PRINTER'S NO. 1500
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1355
Session of
2023
INTRODUCED BY KUTZ, ECKER, GROVE AND KAUFFMAN, JUNE 9, 2023
REFERRED TO COMMITTEE ON JUDICIARY, JUNE 9, 2023
AN ACT
Amending the act of June 13, 1967 (P.L.31, No.21), entitled "An
act to consolidate, editorially revise, and codify the public
welfare laws of the Commonwealth," in fraud and abuse
control, further providing for definitions and for provider
prohibited acts, criminal penalties and civil remedies.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 1401 of the act of June 13, 1967 (P.L.31,
No.21), known as the Human Services Code, is amended by adding a
definition to read:
Section 1401. Definitions.--The following words and phrases
when used in this article shall have, unless the context clearly
indicates otherwise, the meanings given to them in this section:
* * *
"Representation" means a communication that is used to
identify goods or services for which reimbursement is sought
under the medical assistance program or that is or may be used
to determine a rate of reimbursement under the medical
assistance program.
* * *
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Section 2. Section 1407 of the act is amended to read:
Section 1407. [Provider] Prohibited Acts, Criminal Penalties
and Civil Remedies.--(a) It shall be unlawful for any person
to:
(1) [Knowingly or intentionally present for allowance or
payment any false or fraudulent claim or cost report for
furnishing services or merchandise under medical assistance, or
to knowingly present for allowance or payment any claim or cost
report for medically unnecessary services or merchandise under
medical assistance, or to knowingly submit false information,
for the purpose of obtaining greater compensation than that to
which he is legally entitled for furnishing services or
merchandise under medical assistance, or to knowingly submit
false information for the purpose of obtaining authorization for
furnishing services or merchandise under medical assistance.]
Make or cause to be made a materially false, fraudulent or
misleading statement, claim or representation in a document or
record in any format, including written or electronic, used by
any person in connection with providing goods or services to any
recipient under the medical assistance program.
(1.1) Submit or cause to be submitted false information for
the purpose of obtaining greater compensation than that to which
the person is legally entitled for furnishing goods or services
under the medical assistance program.
(1.2) Submit or cause to be submitted a claim for medically
unnecessary or inadequate services or merchandise provided to a
recipient under the medical assistance program.
(2) Solicit or receive or to offer or pay any remuneration,
including any kickback, bribe or rebate, directly or indirectly,
in cash or in kind from or to any person in connection with the
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furnishing of services or merchandise for which payment may be
in whole or in part under the medical assistance program or in
connection with referring an individual to a person for the
furnishing or arranging for the furnishing of any services or
merchandise for which payment may be made in whole or in part
under the medical assistance program.
(3) Submit or cause to be submitted a duplicate claim for
services, supplies or equipment for which [the provider] a
person has already received or claimed reimbursement from any
source.
(4) Submit or cause to be submitted a claim for services,
supplies or equipment which were not rendered to a recipient.
(5) Submit or cause to be submitted a claim for services,
supplies or equipment which includes costs or charges not
related to such services, supplies or equipment rendered to the
recipient.
(6) Submit or cause to be submitted a claim or refer a
recipient to another provider by referral, order or
prescription, for services, supplies or equipment which:
(i) are not documented in the record in the prescribed
manner and are of little or no benefit to the recipient[,];
(ii) are below the accepted medical treatment standards[,
or]; or
(iii) are unneeded by the recipient.
(7) Submit or cause to be submitted a claim which
misrepresents the description of services, supplies or equipment
dispensed or provided; the dates of services; the identity of
the recipient; the identity of the attending, prescribing or
referring practitioner; or the identity of the actual [provider]
person dispensing or providing services, supplies or equipment.
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(8) Submit or cause to be submitted a claim for
reimbursement for a service, charge or item at a fee or charge
which is higher than the [provider's] person's usual and
customary charge to the general public for the same service or
item.
(9) Submit or cause to be submitted a claim for a service or
item which was not rendered by the [provider] person.
(10) Dispense, render or provide a service or item without a
practitioner's written order and the consent of the recipient,
except in emergency situations, or submit a claim for a service
or item which was dispensed, or provided without the consent of
the recipient, except in emergency situations.
(11) Except in emergency situations, dispense, render or
provide a service or item to a patient claiming to be a
recipient without making a reasonable effort to ascertain by
verification through a current medical assistance identification
card, that the person or patient is, in fact, a recipient who is
eligible on the date of service and without another available
medical resource.
(12) Enter into an agreement, combination or conspiracy to
obtain or aid another to obtain reimbursement or payments for
which there is not entitlement.
(13) Make a false statement in the application for
enrollment as a provider.
(14) Commit any of the prohibited acts described in section
1403(d)(1), (2), (4) and (5).
(15) Submit or cause to be submitted a claim or any document
or record in any format, including written or electronic, for
the purposes of obtaining reimbursement from the medical
assistance program during any time period when the person is
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excluded or precluded from participation in the medical
assistance program or when the person is on the Federal List of
Excluded Individuals/Entities.
(b) (1) [A person who violates any provision of subsection
(a), excepting subsection (a)(11), is guilty of a felony of the
third degree for each such violation with a maximum penalty of
fifteen thousand dollars ($15,000) and seven years imprisonment.
A violation of subsection (a) shall be deemed to continue so
long as the course of conduct or the defendant's complicity
therein continues; the offense is committed when the course of
conduct or complicity of the defendant therein is terminated in
accordance with the provisions of 42 Pa.C.S. § 5552(d) (relating
to other offenses). Whenever any person has been previously
convicted in any state or Federal court of conduct that would
constitute a violation of subsection (a), a subsequent
allegation, indictment or information under subsection (a) shall
be classified as a felony of the second degree with a maximum
penalty of twenty-five thousand dollars ($25,000) and ten years
imprisonment.
(2)] A person who knowingly or intentionally violates
subsection (a), excluding the provisions of subsection (a)(15),
commits:
(i) A felony of the second degree if the amount of excess
payments, whether claimed or actually paid, is more than one
hundred thousand dollars ($100,000) or if the person has a prior
conviction in any Federal or state court for conduct that would
constitute a violation of subsection (a).
(ii) A felony of the third degree if the amount of excess
payments, whether claimed or actually paid, is more than two
thousand dollars ($2,000) but less than one hundred thousand
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dollars ($100,000).
(iii) A misdemeanor of the first degree if the amount of
excess payments, whether claimed or actually paid, is less than
two thousand dollars ($2,000).
(2) A person who knowingly or intentionally violates
subsection (a)(15) commits a felony of the second degree.
(b.1) (1) In addition to the penalties provided under
subsection (b), the trial court shall order any person convicted
under subsection (a):
(i) to repay the amount of the excess benefits or payments
plus interest on that amount at the maximum legal rate from the
date payment was made by the Commonwealth to the date repayment
is made to the Commonwealth;
(ii) to pay an amount not to exceed threefold the amount of
excess benefits or payments.
(2) (Reserved).
(3) Any person convicted under subsection (a) shall be
ineligible to participate in the medical assistance program for
a period of five years from the date of conviction. The
department shall notify any [provider so convicted that the
provider agreement is terminated for five years, and the
provider] person so convicted of the termination of any provider
agreement and of the five-year period of ineligibility to
participate in the medical assistance program. The person is
entitled to a hearing on the sole issue of identity. If the
conviction is set aside on appeal, the termination shall be
lifted.
(4) The Attorney General and the district attorneys of the
several counties shall have concurrent authority to institute
criminal proceedings under the provisions of this section.
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(5) As used in this section the following words and phrases
shall have the following meanings:
"Conviction" means a verdict of guilty, a guilty plea, or a
plea of nolo contendere in the trial court.
"Medically unnecessary or inadequate services or merchandise"
means services or merchandise which are unnecessary or
inadequate as determined by medical professionals engaged by the
department who are competent in the same or similar field within
the practice of medicine.
(b.2) A violation of subsection (a) shall be deemed to
continue so long as the course of conduct or the person's
complicity in the course of conduct continues. An offense is
committed when the course of conduct or complicity of the person
in the course of conduct is terminated as provided under 42
Pa.C.S. § 5552(d) (relating to other offenses).
(c) (1) If the department determines that a [provider]
person providing or dispensing services, supplies or equipment
has committed any prohibited act or has failed to satisfy any
requirement under [section 1407(a)] subsection (a), it shall
have the authority to immediately terminate, upon notice to the
[provider, the] person, any provider agreement and to institute
a civil suit against such [provider] person in the court of
common pleas for twice the amount of excess benefits or payments
plus legal interest from the date the violation or violations
occurred. The department shall have the authority to use
statistical sampling methods to determine the appropriate amount
of restitution due from the [provider] person.
(2) [Providers who are] A person who is terminated from
participation in the medical assistance program for any reason
shall be prohibited from owning, arranging for, rendering or
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ordering any service for medical assistance recipients during
the period of [termination] ineligibility to participate in the
medical assistance program. In addition, such [provider] person
may not receive, during the period of [termination]
ineligibility to participate in the medical assistance program,
reimbursement in the form of direct payments from the department
or indirect payments of medical assistance funds in the form of
salary, shared fees, contracts, kickbacks or rebates from or
through any participating provider.
(3) [Notice of any action taken by the department against a
provider pursuant to clauses (1) and (2) will be forwarded by
the department to the Medicaid Fraud Control Unit of the
Department of Justice and to the appropriate licensing board of
the Department of State for appropriate action, if any. In
addition, the department will forward to the Medicaid Fraud
Control Unit of the Department of Justice and the appropriate
Pennsylvania licensing board of the Department of State any
cases of suspected provider fraud.] The department shall forward
notice of any action taken by the department against a person
under this section to the Medicaid Fraud Control Unit of the
Office of Attorney General and to the appropriate licensing
board of the Department of State for appropriate action. The
department shall forward to the Medicaid Fraud Control Unit of
the Office of Attorney General and the appropriate licensing
board of the Department of State any cases of suspected fraud by
a person except for reports required under section 1417.
Section 3. This act shall take effect in 60 days.
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