Annals of Health Law
READY OR NOT
the conditions (medical necessity) or regulations (impacting conditions of
participation) upon which certification theories have been traditionally
based in quality of care cases. This is so because claims for reimbursement
in the traditional billing context are based on payments for services
rendered and subject to reimbursement regulations, whereas VBP claims are
based on exemplary performance data and are not subject to similar
reimbursement regulations. Therefore, the FCA will not likely reach VBP
reimbursement claims through traditional false certification theories.
2. Worthless Services Claims
When the government suspects that a provider has rendered substandard
or deficient services to a Medicare beneficiary, it may pursue a FCA claim
based on the “worthless services” theory. 146 Historically, this prosecutorial
strategy has fared best for the government in the long-term care context, in
light of the typical fact pattern involving allegations that nursing home
residents received wholly inadequate care or no care at all. 147 However, the
government could feasibly expand the application of this theory and charge
other healthcare providers with similar allegations under compelling
circumstances. 148 As such, the new reimbursement paradigm and rise of
quality data submissions required by VBP and P4P programs will likely
breathe new life into quality fraud investigations and prosecutions by
offering the OIG new targets.
146. Schindler, supra note 133, at 396-97.
147. According to the OIG for HHS, between 1996 and 2003, more than twenty cases
involving quality of care issues were settled against nursing homes based on alleged
violations of the FCA. See Schindler, supra note 133, at 398 (2003) (statement of Dara
Corrigon, Acting Principal Deputy Inspector General, U.S. Department of Health and
Human Services), available at https://oig.hhs.gov/testimony/docs/2003/071703fin.pdf. Mr.
Schindler suggests that the very nature of nursing home reimbursement places these facilities
at a particular risk of being targeted for tort, civil enforcement and criminal cases under the
various billing fraud statutes. See Schindler, supra note 133, at 399.
148. The use of worthless services to target substandard quality of care outside the
nursing home context will depend largely on the distinction between “systematic and
widespread malpractice” (laying a foundation for quality fraud) and “simple malpractice,”
which is not well-suited to the FCA but rather is historically handled by state malpractice
laws. See Schindler, supra note 133, at 398-99. Certainly the government has validated
worthless services applicability to the hospital setting by recognizing it as an investigative
focus in its 2012 Work Plan. See 2012 WORK PLAN, supra note 86, at IV- 4.