HHS Announces Hefty Increase in Civil Monetary Penalties

Friday, September 23, 2016
By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

On September 16, 2016, the U.S. Health and Human Services (HHS) announced new updates that would require health care organizations to pay heftier penalties if they violate federal regulations. HHS is seeking maximum penalties and adjustments reflects multiple years of inflation.

HHS is required to publish “catch-up adjustments” under Section 4(b) of the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, which amended the Federal Civil Penalties Inflation Adjustment Act of 1990 to “improve the effectiveness of civil monetary penalties and to maintain their deterrent effect.”

Under the interim final rule, several civil monetary penalties—ranging from biological product recall violations to health insurers failing to provide medically necessary services—will nearly double because of decades of inflation adjustments.


New Maximum Penalties.


The new updates seek maximum penalties and reach every part of health care that works with the federal government. For example, Medicare Advantage insurers that attempt to deny or discourage people from enrolling in their plans will face a much steeper penalty than in previous years. Dozens of other updated penalties affect both Medicare and Medicaid managed-care companies.

Additionally, hospitals with more than 100 beds now face penalties of more than $103,000 if they dump patients who need emergency care, an increase from the previous penalty set at $50,000 penalty set in 1987. Ignoring the federal Stark Law's restrictions on physician self-referrals will now cost $159,089, compared with the original $100,000 amount.

HHS also updated its civil fraud penalties to reflect the annual adjustment for inflation.

The rule noted the new maximum penalties apply to any fines assessed after Aug. 1, 2016, as well as all penalties stemming from violations that took place after Nov. 2, 2015.

Click here to read the interim final rule.

To learn more on civil monetary penalties, click here to read one of our prior blogs.


Contact Experienced Health Law Attorneys.


The Health Law Firm routinely represents pharmacists, pharmacies, physicians, nurses and other health providers in investigations, regulatory matters, licensing issues, litigation, inspections and audits involving the DEA, Department of Health (DOH) and other law enforcement agencies. Its attorneys include those who are board certified by The Florida Bar in Health Law as well as licensed health professionals who are also attorneys.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.


Sources:

Herman, Bob. “HHS hikes civil money penalties.” Modern Healthcare. (September 6, 2016). Web.

Elgatian, Elaine. “HHS hikes civil monetary penalties.” Bloomburg BNA. (September 6, 2016). Web.


About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

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“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
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9/23/2016

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