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The Modern Age of Fraud and Abuse Compliance


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The Modern Age of Fraud and Abuse Compliance

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The Modern Age of Fraud and Abuse Compliance

  1. 1. The Modern Age of Fraud and Abuse Compliance PSOW 30th Annual Workshop September 21, 2017 Tundra Lodge Hotel & Convention Center Green Bay, WI 1 Wendy Arends, Esq. Godfrey & Kahn, S.C.
  2. 2. Overview • Legal Framework −Government Enforcement −Relevant Laws −CMS Study • Recent Cases • Strategies to Avoid Violations 2
  3. 3. Government Enforcement Federal HHS – U.S. Department of Health & Human Services OIG – Office of Inspector General (within HHS) CMS – Center for Medicare and Medicaid Services U.S. DOJ – U.S. Department of Justice State WI AG – Wisconsin Attorney General’s Office WI DHS – Wisconsin Department of Health Services WI OIG – Office of Inspector General (within WI DHS) 3
  4. 4. Other Governmental Entities • ZPICs – Zone Program Integrity Contractors − Developed by CMS in 1999 − Ability to initiate a fraud investigation − ZONE 3 – Safeguard Administrators • Operational April 24, 2012 • IL, IN, KY, MI, MN, OH and WI • RACs – Recovery Audit Contractors − Identify and correct Medicare improper payments − Can implement actions that will prevent future improper payments in all 50 states 4
  5. 5. Laws to Know 5 • Anti-Kickback Statute (AKS) • False Claims Act (FCA)
  6. 6. Anti-Kickback Statute • The AKS (42 U.S.C. § 1320a-7b) provides that it is: − Unlawful to knowingly and willfully, solicit or receive any remuneration (directly or indirectly, overtly or covertly, in cash or in kind) − In return for referring any item or service reimbursable by federal health care programs, or purchasing, leasing, ordering or arranging for (or recommending any of the same) any good, facility or service reimbursable by federal health care programs (e.g., Medicare or Medicaid) 6
  7. 7. Anti-Kickback Statute • 3 required elements for a violation: −Intentional act −Direct and indirect payment of remuneration −To induce the referral of patients or business 7
  8. 8. Anti-Kickback Statute Statutory Exceptions and Safe Harbors: • Discounts; • Employees; • Group purchasing organizations; • Sale of a practice; • Referral services; • Warranties; • Investment interests; • Space rental; • Equipment rental; • Personal services and management contracts; and • Waiver of deductibles and coinsurance. 8
  9. 9. What is Remuneration? • An extremely broad definition, whether in case or in kind, and whether made directly or indirectly, including: − Kickbacks; − Bribes; − Rebates; − Gifts; − Above or below market rent or lease payments; − Discounts; − Furnishing of supplies, services or equipment either free, above or below market; − Above or below market credit arrangements; and − Waiver of payment due. 9
  10. 10. False Claims Act • FCA (31 U.S.C. §§ 3729-3733) • Prohibits a person from “knowingly” submitting claims or making a false record or statement in order to secure payment of a false or fraudulent claim by the federal government: − Has actual knowledge of the information, − Acts in deliberate ignorance of the truth or falsity of the information, and − Acts in reckless disregard of the truth or falsity of the information. 10
  11. 11. False Claims Act • Key elements: −False Claims −Intent −Materiality −Causation 11
  12. 12. False Claims Act • Potential FCA violations include: −Upcoding/billing for services not rendered −False certification of compliance with regulations −Quality of care/unneeded services −Improper retention of overpayments −“Causing” submission of false claims • Does not cover false tax returns 12
  13. 13. 2015 CMS Study • In 2012, Medicare Part B paid $5.8 billion for ambulance transports, almost double the amount paid in 2003. • CMS study looked at inappropriate payments and questionable billing for Medicare Part B ambulance transports • Data included transport destinations, transport levels, distance of urban transports, other Medicare services that beneficiaries received, and the geographic locations where the beneficiaries who received transports resided. 13 Source: HHS, OIG. Inappropriate Payments and Questionable Billing for Medicare Part B Ambulance Transports (OEI- 09-12-00351) September, 2015
  14. 14. 2015 CMS Study Findings • Identified both improper payments for ambulance transports and questionable billings by ambulance suppliers: − Medicare paid $24 M for ambulance transports that did not meet certain Medicare requirements justifying payment − Medicare paid $30 M for transports for which the beneficiaries did not receive Medicare services at the pick- up or drop-off locations, or anywhere else − 1 in 5 suppliers had questionable billing − More than half of all questionable transports were provided to beneficiaries residing in 4 metropolitan areas 14
  15. 15. 2015 CMS Study Recommendations • Enhance existing fraud and abuse safeguards • Require ambulance suppliers to include National Provider Identifier of the certifying physician on transport claims that require certification • Increase CMS monitoring of ambulance billings • Determine the appropriateness of claims billed by ambulance suppliers identified in the report and take appropriate action 15
  16. 16. Recent Cases – Navicent Health • OIG - August 2017 settlement with Navicent Health, Inc. −Navicent agreed to pay $2.5 million and enter into OIG corporate integrity agreement. • Alleged False Claims Act violations: −Upcoding non-emergency hospital to hospital ambulance transports as emergency claims −Billing for non-emergency ambulance transports of patients released from the hospital 16
  17. 17. • OIG – January 2017 settlement with MedStar (MA ambulance provider) − MedStar agreed to pay $12.7 million; entered into OIG corporate integrity agreement − Former employee brought whistleblower case • Alleged False Claims Act violations: − Billing for higher levels of services than what patients required − Submitted claims for ambulance transport services that did not qualify as medically necessary 17 Recent Cases – MedStar Ambulance
  18. 18. Other Recent Cases • In each case below, the ambulance provider entered into a settlement agreement with OIG to resolve the alleged FCA violations: − 3/31/17 – Freedom Ambulance, LLC (Beeville, TX) agree to pay $846,563 − 3/31/17 – EasCare, LLC (Dorchester, MA) agreed to pay $255,768 − 11/28/16 – Mitchell Jordan (Mattoon, IL) agreed to pay $126,425 − 5/5/16 – Allied EMS Systems, Inc. (Petoskey, MI) agreed to pay $121,722 18
  19. 19. Compliance Program • Strategies to avoid fraud and abuse violations: −Develop or strengthen compliance program −Designate someone to be in charge of compliance program • For example, high level manager can act as compliance officer; larger organizations may also want to create a compliance committee −Conduct periodic training and education −Develop internal monitoring and reviews 19
  20. 20. Compliance Program • Basic elements of a compliance program: • Develop effective lines of communication • Conduct internal auditing and monitoring • Enforce standards through well-publicized disciplinary guidelines • Respond promptly to detected violations and take appropriate corrective action 20
  21. 21. The presentation and materials are intended to provide information on legal issues and should not be construed as legal advice. In addition, attendance at a Godfrey & Kahn, S.C. presentation does not create an attorney-client relationship. Please consult the speaker if you have any questions concerning the information discussed during this seminar. OFFICES IN MILWAUKEE, MADISON, WAUKESHA, GREEN BAY AND APPLETON, WISCONSIN AND WASHINGTON, D.C. Thank You Wendy Arends, Esq. Godfrey & Kahn, S.C. (608) 284-2659, 21