False Physician Practice Incentive Claims: The Report Says Yes, the System Says No

A physician practice false EHR incentive attestation claims government money by falsely certifying that the practice met the program’s requirements. The falsehood can sit in a fabricated utilization report or a vendor’s claim about certified software. Separate bonus claims can rest on a false eligibility statement. If you prepared the reports, maintained the software or questioned the payment, you may know exactly where the claim stopped matching the practice. That knowledge reaches beyond the signature on the final submission.

The Certification Is Part of the Claim

False incentive claims turn a statement about the practice into a request for public money. In this form of physician billing fraud, the lie is about whether the practice qualified or what it actually did. The government pays because the practice says it earned an incentive.

A Forensic Accountant’s Guide to the Most Potent Federal Laws Used Against Healthcare Fraud, published in the Journal of Forensic and Investigative Accounting in 2020, describes false certification claims involving services that were actually provided. The lie concerns something the government required before it would pay. For an incentive claim, we connect that statement to the underlying data, the money it obtained and what the people making it knew.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. The cases below show how practice staff, software employees and billing staff can see different parts of the same payment claim.

What the Practice Had to Show

Historical meaningful-use incentive claims depended on certified electronic health record technology and the practice’s qualifying use of it. The vendor’s certification concerned the product’s capabilities, while the provider’s attestation connected its use of that product to payment. Those statements came from different participants, and each had facts behind it.

The distinction matters in everyday health care work. A system can hold patient records and support office operations while lacking the exchange functions required for certification. A 2013 Department of Health and Human Services study of providers outside the incentive programs found that many used technology for clinical and business needs without the interoperability those programs required. For a practice claiming an incentive, the useful comparison is the particular function promised against the function available.

Utilization reports add another comparison: what the practice actually did against what it certified. A report bearing a software vendor’s logo can look authoritative to someone reviewing a payment request. The allegations against 21st Century Oncology show why the source of that report matters as much as its appearance.

21st Century Oncology and the Fabricated Utilization Reports

21st Century Oncology agreed to a $26 million settlement in December 2017 resolving allegations about false meaningful-use attestations and physician compensation. The Justice Department described self-disclosed allegations involving fabricated utilization data and reports bearing a vendor’s logo.

For someone inside a practice, the comparison is concrete: the utilization data in the system, the report presented as proof and the attestation supported by that report. We want to know who produced each version and what changed between them. We see the absurdity in dressing invented usage as a software report: the document meant to demonstrate that the technology worked becomes the invention itself.

The physician-compensation allegations came through a whistleblower who had served as interim vice president of financial planning. They concerned referrals from physicians whose compensation allegedly failed the requirements of the physician self-referral law. The company disclosed the electronic health record conduct separately, and the settlement covered both sets of allegations.

Modernizing Medicine and the Claims Downstream of Its Software

Modernizing Medicine agreed to a $45 million settlement announced in November 2022 over allegations involving electronic health record functionality, software donations and referral payments. The Justice Department alleged that deficiencies in required standardized medical vocabularies caused inaccurate meaningful-use incentive claims. A former vice president of product management brought the whistleblower case, and the Justice Department announced an approximately $9 million whistleblower reward.

The government’s complaint made the technical problem specific. It alleged that, from April 2014 through July 2017, the company’s EMA software did not always let users conduct transactions using required standard vocabularies. An IT employee’s knowledge of what the software could do would bear directly on the representation used to obtain public payment.

The Donation Followed the Expected Referrals

The complaint also alleged that Miraca Life Sciences, the pathology laboratory working with Modernizing Medicine, evaluated proposed electronic health record donations by projecting the referrals and revenue they would bring. Miraca’s sales force calculated the expected return, and management used it to decide which providers would receive donations and how much. The software donation had a sales calculation behind it.

According to the government, the vendor also restricted useful software features according to the physician’s choice of laboratory:

The government alleged that Modernizing Medicine recommended Miraca and prevented competing laboratories from developing enhanced features in exchange for financial benefits tied to specimen referrals. These alleged referral kickbacks put the laboratory relationship inside the software a practice used to order care. We see a sharp contradiction in the government’s account: a donation presented as help with technology was evaluated by the business it would send back.

Practice Fusion and the Feature Users Could Not Access

Practice Fusion’s January 2020 civil resolution gives another concrete example of a vendor defect reaching a practice’s incentive claim. The Justice Department alleged that the company obtained certification for software versions that could not create standardized export summaries for all patients, despite representing that they could. The requirement concerned moving patient information out of the system.

The government further alleged that, after obtaining certification, Practice Fusion disabled access to the export feature altogether. Users had to contact the company separately to request their patient data. The civil allegations also included failures to incorporate required standardized vocabularies. These were specific capabilities that a practice’s technical staff could compare with the vendor’s certification claims.

The Justice Department alleged that false certifications caused eligible providers using certain software versions to submit false incentive attestations for Medicare reporting periods from 2014 through 2016 and Medicaid reporting periods from 2014 through 2017. The government’s allegation connected the software version, the unavailable function, the reporting period and the payment. For an insider who remembers being told a feature was certified but could not make it work, those connections give the problem its financial significance.

Medical Reimbursement Systems and the Unearned Shortage-Area Bonus

Medical Reimbursement Systems agreed to a $500,000 settlement announced in January 2016 over TRICARE bonus claims for a physician group in Watertown. The billing company continued certifying claims for a 10% Health Professional Shortage Area bonus after learning that the practice was geographically ineligible. It accepted responsibility for the facts in the settlement agreement and acknowledged that seeking the bonuses was inappropriate.

An employee’s warning to management in 2009 preceded billing that continued through October 2014. Written warnings reached a vice president. The billing company earned a percentage of net collections, so its own fee depended on what the practice collected. The claim for an extra payment and the company’s financial interest in collecting it belonged in the same examination.

Here, the comparison runs from the practice’s location and bonus eligibility to the warning and the later claims. A billing employee who knew why the bonus did not apply could identify a problem that remained hidden in an otherwise routine claim. The software’s capabilities were beside the point: the company had been told that its client did not qualify and kept claiming the extra money.

MIPS Uses a Different Payment Structure

The Merit-based Incentive Payment System ties performance reports to later Medicare payment adjustments. The Centers for Medicare & Medicaid Services explains the transition from the historical Medicare EHR Incentive Program for eligible professionals to MIPS, where Promoting Interoperability is a performance category.

The MIPS payment framework separates performance and payment by two years: 2026 performance affects 2028 payment. Those adjustments apply to Medicare payments for covered professional services. For a practice employee who knows a report misstates performance, the money at issue is the later payment adjustment, and we connect the report to the claims it affected.

What Evidence Does a Whistleblower Need?

Useful evidence connects the representation to the underlying records and the government payment. In an incentive case, that means the report, certification or eligibility statement that justified the money. The cases here show why the person preparing the data, the person signing the attestation and the manager receiving a warning each deserve attention.

An attestation condenses the practice’s story into a final answer. We work back through that answer with you to identify the source data, the people who controlled it and the government money attached to it. Your knowledge of how the answer was produced can be the part a reviewer outside the business would never see.

When You Know How the Answer Was Produced

If you worked on utilization reports, vendor certification or bonus billing and saw a claim the facts could not support, speak with our whistleblower experts about that claim. We use your technical knowledge and the payment records to build your strongest whistleblower case, and bring in physician-practice whistleblower lawyers who understand incentive certifications and vendor responsibility. We stay with you from that first conversation through the case.