Health law is the federal, state, and local law, rules, regulations and other jurisprudence among providers, payers and vendors to the healthcare industry and its patient and delivery of health care services; all with an emphasis on operations, regulatory and transactional legal issues.
Almost two years after “Operation Brace Yourself” regarding purported telemedicine and orthotic bracing fraud made national headlines, on February 4, 2021 the Department of Justice Announced that a major player in that fraud – Florida businesswoman Kelly Wolfe – recently pled guilty to criminal health care and tax fraud charges.
Operation Brace Yourself was a 2019 crackdown on the illegal use of telemarketing and telemedicine to generate fraudulent claims for DME orders, whose reach spanned continents and ultimate implications defrauded taxpayers out of billions of dollars.
According to the Department of Justice Press Release and Settlement Agreement, Mr. Wolfe was seemingly a significant mastermind in establishing hundreds of DME companies that went on to defraud US taxpayers and Medicare beneficiaries.
Here are some highlights of the recently signed Settlement Agreement between the United States DOJ, Kelly Wolfe and her company Regency, Inc. read more
Since the beginning of the COVID pandemic many healthcare businesses are exploring various ways to increase their referrals, and although exchanging fees and gifts in return for referrals may sound like an easy way to obtain additional business, there are state and federal laws that strictly prohibit such activities that are discussed in greater detail below.
Two of the most important laws that all physical therapists should be aware of are the Anti-Kickback Statute and the Stark Law which are used to ensure that medical decisions are not made based on financial incentives. However, each of the laws do have distinctions that you need to be aware of. read more
When an overpayment is identified in Medicare Part A or B claims, providers can contest the overpayment amount by using the Medicare administrative appeals process. Because of the large difference between overpayment amount in a sample from an extrapolated amount, the OIG states that it is critical for the review process during an appeal to be fair and consistent. In the first and second levels of Medicare appeals (redetermination and reconsideration) extrapolated overpayments are reviewed by MAC (Medicare Administrative Contractors) and by QICs (Qualified Independent Contractors).
The OIG audit was to make sure that the MACs and the QICs reviewed the appealed extrapolated overpayments consistently and in compliance with CMS requirements.
What OIG found was that CMS did not always provide sufficient guidance and oversight to ensure that these reviews were performed in a consistent manner. The most significant inconsistency identified was the use of a type of simulation testing that was performed only by a subset of contractors. The test was associated with at least $42 million in extrapolated overpayments that were overturned in fiscal years 2017 and 2018. read more
CMS has rolled out a telehealth/telemedicine tool kit to assist medical professionals with health care delivery during the current COVID-19 public health emergency.
The toolkit contains information and links concerning:
1135 Waivers – allows the Secretary of HHS to temporarily waive or modify certain Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) requirements to ensure sufficient health care services and items are available to meet the needs of individuals enrolled in Social Security Act programs during the emergency and that providers who provide services in good faith can be reimbursed and exempted from sanctions (provided there is no determination of fraud and abuse). 1135 waiver or modifications include:
Conditions of participation and other certification requirements;
Program participation and similar requirements;
State licensing requirements where services are rendered as long as the provider has equivalent licensing in another State (for Medicare, Medicaid, CHIP reimbursement only; State licensing still controls whether a non-Federal provider may provide services in a state he/she is not licensed in);
EMTALA sanctions for redirection for medical screening, as long as redirection is not the result of discrimination on the basis of a patient’s source of payment or ability to pay;
Stark self-referral sanctions;
Adjustment (not waiver) to performance deadlines and timetables;
Limitations on payment to permit Medicare enrollees to use out of network providers in an emergency situation.
HHS found that a home health agency incorrectly billed Medicare and did not comply with Medicare Billing requirements for beneficiaries that were not homebound and for others that did not require skilled services at all.
In August and September 2018, physicians and the owner of a home health agency were each sentenced on multiple counts of conspiracy and healthcare fraud and ordered to pay $6.5 million in restitution. One physician was sentenced to 132 months in prison following trial. A physician who pled guilty was sentenced to 27 months in prison following a guilty plea. The home health agency owner was sentenced to 42 months in prison. The defendants paid and received kickbacks in exchange for patients and billed Medicare more than $8.9 million for services that were medically unnecessary, never provided, and/or not otherwise reimbursable. Additionally, certain defendants provided prescriptions for opioid medications to induce patient participation in the scheme.
In September 2018, the co-owner and administrator of a home health agency was sentenced to 24 months in prison, ordered to pay over $2.2 million in restitution, and ordered to forfeit over $1.1 million. The co-owners participated in a home healthcare fraud conspiracy that resulted in Medicare paying at least $2.2 million on false and fraudulent claims. The owners and their co-conspirators paid kickbacks to doctors and patient recruiters in exchange for patient referrals, billed Medicare for services that were medically unnecessary, and caused patient files to be falsified to justify the fraudulent billing.
Back in February 2018, the owner of more than twenty home health agencies was sentenced to 240 months in prison and ordered to pay $66.4 million in restitution, jointly and severally with his co-defendants, after pleading guilty to one count of conspiracy to commit health care fraud and wire fraud. A patient recruiter for the home health agencies, who also owned a medical clinic and two home health agencies of her own, was sentenced to 180 months in prison. Another patient recruiter, who also was the owner of two home health agencies, was sentenced to 115 months in prison. These conspirators paid illegal bribes and kickbacks to patient recruiters in return for the referral of Medicare beneficiaries many of whom did not need or qualify for home health services. Medicare paid approximately $66 million on those claims.
Illegal kickbacks in exchange for referrals of Medicare beneficiaries, lack of medical necessity for home health services, failing to meet the guidelines, fraudulent billing, billing for services beneficiaries did not receive and fraudulent documentation continues to plague the home healthcare industry.
A Final Rule recently issued by CMS will require Medicare, Medicaid, and CHIP (Children’s Health Insurance Program) providers and suppliers to disclose current and previous affiliations (direct or indirect) with a provider or supplier that: (1) has uncollected debt; (2) has been or is excluded by the OIG (Office of Inspector General) from Medicare, Medicaid or CHIP, or (3) has had its billing privileges with either of these three programs denied or revoked. Such provider affiliations may lead to enrollment being denied if it poses a risk to fraud, waste or abuse. read more
Over the past several months, the Centers for Medicare & Medicaid Services (CMS) has taken a number of steps that show an awareness of the regulatory burden placed upon participants in the government’s health care programs, and even some willingness to consider reducing those burdens. While it remains to be seen whether the recent proposals will have measurable results, the following actions can still be viewed with guarded optimism.
Proposed Changes to Medicare
In July, 2018, CMS proposed significant changes to Medicare, to be included in rules that take effect in 2019. These changes cover physician fee schedules, streamlining Evaluation & Management (E&M) billing, advancing “virtual care,” decreasing drug costs, revising the MIPS program and establishing the MAQI demonstration project. The agency also asked for comments on price transparency issues. read more
The transition from paper medical records to electronic medical records has brought with it many conveniences and some unintended consequences. One example of an unintended consequence is cloning in the medical record. Cloning is copying and pasting previously recorded information from a prior patient note into a new patient note.
Providing quality medical care is only one part of the job. Appropriately documenting that care in order to be paid for your efforts is another. And while medical professionals are trained at length to provide care, hardly any are aware of the potential pitfalls associated with improper documentation.
As noted in Opting Out of Medicare Part I, opting out of Medicare may be an option for some physicians and practitioners. After determining whether you are eligible for opt-out or if it is financially feasible, there are a few other considerations. Part I discussed the Private Contract a physician must enter into with each Medicare beneficiary he or she treats; here, we will address the opt-out affidavit and other nuances of opting out. Let’s get started!
The Medicare Opt Out Affidavit
Provisions in an Opt Out Affidavit are similar to provisions that must be included in the opted out physician’s or practitioner’s private contract with Medicare beneficiaries. The opt-out affidavit must state that the physician or practitioner will only provide services to Medicare beneficiaries with whom they have a written and signed private contract and that the physician or practitioner will not submit claims to Medicare on behalf of Medicare beneficiaries. Medicare does allow for an exception here, but that is only when an opted out physician or practitioner treats a Medicare beneficiary who is not under private contract, and that beneficiary presents with a medical emergency or urgent care problem. Keep in mind, that if a Medicare beneficiary presents with a medical emergency or urgent care problem, the physician or practitioner cannot require that patient to sign a private contract at that time. read more
The Centers for Medicare & Medicaid Services (CMS) relies on its Medicare Administrative Contractors (MACs) to serve as guardians of the Medicare trust fund through the MACs taking steps to prevent improper payments. Despite that reliance, in its most recent report to the US Senate Finance Committee, the Government Accountability Organization (GAO) reports that improper payments totaling $41.1 billion (no, that is NOT a typo, that is a “b”) occurred during 2016 in the Medicare fee-for-service program . That figure represents an overall 11% percent improper payment rate.
How many of us would feel good about being “wrong” in our core job function 11% of the time? Not very many of us, I suspect.
The GAO report goes on to quote the MACs as generally having ongoing concerns about the following types of claims as those which pose the greatest financial risk to the Medicare trust fund.
Short inpatient acute care stays and claims for both skilled nursing and inpatient rehabilitation
Evaluation and management (including office visits, hospital visits, emergency room visits, and home visits for assisted living and nursing homes) and ambulance services
Home health therapy services and home health or hospice stays that were longer than average
So, what does CMS plan to do to hold its MACs more accountable and to further the objective of reducing improper payments? On August 14th CMS announced an expansion of an ongoing pilot program “Targeted Probe and Educate” Medical Reviews (TPE).
7 Things to Know
The basics of what the provider and supplier communities need to know about the TPE program follows.
The silver lining here is that providers and suppliers with minimal aggregated billing pattern deviations from their peer group coupled with good audit track records may now experience fewer MAC medical review audit requests.
TPE will be concentrated on providers and suppliers with “the highest claim error rates or billing practices that vary significantly from their peers”.
In the first round of reviews, MACs will review a 20-40 record probe sample of claims for each lucky provider or supplier selected to participate in TPE.
Providers and suppliers who perform well during the first TPE audit, or who demonstrate significant improvement during the second or third audit may be removed from the TPE audit cycle for a period of up to 12 months.
Each provider and supplier with moderate and high error rates during round one TPE audits will receive provider-specific education, be given approximately 45 days to improve its rate of compliance, and will advance to a bonus round two TPE audit.
Providers and suppliers who fail to improve during the round two TPE audit will again receive provider-specific education, be given another 45 days to improve processes and controls to improve rates of compliance, and will advance to the third round of TPE audits.
Providers and suppliers who perform poorly during the final TPE audit round could be placed on 100% prepayment review, be subject to the dreaded “extrapolation”, and/or be referred to the appropriate Recovery Auditor, Zone Program Integrity Contractor or a Unified Program Integrity Contractor. It goes without saying that none of these are desirable outcomes.
7 Steps to Readiness
Many providers and suppliers are outliers relative to some component of their billing pattern. Use all the resources at your disposal to “know your numbers” and where your areas of exposure or risk most likely exist.
Closely review results and findings from any recent internal audits or reviews conducted pursuant to your compliance program.
If you have experienced recent external medical review audits, evaluate those results. If there were denied claims, identify the issue or issues leading to the denials. Then, identify the root causes of errors. Finally, and most importantly, resolve the problems which lead to denied claims.
If you provide health care services in any of the areas mentioned above which are deemed highest risk by the MACs, examine on your billing patterns in those service lines.
Pay attention to what your MAC says about TPE and areas of emphasis for audit. If you provide those health care services, examine your billing in those areas.
Drill down into any area where your billing pattern materially deviates from your peer group and make sure you understand the basis for the deviation.
If there is no obvious business rationale or justification for a considerable deviation from the “norm” do a deeper dive of your charge capture and billing practices to determine whether any process or practice needs further evaluation and/or adjustment.
These suggestions should position you for a successful outcome if / when you are selected to participate in the TPE audit program.