[Congressional Record Volume 144, Number 31 (Thursday, March 19, 1998)]
[Extensions of Remarks]
[Page E434]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                    HEALTH CARE CLAIMS GUIDANCE ACT

                                 ______
                                 

                           HON. BILL McCOLLUM

                               of florida

                    in the house of representatives

                        Thursday, March 19, 1998

  Mr. McCOLLUM. Mr. Speaker, today I join my colleague from 
Massachusetts, Mr. Delahunt, in introducing the Health Care Claims 
Guidance Act. This legislation recognizes that, in our zeal to crack 
down on health care fraud and abuse, we must be careful not to throw 
our nets so wide that we ensnare honest providers who are making 
inadvertent billing mistakes. Ensuring that health care providers 
comply with all federal, state and local laws and regulations is, and 
always has been, a priority. At the same time, we should not carelessly 
paint all health care billing mistakes as billing fraud.
  Many hospitals and other health care providers have received demand 
letters from the offices of U.S. Attorneys asserting that the provider 
may be guilty of fraudulent billing and threatening the imposition of 
treble damages plus $5,000 to $10,000 per claim under the False Claims 
Act unless a quick settlement is reached. In some cases, demand letters 
have been sent based on alleged overbilling of less than $100. In one 
case, a demand letter was sent to a hospital for overbilling in the 
amount of $8.79 on a single claim over a one year period.
  The most innocent of providers often feel forced to settle these 
claims instead of facing the prospect of an automatic $10,000 fine for 
a small disputed amount. Even if a provider could clearly prove their 
innocence and show that these claims resulted from innocent clerical 
error, they would be likely to settle the case rather than incur large 
legal costs. The numbers speak for themselves. In fiscal year 1997, 
there were 4,010 federal civil health care fraud matters pending but 
only 89 cases resulted in the actual filing of a civil complaint. The 
large majority were settled.
  Considering that providers are faced with a federal health care 
payment system of more than 1,700 pages of law and over 1,200 pages of 
regulations interpreting those laws, as well as thousands of additional 
pages of instruction, it is inevitable that human error will occur and 
that erroneous claims will be submitted. Every day, providers submit 
over 200,000 federal health care claims, adding up to 73 million claims 
per year. Considering the sheer volume and complexity of such claims, 
it is unreasonable to view every single billing mistake as fraud that 
merits the threat of the severest civil sanctions.
  Mr. Speaker, the Health Care Claims Guidance Act provides a clear and 
simple way of distinguishing between those claims that are fraudulent 
and those claims that result from human error. The bill establishes a 
deminimus threshold requiring that the amount of damages in dispute be 
a material amount for an action brought under the False Claims Act. The 
deminimus threshold would be established by the Secretary of Health and 
Human Services. This requirement would protect against the use of the 
False Claims Act for small, erroneous billings which likely result from 
human error.
  In addition, the legislation would provide safe harbors for reliance 
on government advice or written policies. There is no better example of 
fundamental unfairness than when a private party relies on government 
advice but is then threatened with court action for having done so. The 
Health Care Claims Guidance Act would also provide safe harbors for 
claims that are in substantial compliance with model compliance plans. 
Affirmative defenses would be established for these situations.
  It is clearly in the public's interest for parties to work together 
to prevent health care billing mistakes from occurring. Providers 
should actively seek out trouble spots and quickly flag problems to 
government agencies. At the same time, in order to further the goal of 
compliance, federal agencies which administer federal health care 
programs should be encouraged to assist providers in the early 
detection and correction of practices which may result in a disputed 
claim. By encouraging such self-policing, providers and government 
agencies will be able to work together to root out problems quickly.
  It is clear that there are organizations and individuals engaging in 
efforts to defraud the federal government and we must use all of the 
tools at our disposal to pursue and severely punish such willful 
violators. In fact, during consideration of the Health Insurance 
Portability and Accountability Act during the last Congress, the Crime 
Subcommittee worked on provisions to strengthen criminal health care 
fraud statutes. At the same time, there are honest providers doing 
their best to comply with complex health care rules and regulations who 
will make honest mistakes. The Health Care Claims Guidance Act provides 
clear guidance to ensure that the false claims of fraudulent actors are 
distinguished from the honest mistakes of innocent providers. I urge 
all my colleagues to support the Health Care Claims Guidance Act.

                          ____________________