Naples Quoted on Federal Push Behind Health Care Fraud Enforcement

Pat said that the truth is this level of enforcement is not new and comes from both sides of the aisle. 

“This is, in a lot of ways, a continuation of what the Biden administration was doing and the first Trump administration before that,” he said, describing the current campaign as the latest turn in a years-long escalation that has survived changes in the White House. “This is something that’s not going away.”

The current Administration announced a package of anti-fraud actions that include using artificial intelligence (AI) to flag fraud and stop improper payments. 

Pat said that the AI piece is newly prominent in enforcement, though not in law; claims data mining has been a recognized basis for a credible allegation of fraud since 2011, and enforcers are “looking for large outliers in the data set.”

As to whether a single flagged claim can justify withholding physician payment, Pat said, “It depends.” 

He added that physicians have recourse, but it’s a slow process. A physician can file a written rebuttal statement arguing there is no credible allegation of fraud, but whether the agency credits it is “largely within the agency’s discretion,” and only after the ordinary administrative appeal is exhausted does judicial review become an option. Suing the Centers for Medicare & Medicaid Services over an incorrect alert is a dead end, he said, because sovereign immunity almost certainly shields the agency.

Self-protection is the remaining practical strategy. 

“Check your own data and be on top of it and be monitoring it so that you can be prepared,” Pat said. 

He added that practices that merely refer patients to a durable medical equipment supplier are also at risk and should measure those relationships against CMS safe harbors. Even a physician doing everything correctly “can still be a witness to an investigation” and absorb the cost of subpoenas, document production and staff interviews.

Pat noted that the recurring failures he sees in small practices are the familiar ones: anti-kickback and referral arrangements, thin documentation on medical necessity, and cybersecurity gaps. He counsels his clients to identify their highest-risk areas, train staff, audit referral and coding on a basic cadence and keep outside counsel on call, all of it cheaper than reacting to an enforcement action no one saw coming.

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