NBI MEDIC Referrals to Boards, OIG and DOJ are Here!

(June 28, 2017): The Medicare program is enormous. As of 2016, more than 56 million individuals participated in the program, with more than 10,000 additional individuals enrolling in the program each day. The Centers for Medicare and Medicaid Services (CMS) is the agency responsible for managing this costly program. To direct this $640 billion program, CMS has engaged a number of private companies to handle practically every aspect of the administrative claims submission, payment and audit process. Several companies have dominated this industry, one of which is Health Integrity, LLC (Health Integrity). Established in 2006, Health Integrity has been awarded three major categories of contracts by CMS. In addition to serving a Zone Program Integrity Contractor (ZPIC) responsible for auditing Medicare Part B claims[1], Health Integrity also serves as the Medicaid Integrity Contractor (MIC) in one or more jurisdictions around the country. Finally, since 2009, Health Integrity has served as the only National Benefit Integrity Medicare Drug Integrity Contract (NBI MEDIC).

I. Impact of the Opioid Crisis on Health Integrity’s Activities (as NBI MEDIC):

As NBI MEDIC, Health Integrity is responsible for identifying and investigating incidents of fraud, waste and abuse in the Medicare Part C (Medicare Advantage) and Medicare Part D (Outpatient Prescription Drug) programs. In this capacity, Health Integrity has established close working relationships with federal and state law enforcement and regulatory agencies around the country.

Over the last two years, Health Integrity’s benefit integrity activities as NBI MEDIC have effectively been on overdrive. This is due, in large part, to the government’s national initiative to address the current opioid epidemic that has become endemic in areas around the country and has disproportionately impacted Medicare and Medicaid beneficiaries. In one report published by the Office of Inspector General (OIG) in 2016, the agency found that 30% of Medicare of beneficiaries have at least one prescription for an opioid. Moreover, OIG concluded that a median number of 5 prescriptions for opioids were issued per Medicare beneficiaries over the period of a year.[2] Over the last year, a number of federal and state legislature and regulatory bodies have taken affirmative steps to better protect patients from opioid abuse and the public from the illegal diversion of opioids and other controlled substances.[3] In addition to their day-to-day analytics work to identify health care providers with aberrant opioid and / or other controlled substance prescribing practices, Health Integrity is also actively involved in a number of specific projects targeting specific categories of prescribers and / or claims. These projects include:

The Quarterly Pharmacy Risk Assessment Project: In this project Health Integrity is targeting pharmacies that appear to be engaged in illegal or improper prescribing activities. Two of the factors examined by Health Integrity involved schedule II controlled substances. Potential wrongdoers are either audited or referred to law enforcement for further investigation.

The Prescriber Risk Assessment Project:In this project, Health Integrity is comparing the controlled substances prescribing practices of physician, nurse practitioners, physician assistants, podiatrists and dentists against those their peers within their primary specialty and location (by state). If a licensed prescriber is identified as a potential target, Health Integrity may initiate a claims audits of the opioid prescriptions at issue to see whether the orders were medically necessary and appropriate. If evidence of fraud, waste or abuse is identified, Health Integrity may also make referral to federal and state law enforcement for further investigation and prosecution, if justified. Finally, Health Integrity may also file a complaint against the licensee with the licensee’s state licensing board. It is this final category of referrals where we have recently been seeing an increase in enforcement activity.

The Quarterly Pharmacy Spike Analysis Project. Health Integrity uses this project to identify “spikes” in the billing patterns of pharmacies from one-quarter to another with respect to schedule II through IV controlled substances. While this project is focused on pharmacies, it is important to keep in mind that every one of the prescriptions filled was originally filled by qualified prescriber. After auditing a pharmacy identified under this project, Health Integrity will automatically turn to the physicians and other prescribers who are alleged to have ordered the scripts to be filled in the first place.

The Quarterly Prescriber Spike Analysis Project. In this project, Health Integrity analyses available databases to identify any billing trends of nationwide prescribers that appear to be unusual of controlled substances, human immunodeficiency virus medications, and antipsychotics. Health integrity also looks for unusual spikes in the quantity of schedule III-V control substances prescribed by qualified physicians, nurse practitioners, physician assistants, podiatrists and dentists. As a participant in the Medicare program, you are REQUIRED to have an effective Compliance Program in place. One of the seven essential elements of your Compliance Program is that you are supposed to be monitoring and reviewing claims submitted for coverage and payment. An important component if this internal monitoring process should be an ongoing comparison of your provider’s prescribing practices. If there are spikes, you need to be prepared to explain how and / or why they occurred.

The Transmucosal Immediate Release Fentanyl (TIRF) Drug Project. This project involves the identification of improper payments by Health Integrity that have made by Prescription Drug Plans (PDP) and Medicare Advantage-Prescription Drug (MA-PD) Plans for unapproved uses of these drugs. Health Integrity is also examining whether prescriptions for TIRF have been medically necessary and appropriate. TIRF drugs are typically used by licensed prescribers to achieve pain relief in cancer patients. We recommend that you carefully monitor your staff prescription practices when it comes to TIRF drugs. Are the prescriptions related to the care of a cancer patient? If not, is the medical necessity of this drug fully documented.

The Pill Mill Doctor Project. Health Integrity participated in this project to identify prescribers with a high risk of fraud, waste, and abuse in prescribing schedule II-IV controlled substances. Essentially, Health Integrity is seeking to identify and either audit or refer any prescribers who might be engaged in “pill mill” related prescribing practices. Over the last few months, both federal and state law enforcement agencies have been actively investigating and prosecuting physicians and others who appear to be engaging in “pill mill” type prescribing practices.

The Trio Prescriber Project. This project is used by Health Integrity to focus on identifying licensed health care providers who prescribe the following three medications to a Medicare beneficiary: (1) an Opioid, (2) a Benzodiazepine, and (3) the Muscle Relaxant carisoprodol. This particular combination of medications is a popular “drug cocktail” used by individuals to heighten the effects of the opioid. With access to the various CMS claims databases, Health Integrity has been quite effective at determining which prescribers AND beneficiaries may be engaged in these drug cocktail practices.

The Compounding Pharmacy Project. Health Integrity is using data analytics to identify high-rick pharmacies that appear to be billing Medicare for compounded prescription drugs. In 2017 alone, DOJ has prosecuted a number of compounding pharmacies and associated prescribers for various violations of health care fraud and abuse laws. Are you a licensed physician, nurse practitioner or other qualified prescriber who writes scripts for compounded drugs? If so, we recommend that you immediately contact your health law counsel to discuss the business relationship between the parties and whether the compounded drug is truly medically necessary.

The Brand Name Drug Project. In its role as NBI MEDIC, Health Integrity is using this audit project to identify abnormal or aberrant Medicare Part D billing practices by independent pharmacies for brand-name prescription drugs, including opioids sold under brand names, such as OxyContin®, Percocet®, Vicodin®, Percodan®, Tylox®, and Demerol®. Once again, Health Integrity’s initial audit may focus on the independent pharmacy but a collateral audit or referral to law enforcement will likely be made to examine the prescribing practices of the physician or other qualified prescriber. Why were only expensive, brand name drugs ordered by the prescribing physician? Why hasn’t the prescriber ordered a drug that is therapeutically equivalent to the expensive name brand drug? If a referral to law enforcement is made, they will also likely examine the prescriber’s business relationship, if any, with the pharmaceutical manufacturer of the brand name drug(s).

II. How Are NBI MEDIC Investigations Initiated?

As the company President of Health Integrity, Susan Love, testified late last year before the U.S. Senate Committee on Homeland Security and Governmental Affairs, Subcommittee on Investigations, the NBI MEDIC performs both “reactive” and “proactive” benefit integrity enforcement audits and investigations.

  • Reactive Audits.The NBI MEDIC’s Fraud Hotline provides one example of the reactive mechanisms that lead to audits and investigations handled by Health Integrity. From 2013-2015, the NBI MEDIC received more than 37,000 calls to their toll-free Fraud Hotline alleging fraud, waste and abuse of the Medicare Part C and Part D programs. The NBI MEDIC also receives complaints by fax, mail and encrypted e-mail through the contractor’s website. After culling through these complaints, the NBI MEDIC identified more than 24,000 actionable complaints that could be pursued.
  • Proactive Audits. In September 2013, CMS instructed the NBI MEDIC to perform more proactive audits using data analytics to identify and investigate possible violations. This resulted in an increase in referrals of 520% to law enforcement.

III. What Actions Can an NBI MEDIC Take After Conducting an Audit?

Should a Health Integrity auditor conclude that a licensed prescriber’s utilization practices of opioids and / or controlled substances are different than those of their peers, there is significant likelihood that one or more of the following actions will be taken by the NBI MEDIC:

  • Make a Referral to Law Enforcement. Over the past few years, the NBI MEDIC initiated investigations have resulted in more than 1000 referrals to law enforcement. These referrals are the result of both reactive and proactive investigations conducted by the NBI MEDIC.
  • Conduct a Claims Audit. Health Integrity (as NBI MEDIC) will conduct an audit of your prescribing practices to determine if your prescriptions for opioids and other controlled substances were medically necessary and appropriate.
  • Recommend that Your Medicare Number be Revoked. Notably, since August 2015, the NBI MEDIC has recommended the revocation of Medicare enrollment for 169 providers. This administrative sanction has become more frequent in 2016 and 2017.
  • File a Complaint with Your State Licensing Board. Health Integrity will (as NBI MEDIC) file a complaint against your license with the state. Depending on the nature of your profession, Health Integrity will either file a complaint with the State Medical Board (If you are a physician, osteopath or physician assistant), with the State Nursing Board (if you are a nurse practitioner), with the State Board of Podiatric Examiners (if you are a podiatrist), or with the State Board of Dentistry (if you are a dentist or oral surgeon). These complaints are due, in large part, due to the opioid epidemic currently sweeping the nation. The NBI MEDIC is aggressively monitoring and auditing the prescription of opioids and other controlled substances to Medicare beneficiaries under the Part D program. These audits are typically initiated by NBI MEDIC auditors and analysts who utilize “data mining” to identify potential physician, nurse practitioner and physician assistant targets that may be engaged in prescribing practices that are different from those of prescribers that the NBI MEDIC perceives to be their peers.

IV. How Can You Reduce Your Level of Regulatory Risk?

As reflected above, if you or your practice is targeted, the range of actions that the NBI MEDIC may take widely varies, depending the contractor’s findings. Unfortunately, since data mining is one of the primary ways that a potential target is identified for review, the first time that you know find out that your prescribing practices are being assessed could be when you receive notice of an investigation by law enforcement or that a complaint has been filed against your with the state licensing board. This is often the case, regardless of whether the investigating contractor is a Unified Program Integrity Contractor (UPIC), ZPIC or NBI MEDIC.

How can you reduce your level of regulatory audit risk? As a first step, if you have not already done so, you need to develop and implement an effective Compliance Program.[4] Assuming that you already have such a program in place, take the time now, before you have a problem, to assess your prescribing, care and treatment practices. Are they compliant with applicable standards of care and any state law restrictions that may restrict the time period that controlled substances may be prescribed in non-cancer / non-chronic pain cases? Does your documentation meet applicable requirements? Have you documented that the care and treatment decisions made were medically necessary and appropriate? Were the services properly coded and billed?


Robert W. Liles is Managing Partner at the health law firm, Liles Parker, PLLC. With offices in Washington, DC, Houston, TX, McAllen, TX and Baton Rouge, LA, our attorneys represent dental professionals around the country in connection with Medicare / Medicaid audits, Compliance Plan reviews and state peer review actions. Should you have any questions, please call us for a free consultation. Robert can be reached at:1 (800) 475-1906.

  • [1] Health Integrity serves as the ZPIC for Texas, Oklahoma, Colorado and Oklahoma.
  • [2] HHS OIG. “High Part D Spending on Opioids and Substantial Growth in Compounded Drugs Raise Concerns” (OEI-02-16-00290). 6/21/2016. http://oig.hhs.gov/oei/reports/oei-02-16-00290.asp
  • [3] In March 2016, the Centers for Disease Control and Prevention (CDC) issued its “CDC Guideline for Prescribing Opioids for Chronic Pain – United States, 2016”. This guideline was intended to provide qualified prescribers of opioids with recommendations designed to reduce opioid-related overdoses and deaths. Although the CDC’s guidelines are voluntary, several states have taken legislative or regulatory action to adopt a number of the recommendations set out in the CDC’s March 2016 guidance. Examples of these states include Indiana, Ohio, Kentucky and Maryland. Each of these states have adopted, to some degree, the CDC’s recommendations.
  • [4] The term “corporate compliance program” refers to an initiative that evolved from the Federal Sentencing Guidelines, which were adopted under the Sentencing Reform Act of 1984 (28 U.S.C. § 994). As set out in the U.S. Sentencing Commission Guidelines, Sentencing for Organizations, lesser criminal sanctions for companies have been specifically recommended for companies that have effective compliance plans in operation. Guidelines for benefiting from a Compliance Plan have been set out as early as 1991. (56 Fed. Reg. 22762). As far as civil sanctions are concerned, the Department of Justice’s Civil Division has implemented a similar philosophy of treating defendants more leniently if they have endeavored to implement and follow an effective compliance program. Finally, an effective compliance program can significantly reduce non-governmental civil exposure by identifying potential practices that may pose litigation risk and taking action to reduce that risk.