AMERICAN AMERICAN OSTEOPATHIC OSTEOPATHIC ASSOCIATIONASSOCIATION

DEPARTMENT OF SOCIOECONOMIC AFFAIRS

Indiana Osteopathic Association

December 2, 2011

Socioeconomic Affairs StaffSocioeconomic Affairs Staff

• Yolanda Doss, MJ, RHIA, Director, Division of Socioeconomic Affairs

• Sandra Peters, Assistant Director, Clinical Practice Outreach

• Kavin Williams, CPC, CCP Health Reimbursement Policy Specialist

• Michele Campbell, CPC, Coding & Reimbursement Specialist

Yolanda Doss, MJ, RHIAYolanda Doss, MJ, RHIA

Responsibilities include:– Helping to secure reimbursement for

osteopathic services– Securing the acceptance of osteopathic

credentials– Addressing Medicare issues– HIPAA compliance– Fraud and Abuse

ComplianceCompliance

Objective: • To provide information related to the required

framework; the rules of the road for successful reimbursement – Recognizing and avoiding fraud and abuse

potholes– Knowing the governing regulations: Medicare,

Medicaid, False Claims Act, HIPAA, and Stark – Understanding your contractual obligations

Fraud and AbuseFraud and Abuse

• Fraud is the intentional deception or misrepresentation that an individual knows to be false or does not believe to be true. It’s the knowing that this deception or misrepresentation could result in some unauthorized benefit, such as reimbursement under the Medicare program

Fraud and AbuseFraud and Abuse

• Abuse are provider practices that are inconsistent with sound fiscal, business or medical practices (coding and billing) resulting in unnecessary costs to Medicaid or Medicare programs including reimbursement for services that are not medically necessary or that fail to meet professionally recognized standards of care

Combating Fraud and Combating Fraud and AbuseAbuse

• Defining fraudulent activitiesBilling DiagnosisClaim forms PaymentsKickbacks ChargesMisrepresentation Non-covered servicesGang visits Medicare provider

numbers

Combating Fraud and Combating Fraud and AbuseAbuse

• Co-payments and deductibles• Home health care• Suspect practices uncovered

– Free space or equipment– Training (Free)– Income guarantees– Payments

Combating Fraud and Combating Fraud and AbuseAbuse

Enforcement of the Statutes– Department of Justice (DOJ)-Federal laws– Office of the Inspector General (OIG)-

HHS– Medicaid Fraud Control Units & State

Attorney Generals

Combating Fraud and AbuseCombating Fraud and Abuse

• Department of Justice (DOJ) and Health and Human Services (HHS) Health Care Fraud Prevention and Enforcement Action Team (HEAT)

• A targeted criminal, civil and administrative effort

• The joint initiative was announced May 2009

Combating Fraud and AbuseCombating Fraud and Abuse

• The operations are now in eight areas: Tampa, Baton Rouge, Brooklyn, Detroit, Houston, Los Angeles, Miami and Chicago. The first phase of this effort began in 2007

• Chicago was most recently added in February of 2011.

Combating Fraud and AbuseCombating Fraud and Abuse

• The HEAT is ON• These are examples of reports that are now

regularly published by HHS and the DOJ:• 2011.04.14: Miami Doctor Convicted in $23 Million

Medicare Fraud Scheme• 2011.04.14: Two Owners of Miami-Area Mental

Health Care Corporation Plead Guilty to Orchestrating $200 Million Medicare Fraud Scheme

Combating Fraud and AbuseCombating Fraud and Abuse

• On March 10, 2010, the White House released a Presidential Memorandum Regarding Finding and Recapturing Improper Payments

• Memorandum for the heads of Executive Departments & Agencies

• Subject: Finding & Recapturing Improper Payments

Combating Fraud and AbuseCombating Fraud and Abuse

• Reclaiming the funds associated with improper payments is a critical component of the proper stewardship and protection of taxpayer dollars, and it underscores that waste, fraud, and abuse by entities receiving Federal payments will not be tolerated

Combating Fraud and AbuseCombating Fraud and Abuse

• Therefore, I hereby direct executive departments and agencies to expand their use of Payment Recapture Audits, to the extent permitted by law and where cost-effective. …

• Today, to further intensify efforts to reclaim improper payments, my Administration is expanding the use of "Payment Recapture Audits," which have proven to be effective mechanisms for detecting and recapturing payment errors

Combating Fraud and AbuseCombating Fraud and Abuse

Transparency through oversight

• Recovery Audit Contractors (RAC)

• HEAT

• Federal Payment Recapture Audits

• Private Payer Audits

Combating Fraud and Combating Fraud and AbuseAbuse

• OIG Sanctions list for September 2011– 352 entities or individuals– 9 Physicians – 2 DOs

The Best Defense is a Good The Best Defense is a Good OffenseOffense!!

The Compliance ProgramThe Compliance Program• Five Tips to Avoid Government Scrutiny as

provided by Foley and Lardner, LLP Attorneys Lisa M. Noller, Judith A. Waltz and Heidi A. Sorensen– Monitor Claims Submissions and Payments– Develop and Follow a Written Compliance Plan– Conduct Due Diligence on Employees and

Contractors– Consult With Outside Counsel– Assume a Criminal Investigation is Under Way

(if contacted by the HEAT)

The Compliance ProgramThe Compliance Program

• The United States Sentencing Guidelines were amended in November 2010 to allow for the reduction in a recommended sentence if a defendant could demonstrate the existence of an effective compliance and ethics program.

Seven Key ElementsSeven Key Elements

1. Reasonable compliance standards and procedures

2. Designation of a corporate officer

3. Due Care in delegation of authority

4. Effective training and education programs

5. Monitoring, auditing and reporting systems

6. Consistent enforcement and discipline

7. Responding to offenses with corrective actions

Seven Key ElementsSeven Key Elements

1. Reasonable compliance standards and procedures.– Begin by meeting with office managers to

obtain their perspective in their areas of responsibility (staffing, scheduling, billing)

– Analyze the practice and the legal standards applicable, which it must comply with

– Assess existing policies and procedures– Develop an employee “Standard of Conduct” to

promote compliance

Seven Key ElementsSeven Key Elements2. Designation of a corporate compliance officer

– Overseeing and monitoring the implementation of the program

– Reporting on a regular basis and establishing methods for improvements

– Periodically revising the compliance program in light of changes or needs of the practice

– Developing, coordinating and participating in an educational training program focusing on the elements of compliance to ensure that they are appropriate

– Ensure employees and management are knowledgeable and comply with the standards

Seven Key ElementsSeven Key Elements– Ensure that National Practitioner Data Bank and

Cumulative Sanction Report have been checked with respect to all employees and medical staff. The OIG report may be found on the Internet at http://oig.hhs.gov. The website also includes a list of monthly disbarred contractors

– Develop policies and programs to encourage the reporting of suspected fraud and other improprieties without fear of retaliation

– Handling investigations, inquiries by employees, and overseeing, monitoring and auditing of practice compliance operations.

– Correcting problems with the compliance program

Seven Key ElementsSeven Key Elements

3. Due care in delegation of authority– A practice should use due care in delegating

substantial authority to individuals whom the organization knows, or should know, through the exercise of due diligence, have a propensity to engage in illegal and/or unethical activities

– Current employees– New applicants

Seven Key ElementsSeven Key Elements

4. Effective training and education programs– Summarizing fraud and abuse laws and the

applicability of the False Claims Act (31 USC 3729) both civil and criminal provisions of the Social Security Act (42 USC1320a-7a and 1320-7b), criminal offenses concerning false statements relating to health care fraud (18 USC 1347), the Federal anti-referral laws (42 USC 1395nn), and the Federal anti-kickback laws (42 USC 1320a-7b(b))

Seven Key ElementsSeven Key Elements– ACA amended the language of the Anti-

kickback statute to state that a person “need not have actual knowledge of this section or specific intent to commit a violation of this section.” (Ignorance of the law is no excuse)

– Civil Monetary Penalties (CMP) law revised – Knowingly making or using false record or

statement material to a false or fraudulent claim for payment by a federal health care program (up to $50,000 per violation)

Seven Key ElementsSeven Key Elements– Document the training– Compliance as an element of a

performance evaluation appraisal5. Monitoring, auditing and reporting

systems– Checks and balances

6. Consistent enforcement and discipline– Warning – Reprimand – Probation– Demotion – Temp. Suspension– Discharge/termination of employment– Restitution – criminal prosecution – Self reporting

Seven Key ElementsSeven Key Elements

7. Responding to offenses with corrective actions– “Reasonable steps” including modifications

to a compliance program to prevent and detect violations of law

Know the Rules – Have the Know the Rules – Have the Answers!Answers!

Rules and RegulationsRules and Regulations

• The Centers for Medicare and Medicaid Services: http://www.cms.hhs.gov

Rules and RegulationsRules and Regulations• Health Insurance Portability and

Accountability Act (HIPAA) • Transaction regulations

– Protected Health Information (PHI)– Covered entities– Business associates

• Privacy and security

Rules and RegulationsRules and Regulations

• Health Information Technology for Economic and Clinical Health Act (HITECH Act), part of the American Recovery and Reinvestment Act (ARRA) of 2009

• The HITECH Act created higher fines for HIPAA violations, which were issued in the recent Cignet Health case.

Rules and RegulationsRules and Regulations

• HHS Imposes a $4.3 Million Civil Money Penalty for HIPAA Privacy Rule Violations

• HHS explained in a statement that Cignet Health refused to respond to OCR's demands to produce the records and failed to cooperate with OCR's investigations of the complaints and produce the records in response to a subpoena. February 22, 2011

Rules and RegulationsRules and Regulations

• Security Breach Notification regulations– On August 19, 2009 HHS issued the Interim

Final Rule

– These regulations attempt to clarify and provide guidance on the definitions outlined in the HITECH Act

– Currently awaiting the updated Privacy and Security Regulations due out by the end of the year.

Rules and RegulationsRules and Regulations

• Security Breach Notification definitions• What is a Breach?• Exceptions to notification• Timeliness of notification• Content of information within the notification• Actual or Substitute notification etc.

Rules and RegulationsRules and Regulations

• The Stark Law prohibits referrals of patients for Designated Health Services (DHS) if the physician (or physician’s immediate family members) has a “financial relationship” with the entity providing the services

• Knowing when exceptions apply is key (i.e. certain in-office ancillary services, compensation arrangements, rentals and leases of equipment or office space.) 42 CFR § 411.357

Rules and RegulationsRules and Regulations

• ACA has new requirements for Physician –Owned Hospitals and in-office ancillary services

• The exceptions are increasing in limitations, and will require increased reporting and documentation to HHS providing a detailed description of ownership

Rules and RegulationsRules and Regulations

• Patients have to be notified that they can seek the DHS elsewhere

• It must be in writing • They must be provided a list of alternate

suppliers to furnish the service

Rules and RegulationsRules and Regulations

• Hospitals utilizing the Rural or Whole Hospital exceptions must submit an annual report to HHS containing detailed descriptions of ownership

• This exception was extended until December 31, 2010. The exception will be grandfathered in but;

• There may be no increase in capacity, or increase in physician investment percentage after March 23, 2010

Rules and RegulationsRules and Regulations

• New regulations will be published by January 1, 2012

• Hospitals continuing to use the exception must submit an annual report containing a detailed description of ownership

• There will be additional standards for determining if the ownership or interest is “bona fide”

Understanding Your Contract Understanding Your Contract (don’t have blinders on!)(don’t have blinders on!)

Contractual RelationshipsContractual Relationships

• In signing the Managed Care Organization (MCO) contract, physicians are not only agreeing to follow all the rules listed and accept all the risks involved; the physicians are also agreeing that they are aware of and understand everything in the contract

Contractual RelationshipsContractual Relationships• Six Steps that Should be Taken before Signing Any

Contract1.Investigate the MCO2.Analyze the terms of the contract3.Obtain and review all relevant documents,

especially those which are referred to in the contract

4.Ask questions and or negotiate to clarify the contract

5.Assess administrative and financial impact on the medical practice

6.READ the final agreement, then sign. No matter how tedious. Also, no contract should be signed without legal review

Top Ten Compliance Risks For 2011Top Ten Compliance Risks For 2011

• Compliance Risk Number 1: Increased “HEAT” Activity and Enforcement: Perhaps the greatest risk to consider in 2011 is the increase in targeted health care fraud enforcement efforts by the government’s Health Care Fraud Prevention and Enforcement Action Team (HEAT).

• Compliance Risk Number 2: Zone Program Integrity Contractor (ZPIC) / Program Safeguard Contractor (PSC) / Recovery Audit Contractor (RAC) Audits of Medicare Claims: As you already know, private contractor reviews of Medicare claims are big business – one ZPIC was awarded a five-year contract worth over $100 million.

Top Ten Compliance Risks For 2011Top Ten Compliance Risks For 2011

• Compliance Risk Number 3: Electronic Medical Records: Unfortunately, some early adopters of Electronic Medical Records (EMR) software are now having to respond to “cloning” and / or “carry over” concerns raised by ZPICs and Program SafeGuard Contractors (PSCs).

• Compliance Risk Number 4: Physician Quality Reporting Initiative (PQRI) Issues: Under the Health Care Reform legislation passed last March. PQRI was changed from a voluntary “bonus” program to one in which penalties will be assessed if a provider does not properly participate. As of 2015, the penalty will be 1.5% and will increase to 2.0% in 2016 and subsequent years.

Top Ten Compliance Risks For 2011Top Ten Compliance Risks For 2011

• Compliance Risk Number 5: Medicaid Integrity Contractors (MICs) and Medicaid Recovery Audit Contractors (MDRACs): In recent months, we have seen a marked increase in the number of MIC inquiries and audits initiated in southern States. Notably, the information and documentation requested has often been substantial.

• Compliance Risk Number 6: HIPAA / HITECH Privacy Violations: Failure to comply with HIPAA can result in civil and / or criminal penalties. (42 USC § 1320d-5).

Top Ten Compliance Risks For 2011Top Ten Compliance Risks For 2011

• Compliance Risk Number 7: Increased Number of Qui Tams Based on Overpayments: Section 6402 of the recent Health Care Reform legislation requires that all Medicare providers, (a) return and report any Medicare overpayment, and (b) explain, in writing, the reason for the overpayment.

• Compliance Risk Number 8: Third-Party Payor Actions: Third-party (non-Federal) payors are participating in Health Care Fraud Working Group meetings with DOJ and other Federal agents. Over the last year, we have seen an increase in the number of “copycat” audits initiated by third-party payor “Special Investigative Units” (SIUs).

Top Ten Compliance Risks For 2011Top Ten Compliance Risks For 2011

• Compliance Risk Number 9: Employee Screening: With the expansion of the permissive exclusion authorities, more and more individuals will ultimately be excluded from Medicare. As we have seen, HHS-OIG is actively reviewing whether Medicare providers have employed individuals who have been excluded.

Top Ten Compliance Risks For 2011Top Ten Compliance Risks For 2011• Compliance Risk Number 10: Payment Suspension

Actions: Last, but not least, we expect the number of payment suspension actions to increase in 2011. In late 2010, Medicare contractors recommended to CMS that this extraordinary step be taken against providers in connection with a wide variety of alleged infractions. Reasons given for suspending a provider’s Medicare number included, but were not limited to: (1) the provider failed to properly notify Medicare of a change in location, (2) the provider allegedly engaged in improper billing practices, and (3) the provider failed to fully cooperate during a site visit. http://www.zpicaudit.com/2011/01/top-ten-health-care-compliance-risks-for-2011/

Socioeconomic Affairs Socioeconomic Affairs Staff Staff

Contact Information:Contact Information:• Yolanda Doss, MJ, RHIA Director

(312) 202-8187 phone

(312) 202-8487 fax

ydoss@osteopathic.org

• Sandra Peters, MHA Assistant Director, Clinical Practice Outreach

(312) 202-8088 phone

(312) 202-8388 fax

speters@osteopathic.org

• Kavin Williams, Health Reimbursement Policy Specialist

(312) 202-8194 phone

(312) 202-8494 fax

kwilliams@osteopathic.org

• Michele Campbell, Coding and Reimbursement Specialist

(312) 202-8182 phone

(312) 202-8482 fax

mcampbell@osteopathic.org

Questions & AnswersQuestions & Answers