Transcript HEALTH LAW PRACTICE IN GOVERNMENT: HEALTH CARE FRAUD AND ABUSE 2009 ABA Health Law Section James G.

HEALTH LAW PRACTICE IN
GOVERNMENT: HEALTH CARE
FRAUD AND ABUSE 2009
ABA Health Law Section
James G. Sheehan
Medicaid Inspector General/former Associate US Attorney
Albany, New York
518 473-3782
[email protected]
USUAL DISCLAIMERS
• Focus on Medicare and Medicaid
• Propagation is not plagiarism-if you see a
good idea, I probably borrowed it
• if you would like to use these slides in
your own presentation, or pass them to
others, feel free
• [email protected]
GROWING JOBS IN GOVERNMENT
HEALTH LAW PRACTICE-FRAUD
AND ABUSE
• Prosecutors, defense counsel
• Civil litigation-investigations, whistleblower (qui
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tam) cases, money recovery, defending agency
actions
Government f/a contractor work
state and federal program integrity agencies
Compliance officers
The growth is outside the criminal area
TRENDS IN THE LAW OF FRAUD
ABUSE AND COMPLIANCE
• OLD MODEL-FRAUD-INTENTIONAL CONDUCT
• OLD MODEL-ABUSE-SUSPECTED BUT
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UNPROVEABLE INTENTIONAL
CONDUCT;PATIENT NEGLECT OR
MISTREATMENT
NEW MODEL-FAILURE OF COMPLIANCE
SYSTEMS AND CONTROLS
NEW MODEL-”IMPROPER PAYMENT”-
TREND IN THE LAW OF FRAUD,
ABUSE, AND COMPLIANCE
• OLD MODEL:CRIMINAL PRIMARY, PROOF BEYOND
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REASONABLE DOUBT (DOJ)
RECENT MODEL:CIVIL FALSE CLAIMS ACT PRIMARYSETTLEMENT INCLUDES $, CORPORATE INTEGRITY
AGREEMENT, MISDEMEANOR PLEA (OIG)
NEW MODEL:DATA-DRIVEN REVIEW, RECOVERY OF
IMPROPER PAYMENTS (RACs, Medicaid Integrity
Contractors), FOCUS ON COMPLIANCE OUTLIERS IN
PAYMENT AND QUALITY-ADMINISTRATIVE ACTION
(CMS, state program integrity agencies);arbitrary and
capricious
CHANGING LANGUAGE IN
MEDICARE AND MEDICAID
PROGRAM CONTROLS
• OLD LANGUAGE-”FRAUD AND ABUSE”
• NEW LANGUAGE-”PROGRAM INTEGRITY,
IMPROPER PAYMENTS”
• “any payment that should not have been
made or that was made in an incorrect
amount “
• “Improper payments” require neither
intent nor faultI
CHANGING EXPECTATIONS OF
HEALTH CARE PROVIDERS
(particularly large institutional
providers)
• MANDATORY “Effective” compliance and
internal controls
– Billing
– Quality
– Reporting
– Credentialing
– Governance
– Compliance process
WHAT IS FRAUD
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– “Fraud” is intentional breach of the standard of good faith and
fair dealing, as understood in the community, involving
deception or breach of trust, for money (USA v. Goldblatt)
– In health care practice, “fraud and abuse” has come to includes
far more than the Goldblatt definition-kickbacks and Stark
violations
– Health care fraud, mail fraud, false statements and instruments,
insurance fraud statutes
– “false or fraudulent claim” in False Claims Acts (state and federal
31 U.S.C. 3729 et seq.))
– 42 CFR 433.302 definition of fraud for Medicaid
ABUSE
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WHAT IS “ABUSE”?
• “ABUSE MEANS PRACTICES THAT ARE
INCONSISTENT WITH SOUND . . .
MEDICAL OR PROFESSIONAL PRACTICES
AND WHICH RESULT IN UNNECESSARY
COSTS. . ., PAYMENT FOR SERVICES NOT
MEDICALLY NECESSARY, OR . . .WHICH
FAIL TO MEET RECOGNIZED STANDARDS
FOR HEALTH CARE.”
HOW DOES “FRAUD” DIFFER FROM
“ABUSE”?
• “Fraud” requires evidence of the intent of a
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specific individual
“Fraud means an intentional deception or
misrepresentation made by a person with the
knowledge that the deception could result in
some unauthorized benefit to himself or some
other person. It includes any act that constitutes
fraud under applicable Federal or State law. “ 42
CFR 455.2
HOW DOES “FRAUD” DIFFER FROM
“ABUSE”?
• “Abuse means provider practices that are inconsistent
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with sound fiscal, business, or medical practices, and
result in an unnecessary cost to the Medicaid program,
or in reimbursement for services that are not medically
necessary or that fail to meet professionally recognized
standards for health care. It also includes recipient
practices that result in unnecessary cost to the Medicaid
program.” 42 CFR 455.2-similar provisions in state
regulations-(see, e.g., 18 NYCRR 515.1 (B))
No evidence of intent of specific individual required
At the beginning of an investigation, neither prosecution
nor defense can know whether matter will be a fraud
case, an abuse case, or no case.
HOW DOES GOVERNMENT DETECT
FRAUD OR ABUSE?
• OLD MODEL-INFORMANTS, WHISTLEBLOWERS,
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HOTLINES, READING NEWSPAPERS
NEW MODEL-RISK OF RANDOM REVIEW,
ERROR RATE MEASUREMENT, QUALITY
ASSESSMENT
NEW MODEL-DATA INTEGRATION, MINING,
ANALYSIS (e.g., Medstat, Salient, Fair Isaac,
Entity Analytics)
NEW MODEL-AUDIT CONTRACTORS-RACs, MICs
New York Data Mining Approaches
Data Matches/Demographics
• Men having babies
• Fillings in crowns
• Excluded persons on public, health provider
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payroll
Hospital in-patient ambulance trips
Women giving birth every 5 months
Dead people having prescriptions filled
Enrollees with multiple lives
One enrollee-two managed care numbers
FRAUD EXAMPLES (IF CONDUCT IS
INTENTIONAL)
• Billing for services not provided
• Billing for unneeded services
• Submitting a claim you know is not reimbursable
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(Stark)
Submitting a claim you know is not properly
coded to get more money
Providing a false diagnosis
Keeping money you know you are not entitled to
Creating false documents to support a claim or
cost report
FRAUD EXAMPLES
• Lying to a regulatory agency of the Government
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to keep your license or certification (which
allows you to continue to collect Medicaid
claims) is a fraud. See United States v. Blumeyer
114 F.3d 758 (8th Cir. 1997)
The negligence of the victim is not a defense to
fraud-”the laws . . . against fraud are most
needed to protect the careless and naïve from
lupine predators. . .” US v. Kreimer 609 F. 2d
126 (5th Cir. 1980)
HINTS OF FRAUD
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inconsistent statements
Probing claims
Claims denials and resubmissions
Missing, altered or xeroxed documents
Lulling statements
Employment of untrained or vulnerable individuals in
managerial positions
Large cash transactions
Icebox treatment
Data mining for outliers, surges, networks
Usual suspects
WHAT ELSE IS “FRAUD AND
ABUSE” IN HEALTH CARE ?
• “Unacceptable practice” 18 NYCRR 515.2
– Submitting a claim in an amount “in excess of established rates
or fees” Unacceptable recordkeeping “failure . . . to maintain
records necessary to fully disclose the medical necessity for and
the nature and extent of the medical care”
– Excessive services
– Failure to meet recognized standards-”furnishing medical care. .
. that fails to meet professionally recognized standards of health
care. . .”
– (See 42 CFR 1001.701 for similar HHS/OIG authorities, also
Medi-Cal provider agreement, Kentucky unacceptable practices
regs., Texas DADS DAHS Handbook, Section 8000)
What else is included in “health
care fraud and abuse?”
• violations of the Medicare/Medicaid Anti-
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Kickback Act, 42 U.S.C. 1320a-7b-”knowingly
and willfully offering or making, soliciting or
accepting anything of value in return for the
referral of a patient whose services are
reimbursable by Medicare or Medicaid.”
USA v. Greber 760 F. 2d 68(3d Cir. 1985)-Act is
violated even if only “one purpose” is to induce
referrals
WHO INTERPRETS AND ENFORCES
THE FRAUD AND ABUSE LAWS?
• Courts, agencies, manuals, treatises
• Compliance officers, attorneys, professional
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societies
Center for Medicare and Medicaid Services
(CMS)
Office of Inspector General, Department of
Health and Human Services(OIG)
Prosecutors
Private whistleblowers and their counsel
Government contractors
HOW ARE FRAUD AND ABUSE
LAWS ENFORCED?
• Denial or authorization of payment(CMS and its contractors, state
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agencies, CSC)
Issuing bulletins, guidances, opinions, manuals, regulations(CMS
and its contractors, OIG, state Medicaid agencies, OMIG,CSC)
Investigating fraud allegations(OIG, state IGs,OMIG, state MFCUs)
Prosecuting civil and criminal fraud cases
Prosecuting administrative sanctions and exclusion cases(OIG,
OMIG)
ENTERING SETTLEMENTS, CONSENT ORDERS(EVERYONE)
Deferred prosecution agreements(DOJ so far, states?)
HOW ARE FRAUD AND ABUSE
LAWS ENFORCED?
• STATE EXCLUSION PROCEEDINGS
• STATE TERMINATION PROCEEDINGS 18 NYCRR
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Public disclosure-NY website list beginning
January 1, 2010 of providers who bill for dead
patients
Review of mandatory compliance program
effectiveness-New York-18 NYCRR 521
THE NEXT PAYMENT REFORM
WILL BE QUALITY AND OUTCOMES
BASED
• PREDICTION: THE SHIFT TO QUALITY BASED
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REPORTING AND PAYMENT WILL HAVE
INDUSTRY EFFECTS GREATER THAN THE SHIFT
FROM COST REIMBURSEMENT TO DRGs.
MOVING FRAUD AND ABUSE ISSUES TO
QUALITY REPORTING
INCREASES NEED FOR ATTORNEYS WITH
CLINICAL BACKGROUND OR INTEREST
(RN/JDs,Pharm.D./JDs)
COMPLIANCE AS ENTERPRISE RISK
• JUNE 19,2009 HOUSE HEALTH CARE
DISCUSSION DRAFT-
– 10 point mandatory compliance plan for certain
health providers and suppliers-similar to New York
regulation
– Section 1641 of discussion draft-Medicare provider
must return overpayment, provide statement in
writing of reason for overpayment
– Growth in compliance and oversight of compliance
HOT NEW ISSUES IN HEALTH
CARE FRAUD
• MEDICAID IS NEWEST AREA OF
EMPHASIS-CMS ROLE WITH STATES
• “EFFECTIVE” COMPLIANCE PLANS-EVERY
PROVIDER SHOULD HAVE ONE
• STATE BASED EXCLUSIONS
• QUALITY/OUTCOMES
• MANDATORY REPORTING
• NEVER EVENTS/READMISSIONS
FREE STUFF FROM New YorkOMIG websiteWWW.OMIG.State.ny.us
• Model compliance programs-hospitals, managed care
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(coming soon)
Over 1000 provider audit reports, detailing findings in
specific industry
70 page work plan issued 4/24/09-shared with other
states and CMS, OIG
Listserv
New York excluded provider list
Disclosure protocol
Job openings
WANT A COPY-OR MAKE A
COMMENT
• [email protected]
• 518 473-3782