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Spikes in Fraud Penalties under the False Claims Act and the Anti-Kickback Act

New rules published on June 30th, 2016 in the Federal Register could dramatically change the regulatory enforcement landscape for healthcare providers, with fraud penalties nearly doubling under the False Claims Act and the Anti-Kickback Act.

The False Claims Act (which in pertinent part imposes penalties on healthcare providers for submitting false claims to a government program) has had a penalty range of $5,500 to $11,000 per claim since 1996, but such penalties will increase to a range of $10,781 to $21,563 per claim. Penalties for violations of the Anti-Kickback Act (which prohibits physicians from referring Medicare beneficiaries to an entity in which they have a financial relationship for designated health services) will correlatively be substantially enhanced, from $11,000 per violation to $21,563 per violation.

The basis for these adjustments is the Federal Civil Monetary Penalties Inflation Adjustment Act of 1990, which requires that civil monetary penalties be adjusted regularly in order to account for inflation. These changes are set to take effect on August 1st, 2016. Public comments on the changes can be submitted to the Justice Department until August 29th, 2016.

For further clarification regarding the Anti-Kickback Act or False Claims Act, please contact Adrienne Dresevic, Esq., at adresevic@thehlp.com, or Carey Kalmowitz, Esq., at ckalmowitz@thehlp.com, or alternatively, please reach them at our offices by calling (248) 996-8510 or (212) 734-0128.

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