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False Claims Act
New Rule Has Relatively Small Impact on FPs
However, physicians probably will receive notification from hospitals and managed care companies about compliance with the regulation and the federal law. The notifications are part of these larger organizations' requirement to comply with an obscure section of the Deficit Reduction Act of 2005, or DRA.
Section 6032 of the DRA requires health-related "entities" -- such as hospitals or managed care organizations -- that receive at least $5 million in Medicaid funds per year to develop fraud and abuse prevention policies and then communicate those policies to their staff members and contractors. Most physician offices are considered contractors under the regulation. That means for most family physicians, the rule will require them to sign hospital, managed care and health system letters acknowledging receipt of the entities' policies and agreement that they will comply with the policies in interactions with these organizations.
"The law distinguishes between entities and contractors," said Kent Moore, AAFP manager of health care financing and delivery systems. "Entities are organizations that receive $5 million in Medicaid funds each year. The typical family physician or family medicine practice is not pulling in $5 million from Medicaid alone. So, because they aren't 'entities,' the requirement to develop fraud and abuse prevention policies does not apply to the typical family medicine doctor."
However, Moore does suggest that physicians post the False Claims Act guidelines, as well as policies sent to them from large health care organizations they contract with, on a bulletin board in the employee break room or similar location at their offices. They also should include this information in existing employee manuals. Physicians are not required to develop an employee manual if none currently exists.
Family physicians can review the federal guidelines (3-page PDF; About PDFs) on the Taxpayers Against Fraud Web site. Though primarily written to help states interpret the provisions of the act, the guidelines can help physicians educate their staff members about what constitutes a false claim, the remedies and methods for reporting a false claim, and the protections afforded those who report false claims.
In addition, 19 states and the District of Columbia have passed false claims legislation that physicians also can download and post in accessible areas for employees. They are
- California,
- District of Columbia,
- Delaware,
- Florida,
- Georgia,
- Hawaii,
- Illinois,
- Indiana,
- Louisiana,
- Massachusetts,
- Michigan,
- Montana,
- Nevada,
- New Hampshire,
- New Mexico,
- New York,
- Oklahoma, (13-page PDF; About PDFs)
- Tennessee,
- Texas, and
- Virginia.
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