Chapter 4: Evaluation Processes, Investigations, and Noncompliance Response

Government Settlements: Corporate Integrity Agreements and Integrity Agreements

As our society’s health needs change, our healthcare system continues to evolve based on applicable laws, regulations, and available resources. Healthcare providers also need to adapt accordingly. In this process, violations—whether inadvertent or intentional—have also taken place, negatively affecting healthcare programs and the well-being of the people who truly need them.

Fraud and abuse have been among the biggest culprits of the waste of federal healthcare programs funded by taxpayers. To fight against fraud and abuse in healthcare, Congress created the Office of Inspector General (OIG) in the 1970s and gave it the authority to implement measures and actions to protect the public interest and tax dollars. In addition, the government also has strengthened interdepartmental collaboration to enforce laws and regulations, including the False Claims Act (FCA), Anti-Kickback Statute (AKS), Stark Law, etc., in an effort to stop unlawful and/or unethical practices and save tax dollars and resources.

When the government determines the existence of unlawful practices or finds actual wrongdoing (e.g., defrauding a federal healthcare program), a civil settlement may be entered into between the US government and a provider to resolve any allegations of fraud and abuse or other offenses arising from the applicable laws. A government settlement generally comes with a civil monetary penalty and a set of terms and conditions that stipulate the specific legal obligation and requirements that the provider must meet. Depending on the nature of the allegations and investigative findings, the OIG, in its sole discretion, may choose to settle with a provider that has been accused of wrongdoing and to negotiate a set of legal obligations by which the provider must abide, such as a corporate integrity agreement (CIA) or integrity agreement (IA).

A CIA is basically a contract that sets forth all obligations and requirements with which a provider agrees to comply, as part of the civil settlement with the government in exchange for its continual participation in federal healthcare programs (meaning the OIG will not exclude such provider from the programs).

An IA is similar to a CIA in that it is also a contract between the government and a provider, and it outlines all the obligations and requirements. The unique part is that an IA is designed to settle matters with an individual practitioner, small practice groups, or small providers.

The following will explain the major components of a government settlement, its framework, and its implications.

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