Civil Monetary Penalties Law (CMPL)

Under the Civil Monetary Penalties Law, “knows or has reason to know” sets a lower bar than the False Claims Act’s “knowingly.”

While the FCA requires actual knowledge, deliberate ignorance, or reckless disregard, the CMPL standard sweeps more broadly. It covers a spectrum from actual knowledge to negligence.

In practical terms, a provider can face CMPL liability if they simply should have known a claim was false. The FCA, by contrast, does not punish mere negligence. This makes the CMPL a more aggressive tool for pursuing billing errors that fall short of intentional fraud.

Beyond false claims, CMPL liability extends to a wide range of healthcare fraud and abuse violations. These include:

– Anti-Kickback Statute and knowing Stark Law violations
– Beneficiary inducements, such as waiving copays or deductibles
– Contracting with an excluded individual
– Failing to report and return identified overpayments within 60 days
– Emergency Medical Treatment and Labor Act (EMTALA) violations

Each of these can result in significant penalties, and many also form the basis for False Claims Act liability when tainted claims are submitted to federal programs.

Under the Civil Monetary Penalties Law (CMPL), a “penalty” and an “assessment” serve distinct purposes.

A penalty is a fixed sum imposed per violation, such as a set amount for each false claim, designed to punish and deter misconduct.

An assessment, by contrast, is a variable amount calculated by reference to the claims involved, typically as a multiple of the amount falsely claimed, intended to compensate the government for its actual losses. Thus, a penalty acts as a fine, while an assessment functions as a form of restitution or damages.

Yes. Under the Civil Monetary Penalties Law (CMPL), the HHS Office of Inspector General (OIG) has the authority to seek exclusion from participation in Federal health care programs as an administrative remedy against individuals or entities that engage in prohibited conduct.

The consequences of exclusion are severe. An excluded provider cannot furnish, order, or prescribe items or services that are payable by any Federal health care program, including Medicare and Medicaid. This effectively bars them from receiving any federal health care program reimbursement. Additionally, an excluded provider faces significant secondary consequences: any claims submitted for services furnished by or at the direction of an excluded person will be denied, and the provider that employs or contracts with an excluded individual may face its own CMP liability, with penalties of up to $10,000 for each item or service furnished by the excluded person.

The CMPL lacks a qui tam provision because Congress designed it as an administrative enforcement tool for the government, not a private cause of action. Unlike the FCA, which incentivizes private citizens to sue on the government’s behalf, the CMPL is enforced exclusively by the government through the HHS Office of Inspector General.

– This means whistleblowers cannot file a qui tam lawsuit directly under the CMPL or receive a share of any CMPL penalties
– However, the CMPL still complements whistleblower efforts. When a whistleblower reports misconduct under the FCA, the government can use the CMPL as an additional tool to impose penalties and exclusions

The CMPL has a six-year statute of limitations from the date of the violation. This period is codified at 42 U.S.C. § 1320a-7a(c)(1) and applies to the government’s administrative actions to impose penalties and assessments.

Notably, this six-year limitations period does not apply to exclusions from federal healthcare programs that are imposed separately, and the government may require parties to waive statute of limitations defenses as a condition of entering into a self-disclosure agreement.

The Beneficiary Inducements CMP is a specific provision under the Civil Monetary Penalties Law. It prohibits offering or transferring anything of value to a Medicare or Medicaid beneficiary that the person knows or should know is likely to influence that beneficiary’s choice of a particular provider, practitioner, or supplier.

– Target and Standard: The CMP targets beneficiaries (patients) and uses a “knows or should know” standard, meaning negligence can trigger liability
– The AKS Difference: The Anti-Kickback Statute (AKS) targets referral sources (like physicians) and requires “knowing and willful” intent, a much higher criminal standard