Dr. Pearson has recently been hired into the Central City Internal Medicine Group as its fifth physician. He has recently completed his residency and is eager to enter private practice. Dr. Pearson is introduced to Meredith and Dawn, two members of the billing staff for the practice. Unbeknownst to Dr. Pearson, Meredith financially assists the practice in several ways. She bills procedures by using individual codes instead of comprehensive codes, she has decided to bill Dr. Pearson’s services under the Medicare number of Dr. Craig (another Central City physician) until Dr. Pearson’s credentialing process has been completed, and habitually submits a claim more than once if she isn’t sure whether or not it has already been submitted.
- Name the types of fraudulent billing that Meredith is conducting. (Name the specific Act)
- Could Meredith be held liable for these activities?
- Is Dr. Pearson subject to liability although he doesn’t know Meredith is conducting these activities? (Is Dr. Pearson responsible for the behavior of his staff?)
- Once Meredith’s activities are discovered, how should her conduct be addressed by her employer, Central City Internal Medicine? (What action might her supervisor take against Meredith? Consider what she learned as a new employee)
- What should Central City do to ensure these types of problems don’t occur in the future? (Look at it from a perspective of new hires. What should be done so they know this type of action is wrong?)
Expert Solution Preview
Introduction: This scenario involves a new physician, Dr. Pearson, and a billing staff member, Meredith, who is engaged in fraudulent billing practices. The following questions address the types of fraudulent billing, liability for Meredith and Dr. Pearson, how to address Meredith’s conduct, and how to prevent similar problems in the future.
1. Meredith is engaged in several types of fraudulent billing, including unbundling (billing for individual procedures instead of using comprehensive codes), upcoding (billing for a higher level of service than actually provided), and submitting duplicate claims. These actions violate the False Claims Act and the Anti-Kickback Statute.
2. Yes, Meredith could be held liable for her fraudulent billing practices. If caught, she could face fines, legal action, and even potential imprisonment.
3. As the new physician at the practice, Dr. Pearson may not be aware of Meredith’s fraudulent billing practices. However, he could be held responsible for her behavior as her supervisor. It is important for physicians to ensure their staff is conduct business ethically and to report any suspected fraudulent activities.
4. Once Meredith’s activities are discovered, her conduct should be addressed by her employer, Central City Internal Medicine. Depending on the severity of her fraudulent activities, disciplinary action may be taken. This could include warnings, suspension, termination, or even legal action.
5. To prevent these types of problems in the future, Central City should take steps to educate new hires and ensure they understand the legal and ethical standards for billing practices. This could include mandatory training sessions, regular audits to detect fraudulent activities, and a strict code of conduct for all staff members. Additionally, the practice could consider implementing a system of checks and balances to ensure that no individual employee has the ability to engage in fraudulent billing practices undetected.