RACs, PSCs, ZPICs, HIPAA Auditors, State MFCUs, MICs, Medicaid RACs, HHS-OIG, DOJ, FBI, and Now. . . Patients?
January 20, 2012 by rliles
Filed under Featured, Health Law Articles, Medicare Overpayments
(January 20, 2012):
I. Background
The Department of Health and Human Services (HHS) has long used reports and complaints from affected patients to further investigate allegations of possible Medicare fraud, waste and abuse. Last June, it was reported that HHS was planning on implementing a “Mystery Shopper” program, with a Federal contractor posing as a potential patient when calling a physician to inquire about possible care. While HHS quickly abandoned this program, it is important to keep in mind that the Centers for Medicare & Medicaid Services (CMS) has actively promoted its “Senior Medicare Patrol” (SMP) program since 1997.
II. Senior Medicare Patrol
For over a decade, CMS and the Administration on Aging (AoA) have educated Medicare beneficiaries and their caregivers about how to examine Medicare Explanation of Benefits (EOBs) and other forms they may receive in connection with their care. As part of this effort, seniors have been asked to keep an eye out for possible indications of fraud or abuse, such as double-billing or billing for services not rendered. Recently, CMS announced an additional $9 million grant that will be used to bolster this program and teach more beneficiaries how to assist the government in stamping out fraudulent practices.
III. States Involved
As expected, CMS has awarded a majority of grant monies to areas of the country that are hit hardest by Medicare fraud, including California, Texas, Florida, Louisiana, Illinois, Michigan and New York. However, every state is appropriated at least some funding to enhance this program. Moreover, if this program is effective at detecting and deterring fraudulent, wasteful or abusive billing, you can expect that it will be expanded (in terms of both funding and scope) in the future.
IV. Impact on Your Practice
To be clear, we all applaud these grass-roots efforts to identify fraud. Educated seniors could eventually represent CMS’ most effective line of defense in identifying fraud early, before significant harm can occur. Having said that, at this time, we are concerned that few Medicare beneficiaries are experienced or skilled in deciphering an EOB. As a result, many reports of possible wrongdoing cited by beneficiaries may merely be a mistake or a misunderstanding of the coding and billing process. Therefore, if you bill in an area that is complex or otherwise confusing (especially to the untrained eye of a beneficiary), there is an increased likelihood that your practice will be audited or reviewed.
V. Avoiding an Audit
Hopefully, beneficiaries will continue to be trained on reading EOBs and CMS will continue its efforts to simplify the EOBs so that patients and their families can more easily understand what has been billed to Medicare.
In the meantime, health care providers should diligently work to meet all applicable statutory and regulatory requirements. If you do not already have an effective Compliance Plan in place (as opposed to a non-personalized, non-provider specific plan based on a sample off of the internet), the first step would be for you to conduct a “gap analysis” of the services being billed. The gap analysis would also assess the propriety of your organization’s business practices. Through the use of a gap analysis, you will be able to identify any areas of concern and take remedial action. This approach can significantly reduce your level of risk. While no practice is perfect, a gap analysis can greatly assist you in identifying problems – thereby increasing the likelihood that a Medicare contractor will find your claims payable if you are subsequently audited.
South Texas Health Care Providers Remain Under Considerable Scrutiny by HEAT Prosecutors and Investigators – Compliance Isn’t Optional – It’s Essential in 2011.
(January 6, 2011): Three Houston-area residents, one of whom is a physician, were sentenced to prison on January 4th for their roles in a multi-million dollar durable medical equipment (DME) Medicare fraud scheme. Each of the three defendants were also ordered to pay restitution to the Federal government, in amounts ranging from $29,052 to $1.4 million.
According to DOJ, a Houston-area DME company improperly billed Medicare for power wheelchairs and orthotic devices, beginning in 2003 and continuing until late 2009. In addition to the three co-conspirators sentenced today, a total of eight other individuals were convicted for their participation in the fraudulent scheme. One of the eight included the owner of the DME company.
At trial, Federal prosecutors were able to show that a variety of fraudulent actions had been taken by members of the group, ranging from the payment of illegal kickbacks to the prescription of medically unnecessary devices.
Notably, this was just the latest case investigated by members of the DOJ / HHS-OIG / MFCU Health Care Fraud Prevention and Enforcement Action Team (HEAT). This strike force is responsible for investigating and prosecuting cases throughout South Texas. As DOJ noted:
“Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 850 individuals who collectively have falsely billed the Medicare program for more than $2.1 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.”
Both Federal and State investigators are aggressively targeting non-compliant providers. South Texas providers who take the time to review and update their current Compliance Plan should also conduct a gap analysis to better ensure that their operational and billing practices fully comply with applicable statutory and regulatory requirements.
Liles Parker attorneys have extensive experience representing health care providers in alleged Medicare overpayment and fraud cases. Should you have questions about our services, give us a call for a free consultation. We can be reached at 1 (800) 475-1906.
As Noted at the Los Angeles DOJ/HHS Health Care Fraud Summit — Data Mining is Being Used by DOJ to Target Health Care Providers
August 31, 2010 by admin
Filed under Health Law Articles
(August 31, 2010): Introduction: Last week, department heads of the U.S. Department of Justice (DOJ) and the Department of Health and Human Services (HHS), met in Los Angeles, CA and conducted the second of a planned series of “Regional Health Care Fraud Prevention Summits.” Following-up on a similar conference held in Miami, DOJ Attorney General Eric Holder HHS Secretary Kathleen Sebelius discussed a number of ongoing concerns and remedial steps that are being taken to identify, investigate and prosecute instances of Medicare fraud. In addition to these agency heads, participants learned of current and additional planned fraud enforcement initiatives from Federal and State law enforcement officials.
Issues Discussed at the Summit: As Attorney General Holder discussed, the administration’s current enforcement actions were having a significant impact on health care fraud. In fact, additional funding has been allocated to expand the HEAT program to additional cities:
“. . . Last year brought an historic step forward in this fight. In May 2009, the Departments of Justice and Health and Human Services launched the Health Care Fraud Prevention and Enforcement Action Team, or “HEAT.” Through HEAT, we’ve fostered unprecedented collaboration between our agencies and our law enforcement partners. We’ve ensured that the fight against criminal and civil health care fraud is a Cabinet-level priority. And we’ve strengthened our capacity to fight health care fraud through the enhanced use of our joint Medicare Strike Forces.
This approach is working. In fact, HEAT’s impact has been recognized by President Obama, whose FY2011 budget request includes an additional $60 million to expand our network of Strike Forces to additional cities. With these new resources, and our continued commitment to collaboration, I have no doubt we’ll be able to extend HEAT’s record of achievement. And this record is extraordinary.
In just the last fiscal year, we’ve won or negotiated more than $1.6 billion in judgments and settlements, returned more than $2.5 billion to the Medicare Trust Fund, opened thousands of new criminal and civil health care fraud investigations, reached an all-time high in the number of health care fraud defendants charged, and stopped numerous large-scale fraud schemes in their tracks.
We can all be encouraged, in particular, by what’s been accomplished in L.A. Criminals we’ve brought to justice here – in the last year alone – include the owners of the City of Angels Hospital, who pleaded guilty to paying illegal kickbacks to homeless shelters as part of a scheme to defraud Medicare and Medi-Cal; a physician in Torrance who defrauded insurance companies by misrepresenting cosmetic procedures as “medically necessary”; an Orange County oncologist who pleaded guilty to fraudulently billing Medicare and other health insurance companies up to $1 million for cancer medications that weren’t provided; a Santa Ana doctor who pleaded guilty to health care fraud for giving AIDS and HIV patients diluted medications; and a ring of criminals who defrauded Medi-Cal out of more than $4.5 million by using unlicensed individuals to provide in-home care to scores of disabled patients, many of them children.“ (emphasis added).
As HHS Secretary Sebelius further noted:
“In March, we gave him some help when Congress passed and the president signed the Affordable Care Act — one of the strongest health care anti-fraud bills in American history. Under the new law we’ve begun to strengthen the screenings for health care providers who want to participate in Medicaid or Medicare. And I am proud to announce that CMS is issuing a final rule strengthening enrollment standards for suppliers of durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS).
This rule and others coming soon mean that only appropriately qualified suppliers will be enrolled in the program. The days when you could just hang a shingle over a desk and start submitting claims are over. No more power-driven wheelchairs for marathon runners. Under the new law, we’re also making it easier for law enforcement officials to see health care claims data from around the country in one place, combining all Medicare-paid claims into a single, searchable database. And we’re getting smarter about analyzing those claims in real time to flag potential scams. It is what credit card companies have been doing for decades: If 10 flat screen TV’s are suddenly charged to my card in one day, they know something’s not quite right. So they put a hold on payment and call me right away.
We should be able to take the same approach when one provider submits ten times as many claims for oxygen equipment as a similar operation just down the road. It’s about spotting fraud early before it escalates and the cost grows. As we step up our efforts to stamp out fraud, we’re holding ourselves accountable. The President has made a commitment to cut improper Medicare payments in half by 2012.”
While DOJ Attorney General Holder’s and HHS Secretary Sebelius’ presentations provided an overview of law enforcement’s current and future efforts, the comments of DOJ Assistant Attorney General for the Criminal Division, Lanny A. Breuer, were especially enlightening in terms of how providers are being identified and targeted for investigation. As Mr. Breuer discussed:
“In 2007, the Criminal Division of the Justice Department refocused our approach to investigating and prosecuting health care fraud cases. Our investigative approach is now data driven: put simply, our analysts and agents review Medicare billing data from across the country; identify patterns of unusual billing conduct; and then deploy our “Strike Force” teams of investigators and prosecutors to those hotspots to investigate, make arrests, and prosecute. And as criminals become more creative and sophisticated, we intend to use our most aggressive investigative techniques to be right at their heels. Whenever possible, we actively use undercover operations, court-authorized wiretaps and room bugs, and confidential informants to stop these schemes in their tracks.” (emphasis added).
As Mr. Breuer’s comments further confirm, health care providers are being identified based on their billing patterns. Through the use of data-mining, providers who coding and billing practices identify them as “outliers,” are finding themselves subjected to administrative, civil and even criminal investigation.
Commentary: As counsel for a wide variety of health care providers around the country, we are especially concerned that honest, hard-working health care providers are finding themselves and their practices / clinics under investigation merely because: (1) their productivity is higher than that of their peers, or (2) their focus is specialized and often treats a higher percentage of seriously sick patients which ultimately requires a more detailed or comprehensive examination than one might normally find. Ultimately, through our representation of health care providers who have been targeted through data-mining, we believe that it is fundamentally unfair to investigate a provider merely on the basis of statistical data which can be manipulated in a thousand different ways in order to justify going after a specific provider or a type of practice.
On the administrative side, when data-mining is used as a targeting tool, providers are being audited and pursued by ZPICs, PSCs and RACs – each of is incentivized (either because they receive a percentage of any overpayment OR they are under contract with CMS to find overpayments and wrongful billings) to find fault with the provider.
Continuing Concerns: Under the current system, providers targeted through data-mining are likely to be saddled with extrapolated damages which can easily run into the millions of dollars, regardless of the fact that a large percentage of these providers are eventually exonerated (either fully or partially) when the case is heard by an Administrative Law Judge.
Health care providers subjected to an administrative audit (by a ZPIC, PSC or RAC), civil investigation (such as a review by the DOJ for possible False Claims Act liability), or criminal investigation (by DOJ or a State Medicaid Fraud Control Unit) should immediately contact your counsel. Extreme care should be taken when making statements to Federal or State investigators. Should the provider make a statement that is false or misleading, such comments could be used as the basis for bringing a separate cause of action. Your legal counsel may choose to handle all contacts with the government.
Liles Parker attorneys represent health care providers in administrative, civil and criminal health care fraud and overpayment case. Should you have questions regarding these issues, give us a call. You may call 1 (800) 475-1906 for a free consultation.
Texas Physician Indicted and Arrested
(July 9, 2010): On June 14, 2010 the U.S. Attorney’s Office for the Western District of Texas announced that a Federal Grand Jury had returned a 99-count indictment against a pain management physician who operated clinics in San Antonio and El Paso. The physician was charged with 21 counts of health care fraud, 20 counts of false statements relating to health care fraud matters, 21 counts of mail fraud, 16 counts of wire fraud, 4 counts of unlawful distribution of a controlled substances and 16 counts of money laundering. The indictment alleges that the physician “caused to be submitted claims for reimbursement of peripheral nerve injections, facet injection procedures and Level Four office visits–typically involving 25 minutes of face-to-face time between patient and physician–which never were performed.” Instead, the U.S. Attorney’s Office alleges that the physician performed “prolotherapy” on his patients — a procedure that Federal health care benefit programs do not reimburse.
Notably, an indictment is merely a charge and is not considered to be evidence of guilt. In issuing this indictment, the Texas HEAT task force, comprised of Federal prosecutors and investigative agencies, have continued to ramp up efforts to investigate and prosecute allegations of health care fraud. Notably, the use of “prolotherapy,” a relatively new therapeutic approach, has been supported by some of the best known clinics and physicians in the country.
While this case has yet to fully develop, it again points out that health care providers must take care when utilizing new approaches, despite the fact the therapeutic technique may be considered to be state-of-the-art. Unfortunately, Medicare may take years to recognize and cover some techniques. In the mean time, it is essential that providers take care when coding and billing for procedures that may not clearly qualify for coverage under applicable Medicare and / or contractor guidance.
Should you have any questions regarding these issues, don’t hesitate to contact us. For a complementary consultation, you may call Robert W. Liles or one of our other attorneys at 1 (800) 475-1906.
You’ve Got To Be Kidding. . . the Government Wants More “Bounty Hunters” Conducting Medicare Audits?
March 25, 2010 by admin
Filed under Medicare Overpayments
(March 25, 2010): Yesterday, the White House announced that President Obama intends to back additional bipartisan plans to stamp out waste in government-run medical programs for the elderly and needy. The White House said this new effort to root out improper payments in the Medicare and Medicaid programs could double taxpayer savings over the next three years to at least $2 billion.
“We cannot afford nor should we tolerate this waste of taxpayer dollars,” the White House said. The government believes that approximately $54 billion was lost through improper Medicare and Medicaid payments in 2009. Medicare is the government-run program covering elderly Americans and Medicaid is for the country’s poorest.
President Obama is seeking to crack down on waste and fraud as his administration strives to secure an overhaul of the $2.5 trillion healthcare system to contain costs and expand coverage to tens of millions of more Americans. The action endorses Republican-backed proposals on alleged health care wrongdoers.
Similar to the current RAC reimbursement scheme, the proposed new plan will offer private auditors a share of the money that they recoup in order to encourage them to work harder to uncover improper payments under Medicare and Medicaid. President Obama is also expected to back bipartisan legislation to expand the ability of government agencies to undertake these so-called payment recapture audits by providing more funds. No additional information on how this will impact CMS was given.
As many health care providers will readily attest, over the past year, it appears that there has been a marked increase in PSC and ZPIC audits, almost all of which are accompanied by demands for extrapolated damages. Once again, this points to the importance of self-assessment and an effective compliance strategy. Asked to comment on this new “risk” to health care providers, Robert W. Liles, Managing Partner at Liles Parker, Attorneys and Counselors at Law, responded:
”Our firm has represented a number of health care providers around the country. We have aggressively fought to have improper claims denial overturned. This new risk will increase the likelihood that providers who have not been subjected to RAC audits in the past may now find themselves being examined by RAC-like auditors in the future. Coupled with existing PSC and ZPIC audits, sole practitioners, small practice groups and clinics will find their coding and billing practice under the spotlight. Unfortunately, based on recent cases we have handled, it appears that PSCs and ZPICs are increasingly imposing their own views regarding what is required, well beyond the four corners of CMS-authorized provisions set out under LCDs and LMRPs covering the services at issue. Fortunately, when faced with the facts, ALJs have applied a reasonable approach and most of the claims at issue have been found to be payable. We recommend that health care providers carefully review their documentation practices to lessen the likelihood that ZPICs, PSCs, RACs and these new third-party reviewers can successfully argue that the claims don’t qualify for coverage.”
Liles Parker attorneys have extensive experience representing Medicare providers in the appeal of post-payment audits by ZPICs, PSCs and other Medicare contractors. Should you have any questions regarding these issues, don’t hesitate to contact us. For a complementary consultation, you may call Robert W. Liles or one of our other attorneys at 1 (800) 475-1906.
