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Posts Tagged ‘Self Disclosure’

Using the Self Disclosure Protocols to Minimize Risk

Tuesday, June 27th, 2017

When to Use the OIG’s Self Disclosure Protocols

Self Disclosure Mitigate RiskThe HHS Office of Inspector General offers providers an opportunity to self-disclose certain violations in exchange for avoiding some of the more draconian penalties that may otherwise apply under applicable regulations.  Even though the OIG’s Provider Self-Disclosure Protocols (“SDP”) can be very compelling, the decision whether to utilize the OIG’s self-disclosure protocols is often very difficult.

To begin, the SDP is not available in all situations.  The SDP is limited to situations that potentially violate Federal criminal, civil, and administrative laws for which Civil Monetary Penalties are authorized.  The SDP requires the disclosing party to Continue

Using Self-Disclosure Protocols – CMS and OIG Self Disclosure Process

Tuesday, April 11th, 2017

Self-Disclosure Has Become a Normal Part of the Compliance Process

As the OIG and CMS make self-disclosure easier for providers, we have noticed an increase in the rate of cases that are being filed.  Assisting providers in making decisions whether to self-disclose, conducting internal investigations, and guiding the self-disclosure process when appropriate has become a large part of our compliance practice.  Here are just a few of the articles and other resources that we have released regarding self-disclosure issues:

Exercising Reasonable Care to Identify and Address Potential Overpayments

Criminal Exposure for Failing to Repay Known Overpayment

When to Use the OIG’s Self Disclosure Protocols

Excluded Party Cases Dominate OIG Published Self Disclosure Settlements

Self-Disclosure Process – Voluntary Self Disclosure Decisions are not Always Easy

When Does An Overpayment Become Fraud? How Simple Inattention Can Expose You to Penalties for Fraudulent Activities

Provider Self-Disclosure Decisions – Voluntary Disclosure Process

Provider Self Disclosure Process

For more information on the self-disclosure process and legal updates impacting the process, watch this space.

Excluded Party Cases Dominate OIG Published Self Disclosure Settlements

Friday, March 17th, 2017

Using SDP Self Disclosure Protocol – Excluded Party Disclosures

CMS Self DisclosureIn 2013, the HHS Office of Inspector General issued revised protocols outlining the process through which health care providers are able to self-disclose and resolve potential liability under the OIG’s civil monetary penalty (CMP) authorities.  The 2013 Self Disclosure Protocols (SDP) clarified the process of self-disclosure and provided answers to some of the questions that were previously impeding provider use of the self-disclosure process.  One area that the SDP clarified involved the calculation of damages where a provider discovers that an employee has been excluded from the Medicare and Medicaid programs.  When a provider is a “direct billing” provider, such a physician, it is relatively easy to identify the billings that are attached to that provider.  Prior to 2013, the process for estimating damages was unknown for employees that do not directly bill federal programs for their services.

The 2013 SDP contained a suggested process for estimating damages when non-billed employees are excluded from the program.  The process is based on the cost of employing the excluded individual.  This made it much easier for providers to use the SDP in these circumstances.  Review of the recently settled self-disclosure cases confirms that the process is working to encourage providers to use the SDP in cases involving exclusions.  The SDP uses a multiple of 1.5 times estimated program damages as a minimum baseline for settling SDP cases.  Calculation of damages resulting from exclusion involve identification of billing for the services of a physician or other provider that receives reimbursement for their services.  Other employees, such as nurses, medical assistants, administrative staff and others, use the estimated cost of employment method.

By my count there appears to have been a total of 49 excluded party SDP settlements from the beginning of 2016 through the date of publication of this article.  This is reflective of the clarified procedure in the 2013 SDP.  Settlement amounts range from around $10,000 to a high of around $800,000.  The higher dollar amount settlements likely relate to multiple excluded parties, long term employees, or large dollar “direct bill” employees.

Self Disclosure Settlements Help Identify Compliance Risk Areas

Friday, January 27th, 2017

Self Disclosure Settlements Indicate Areas of Compliance Risk

Compliance officers can identify areas of potential compliance risk in a number of ways.  One way is to examine self disclosure settlements under the Stark Law and OIG self disclosure process.  This helps indicate issues that other providers are disclosing to the government and can help identify potential risk areas within your organizations.

Here are a handful of self disclosure settlements that have been published:

A Massachusetts hospital settled several Stark law violations involving failure to satisfy the requirements of the personal services arrangements exception with department chiefs and medical staff for leadership services, and for arrangements with physician groups for on-site overnight coverage for patients at the Hospital. Settlement Amount – $579,000.00

An Ohio physician group practice settled two Stark law violations involving prescribing and supplying a certain type of DME that did not satisfy the requirements of the inoffice ancillary services exception. Settlement Amount – $60.00

A Mississippi critical access hospital settled several violations of the Stark law relating to its failure to satisfy the requirements of the personal services arrangements exception for arrangements with hospital and emergency room physicians. Settlement Amount – $130,000

A California hospital settled two Stark law violations that exceeded the annual nonmonetary compensation limit for physicians. Settlement Amount – $6,700

A hospital in Georgia settled violations involving two physicians and the annual nonmonetary compensation limit. Settlement Amount – $4,500

A physician group practice in Iowa settled Stark law violations after disclosing that its compensation for certain employed physicians failed to satisfy the requirements of the bona fide employment relationship exception. Settlement Amount – $74,000

An Arizona acute care hospital settled a Stark law violation after disclosing a single physician arrangement that did not meet the personal service arrangements exception. Settlement Amount – $22,000

A hospital located in North Carolina settled six Stark law violations for $6,800 after disclosing that it exceeded the calendar year nonmonetary compensation limit for two physicians during three consecutive years. Settlement Amount – $6,800

An Alabama hospital resolved a Stark violation involving a rental charge formula that did not satisfy the requirements of the rental of equipment exception. Settlement Amount – $42,000

A hospital in Maine settled potential Stark law violations relating to arrangements with a physician and physician group practice that failed to satisfy the requirements of the personal services exception. Settlement Amount – $59,000

A Massachusetts hospital settled violations concerning arrangements with two physician practices for call coverage that did not satisfy the personal service arrangements exceptions. Settlement Amount – $208,000

A hospital located in Florida resolved arrangements with three physicians that did not satisfy the personal service arrangements exception. Settlement Amount – $22,000

A Missouri hospital settled Stark law violations involving two physicians for the provision of dental services that did not meet the requirements of the personal service exception. Settlement Amount – $125,000

A North Carolina-based general acute care hospital and its hospice agreed to settle several Stark law violations involving arrangements and payments that failed to meet the physician recruitment, fair market value, and personal services arrangement exceptions. Settlement Amount – $584,700

A hospital in California settled a Stark law violation, which arose from its failure to meet the physician recruitment exception. Settlement Amount – $28,000

An acute care hospital in California settled a violation of the Stark law after disclosing that it failed to meet the personal service arrangements exception for an on-call arrangement with a physician. Settlement Amount – $1,600

A South Carolina general acute care hospital settled several violations of the Stark law involving arrangements with physicians and physician group practices that failed to satisfy the requirements of the FMV compensation exception, the personal services arrangements exception, and the rental office space exception. Settlement Amount – $256,000

A Massachusetts acute care hospital settled several Stark law violations involving arrangements with physicians that failed to satisfy the definition of “entity”, the rental office space exception, and the personal services arrangement exception. Settlement Amount – $199,400

A Louisiana acute care hospital used the SRDP to resolve violations related to professional service arrangements with physicians, a professional staffing organization, and a physician group practice. Settlement Amount – $317,620

A Minnesota hospital agreed to settle a Stark violation that stemmed from a recruitment arrangement that failed to satisfy the requirements of the physician recruitment exception. Settlement Amount – $760.00

A Texas rehabilitation hospital resolved several Stark violations through the SRDP involving arrangements for ownership interests held by certain physicians that failed to satisfy the whole hospital exception. Settlement Amount – $23,730

A general acute care hospital in New York agreed to settle a violation of the Stark law that involved an arrangement that failed to satisfy the requirements of the rental office space exception. Settlement Amount – $78,500

A Florida acute care hospital settled several Stark violations relating to arrangements with multiple physicians for emergency cardiology call-coverage that did not satisfy the requirements of any applicable exception. Settlement Amount – $109,000

A general acute care hospital in Florida settled several Stark violations involving arrangement with a group practice to provide residency program services, a physician to provide electronic health records subject matter expert services, a physician to provide Medical Director services, and a physician to provide leadership services for a hospital committee, none of which satisfied applicable exceptions. Settlement Amount – $76,000

An Alabama acute care hospital resolved a violation of the Stark law involving an arrangement with a physician group practice for the rental of office space that did not satisfy the exception. Settlement Amount – $187,340

A Wisconsin critical access hospital used the SRDP to resolve a violation of the Stark law relating to an arrangement with one physician for the provision of emergency room call coverage services at adjacent walk-in clinics that failed to satisfy any applicable exception. Settlement Amount – $12,724

A Tennessee acute care hospital settled a Stark violation involving an arrangement with one physician for the supervision of cardiac stress tests that failed to satisfy the requirements of any applicable exception. Settlement Amount – $72,270

An acute care hospital in Pennsylvania resolved several Stark violations related to arrangements for Medical Director services with certain physicians and a physician practice that did not satisfy the personal services exception. Settlement Amount $24,740

A general acute care hospital in Ohio used the SRDP to settle violations of the Stark law that involved arrangements with certain physicians for EKG interpretation, medical director services, Vice-Chief of Staff services, and hospital services that did not satisfy the requirements of any applicable exception. Additional violations stemmed from arrangements with certain physicians and a physician group practice for the donation of EHR items and services that failed to satisfy the applicable exception. Settlement Amount $235,565

A Texas acute care hospital settled a Stark violation involving an arrangement for case management physician advisor services with a physician that did not satisfy the requirements of any applicable exception. Settlement Amount – $54,108

A physician group practice in Louisiana resolved a Stark violation relating to arrangements with two physicians that failed to satisfy the requirements of the in-office ancillary services exception. Settlement Amount – $13,572

A non-profit community hospital in Minnesota settled a violation of the Stark law that involved an arrangement with a physician group practice for the rental of office space and provision of support services that failed to satisfy the requirements of any applicable exception. Settlement Amount – $9,570

A California acute-psychiatric hospital resolved two Stark violations relating to arrangements with two physicians for the provision of psychiatric services that did not satisfy the requirements of any applicable exception. Settlement Amount – $67,750

A North Carolina acute care hospital used the SRDP to settle several violations of the Stark law relating to arrangements with a physician to provide Medical Director Services, a physician group practice to provide medical coding and consulting services, and a physician and a physician group practice for the lease of office space, that failed to satisfy the requirements of any applicable exception. Settlement Amount – $87,110.00 19.

A general acute care hospital in Texas resolved a Stark violation involving an arrangement with a physician to provide utilization review services that did not satisfy any applicable exception. Settlement Amount – $82,055 20.

A California acute care hospital resolved several violations of the Stark law involving arrangements with three physicians for the provision of on-call services to the Hospital’s emergency department that did not satisfy the requirements of any applicable exception. Settlement Amount – $42,630 21.

An acute care hospital in Oklahoma used the SRDP to settle several Stark violations relating to arrangements with four physicians for the provision of electrocardiogram interpretation services that failed to satisfy the requirements of the personal services exception. Settlement Amount – $124,008

Voluntary Self Disclosure Decisions Can Be Complicated

Tuesday, April 8th, 2014

Provider Self Disclosure Decisions – Voluntary Disclosure Process

OIG Self Disclosure DecisionsThe decision whether or not to voluntarily disclose to the government can be very difficult.  Not every case is clear.

Clearly not every situation where there has been a billing error amounts to fraud or wrongdoing requiring use of the self-disclosure protocol.  Many over-payments that are identified through audit can be dealt with at the intermediary level.  Where investigation raises questions about whether incorrect bills are “knowingly” submitted, the self disclosure process may provide some mitigation of potential loss.  Situations where the provider perhaps “should have known” raise more difficult issues of analysis.

The situation is also complicated because a potential whistle-blower may view a situation much differently than a provider who finds what it believes to be an innocent mistake through the audit process.  A provider may sincerely believe that there was no “wrongdoing” and that a simple mistake has been identified.  Finding such a mistake may actually be evidence that the provider’s compliance efforts are working.  On the other hand, there is a whole legal profession out there now that is advertising for people to come forward with these types of mistakes.  With potential recover under the False Claims Act of 3 times the over-payment plus $11,000 per claim, these lawyers have strong incentive to attempt to turn what the provider believes to be an innocent mistake into a false claim.  This presents risk, even in the more innocent cases involving billing errors.

Generally speaking, when errors are discovered, the providers best bet is to be forthright and deal with the matter “head on.”  A complete internal investigation should be conducted to determine the precise nature of the issues and to identify the extent of wrongdoing.  Based on the outcome of the investigation, the provider can determine whether a simple repayment can be used or whether there may be reason to go through the formal self disclosure process.

Anyone who has worked with reimbursement rules will realize that payment policies, rules and regulations are not always clear.  At times it is difficult to determine whether there is even a violation of applicable rules.  Legal ambiguities further complicate the self disclosure decision.  The precise nature of any legal ambiguities involved in the specific case need to be completely documented.  If a decision is made that there has been no wrongdoing, the legal analysis should be laid out in writing and in detail and a reasonable judgment should be made regarding the interpretation of applicable legal standards.  If self disclosure is made in situations involving legal ambiguities, those ambiguities should be explained in detail as part of the self disclosure.

In the end, a provider facing potential self disclosure must follow a reasonable process to make a reasoned decision.  All elements forming the basis for the reasonable determination must be documented.  In cases of apparent wrongdoing, the provider can expect that its decision will be questioned at some point in the future.  Every step should be taken under that assumption.

Auditing Physician Payments For Stark Law Compliance

Thursday, April 3rd, 2014

One area of compliance that is often overlooked involves auditing of physician payments.  Physician contracts are often audited to determine whether they comply with a Stark Law exception.  Compliance should also work in the other direction, from payments that are made back to the existence of a contract that memorializes an applicable Stark Law exception.

Periodic monitoring of payments that are made to physicians should be undertaken.  Payments should be tracked to contracts to assure that the payment is covered by an applicable exception.  If there is no corresponding written agreement or if the written agreement has expired, there could be a potential Stark Law violation.  Further examination concerning the nature and purpose of the payment should be made.  If a Stark Law violation is found, self disclosure should be considered.

Wednesday, April 2nd, 2014

From HCCA Compliance Institute – False Claims Act Developments

I am in the morning session of HCCA Compliance Institute covering False Claims Act issues.  Some interesting items being covered.  I will summarize a few of the major points being made and will provide some additional analysis and observations on some of these points.  Forgive my typos or poor writing.  I am blogging live from within the session on my handheld device.

  • This discussion is in the context of the False Claims Act and determining whether there is an obligation to self disclose or take other remedial action.  The following points are made:
  • Ambiguities in the law will be identified that cast doubt on whether or not a violation exists.  A provider cannot bury its head in the sand.  If relying on a legal interpretation on whether and overpayment or self disclosure should take place, make certain to document the process you took to make a reasonable determination on how a law applies.  Reasonable efforts should be documented to indicate that a reasonable assessment was made and a reasonable determination was made concerning interpretation.
  • I always advise providers to completely document their investigation of issues regarding application of specific laws.  The process taken should be documented to memorialize that a reasonable decision was made concerning potential legal application.
  • Reasonable steps should be taken to reach an answer.  If guidance is sought from an FI or state agency, the contact and results should be documented in the investigation process.  Many ambiguous cases of legal interpretation come through my office.  I tend not to see the easy cases.  I get the cases where the answer is not entirely clear or well defined under legal authorities.  Response from legal review should be provided to you in writing as privileged communication.  If there are any false assumptions made in the legal analysis, make certain they are properly addressed and that the opinion is properly modified to be based on the correct assumptions.
  • You should never chose to simply ignore legal advice and opinion on interpretation of a legal issue.  Failing to follow a legal opinion or analysis can create very bad evidence in your files.  If there is disagreement or a false assumption in the legal opinion, it is fair to address the issue and ask for a correction.  But you should never put yourself in a position of putting your head in the sand when you have a legal opinion or analysis that you simply do not like.

More on false claims act coming.

New 2013 Self Disclosure Protocols

Wednesday, April 2nd, 2014

An OIG representative spoke about the new revised self disclosure protocols at a recent HCCA seminar that I attended.  The OIG felt it was appropriate to be more transparent regarding the process for self disclosure.  A few points were highlighted in this session:

  1. The OIG held its own feet to the fire by acknowledging the 1.5 damage multiplier when the self disclosure protocol is used.  They will need to justify if they are going to ask for more.
  2. Self disclosure is not admission of liability.  However, you will be required to make a settlement and payment if you make a self disclosure.
  3. Self disclosure is not to be used to get an interpretation of whether your activity was wrongful or whether a law was violated.
  4. Decision not to self disclose leaves you open to potential whistleblower complaints.  False Claims Act potential remains for the ten-year False Claims Act statute of limitation.
  5. Repayment can go to the fiscal intermediary if there is no wrongdoing but there is still an overpayment.
  6. Self disclosure requires disclosure of how your investigation was conducted.  If the investigation was conducted under privilege, you will need to disclose privileged information on investigation under privilege.
  7. The only party that can give you a False Claims Act release is the Department of Justice (“DOJ”).  The DOJ does not have a formal process for obtaining a signoff from the DOJ.  There is an option to go to the DOJ to get a waiver of False Claims Act remedies.
  8. Protocol requires the provider to have done some level of fraud investigation before they self disclose.  OIG likes to see more work done on the front end.
  9. The OIG coordinates with the DOJ on all investigations.  The DOJ may elect to defer or to participate.  If the DOJ participates, there will also be a False Claims Act issue.
  10. Even if you enter a settlement with the OIG, you may still be open to a False Claims Act action by a whistleblower.  However, there would have been a public disclosure which may cut off a potential whistleblower.
  11. OIG does not go to DOJ until they develop the case and know what they are dealing with.
  12. Intent to make calculation of damages simpler.  They now use 100 claim sample to determine damages.  They tend to take the midpoint on damage calculations.
  13. Thirty to forty percent of self disclosures involve excluded parties.  The new protocols includes more detail on how to self disclose based on excluded parties, OIG requires exclusion checks for all providers are required before submitting a self disclosure.
  14. The self disclosure protocols include a formula for calculating damages when there is no direct billing for an excluded party.  The formula includes multiplying the total cost of employment by the payor mix percentage for federal health care programs.

RAT-STATS – What Is Rat-Stats?

Tuesday, March 11th, 2014

RAT-STATS and Statistical Estimation of Overpayments

 

rat-stats statistical samplingRAT-STATS is a free software that is offered by the federal government to assist health care providers with statistical sampling.  Statistical sampling models can be used by health care providers to statistically estimate required overpayments based upon a statistically valid sample.  The RAT-STATS package was developed by the Office of Inspector General to assist providers with random sampling.

The RAT-STATS software suite helps make the random sampling process much easier for providers.  Generally, the RAT-STATS can be used to run a small number of claims in an initial probe audit.  The probe audit will suggest whether problems might exist with a defined, randomly selected parameter of claims.  The sample size estimator function will provide sample sizes for complete audits that can statistically extrapolate findings to estimate overpayments within a range of statistical accuracy.

If used properly, RAT-STATS can assist providers in the performance of defined area audits.  Based on identified problems, RAT-STATS can suggest the scope of further, more statistically reliable audit samples.  Based on the results of more complete audit, RAT-STATS can help estimate overpayments.

RAT-STATS is only a tool to help with statistical projection.  Judgment is required in the identification of risk areas that may require monitoring and auditing.  RAT-STATS can be a useful tool for providers to effectuate their compliance efforts.

False Claims Act Basics – Health Care False Claims

Thursday, February 6th, 2014

False Claims Act Basics

Overpayment Repayment 60 Day RuleThe False Claims Act (“FCA”) provides a very strong enforcement tool to the federal government.  The FCA also provides the opportunity for whistleblowers to bring “qui tam” cases and collect a portion of the recovery where false claims are proved against the federal government.

FCA recovery was originally intended to provide a remedy against unscrupulous civil war profiteers.  Penalties were enhanced when the FCA was dragged off the shelf in the 1980s in reaction to some of the overpricing of government contracts selling supplies to the federal government.

Recently, the FCA has become one of the government’s prime enforcement tools t o deter fraud in the federal health care programs.  Historically, the FCA has been available when a health care provider falsely bills for covered services.  Triple damages and an $11,000 per claim penalty provide a strong deterrent in an industry that may make hundreds of claims per day.

Recent legislation has expanded FCA liability to claims that the provider knows resulted in an overpayment if the provider does not make repayment within 60 days of obtaining knowledge of the wrongfully billed amount.  Some of the potential applications of this that makes a simple overpayment a false claim has generated much discussion among health care lawyers and compliance officers alike.  When an organization is deemed to have knowledge of the overpayment has been the subject of much speculation due to the ambiguities that exist in the new rule.

It may be helpful to frame this discussion by touching on the general requirements that must be met in order to prove any claim under the Federal False Claims Act.  The three general elements that must be proved include:

1.         The submission of a claim to the federal government.  In the health care context, the claim will normally be submitted to a government health program.

2.         The claim must be false.

3.         The claim must have been submitted knowingly.  Actual knowledge that the claim was false will always prove the knowledge requirement.  However, a FCA case can also be built around the submission of a claim with “reckless disregard” for its truth or falsity.

Recent health care legislation, in particular the Fraud Enforcement Recovery Act of 2009, greatly expanded the scope of the FCA.  The FCA is now applicable to a wide variety of situations that would not have previously been covered.  For example, the failure to return an identified overpayment now becomes a false claim.  The potential remedies that a provider may face for not promptly repaying known overpayments creates a strong incentive for health care providers to monitor and audit their claims and set up processes that will catch improper billing that could ripen into the FCA.

Reckless disregard or hiding your head in the sand like an ostrich is no longer a way to avoid massive potential FCA liability.

Compliance programs need to be amended appropriately to address the new potential legal and financial risk presented by these new penalties.

John H. Fisher

Health Care Counsel
Ruder Ware, L.L.S.C.
500 First Street, Suite 8000
P.O. Box 8050
Wausau, WI 54402-8050

Tel 715.845.4336
Fax 715.845.2718

Ruder Ware is a member of Meritas Law Firms Worldwide

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