36-2918. Prohibited acts; penalties; subpoena power

A. A person may not present or cause to be presented to this state or to a contractor:

1. A claim for a medical or other item or service that the person knows or has reason to know was not provided as claimed.

2. A claim for a medical or other item or service that the person knows or has reason to know is false or fraudulent.

3. A claim for payment that the person knows or has reason to know may not be made by the system because:

(a) The person was terminated or suspended from participation in the program on the date for which the claim is being made.

(b) The item or service claimed is substantially in excess of the needs of the individual or of a quality that fails to meet professionally recognized standards of health care.

(c) The patient was not a member on the date for which the claim is being made.

4. A claim for a physician's service or an item or service incidental to a physician's service, by a person who knows or has reason to know that the individual who furnished or supervised the furnishing of the service:

(a) Was not licensed as a physician.

(b) Obtained the license through a misrepresentation of material fact.

(c) Represented to the patient at the time the service was furnished that the physician was certified in a medical specialty by a medical specialty board if the individual was not certified.

5. A request for payment that the person knows or has reason to know is in violation of an agreement between the person and this state or the administration.

B. A person who violates a provision of subsection A of this section is subject, in addition to any other penalties that may be prescribed by federal or state law, to a civil penalty of not to exceed two thousand dollars for each item or service claimed and is subject to an assessment of not to exceed twice the amount claimed for each item or service.

C. The director or the director's designee shall make the determination to assess civil penalties and is responsible for the collection of penalty and assessment amounts. The director shall adopt rules that prescribe procedures for the determination and collection of civil penalties and assessments. Civil penalties and assessments imposed under this section may be compromised by the director or the director's designee in accordance with criteria established in rules. The director or director's designee may make this determination in the same proceeding to exclude the person from system participation.

D. A person who is adversely affected by a determination of the director or the director's designee under this section may appeal that decision in accordance with provider grievance provisions set forth in rule. The final decision is subject to judicial review in accordance with title 12, chapter 7, article 6.

E. Amounts recovered under this section shall be deposited in the state general fund. The amount of such penalty or assessment may be deducted from any amount then or later owing by the administration or this state to the person against whom the penalty or assessment has been imposed.

F. If a civil penalty or assessment imposed pursuant to subsection C of this section is not paid, this state or the administration shall file an action to collect the civil penalty or assessment in the superior court in Maricopa county. Matters that were raised or could have been raised in a hearing before the director or in an appeal pursuant to title 12, chapter 7, article 6 may not be raised as a defense to the civil action. An action brought pursuant to this subsection shall be initiated within six years after the date the claim was presented, except that the time to file a collection action is tolled either:

1. After any administrative action arising out of or referencing the wrongful acts is commenced and until the action's final resolution, including any legal challenges to the action.

2. While the state and the administration did not know, and with the exercise of reasonable diligence, should not have known, that a claim was false, fraudulent or not provided as claimed.

G. Pursuant to an investigation of prohibited acts or fraud and abuse involving the system, the director, and any person designated by the director in writing, may examine any person under oath and issue a subpoena to any person to compel the attendance of a witness. The administration by subpoena may compel the production of any record in any form necessary to support an investigation or an audit. The administration shall serve the subpoenas in the same manner as subpoenas in a civil action. If the subpoenaed person does not appear or does not produce the record, the director or the director's designee by affidavit may apply to the superior court in the county in which the controversy occurred and the court in that county shall proceed as though the failure to comply with the subpoena had occurred in an action in the court in that county.