Hospitals fined over $7.5M for False Ambulance Claims over Lack of Medical Necessity

Nine hospitals in Florida faced FCA charges for false claims submitted by independent ambulance companies because the physician certifications used lacked proper showing of medical necessity. This is one of the first cases where the government has focused on physician certification for the use of ambulances and with a combined sum of over $7.5 million in fines for the nine hospitals involved, hospitals and ambulance operators ought to revisit their compliance policies.

The Problem

To bill Medicare for non-emergency transports, hospitals or skilled nursing facilities must provide physician certification statements. A physician, physician assistant, nurse or any other person authorized by Medicare signs these physician certifications, attesting to medical necessity.

However, since CMS doesn’t require the use of a particular form, ambulance companies often develop their own. These forms may lend themselves to liability under FCA since many do not require detailed medical documentation of medical necessity. In fact, hospitals and skilled nursing facilities have developed a reputation for sending certifications that are brief and even erroneous. For example, rather than providing detailed certification of medical necessity, physicians may just write, “bed confined” and sign their name. As the Assistant U.S. Attorney Jason Mehta stated, this lack of clinical narrative turns ambulances into “an indirect taxi service.”

The Solution

In cracking down on false claims based on improper notation of medical necessity, the focus is on “changing the culture of how patients are transported and requiring hospitals to give thoughtful consideration before ordering ambulances,” Mehta stated. This change places liability on hospitals, since they make the request and certify the medical necessity of the trip, even though hospitals don’t bill for ambulance services or provide them. According to Mehta, the focus on false ambulance claims forces hospitals to absorb the cost rather than passing it off to the federal government.

Concluding Thoughts

Even though lack of proper certification may incur FCA liability, the presence of a signed physician certification for ambulance transport does not prevent liability. Instead, compliance officers must ensure certification precisely and accurately describes patient conditions at the time of practice and must show, with sufficient clinical narrative, that the transport is medically necessary.