Study objective: To identify the incidence of federally imposed penalties for violations of the Consolidated Omnibus Reconciliation Act (COBRA).
Methods: Under the Freedom of Information Act, we retrieved a copy of any document related to fines imposed on, settlements made by, or litigation against physicians or hospitals as a result of COBRA violations from the Office of the Inspector General. Under a separate inquiry, also under the Freedom of Information Act, we requested and received from the central office of the Health Care Financing Administration the National Composite Log showing the status of all complaint investigations pursuant to COBRA since the inception of the law.
Results: One thousand seven hundred fifty-seven complaint investigations were authorized. Of the 1,729 investigations completed, 412 (24%) were found to be out of compliance with federal regulations. Of these, 27 cases resulted in fines imposed on hospitals. These fines ranged from $1,500 to $150,000 with a mean of $33,917, a median of $25,000, and standard deviation of $35,899. The six fines that were imposed against physicians ranged in value from $2,500 to $20,000 with a mean of $8,500, a median of $7,500, and an SD of $8,612. Seven hospitals but no physicians were terminated from the Medicare program for COBRA violations.
Conclusion: The incidence of federally imposed penalties for COBRA violations is low given the multitude of patient transfers that have occurred since the enactment of COBRA. The growing concern regarding this issue may be related to current litigation efforts to broaden the scope and applications of these laws.