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EnforceMintz — Tele-Fraud Enforcement in 2023 Remained Focused on Same Schemes as Years Past

Government enforcement activities focused on tele-fraudsters remained active in 2023, but did not break substantial new ground. Several significant criminal resolutions last year involved allegations that were similar to each other and to other enforcement actions from previous years: fraud schemes involving medically unnecessary durable medical equipment (DME) or genetic testing ordered by providers working for telehealth companies who had never met or never treated the patients for whom the providers ordered testing or DME, or some combination of both. These orders were then sold to laboratories or DME suppliers, which billed Medicare for these items or services. You can find examples of these actions here, here, and here. Notably, many of the schemes at the heart of these settlements involved one or more of the “suspect characteristics” identified by the OIG as “hallmarks” of potential telemedicine fraud schemes in its July 2022 Special Fraud Alert.

In addition to enforcement action, the OIG released some telehealth guidance in 2023: Toolkit: Analyzing Telehealth Claims to Assess Program Integrity Risks. This toolkit provides resources to enable a variety of public and private entities (such as private health plans, Medicare Advantage plans, State Medicaid Fraud Control Units, and other federal health care agencies) to assess their own telehealth claims data to identify potential risk areas. The OIG developed this toolkit in response to congressional emphasis on controlling fraud and abuse in this space, especially after Congress extended Medicare coverage for certain telehealth services through the Consolidated Appropriations Act of 2023.

Perhaps more notable than the telehealth-related developments we did see in 2023 are the developments we did not see. We have not yet seen significant civil enforcement involving telehealth fraud allegations, including False Claims Act qui tam actions. We can only speculate as to the cause of the delay, but it is possible that qui tam cases have been filed and remain under seal while the government investigates the allegations. It is also possible that the government is focusing its enforcement resources on what it views as the most egregious fraud and will turn to civil enforcement in a later phase of its enforcement efforts.

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Samantha advises clients on regulatory and enforcement matters. She has deep experience handling violations of the federal ant-kickback statute and FCA investigations for clinical laboratories and hospitals.