Healthcare organizations that run afoul of federal regulations will be paying heftier penalties, due to updates made by HHS last Friday that factor in multiple years of inflation.
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 thanks to decades of inflation adjustments. Although a nearly 200% increase on a $2,000 penalty for billing Medicare for an intraocular lens may be relatively small, some of the other ballooning penalties start at $1 million before the adjustments.
The new maximum penalties will touch every part of healthcare that works with the federal government. For example, Medicare Advantage insurers that attempt to deny or discourage people from enrolling in their plans will be penalized more than $147,000 per infraction, up from the $100,000 penalty that was set in 1997. Dozens of other updated penalties affect both Medicare and Medicaid managed-care companies.
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 $50,000 penalty set in 1987. Skirting 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 that those penalties and other fines will now be adjusted annually to account 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.
