soon as possible.

While all audits and investigations are unique, most generally present the same overarching legal challenges and considerations. With this in mind, here are five keys to building a successful defense:

1. Understanding the Nature and Scope of the Allegations at Issue

As we have discussed, audits and investigations targeting clinical laboratories and physicians can involve an extremely wide range of allegations. To execute an effective defense, it is critical to identify both the nature and scope of the allegation at issue in a particular inquiry. Inquiries targeting unlawful referral fees and inquiries targeting Medicare billing violations present different challenges, risks, and opportunities—and knowing what you need to defend against is one of the first steps toward making informed and strategic decisions.  

2. Gaining a Clear and Unbiased Understanding of All Relevant Facts

After a comprehensive understanding of the allegations at issue, targeted entities and practitioners should work with their counsel to gain a clear and unbiased understanding of all relevant facts. This involves quickly conducting an internal compliance and risk assessment. With knowledge of both the relevant allegations and the relevant facts, targeted laboratories and physicians can then work with their counsel to develop custom-tailored defense strategies.

3. Identifying and Preserving All Relevant Contracts, Billing Records and Other Documents

When facing a federal audit or investigation, it is imperative to identify and preserve all relevant contracts, billing records, and other documents. Not only is this important for assessing potential defenses and building a well-documented defense strategy, but failing to preserve relevant records can lead to additional challenges, charges, and risks in some cases. With this in mind, upon learning of an audit or investigation, a targeted laboratory or physician should promptly engage counsel to implement an organization-wide legal hold.

4. Taking a Proactive Approach That Targets a Specific Favorable Resolution

Rather than taking a wait-and-see approach, targeted laboratories and physicians should work with an experienced Georgia-based physician defense attorney to target a specific favorable resolution proactively. This targeted resolution should take into account all relevant facts and circumstances. At the same time, however, targeted laboratories and physicians must work with their counsel to address all document requests, interview requests, subpoenas, and other inquiries in a timely manner, as failure to do so can also lead to unnecessary adverse consequences.

5. Addressing Any Legal Concerns Arising (or That May Arise) Outside of the Federal Inquiry

In addition to presenting risks for civil or criminal enforcement, federal audits and investigations can also present risks for professional disciplinary action and credentialing actions. Targeted clinical laboratories and physicians must address these risks proactively as well, as statements and disclosures made during federal inquiries can have implications in subsequent proceedings. With our broad-based healthcare law practice, we are intimately familiar with the risks that federal audits and investigations present, and our attorneys rely on insights gained from decades of relevant experience to protect our clients’ interests across the board.

Request a Confidential Consultation with a Georgia-Based Physician Defense Attorney at Little Health Law

A Georgia-based physician defense attorney at our health law firm is committed to protecting the financial and professional interests of physicians and healthcare businesses.  We have offices in Atlanta and Augusta, Georgia, and serve clients nationwide. If you have questions about lab-related services or referrals, call us at 404-685-1662 (Atlanta) or 706-722-7886 (Augusta), or schedule a confidential consultation.

We Look Forward to Working With You