Physical Therapy Fraud

“The provision of excessive and medically unnecessary therapy services will not be tolerated.” – Stewart F. Delery, Deputy Attorney General, applauding a Frohsin Barger & Walthall False Claims Act physical therapy fraud settlement

How the Physical Therapy Medicare Reimbursement System Works:

Physical therapy is the treatment of functional limitations to prevent the onset or retard the progression of physical impairments following illness or injury. Medicare insures for physical therapy in at least two contexts:

(1) Through the Part A hospital insurance benefit, Medicare pays for physical therapy as a component of skilled nursing care, in either the acute care setting or in a post-hospital skilled nursing facility. In order to qualify for reimbursement, such therapy must meet the criteria for skilled nursing care.

(2) Through the Part B supplemental insurance benefit, Medicare reimburses for physical therapy under limited circumstances. To qualify for reimbursement, outpatient physical therapy services must: (a) be reasonable and medically necessary; (b) be furnished to a Medicare beneficiary under the care of a physician; (c) be furnished under a plan of care periodically re-certified by a physician; and (d) be furnished by or under the direct supervision of qualified personnel.

Medicare regulations require that physical therapy services be performed either: (1) by a State-licensed physical therapist or (2) by or “incident to” the services of a physician or other medical professional licensed to perform such services under State law. See 42 C.F.R. § 410.60. Under the “incident to” rule, a physician may bill for physical therapy services performed by non-physician personnel so long as those services are (a) commonly furnished in a physician’s office and integral to a physician’s covered services; (b) included in a treatment plan designed by the physician and in which the physician is actively involved; and (c) furnished under the physician’s direct supervision.

In order to bill directly – rather than through a physician – a physical therapist must be State-licensed. Physical therapy services performed incident to a physician’s services may be performed by personnel without a license, but such personnel must otherwise meet all qualifications of a licensed physical therapist, including graduation from an approved physical therapy education program.

Regardless of who performs physical therapy services to be billed to Medicare or Medicaid, such services must be furnished in accordance with a sufficient plan of care established by a physician or by the licensed physical therapist who performs the services. The plan must “prescribe the type, amount, frequency, and duration of the physical therapy . . . to be furnished to the individual, and indicate the diagnosis and anticipated goals.” 42 C.F.R. § 410.60.

The Office of Inspector General for DHHS Warns that Physical Therapy Fraud is a Huge Problem.

Fraud in physical therapy is rampant. In 1994, the Office of Inspector General (OIG), Department of Health and Human Services (DHHS) published a report finding that 78% of physical therapy billed by physicians did not constitute true physical therapy. In 2006, OIG published another report, stating that a staggering 91% of physician physical therapy bills submitted in the first half of 2002 were deficient in at least one regard.

“We have seen ugly abuse of the physical therapy fraud benefit,” says Jim Barger, “including shocking reports of elderly citizens being dragged around facilities (‘deregulation’ as it’s called by callous providers) and reports of patients abandoned on uncomfortable, unnecessary, and excessive electronic stimulation (E-Stim).”

Frohsin Barger & Walthall Has Identified and Uncovered the Following Types of Physical Therapy Fraud:

  • Billing for physical therapy services performed by unqualified personnel
  • Billing for physical therapy services that were never performed or only partially performed
  • Billing for physical therapy services when, in fact, the service performed was unskilled or amounted to maintenance therapy, or both, and thus did not constitute physical therapy
  • Billing for physical therapy services performed under a deficient plan of care
  • Billing under individual therapy codes for group therapy services

Frohsin Barger & Walthall are Experienced in Prosecuting Physical Therapy Fraud and are Noted False Claims Act Academics and Trial Lawyers.

Jim Barger and Elliott Walthall are the only private attorneys general in the country ever to be tapped as part of a Department of Justice trial team in a Medicare fraud jury trial. A noted expert on the False Claims Act (FCA), Jim Barger teaches upper-level courses on the subject as an adjunct professor at the University of Alabama School of Law, ranked among the nation’s top 15 law schools by Business Insider in 2016. Barger has appeared on HuffPost Live, Fox 6 Atlanta, and National Public Radio, and his opinions on FCA Medicare enforcement are regularly sought by major newspaper outlets, including The New York Times and The Washington Post.

“The Accomplishments of Frohsin Barger & Walthall warrant the wealth of accolades that it has received.” — Benchmark Plaintiff

Both Barger and Walthall have spoken on national panels about Medicare fraud for the American Bar Association, the American Association for Justice, and Taxpayers Against Fraud. In 2015, Barger was a featured symposium speaker on Medicare Fraud and the FCA at the Georgetown Law Center in Washington, DC. In 2016, Georgetown’s American Criminal Law Review published a new research article by Barger on the public-private partnership of the FCA.

“Frohsin Barger & Walthall Whistleblowers Win Near $1 Million Skilled Nursing & Physical Therapy Fraud Settlement”

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Frohsin Barger & Walthall Represents Whistleblowers Nationwide.

Frohsin Barger & Walthall investigates and litigates qui tam actions on behalf of whistleblowers in federal and state actions across the country. Our representation includes evaluating, investigating, and filing qui tam actions, as well as assisting prosecutors and investigative agents in pursuing cases and reaching settlements, with a high percentage of our cases resulting in government intervention. We have sealed cases in every region of the country and regularly travel to meet with United States Attorney’s offices, State Attorney General Offices, and United States Department of Justice attorneys in Washington, DC.

The False Claims Act Offers Protection for Whistleblowers.

Blowing the whistle on corporate fraud takes courage, and the law rewards that courage with certain protections. We understand that one of the most important aspects of representing corporate whistleblowers is guiding and protecting them through the difficult, stressful process of litigation. The False Claims Act (FCA) provides for a whistleblower’s case to be filed under seal and the identity of the whistleblower to be protected during the course of the government’s investigation. Further, federal laws protect against retaliation by mandating the reinstatement of wrongfully fired employees at the same seniority level, as well as an award of double back-pay, interest, and attorneys’ fees. Finally, successful whistleblowers are entitled to up to 30% of any FCA recovery, which Congress has mandated is three times the amount of fraud that is proved through the whistleblower’s allegations, plus substantial civil penalties.

Frohsin Barger & Walthall whistleblower cases have been featured in the following media outlets, among others:

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