chevron-down Created with Sketch Beta.
July 10, 2018 Practice Points

2018 Health Care Compliance Trends for White Collar Practitioners

Five areas for consideration and focus

by Richard K. Rifenbark and Melissa S. Ho

The calendar year is only half way over, and the U.S. Department of Justice (DOJ) has already charged more than 600 people (including doctors and other medical professionals) with making $2 billion in false billings.

Several health care compliance trends are emerging. The following are key areas that white collar practitioners may want to consider when advising health care providers and compliance professionals as they prepare their work plans for 2019.

  1. Individual Prosecutions. Consistent with the DOJ’s “Yates memo,” which outlined DOJ’s goal of increasing individual accountability for corporate wrongdoing, there has been a clear trend of prosecuting individual wrongdoers in addition to their companies. The Yates memo memorialized DOJ’s belief that executives and senior corporate officers are in the best position to prevent fraud or remedy its consequences after discovery. During 2017, there were several high-profile cases in which individual CEOs, COOs, CMOs, project managers, and other individuals were held criminally and/or civilly liable for health care fraud. Of the approximately 165 health care fraud cases so far this year listed on the Office of Inspector General’s (OIG’s) website, there have been approximately 131 cases in which individuals have been held personally liable for health care fraud, including owners, physicians, mid-level providers, and sales and marketing personnel, among others. To underscore the importance of health care compliance, providers should consider emphasizing the increased focus on individual conduct and potential liability during compliance training.

  2. Sales and Marketing Fraud. The government continues to focus its efforts on health care fraud involving sales and marketing practices, in particular kickbacks paid by marketing personnel to referral sources. Problematic marketing practices, including joint marketing with physicians, led to several multi-million dollar settlements in 2017, and have continued in 2018 as evidenced by several cases this year involving sales and marketing personnel.   Providers should consider taking a fresh look at their marketing policies to ensure that they are consistent with recent best practices and do not permit conduct that has been the focus of recent investigations. Regular compliance training for sales and marketing personnel is also advisable.

  3. Opioid Abuse. DOJ, OIG, state Attorneys General, insurance companies, and private litigants continue to actively investigate, prosecute, and litigate issues related to opioid diversion, fraud and abuse. For example, on June 28, 2018, DOJ announced that a nationwide health care fraud enforcement action resulted in the arrest of 160 individuals (including 76 physicians) for their roles in prescribing and distributing opioids and other dangerous narcotics.  The OIG also issued a special report in July 2017 in which it highlighted questionable prescribing practices by physicians and other providers. Given the scope of the current opioid crisis, it is safe to assume that this scrutiny of the prescribing, storing, and diversion of opioids will continue. Health care providers should have processes in place related to the storage and dispensing of opioids, as well as a procedure for notifying the appropriate regulatory agencies in the event of a drug diversion incident.

  4. Health Care Fraud Settlements Involving Employed Physicians. Over the past several years, there have been several investigations and settlements involving hospital-employed physicians. This had previously been considered an area of somewhat lower risk given the relatively broad exception and safe harbor for employment arrangements under federal statutes that limit or prohibit certain physician self-referrals (“Stark“) and the Anti-Kickback Statute. The recent settlements, which include a $14 million settlement from 2018, highlight the importance of fair market value in physician compensation, which is a requirement of the Stark bona fide employment relationships exception. Providers should ensure that employment arrangements with physicians and other referral sources are supported by fair market value documentation.

  5. Health Information Technology Compliance. During 2017, we saw increased enforcement activities related to health care information technology. This included (i) a settlement involving an electronic health records vendor for $155 million to resolve allegations that it caused providers to violate the false claims act related to meaningful use (MU) program payments, (ii) a $26 million settlement involving a medical group in which the group, among other things, allegedly falsely certified compliance with the MU program, and (iii) a report released by the OIG indicating that the Centers for Medicare and Medicaid Services overpaid $729 million to physicians and other professionals who participated  in the MU programs. Providers who participated in the MU program may want to consider conducting reviews of their past participation to ensure that they have all supporting documentation in the event of an audit or whistleblower lawsuit.

Given these trends, as well as other health care compliance trends not covered here, providers may also want to use the compliance program guidelines issued by the DOJ and OIG in 2017 as an efficient means to compare existing compliance programs against industry standards. The DOJ program guidance is contained in a document titled Evaluation of Corporate Compliance Programs, and the OIG compliance guidance can be found in a document titled Measuring Compliance Program Effectiveness: A Resource Guide.    

A robust compliance program, together with active auditing and monitoring, can go a long way in avoiding trouble with these and other compliance issues.


Richard K. Rifenbark is with Polsinelli in Los Angeles, California. Melissa S. Ho is with Polsinelli in Phoenix, Arizona.

Copyright © 2018, American Bar Association. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s).