A recent OIG Alert highlights potential False Claims Act (FCA) liability for physicians whose services are billed to Medicare under an independent contractor reassignment. The February 8, 2012, Alert titled, "OIG Alerts Physicians To Exercise Caution When Reassigning Their Medicare Payments — Physicians May Be Liable for False Claims Submitted by Entities Receiving Reassigned Medicare Payments [PDF]," discusses recent settlements with eight physicians who were found to have caused false claims to be submitted. Each of the physicians had entered into reassignments with physical medicine companies, which submitted the alleged false claims. The OIG cautioned that "physicians who reassign their right to bill the Medicare program and receive Medicare payments by executing the CMS- 855R application may be liable for false claims submitted by entities to which they reassigned their Medicare benefits."

Under the facts of the scenario present in the OIG Alert, the physicians were reassigning their billing rights to providers through a contractual arrangement, under which the physicians agreed to serve as medical directors and perform certain patient care services. The fact that the physicians were contractors and not employees is a key distinction. It is also worth noting that the Medicare reassignment rules apply to not only physicians but also to other practitioners who enter into reassignment agreements.

Please see full alert below for more information.