Untimely Physician Certifications For Medicare Home Care Claims—Arguably A Technicality—Vulnerable To False Claims Act Allegations: Sixth Circuit


On June 11, 2018, the United States Court of Appeals for the Sixth Circuit sustained a complaint against a home health care agency alleging that the agency had violated the False Claims Act (the “FCA”) by submitting numerous claims to the Medicare program, even though the agency had not timely received the requisite physician certifications of the need for the services billed for. United States ex rel. Prather v. Brookdale Senior Communities, Inc., 892 F.3d 822 (6th Cir. 2018). The Sixth Circuit concluded that the agency's former employee, who filed the FCA action, had sufficiently alleged that (i) the timely submission of physician certifications was “material to the Government's decision to make the payment,” and (ii) the defendants had knowledge—or at least acted with “reckless disregard”—that the Medicare claims may not comply with the applicable Medicare regulations governing payment. The FCA action was allowed to go forward on that basis alone, even though there was no allegation that the home care services were not medically necessary or were not provided, or that the home health agency had backdated certifications, submitted claims with unsigned certifications, or withheld any information from Medicare.

As discussed below, this case highlights the need for providers to implement robust compliance policies and procedures to ensure that mere technical violations of the regulations do not mature into full-blown FCA violations.

Regulatory Background

FCA: The FCA imposes liability—including per claim penalties and treble damages—on health care providers who submit false claims for reimbursement to any federal health care program. 31 U.S.C. § 3729 et seq. To plead a claim under the FCA, the plaintiff must allege with particularity that: (i) the defendant made a false statement or record; (ii) with scienter (intent or knowledge) of the wrongdoing; (iii) the false statement or record was material to the government's decision to pay the claim; and (iv) the defendant submitted the false statement or record to the government causing it to pay the claim. Prather, 892 F.3d at 830-31.

Physician Certification: Medicare Part A or Part B pays for home health services only “if a physician certifies and recertifies” the patient's eligibility for an entitlement to those services. 42 C.F.R. § 424.22. These certifications are essentially projections about the patient's medical need and plan of care. Medicare currently pays home health agencies on a prospective payment system based on a 60-day period of services, known as anepisode of care. The physician's certification of need for home health services must be obtainedat the time the plan of care is established or as soon thereafter and must be signed and dated by the physician who establishes the plan...

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