The Deficit Reduction Act, 2005

Deficit Reduction Act of 2005

In the Deficit Reduction Act of 2005 (DRA) Congress, for the first time, has mandated healthcare providers to have a compliance program.

The federal government has, for many years, encouraged health care providers to have compliance programs, built on the federal sentencing guidelines.

Under the DRA, a compliance program is now a requirement for all providers or organizations that pay out over $5 Million in Medicaid payments each year.

The Deficit Reduction Act – Requirements

To comply with the DRA, as it is written, healthcare entities must:

Provide Education: Educate employees regarding-

Federal False Claims Act (FCA) Michigan False Claims Act Whistleblower provisions

The Deficit Reduction Act - Requirements

Establish Policies/Procedures: Develop written policies/procedures for all employees, contractors and agents regarding-

Detailed information about the False Claims Act Whistleblowers protections Detection and prevention of fraud and abuse

The Deficit Reduction Act - Requirements

Include in any employee handbook* specific information regarding-

Fraud and abuse An employee’s rights to be protected as a

whistleblowers The agency’s policies/procedures for detecting and

preventing fraud and abuse

*A handbook is defined as an organized area within the agency that defines the compliance expectations and is readily available to all employees. Our “handbook” information is located within the policies and within the compliance plan both which are located on the “s” drive.

Current Efforts That Meet DRA Requirements - Education

Methods of Education Compliance Orientation Training Annual Training Ongoing Specialized Training

Content of Education False Claims Act information 7 elements of compliance programs as defined in

the Federal Sentencing Guidelines

Current Efforts That Meet DRA Requirements - Education

Content of Education Continued Compliance Policy and Procedure Internal processes for reporting fraud and

abuse including an anonymous hotline Processes and procedures for detecting

and preventing fraud and abuse An Employees obligation to report any

fraud or abuse

Current Efforts That Meet DRA Requirements – Policies & Procedures

Policies & Procedures Compliance Plan Code of Conduct Reporting of Potential Compliance Violations Billing & Claims Submission Auditing & Monitoring

Current Efforts That Meet DRA Requirements – Employee Handbook

Information relative to fraud and abuse, whistleblowers’ protections and detecting and preventing fraud and abuse is available:

On the agency shared “s” drive within the Compliance Plan. Go to the “s” drive, click on the folder titled “Organizational Plans” and click on “2006 Compliance Plan”This information will also be available within our new website

DRA Training – Federal False Claims Act

First signed into law in 1863 in the wake of Civil War profiteering, the FCA imposes civil penalties for making false claims to the government

Anyone who violates the FCA is liable for a civil penalty of $5,500 to $11,000 per claim, plus three times the amount paid

A person violating the FCA can be liable for the costs of a civil action brought to recover any penalties or damages

DRA Training – Federal False Claims Act

Violators can be excluded from participating in Medicare, Medicaid, and other government programs

Federal criminal enforcement for intentional participation in the submission of a false claim

DRA Training – Federal False Claims Act

The False Claims Act applies when an organization or person:

Knowingly presents the government with a false claim for payment

Knowingly makes a false statement to get a fraudulent claim paid

Conspires to defraud the government by getting a false claim paid by the government

Knowingly makes a false record or statement to conceal, avoid, or decrease an obligation to pay the Government,

“Causes” a false claim to be submitted

DRA Training – Federal False Claims Act

The False Claims Act Defines:

“Knowingly”, as the “reckless disregard” to the truth or falsity of the claim.

The language is intended to prevent the submission of a claim in “deliberate ignorance” of its propriety.

DRA Training – Federal False Claims Act

Protections for People Who report false claims:Anyone who lawfully acts to report false claims is protected from: discharge, demotion, suspension, threats, harassment, and discrimination.

DRA Training – Michigan False Claims Act

Authorizes the attorney general to investigate alleged violations of this act

Provides for civil actions to recover money received by reason of fraudulent conduct

Provides for certain civil fines; and prescribes remedies and penalties

DRA Training – Michigan False Claims Act

Prohibits fraud in the obtaining of benefits or payments in connection with the Medicaid program

Prohibits kickbacks or bribes in connection with the Medicaid program

Prohibits conspiracies in obtaining benefits or payments

DRA Training – Michigan False Claims Act

An employer shall not discharge, demote, suspend, threaten, harass, or otherwise discriminate against an employee who initiates, assists, or participates in a legal proceeding under the act

DRA Training – Whistleblowers’ Protection Act

A law that provides protection to employees who report a violation or suspected violation of state, local, or federal law

Provides protection to employees who participate in hearing, investigations, legislative inquiries, or court actions; and to prescribe remedies and penalties.

DRA Training – Whistleblowers’ Protection Act

An employer shall not discharge, threaten, or otherwise discriminate against an employee because the employee reports or is about to report a violation

An employer shall post notices and use other appropriate means to keep employees informed of Whistleblowers’ protections

DRA Training – Fraud and Abuse Defined

Fraud is defined as “an intentional deception or misrepresentation by a person with the knowledge the deception could result in unauthorized benefit to him/herself or some other person

Abuse is defined as “practices that are inconsistent with sound fiscal, business or medical practices, and result in an unnecessary cost to the payor, or in reimbursement for services that are not medically necessary or fail to meet professionally recognized standards for healthcare

What Now?

This really isn’t anything new. This legislation (False Claims and Whistleblowers’ Protection Acts) has been in place for years.

Postings will be located in the lounges

We provide education as required

What Now?

We have a compliance program, which includes a plan, policies/procedures, and a method for detecting and preventing fraud & abuse

If you have lost or misplaced your copy of the Compliance Plan we will be happy to provide you another one. It is also available on the “s” drive within the folder titled “Organizational Plans”.

Reporting Compliance Concerns

Talk to Sue Germann, extension 232 or sgermann@pinesbhs.org

Talk to a member of the Compliance Committee (Management Staff and Mr. John Swanson, Board Chair)

Call the Hotline: 1-800-624-5215

Remember….

When in doubt, point it out!

Attestation Form

The attestation form acknowledges your obligation to report and attests that you have received training on the DRA and understand your obligation to report any issues of which you are aware

This is to be signed and submitted to the Compliance Officer