Archive for the ‘Fraud and Abuse’ Category

Wisconsin Emergency Order #35 –

Thursday, May 21st, 2020

Tony Evers, Governor of Wisconsin, and Wisconsin Department of Health Services Secretary-designee Andrea Palm have issued another emergency order, Emergency Order #35 (Order #35), directed at suspending certain administrative rules in an attempt to remove unnecessary impediments to the fight against the virus.

A major focus of Order #35 is assuring that Medicaid members retain their coverage eligibility during the COVID-19 pandemic. This provision was required under the Families First Coronavirus Response Act as a condition of eligibility to receive federal funding. Order #35 contains provisions expanding the availability of telehealth in the mental health and substance abuse areas. The order also suspends the requirement that certain mental health and substance abuse services be provided only in a face-to-face setting. This is just one of the many ways in which telehealth received a “shot in the arm” from the pandemic.

A few additional areas touched in Order #35 include:

Temporarily permitting nurses to bill Medicaid for overtime.
Suspension of certain prior authorization requirements, number of refill limitations, and prescription duration limitations.

Waiver of the requirement for parents to make certain payments for the “Birth to 3” program which provides early intervention services for children with developmental delays and disabilities.

Permits supervision of occupational therapists by electronic means in situations where close supervision is required.

Removes the requirement for health departments to conduct a community health assessment resulting in a community health improvement plan at least every five years. The “five-year” requirement is removed but the general obligation remains.


Revises DHS 34.02 (8) relating to emergency mental health services. Reference is directed toward prioritization of services in cases where the need for services outweighs resources.


Extends the time from three months to six months for newly hired mental health training staff who have less than six months experience to complete their 40 hours of documented orientation training.


Makes it easier for volunteers to meet their 40 hour training requirement. Instead of requiring all 40 hours of training be completed before commencing direct client work, trainees must now complete eight hours before starting. Ten additional hours must be completed by the end of the first and second months of volunteer work. The 40 hours of training must be completed within three months of starting volunteer work.

Deleted the minimum staffing requirements for outpatient mental health clinics under Wis. Admin. Code DHS 35. The general requirement the clinic have “a sufficient number of qualified staff members available to provide outpatient mental health services to consumers admitted to care” remains. The two specific options for meeting the minimum staffing responsibility have been removed. Previously, clinics could meet their staffing requirement by meeting any of the three specific staffing scenarios included in the regulation.

This is unlikely to be the last set of waivers issued. Providers who feel they might be restricted by state or federal regulatory requirements during the pandemic should communicate with the regulatory bodies. Federal and state regulators have been sensitive to the needs of providers that are necessary to enable them to address the unprecedented needs created by the COVID-19 virus.

I’ve recapped the highlights, the full Order #35 can be found here.

Unnecessary Inpatient Admissions Results in Hospital DOJ Settlement

Wednesday, April 29th, 2020

By Fisher, JD, CHC, CCEP

Hospital Admissions Fraud Risk Area

Unnecessary Inpatient Admissions – Hospital Fraud Settlement.

An $18 million settlement was agreed by a hospital chain after allegations that claims were submitted to Medicare for patients who were admitted to an inpatient facility when they allegedly could have been treated on a less costly outpatient basis.  The government alleged that the hospital system billed Medicare for short-stay, inpatient procedures that should have been billed on a less costly outpatient basis.  The government also accused the hospital system of inflating reports to Medicare regarding the number of hours of outpatient observation care that was provided.

This is a fairly typical case where the allegation involved billing for services that were of a higher level than required by the patient.  In effect, the excess services are deemed to be medically unnecessary.  In this case, the services involved inpatient admissions that the government alleged could have been taken care of in a less costly outpatient setting.

A former employee was the whistleblower in the case and walks away with over $3.25 million from the settlement.

Read more here: Health Law Blog

  

Whistleblower Settlements Increase Compliance Risk for Providers

Thursday, April 23rd, 2020

By Fisher, JD, CHC, CCEP

Dermatology Risk Areas Fraud and Abuse

Recent Fraud Settlements Emphasize Risk of Whisttleblowers

One of the reasons why compliance officers and health care attorneys read fraud settlements is to identify the issues that the government is focused on.  The cases that the government decides to pursue are very indicative of the areas of fraud enforcement that they feel are important.  These are not the only issues that should be considered, but government enforcement actions certainly tell us what types of arrangements the government considers important.

The misfortune of the defendants involved in these cases hold a potential learning experience for everyone else.  Others have an opportunity to focus on their own operations to identify whether they are at risk in any of the areas involved in these cases.

An ancillary lesson that these settlements hold is that each was initially raised by a whistleblower.  The False Claims Act gives whistleblowers a portion of the settlement in cases where the government decides to intervene.  This in effect creates a universe of potential claimants that can include almost anyone with original knowledge of the alleged practice.

Common whistleblowers include former or disgruntled employees.  It really does not matter of the employee is or was the worst employee in the world, they can

Read more here: Health Law Blog

  

When is a Referral Mandate for Employed Physicians Permitted under the Stark Law?

Thursday, April 23rd, 2020

By Fisher, JD, CHC, CCEP

Referral Requirements Employed Physicians

When Employed Physicians be Required to Make Referrals for Designated Health Services

The Stark Law Regulations include a provision that dictates the conditions under which an employer of a physician may mandate referrals for designated health services. Certain specific conditions must be met if an employer wishes to require its employed physicians to make referrals to the employer’s designated health services. Many institutions assume that an employer may always require an employed physician to make referrals to its ancillary services. That assumption is not correct.

The Stark regulations provides that a physician’s compensation from a bona fide employer or under a managed care contract or other contract for personal services may be conditioned on the physician’s referrals to a particular provider, practitioner, or supplier. There are a number of specific requirements that must be present to permit referral requirements including:

  1. The required referrals can only relate to the physician’s services covered by the scope of the employment or the contract.
  2. The referral requirement must be reasonably necessary to effectuate the legitimate business purposes of the compensation arrangement.
  3. The physician’s compensation must be set in advance for the term of the agreement requiring referrals.
  4. The physician’s compensation must beRead more here: Health Law Blog

      

Investment Interest in Radiation Therapy Anti-kickback Statute Settlement

Thursday, April 16th, 2020

By Fisher, JD, CHC, CCEP

Anti-kickback Statute Radiation Therapy Investments

Radiation Therapy Referral Kickback Arrangements with Investors.

A national operator of radiation therapy centers, has agreed to settle a False Claims Act action alleging that it submitted claims violated the Anti‑Kickback Statute by paying of $11.5 million and entering into a 5 year Corporate Integrity Agreement with the Office of Inspector General.  The arrangement involved payments to investors who were allegedly targeted because of their referral potential to the therapy centers.  The challenged arrangement involved a series of leasing companies that accepted investments from referring physicians.  The investment interests resulted in the payment of investment returns that the government considered to be remuneration for referrals in violation of the Anti-Kickback Statute.  The whistleblower who originally raised the issue will receive up to $1.725 million.

This case involves a garden variety claim of a kickback by investment interest.  The typical investment case involves targeting potential investors who are in a professional position to make referrals to the company in which they are asked to invest.  The referral source has a financial incentive to increase referrals.  This might be an excellent financial investment scenario, but the problem is that the investment return might well be an illegal kickback; which is potentially a federal felony.

Read more here: Health Law Blog

  

Treatment Center Plead Guilty to Anti-kickback Statute Violations Involving Alcohol and Drug Addiction Treatment Centers

Thursday, April 16th, 2020

By Fisher, JD, CHC, CCEP

Treatment Center Fraud Plea

Substance Abuse Treatment Center Fraud Scheme Results in Guilty Plea

The Department of Justice recently announced the guilty plea of two individual alcohol and substance abuse treatment center owners for their participation in what DOJ labeled a “multi-million dollar health care fraud and money laundering scheme.”  The two individuals owned a licensed substance abuse service provider (or treatment center) offering clinical treatment services for persons suffering from alcohol and drug addiction. The treatment center also offered medication-based treatment for opioid addiction.

The government had accused the two owners of paying illegal kickbacks/bribes to “sober homes” in exchange for the referral of the sober homes’ insured residents to treatment program. The sober homes provided safe and drug-free residences for individuals suffering from drug and alcohol addiction. This made them a prime source of potential referrals to the treatment program.

The accusations against these defendants read like a laundry list of thinly veiled kickback schemes.  Some of the specific accusations included:

  1. Providing funds used to purchase or rent several sober home properties under purchase agreements or leases that were in the names of other parties so as to disguise the source of funds.
  2. Paying remuneration for referrals in the form of free or reduced rent, insurance premiumRead more here: Health Law Blog

      

When is a Referral Mandate for Employed Physicians Permitted under the Stark Law?

Thursday, April 16th, 2020

By Fisher, JD, CHC, CCEP

Referral Requirements Employed Physicians

When Employed Physicians be Required to Make Referrals for Designated Health Services

The Stark Law Regulations include a provision that dictates the conditions under which an employer of a physician may mandate referrals for designated health services.  Certain specific conditions must be met if an employer wishes to require its employed physicians to make referrals to the employer’s designated health services.  Many institutions assume that an employer may always require an employed physician to make referrals to its ancillary services.  That assumption is not correct.

The Stark regulations provides that a physician’s compensation from a bona fide employer or under a managed care contract or other contract for personal services may be conditioned on the physician’s referrals to a particular provider, practitioner, or supplier.    There are a number of specific requirements that must be present to permit referral requirements including:

  1.  The required referrals can only relate to the physician’s services covered by the scope of the employment or the contract.
  2. The referral requirement must be reasonably necessary to effectuate the legitimate business purposes of the compensation arrangement.
  3. The physician’s compensation must be set in advance for the term of the agreement requiring referrals.
  4.  The physician’s compensation must be consistent with fair market value for servicesRead more here: Health Law Blog

      

Hold On Just a Daw-Gone Minute – Physician Payment Act Dispute Process

Tuesday, April 11th, 2017

Disputing Inaccurate Reports Under the Physician Payment Sunshine Act

disputing sunshine act reportIn 2013, CMS issued final regulations interpreting and clarifying the requirements of the Physician Payment Sunshine Act (“Sunshine Act”) .  The final regulations clarify the reporting process, identifies exceptions and exclusions from the reporting requirements, and provides further details regarding what constitutes a reportable relationship.  The final rule delineates the specific data elements that reporting organizations are required to include and the reporting format that is required.  Reporting organizations that fail to make required reports are subject to potential civil monetary penalties.

Physicians are often surprised to see the information that reporting agencies submit.  Early on, errors in reporting were frequent as reporting companies struggled to integrate reporting requirements into their compliance process.  Reports tend to be more accurate now, but there are certainly instances where reporting organizations make reports that should be questioned.  A process is included to afford physicians and teaching hospitals to review and dispute the information that a reporting organization proposes to report.  The regulations require physicians to exercise diligence to review the information that is being submitted describing items of benefit that they are alleged to have received.  The regulations include a 45-day review and correction period, but report information does not automatically come to a physician unless affirmative action is taken to sign up to receive this information.

If the physician or teaching hospital receives notification, a process can be used to dispute the proposed disclosure with the applicable manufacturer.  There is a very short time window to dispute and resolve the issue before publication is made for the applicable year so it is critical that a dispute be invoked promptly upon receipt of notice of the proposed report.  Signing up for notifications also permits access to the web based dispute system.  The review period lasts for 45 days and reporting organizations have 15 days after the end of that period to correct data to resolve disputes.

Errors in amount, the nature of items reported, and methodology of calculating or allocating expenditures among numerous recipients are frequent areas of error.  For example, situations have occurred where expenditures that benefitted numerous physicians were allocated to a single physician.  The opportunity for error in reporting are endless; particularly given the multiple parties that can be involved in the reporting chain for the reporting company.

Inaccurate reporting is not without consequence to the subject of the report.  Inaccurate reports can be indicative of conflict of interest and can impact publication or reviewer credibility.  A report can also be an indication of further potential fraudulent payments and can result in further government investigation regarding the fair market value of services provided in a consulting or other relationship.  In extreme cases, payments that are inflated over fair market value for services that are actually and legitimately provided can indicate potential Anti-Kickback Statute and other compliance violations that can carry significant penalties.  If a review is based on an inaccurate or inflated report, a positive resolution can likely be reached with investigators.  However, anyone who has ever been involved in a government compliance investigation understands the intangible damage that the process can create.

In order to avoid complication that could result from inaccurate reports, physicians and other reporting subjects should be certain to register to receive notification of proposed Physician Sunshine Act reports.  Any inaccuracies should be disputed promptly.

Anti-kickback Statutes – Free Transportation Services to Patients – Safe Harbor Regulations

Wednesday, March 22nd, 2017

Free Patient Transportation Services

Factors to Consider When the Transportation Safe Harbor is Not Satisfied

Health Attorney Wisconsin Health LawHere are some factors pulled from various OIG Advisory Opinions on free patient transportation.  The safe harbors for patient transportation should also be consulted, but these factors may be relevant in cases where not all safe harbor elements can be met.  Some factors identify criteria that makes an arrangement suspect.

  • Offering out of state patients free transportation to receive services.
  • Compensating drivers of vans or other vehicles on a per patient basis for patients that are brought to the facility.
  • Offering free luxury transportation.
  • Offering free transportation to the patients of physicians or other referral sources in order to induce them to refer to the facility.
  • Free ambulance services without making any determination of financial need.
  • Offering free transportation to nursing home residents to a facility,especially for services of questionable necessity.
  • The costs of the free transportation must be borne by the facility and should not be passed on to any Federal health care program.
  • Higher levels of advertising and marketing of the transportation service will raise more concern.
  • Transportation from one provider to another raise a higher level of concern than transportation directly to the facility. In other words, where the transportation is from the place of business of a potential referral source (i.e. physician or other health care provider) the fraud and abuse risk is higher.
  • Whether there are other methods of affordable transportation in the area. If affordable transportation options are not readily available, the arrangement will raise less concern.
  • Whether the services are offered and/or marketed outside of the facilities normal service area. The OIG looks with disfavor on “leap-frog” arrangements that induce patients to bypass other closer providers due to the free or low cost transportation arrangement.
  • The OIG also raised general concerns about the provider who uses free transportation to gain access to patients, potentially for unnecessary or questionable services.

Free Transportation Services to Patients and Guests – When Is The Anti-Kickback Statute Violated?

Wednesday, March 22nd, 2017

Free Transportation Services and the Anti-kickback Statute

Advisory Opinions, Safe Harbors, and other Guidance

Free Transportation Safe HarborsIt is a fairly common practice for healthcare facilities, whether long term care facilities, hospitals, or large clinics, to offer free transportation services to patients and sometimes the visitors or guests of the patients. These arrangements require analysis under the Medicare Anti-Kickback Statute because a free service is being provided to the patient and could be viewed to at least partially be for the purpose of inducing the patient to seek services or for referral sources of these patients to refer them for services of the facility.

The OIG has viewed some arrangements where free or low cost transportation is provided to be a violation of the Anti-Kickback Statute and other arrangments to be permissible, even though arguably there is some element of remuneration to induce referrals. The OIG has issued advisory opinions that provide a great deal of guidance on the factors that the OIG will examine when determining which free transportation services are abusive and which will be permitted. Most recently, the OIG released a safe harbor provision that describes the conditions for safe harbor coverage of shuttle services and transportation of existing patients.

Failure to comply with a safe harbor does not necessarily mean that an arrangement violates the AKS. The advisory opinion that have been issued in this area are very instructive of the types of arrangements and various factors that the OIG considers to be suspect.

The particular case involved in the advisory opinion involved a skilled nursing facility that proposed offering local transportation to friends and family of nursing facility residents. The facility is located in an area that is not easy to access and requires payment of a $9 toll to cross a bridge. The service was to be provided uniformly regardless of income level or the source of payment for the residents’ care. There would be no charge for the transportation services and the cost would not be claimed on any Federal health program cost report. The value of the service to the families and friends of each patient is estimated to be over $50 per year. The facility did not plan to advertise the service broadly and advertising would be limited to its normal service area. A written policy would govern the operation of the transportation program.

The OIG found that the particular transportation arrangement would not violate the Anti-Kickback Statute.

The specific reasons given to approve this particular arrangement were (i) that the free transportation was not to assist patients to obtain care or for the benefit of referral sources to the facility, (ii) the program would be offered uniformly, regardless of the payment source for the services to the resident at the facility, (iii) the type of service is reasonable for the circumstances and is not a luxury item, (iv) the arrangement will only be offered and advertised locally and would not be used to expand the service area of the facility, (v) the marketing would be reasonably limited, (vi) local public transportation in the area is limited, (vii) the arrangement is consistent with the mission of providing quality care to patients, and (viii) the costs will not be claimed under any Federal health program.

These factors are instructive, and many are similar to the conditions in the recent safe harbor regulations. Circumstances that do not meet the safe harbor should be structured as close to the safe harbor as possible, but meeting the safe harbor completely is the only way to assure compliance short of requesting an advisory opinion. With all of the various guidance that has been issued in this area, together with the safe harbor regulations and comments, one can gain a very good understanding of the types of arrangements that will gain the disapproval of regulators.