CHC Healthcare Fraud and Abuse 2 — Questions and Answers
Question 1: Under the Stark Law, which of the following is a permissible financial relationship between a physician and a designated health service (DHS) entity?
- A direct ownership interest with no exceptions
- A compensation arrangement that meets the fair market value exception (Correct answer)
- A referral agreement based on the volume of referrals
- A joint venture split based on anticipated DHS referrals
Correct answer: A compensation arrangement that meets the fair market value exception
Stark Law allows financial relationships if they meet specific statutory exceptions, including the fair market value compensation exception.
Question 2: Which federal agency primarily investigates and prosecutes healthcare fraud under the False Claims Act?
- The Centers for Medicare & Medicaid Services (CMS)
- The Department of Justice (DOJ) (Correct answer)
- The Office of Inspector General (OIG)
- The Drug Enforcement Administration (DEA)
Correct answer: The Department of Justice (DOJ)
The Department of Justice prosecutes False Claims Act cases, though the OIG investigates and the DOJ litigates civil and criminal FCA violations.
Question 3: A hospital discovers that a physician has been receiving free office space from the hospital in exchange for referrals. This most likely violates which law?
- HIPAA Privacy Rule
- Emergency Medical Treatment and Labor Act (EMTALA)
- Anti-Kickback Statute (Correct answer)
- Clinical Laboratory Improvement Amendments (CLIA)
Correct answer: Anti-Kickback Statute
Receiving free office space in exchange for referrals constitutes remuneration linked to referral volume, which violates the Anti-Kickback Statute.
Question 4: Which element distinguishes 'fraud' from 'abuse' in healthcare compliance?
- The dollar amount of the improper claim
- The intentional, knowing, or reckless nature of the conduct (Correct answer)
- Whether the provider is a hospital or individual practitioner
- Whether the payer is a government or commercial insurer
Correct answer: The intentional, knowing, or reckless nature of the conduct
Fraud requires intentional or knowing deception, whereas abuse involves practices that are inconsistent with sound fiscal, business, or medical practices but may lack specific intent.
Question 5: Under the False Claims Act, what is the minimum per-claim civil penalty range (approximately) for a false claim submitted to the government?
- $500 to $1,000
- $2,587 to $5,174
- $13,000 to $27,000 (Correct answer)
- $50,000 to $100,000
Correct answer: $13,000 to $27,000
FCA civil penalties are adjusted annually for inflation; as of recent updates, the per-claim penalty range is approximately $13,000 to $27,000 per false claim.
Question 6: A medical equipment supplier bills Medicare for 'motorized wheelchairs' but delivers standard manual wheelchairs. This is an example of:
- Unbundling
- Upcoding (Correct answer)
- Phantom billing
- Medically unnecessary services
Correct answer: Upcoding
Upcoding involves billing for a higher-cost or more intensive service or item than was actually provided, such as billing for a motorized wheelchair when only a manual one was supplied.
Question 7: The 'safe harbor' regulations under the Anti-Kickback Statute are important because they:
- Eliminate all civil and criminal liability for any healthcare arrangement
- Describe arrangements that will not be prosecuted as kickbacks even if they technically involve remuneration (Correct answer)
- Apply only to arrangements involving government payers
- Replace the Stark Law self-referral prohibitions
Correct answer: Describe arrangements that will not be prosecuted as kickbacks even if they technically involve remuneration
AKS safe harbors protect specified arrangements from prosecution because, while they may involve remuneration, they are unlikely to cause the types of abuses the statute was designed to prevent.
CHC Healthcare Fraud and Abuse 2
Under the Stark Law, which of the following is a permissible financial relationship between a physician and a designated health service (DHS) entity?