Kusserow on Compliance: CMS Announced New Rules to Protect Against Fraud and Abuse

CMS has announced new rules that strengthen oversight of Medicare providers and protect taxpayer dollars abusive practices. The rules are designed to prevent physicians and other providers with unpaid debt from re-entering Medicare, remove providers with patterns or practices of abusive billing, and implement other provisions. CMS has removed nearly 25,000 providers from Medicare; and the new rules are designed to block readmission for those who had engaged in improper practices. CMS noted that it had been a common practice for some providers to game the system and dodge rules to get Medicare dollars by exiting and then returning anew to the program. The new Final rule should make it far more difficult for those removed from the program for improper practices to return to the system. Removing providers from Medicare has had a real impact on savings; CMS notes its predictive analytics technology in the Fraud Prevention System has identified providers and suppliers who were ultimately revoked with a result of preventing $81 million in inappropriate claims from being paid. The rules include a provision that amends 42 CFR 424.520(d), Effective date of Medicare billing privileges for  physicians, nonphysician practitioners, and physician and nonphysician practitioner organizations, to include ambulance suppliers, based in part on the elevated risk ambulance suppliers pose to the Medicare program. CMS believes this change will save more than $327 million annually.

CMS cites the new rule as one of many it is using as a result of new authorities created by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) to address Medicare fraud, waste, and abuse. In its announcement of this new action, CMS noted that it has in place temporary enrollment moratoria on new ambulance and home health providers in seven areas in the country where fraud has been the biggest problem. This has been coupled with targeting resources in those areas, including use of fingerprint-based criminal background checks.

Key Features of the CMS Rule Changes

  1. Deny enrollment to providers, suppliers and owners affiliated with any entity that has unpaid Medicare debt, so as to prevent those that have incurred substantial Medicare debts from exiting the program and then attempting to re-enroll as a new business to avoid repayment of the outstanding Medicare debt.
  2. Deny or revoke the enrollment of a provider or supplier if a managing employee has been convicted of a felony offense that CMS determines to be detrimental to Medicare beneficiaries. Recently implemented background checks will provide CMS with more information about felony convictions for high risk providers or suppliers.
  3. Revoke enrollments of providers and suppliers engaging in abuse of billing privileges by demonstrating a pattern or practice of billing for services that do not meet Medicare requirements.

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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Copyright © 2014 Strategic Management Services, LLC. Published with permission.