Government Fines Increasing (and Why You Should Take Note)

In less than 7 minutes I will convince you to get rid of Medicaid, Get a Compliance Program or Surrender your Dental License. Will you accept my challenge?

OSHA’s Fine Increase

OSHA recently announced they are raising their maximum fines amounts. Effective August 1, 2016 maximum fines for serious violations will jump from $7,000 per violation to $12,471 per violation. Willful or Repeated violation fines will increase from $70,000 per violation (max. amount) to $124,709 per violation (max. amount).

It is rare to see OSHA fines issued to dental offices, but it happens. It is even more rare to see a Willful or Repeat violation issued to a dental office. Thank goodness, but OSHA is not the only federal agency capable of levying fines to oral healthcare providers.

Remember, OSHA inspections are not random, they stem from complaints by current and former employees who probably know OSHA regulations better than you. Is your OSHA program up-to-snuff? Do your employees feel safe? Loved? You decide.

Increase in Civil Monetary Penalties for Medicare/ Medicaid Fraud, Waste and Abuse

On another front the government passed the Federal Civil Penalties Inflation Adjustment Act of 2015 (“FCPIAA”), which increases penalties under the federal False Claims Act (“FCA”). Current Civil Monetary Penalties (“CMPs”) under the federal FCA is treble damages (AKA triple repayment) plus penalties up to $11,000 per claim. Well, thanks to the Railroad Retirement Board (“RBB”) that is about to change too. The RBB recently increased penalties imposed by the FCA – the same FCA used to prosecute healthcare providers for Fraud, Waste and Abuse issues. The RBB increased maximum per-claim penalties from $11,000 to $21,563 per-claim. Will the Department of Justice follow suit across the board? Will this increase affect healthcare providers? Specifically, will this increase impact dentists? It seems so. Keep reading!

MintzLevin reported the RBB’s increase resulted from a section of the Bipartisan Budget Act of 2015 (the FCPIAA), which required federal agencies to update CMPs within their jurisdiction by August 1, 2016. The last adjustment in 1990 was based on the Consumer Price Index (“CPI”). The increased amount of $21,563 reportedly represents the increase in the CPI between 1990 and 2015, which (I guess) may be a good thing, but good-gosh, the states went from extremely high to outrageously ridonculous penalties. The next increase may well be an arm and a leg (or your first born child)!

The crux of the story is this….

  1. If you don’t need to take Medicare (think in-hospital dental surgery or Oral Sleep Appliances) or Medicaid – DON’T!
  1. If you participate with Medicare or Medicaid you have two options: 1). Develop a robust, comprehensive compliance program; or, 2). Do your family a favor and surrender your dental license immediately (No, I’m not kidding!)
  1. If your practice participates with (or accepts reimbursement from) Tricare plans- pay attention to what is happening to Medicare and Medicaid providers. Tricare is a federally funded healthcare program. All federal programs are facing increased scrutiny (as are providers – for the same reasons). Tricare Providers are basically Medicaid Providers as far as the need for Compliance Programs. Money from the government has strings.

Going forward, if you participate with Medicare or Medicaid or Tricare, your clinical documentation and billing practices had better be perfect (I’m STILL not kidding!)

Allow Me to Illustrate

Suppose your notes look like this on a date of service (great by pre-2000’s recordkeeping standards, jail bait by 2016 standards) that happens to be audited by Medicaid:


Exam Notes:

Comp. Exam, 2 BW’s, Pano

TX Plan:

Pulp/ SSC #A, B, D, E, F, J, K, L

Ext. #C,

Sealants #S, T

TX Notes:

Completed planned TX

Prescription amox. and Tylenol#3

NV: 6 mo. recall

Your billing for these procedures looks like this (note: disregard the actual numbers for this reimbursement):


Concerns –

  • based on the documentation, it is not clear the dentist read the x-rays (according to CMS guidelines “if it was not written, it did not happen”)
  • If the dentist examined the patient, what was observed to justify/ substantiate this planned/ completed treatment? How/ why was it medically necessary?
  • There is no stated diagnosis
  • No review of the patient’s medical/dental history
  • No consent for treatment
  • No indication whether anesthetic was used

According to CMS, once the practice is paid for these services all of these services, including the examination and x-ray, should be identified as an overpayment and the monies must be returned to Medicare/ Medicaid. Providers have 60 days to return overpayments (dollar-for-dollar) or they assume liability under the FCA (treble (triple) damages and fines range from $5,500 to $11,000 per claim). Let’s see what the numbers look like for just this patient.

If you were audited and overpayments are found by Medicaid before TODAY you would be looking at this: Actual overpayment amount $1795.66 x 3 = $5386.98; and, maximum fines per claim
14 x $11,000 = 154,000

         $5,386.98 (treble (triple) damages)

+ $154,000.00 (maximum fines per claim)

   $159.386.98 (total recoupment under FCA)

Now, let’s fast-forward and see what this looks like under the new FCA fine amounts that range from $10,781.50 to $21,563 per claim, which start TODAY:

Actual overpayment amount
x             3
$5386.98 (treble damages);  then,


     X    14      (New minimum fines per claim)


X      14 (New maximum fines per claim)


In sum, future FCA recoupments for THIS patient ranges from:

$156,327.98 ($5,386.98 + $150,941.00) to $307,268.98 ($5,386.98 + $301,882.00)

If you have a healthcare compliance program, with routine record auditing, your practice catches and corrects these situations (overpayments) within 60 days this recoupment scenario is limited to $1795.66

The difference is $154,532.32 to $305,473.32 you would NOT pay as a recoupment if you found and corrected this overpayment within 60 days. If you audited your own records and/or had a third party audit records could it prevent some HUGE headaches? You decide!

Remember, these numbers are for this one patient. Imagine if this dentist sees 10 patients per day and this scenario repeats?

I promise you this scenario plays out day in and day out in dental offices across the country because dentists are busy and decide something’s gotta give, often it is their clinical documentation that suffers.

Over Payment FACTS

Fact 1: One day of poor record keeping can result in millions of dollars’ worth of  fines and penalties.

Fact 2: Medicare and Medicaid have a tons of rules and regulations that must be followed with precision. Failure to follow any of those rules can result in overpayments.

Fact 3: Failure to repay overpayments of Medicare/ Medicaid funds can result in extreme fines and penalties

Fact 4: An ounce of prevention is worth a pound of cure

Fact 5: Dentists and physicians have deeper pockets than the average American. Uncle Sam is both hungry and determined to punish those who purport to steal from him (based on his perception, not your’s).

Healthcare Compliance Programs

The FCA (False Claims Act) is a powerful tool state and federal agencies use to recoup money from healthcare providers. The only way to even the scale is to invest in your compliance efforts, specifically establish a healthcare compliance program that incorporate the OIG’s core elements for effective compliance programs.

There are:

  1. Establishment of written policies and procedures
  2. Designation of compliance officer
  3. Effective compliance training
  4. Open Lines of Communication (open door policy and whistleblower protections)
  5. Auditing and Monitoring processes
  6. Enforcing disciplinary standards
  7. Responding promptly to suspected violations

While each of these elements is important, the most important element is (quite possibly) establishing Auditing and Monitoring processes. This means you should initiate continuous internal and external audit processes of your clinical documentation and billing records to check for and monitor for compliance with state and federal record keeping standards and guidelines.

For more information on Compliance Guidance for Individual and Small Group Physician Practices, the most applicable set of the OIG’s compliance guidance click here. Are you part of a large dental group practice or Dental Service Organization? If so, click here.


My 7 minutes are up. What will you do?

Get rid of Medicaid? Get a compliance program? Or Surrender your dental license?


I’d love to hear your feedback!

A former Law Enforcement Officer/ Dental Board Investigator, Mr. Duane Tinker is the CEO of Dental Compliance Specialists. Mr. Tinker and his compliance specialists provide compliance consulting, auditing and training services for dentists and Dental Service Organizations nationwide on compliance risks including OSHA, HIPAA, Dental Board rules/ regulations, state radiology rules, DEA and state drug regulations, and Medicaid. He often speaks for dental societies and study clubs. Mr. Tinker can be reached at (817) 755-0035 or click here to email.

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