Presentation on theme: "The Office of the Medicaid Inspector General and Other Friends"— Presentation transcript:
1The Office of the Medicaid Inspector General and Other Friends OMG! OMIG!The Office of the Medicaid Inspector General and Other FriendsHermes Fernandez Bond, Schoeneck & King, PLLC (518)
2The Office of Medicaid Inspector General Created by Statute (Chapter 442 of the Laws of 2006, Public Health Law sections 30-36)Independent office to detect, prevent and recover Medicaid fraud, abuse and illegal actsApproximately 700 employees
3The Medicaid Inspector General Jim Sheehan, appointed by Eliot SpitzerFormerly Deputy US Attorney in PhiladelphiaBrought a number of high profile cases against health care providers across the nation
5OMIG Audits Commenced by a notification letter Audit can cover six years from date of notification letterIf fraud, no time limitAudit must begin within 60 days, although OMIG can extend for another 60 days
6OMIG Audits Take the notification letter seriously Start gathering recordsDo not alter or correct records
7OMIG Audits Notification Letter may ask for more than case records Corporate Compliance PlanMinutesSurvey ResultsFinancial Statements
8OMIG Audits Audit begins with an entrance conference Pay attentionProvide the records requestedKeep lookingOn-site audit includes a closing (exit) conferenceDesk audit – no closing conference
9OMIG Audits Usually done by a statistical sample 100 samples, spread over four yearsSample and time can be differentResults are extrapolatedFindings are usually to a 90% confidence levelThis creates a range of potential overpaymentsLow point and midpoint are important
10OMIG Audits Exit Conference Preliminary Audit Report Very important Not required by regulationsVery importantRespond, keep lines openBest chance to shape the Draft Audit Report
11OMIG Audits Draft audit report Provider response is a legal response Findings and conclusionsProvider response is a legal responseThis is close to OMIG’s final recoupment demand
12OMIG Audit Provider response to draft audit due in 30 days Extensions usually grantedProvider must state all grounds for objection, e.g.:Statistical method improperServices were properly provided and recordedAudit period improper
13OMIG Audits Final audit report Hobson’s choice Comes with letter demanding recoupmentProvider has right to evidentiary hearing before DOH ALJHobson’s choiceIf no hearing, OMIG will accept low point estimateIf hearing, OMIG will seek mid-point estimateAt hearing, provider bears burden of proof
14OMIG Audit OMIG will usually recoup through a withhold Can be totalCan be reduced to 5% for undue hardshipRecoupments paid over time include interest
15OMIG AuditRecoupment continues through the hearing before the Administrative Law JudgeCan be reviewed through Article 78 processRecoupment continues through judicial processNarrow window for success in Article 78
16OMIG Audit Common bases of recoupment Missing records No notes Note inadequately describes serviceLapsed or untimely treatment planService does not tie to treatment planLack of credentialsMissing signature or date
17OMIG Sanctions Could follow audit, could come separately Investigation will look similar to auditNotice of proposed agency action30 days to respondExtensions are not automaticNotice of agency actionMay not include a right to administrative hearing
18OMIG Sanctions Unacceptable practices False claims Care not provided Care excessiveCare inadequateBills excessiveInadequate recordsEmploying an excluded person
19Immediate SanctionsDetermination of imminent danger due to provider’s continued participationExclusion first, hearing secondIndictment or conviction for false billingsState or federal exclusionImmediate withholds
20OMIG Sanctions Program exclusion Censure Prior authorization RecoupmentWith interest
21Self-Disclosure Necessary when overpayments have been identified Cannot be deliberately ignorantNeither should you hunt for unknown problemsTies into corporate compliance program
22Self-Disclosure Make a complete disclosure OMIG web-site has protocol Identify:Nature of ProblemHow DiscoveredClaims coveredCorrective actionCan be done through an intermediaryGood idea
23PPACA, FERA, and NY False Claims Act PPACA = Patient Protection and Affordable Care Act, signed by President Obama on March 23, 2010FERA = Fraud Enforcement and Recovery Act, signed by the President in May, 2009NY False Claims Act
24PPACA SECTION 6402(d) – REPORTING AND RETURNING OVERPAYMENTS ‘‘(1) IN GENERAL — If a person has received an overpayment, the person shall—‘‘(A) report and return the overpayment to the Secretary, the State, an intermediary, a carrier, or a contractor, as appropriate, at the correct address; and‘‘(B) notify the Secretary, State, intermediary, carrier, or contractor to whom the overpayment was returned in writing of the reason for the overpayment
25WHAT IS AN “OVERPAYMENT”? PPACA: ‘‘(B) OVERPAYMENT—The term ‘‘overpayment’’ means any funds that a person receives or retains under title XVIII (Medicare) or XIX (Medicaid) to which the person, after applicable reconciliation, is not entitled under such title”NEW YORK: “An overpayment includes any amount not authorized to be paid under the medical assistance program, whether paid as the result of inaccurate or improper cost reporting, improper claiming, unacceptable practices, fraud, abuse or mistake.” 18 NYCRR § 518.1(c).
26UNACCEPTABLE PRACTICES 18 NYCRR 515.2Conduct contrary to the rules and regulations of DSS, DOH, NYSED, OPWDD, OMH, OASAS, U.S. HHS, and specifically includes:False or fraudulent claimsBribes and kickbacksFailing to meet the standard of careEmployment of sanctioned personsUnacceptable recordkeeping
27WHEN MUST AN OVERPAYMENT BE RETURNED? An overpayment must be reported and returned . . .by the later of –(A) the date which is 60 days after the date on which the overpayment was identified; or(B) the date on which any corresponding cost report is due, if applicable
28WHEN IS AN OVERPAYMENT “IDENTIFIED”? OMIG: “identified” means learning of the fact that an overpayment has been received, not the amount of the overpaymentWhen do providers learn of the fact of an overpayment?
29WHEN IS AN OVERPAYMENT “IDENTIFIED”? PPACA: overpayments are funds received and retained “after applicable reconciliation”suggests that provider has an opportunity to “reconcile” whether an overpayment occurredInterview employeesAssess circumstancesConsult with counsel
30WHAT IF OVERPAYMENT MISIDENTIFIED? No obligation to report if your investigation concludes no overpayment was madeRisk is on provider who decides not to report
31DOCUMENT EFFORTS TO IDENTIFY OVERPAYMENTS Create a record of your organization’s efforts to address allegations of overpaymentsDevelop form to document employee’s internal disclosureDocument interviewsDocument evidenceRecord of employees involved in determinationTimely repayment as an element of an effective compliance program
32RETURNING OVERPAYMENTS TO NY MEDICAID Overpayments should be returned, reported, and explained to OMIGSelf-Disclosure ProtocolProviders may use void process through CSC for smaller or routine claims - $5,000 or lessBilling errorsLate reimbursementDocumentation anomalies
33STATE THE REASON FOR THE OVERPAYMENTS Duplicate paymentsServices not actually renderedPayment already made by primary insurancePayment for services rendered during a period of non-entitlement (patient's responsibility)Excluded providerPatient deceasedProvider lacked required license or certification
34MORE REASONS FOR OVERPAYMENTS Service inconsistent with physician order or treatment planService not ordered or authorizedOrder or service not sufficiently documented as required by regulation or policyPrescriptions, Treatment Plans, Progress NotesMissing signatures
35ENFORCEMENTPPACA 6402(d)(3) “ENFORCEMENT” — Any overpayment retained by a person after the deadline for reporting and returning the overpayment under paragraph (2) is an obligation (as defined in section 3729(b)(3) of title 31, United States Code) for purposes of section 3729 of such title. (False Claims Act)
36CONSEQUENCESFalse Claims Act imposes liability for a person who “knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government” new 31 U.S.C. 3729(a)(1) (G) added by FERA“knowingly” includes reckless disregard, deliberate ignorancePPACA makes clear that claims made for items or services resulting from a violation of the anti-kickback statute are false claimsOMIG View: an overpayment which is timely reported and explained will not give rise to FCA liability even if the provider is unable to repay it within 60 days, unless there is evidence of improper “avoidance”
37CIVIL MONETARY PENALTIES Knowing of an overpayment and failing to report and return within 60 days: $10,000 for each item or service overpaidKnowingly making a false record or statement material to a false or fraudulent claim: $50,000 for each false record or statementFalse statements, or omissions or misrepresentations on an application for enrollment: $50,000Failure to grant timely access for purposes of audit, investigation or evaluation: $15,000 per dayTreble damages
38INCENTIVE TO SUSPEND PAYMENTS Where “the State has failed to suspend payments under the plan during any period when there is pending an investigation of a credible allegation of fraud as determined by the State unless the State determines in accordance with [HHS] regulations there is good cause not to suspend such payments” CMS may recover payments from State
39CMS WITHHOLD REGULATION (42 C.F.R. 455.23) State Medicaid agencies may withhold payments based on “reliable evidence” of fraud or willful misrepresentationNotice must state that payments are being withheld in accordance with this sectionNew York has further authority
40OMIG WITHHOLD REGULATION (18 NYCRR 518.7) OMIG just needs “reliable information” that a provider is involved in fraud, abuse or an unacceptable practiceReliable InformationAuditUtilization review identifies unacceptable practice or significant overpaymentsState licensing board or agencyProsecutorial agency (MFCU)
41Excluded PersonsCannot work in a program funded by Medicaid (overstatement, but best guide)Fee or cost reportCrime by the excluded personCould be crime by the employerBilling for services delivered by excluded person subject to recoupmentOMIG maintains list on websiteCheck every thirty days
42CMS EXCLUSION REGULATION “No payment will be made by Medicare, Medicaid or any of the other federal health care programs for any item or service furnished by an excluded individual or entity, or at the medical direction or on the prescription of a physician or other authorized individual who is excluded when the person furnishing such item or service knew or had reason to know of the exclusion.” 42 CFR (b)
43NY EXCLUSION REGULATION 18 NYCRR Sanctions effect (continued):(b) No payment will be made for medical care, services or supplies ordered or prescribed by any person while that person is excluded, nor for any medical care, services or supplies ordered or prescribed in violation of any condition of participation in the program.(c) A person who is excluded from the program cannot be involved in any activity relating to furnishing medical care, services or supplies to recipients of medical assistance for which claims are submitted to the program, or relating to claiming or receiving payment for medical care, services or supplies during the period. (d) Providers reimbursed on a cost-related basis may not claim as allowable costs any amounts paid or credited to any person who is excluded from the program or who is in violation of any condition of participation in the program. (e) Providers reimbursed on a fee-for-services basis may not submit any claim and cannot be reimbursed for any medical care, services or supplies furnished by any person who is excluded from the program or which are furnished in violation of any condition of participation in the program.
44SCREENING DOH Medicaid Update April 2010 Vol. 26, No. 6 Providers have an obligation to screen employees, prospective employees, and contractors, both individuals and entities, to determine if they have been excluded or terminated from participation in federal health care programs or New York Medicaid
45SCREENING LISTS List of Excluded Individuals/Entities (LEIE) (OIG) List of Parties Excluded From Federal Procurement and Nonprocurement ProgramsRestricted, Terminated or Excluded Individuals or Entities
46IMPACT ON EMPLOYERSPotential Liability for Employing or Contracting with Excluded Individuals/Entities$10,000 civil monetary penalty for each item/service claimedPlus treble damages = amount claimed for each item/servicePossible exclusion for the provider-employerMust apply for reinstatement“Knows or Should Know” of the Employee’s ExclusionCheck the Exclusion Lists!OMIG: potentially amounts to a false claim under FCASeparate basis for administrative sanctions or exclusion
47OMIG COMPLIANCE EXPECTATIONS Check 3 exclusion lists for each new hireCheck 3 exclusion lists for contractorsCheck 3 exclusion lists for referral sourcesCheck 3 exclusion lists once each month for updatesRequire contractors to conduct similar checks on their employees and contractorsReport each verified hit on current employees and current contractors from any of three exclusion lists to OMIG through disclosure protocol
48COMPLIANCE PROGRAMS YOUR BEST DEFENSE NEW YORK REQUIRES . . . MEDICAID - $500,000+An effective planPPACA WILL REQUIRE . . .
49COMPLIANCE PROGRAMSAn effective compliance program in New York will satisfy PPACAOMIG Compliance Program8 Elements (18 NYCRR Part 521)
50COMPLIANCE PROGRAMSWritten policies and procedures that describe compliance expectations, as embodied in a code of conduct, implement the operation of the Program, and provide guidance on dealing with potential compliance issues.2) Designation of a compliance officer as the person vested with day-to-day operation of the Program.
51COMPLIANCE PROGRAMS3) Training and education on compliance issues, expectations, and Program operation.4) Establishment of communication lines to the compliance officer that are accessible to allow compliance issues to be reported.
52COMPLIANCE PROGRAMS5) Fair and firmly enforced disciplinary policies, to encourage good faith participation in the Program, and to outline sanctions for:Failing to report suspected problems;Participating in, encouraging, directing, facilitating, or permitting non-compliant behavior.
53COMPLIANCE PROGRAMS6) Systems for routine identification of compliance risk areas for self-evaluation of such risk areas, including internal audits and, as appropriate, external audits.7) Implementation of systems for responding to, investigating and correcting compliance issues, and for reporting and refunding overpayments.
54COMPLIANCE PROGRAMS8) Non-intimidation and non-retaliation for good faith participation in the ProgramReporting and investigating potential compliance issuesParticipating in self-evaluations, audits, and remedial actions
55Medicaid Fraud Control Unit Part of the Attorney General’s officeSimilar, but different authorities to OMIGHas civil and criminal authoritiesCan exercise OMIG audit authoritiesMakes referrals to OMIG for withholds, sanctions and penalties
56Medicaid Fraud Control Unit Executive Law § 63(12)Powerful enforcement tool“Repeated fraudulent or illegal acts”“Persistent fraud or illegality”Injunctions, restitution, damagesCivil subpoena authority – forced testimonyDoesn’t preclude criminal prosecution
57Medicaid Fraud Control Unit Criminal ChargesGrand LarcenyCivil RecoveryEither or bothConduct during investigation can tip the balance
58Self-incrimination Right to remain silent Everything you say can be used against youMedicaid providers have a duty to cooperate
59Stop talking The investigator is not your friend Call your attorney Only speak with your attorney presentEveryone you speak to is a potential witnessThe walls have ears
60Record Preservation Records must be preserved Electronic records, too Don’t alter recordsDon’t recreate missing records
61The Office of the Medicaid Inspector General and Other Friends OMG! OMIG!The Office of the Medicaid Inspector General and Other FriendsHermes Fernandez Bond, Schoeneck & King, PLLC (518)