Kusserow on Compliance: New anti-kickback law for clinical labs

– Law creates new compliance risk areas for 2019

– Compensation of sales personnel affected

– Not limited to federal health care programs

For the new year, compliance officers should recall Congress passing into law the Eliminating Kickbacks in Recovery Act of 2018 (EKRA), which became effective October 24, 2018. It applies to Medicare and Medicaid, as well as many commercial health insurance plans. It has the effect of eliminating “safe harbors” used by clinical labs in marketing services. The law was intended to be part of the effort to target the national opioid crisis. It makes it a criminal offense to solicit or receive any remuneration, directly or indirectly, in return for referring a patient or patronage to a recovery home, clinical treatment facility or clinical laboratory; or to offer or pay a kickback to “induce” a referral of an individual to a recovery home, clinical treatment facility or clinical laboratory, or in exchange for an individual using the services of a recovery home, clinical treatment facility or clinical laboratory. Penalties for each violation can include a fine of up to $200,000 and imprisonment of up to 10 years. The law has seven “safe harbors,” some of which are similar to the safe harbors under the federal Anti-Kickback Statute that is generally applicable to Medicare and Medicaid services, however the safe harbor for employees and independent contractors under the law expressly excludes from safe harbor protection any payment made to an employee or independent contractor that is determined or varies by:

  • the number of individuals referred;
  • the number of tests or procedures performed; or
  • the amount billed or received.

The EKRA adds an all payor (public and private) provision that enables the federal government to monitor provider arrangements intended to generate business for any laboratory services, not only those related to individuals in treatment for substance abuse disorders, payable by a federal health care program or commercial health insurer.

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.

Connect with Richard Kusserow on Google+ or LinkedIn.

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Copyright © 2018 Strategic Management Services, LLC. Published with permission.

Kusserow on Compliance: OIG Attorneys continue cross-designation with DOJ

The HHS OIG issued its Semi-Annual Report for the first half of fiscal year (FY) 2018 (October-March) and summarizes key accomplishments, significant problems, abuses, deficiencies, and investigative outcomes relating to the administration of HHS programs and operations that were disclosed during the reporting period. Included in the report is a section referred to as the “Special Assistant U.S. Attorney Program.” Many are unaware of this program that unites under the DOJ attorneys and Special Agents of the OIG that are cross-designated as Special Assistant U.S. Attorneys. These OIG attorneys are detailed full time to the Fraud section of DOJ’s Criminal Division for temporary assignments, including assignments to the Health Care Fraud Strike Force. Other attorneys prosecute matters on a case-by-case basis. Both arrangements offer excellent litigation training for OIG attorneys and enhance collaboration between the departments in their efforts to fight fraud. Under this program, OIG attorneys have successfully litigated important criminal cases relating to the fraudulent billing of medical equipment and supplies, infusion therapy, and physical therapy, as well as other types of Medicare and Medicaid fraud.

In its report, the OIG cited as an example of how this program works in a Medicare fraud case in Texas where cross-designated Special Assistant U.S. Attorney prosecuted an individual for fraud. The individual owned and operated group homes in the Houston, Texas area and engaged in a scheme to defraud Medicare by receiving kickbacks in exchange for referring her group home residents for home health services. She pleaded guilty to making false statements to federal agents and was sentenced to 6 months in prison.

 

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.

Connect with Richard Kusserow on Google+ or LinkedIn.

Subscribe to the Kusserow on Compliance Newsletter

Copyright © 2018 Strategic Management Services, LLC. Published with permission.

Kusserow on Compliance: OIG cases involving sanctioned parties and tips to avoid violations

Compliance Officers must screen employees against the List of Excluded Individuals and Entities (LEIE). This is stressed in all of the OIG’s compliance guidance documents. CMS makes it a condition of participation and enrollment. The LEIE continues to change and grow with more than 3,000 exclusions added annually. Failure to screen employees, medical staff, contractors, and vendors results in a great risk. The OIG may consider claims that include work or products from a sanctioned party to be false and fraudulent. Violations can result in monetary penalties. Most cases that deal with this issue are brought to the OIG’s attention through the “Self-Disclosure Protocol.”  In all the recent cases posted, the OIG imposed penalties, but the penalties were mitigated by the fact the matters were self-disclosed—as a result, none of these cases resulted in a Corporate Integrity Agreement (CIA). The OIG posts a number of these cases on its website. The following are examples of recent actions against organizations that engaged individuals they knew or should have known were excluded from participation in the federal health care programs:

  • Southwest Trinity Management, LLC (STM), in Oklahoma paid $141,986.36 in settlement for employing an excluded licensed practical nurse that provided items or services that were billed to Federal health care programs.
  • Diamonds & Pearls Health Services, LLC (DPHS), Cleveland, Ohio paid $75,471.92 for employing an excluded individual who was a scheduling/staffing coordinator, provided items or services to DPHS patients that were billed to Federal health care programs.
  • Center for Ear, Nose Throat & Allergy, P.C. (CENTA) in Indiana, paid $51,564.14 for employing an excluded medical records file clerk, provided items or services to CENTA’s patients that were billed to Federal health care programs.
  • MHMR, Fort Worth, Texas, paid $97,869.78 for employing a program director who had been excluded to provide items or services to clients who were receiving services funded by a Medicaid waiver program.
  • Shawnee Health Services (Shawnee), Carterville, Illinois, paid $107,761.08 as result of employing an excluded individual as a case manager, provided items or services to clients that were receiving services under a Medicaid waiver program.
  • Arkansas Department of Health (ADH) paid $39,343.61 as result of employing an excluded hospice social worker that provided items or services to patients of a community based hospice operated by ADH.
  • Century Pharmacy (Century), Brooklyn, New York, paid $10,000 for an employed excluded individual, who assisted in filling prescriptions in addition to performing other clerical tasks, provided items or services to Century patients that were billed to Federal health care programs.
  • Sundance Behavioral Healthcare System (Sundance), Texas, paid $49,183.48 for an employed sanctioned licensed vocational nurse that provided items or services to patients that were billed to Federal health care programs.
  • ASAP Professional Home Health (ASAP), Houston, Texas, paid $21,797.76 for an employed excluded attendant, provided items or services to ASAP patients that were billed to Federal health care programs.

Practical Screening Tips

  1. Ensure periodic sanction screening of employees, medical staff, contractors, and vendors against the LEIE—best practice is monthly screening.
  2. Inasmuch as most states have developed their own exclusion database, with many states mandating monthly screenings, care should be taken to understand and meet state screening requirements.
  3. Inasmuch as most LEIE exclusions arise from another underlying court, state agency, or licensure board action, it is advisable to also conduct background checks and seek written assurances in applications that prospective employees, contractors, and vendors have not been subject to any prior court or licensure board actions.
  4. It is common for individuals that may be the subject of an investigation, but not yet sanctioned with final actions, to be under investigation for considerable time, therefore it is a best practice to require as a condition of employment, gaining staff privileges, or engagement for the applicant to attest that they have not been, nor are they now, the subject of an investigation by any duly authorized regulatory or enforcement agency. It is also advisable to add a condition that they must promptly report any notice of investigation that involves them.
  5. Educate and inform management and employees on their obligation to promptly report any notification of an adverse action by any duly authorized regulatory or enforcement agency.

Daniel Peake of the Compliance Resource Center (CRC) works with many organizations in ensuring proper sanction screening and from that experience offers a number of practical tips to avoid creating an actionable violation.  He can be reached at dpeake@strategicm.com or (703) 236-9850.

 

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.

Connect with Richard Kusserow on Google+ or LinkedIn.

Subscribe to the Kusserow on Compliance Newsletter

Copyright © 2017 Strategic Management Services, LLC. Published with permission.

Kusserow on Compliance: OIG testimony highlights opioid crisis actions

Gary Cantrell, HHS OIG Deputy Inspector General for Investigations, testified before a Senate Special Committee hearing on enforcement activities currently underway to combat the opioid crisis. He provided key policy recommendations to address the crisis. Opioid fraud encompasses a broad range of criminal activity from prescription drug diversion to addiction treatment schemes. Many of these schemes can be elaborate, involving complicit patients or beneficiaries who are not ill, kickbacks, medical identity theft, money-laundering, and other criminal enterprises. Some schemes also involve multiple co-conspirators and health care professionals such as physicians, nonphysician providers, and pharmacists. These investigations can be complex and often involve the use of informants, undercover operations, and surveillance. The OIG provided critical support in the establishment of the new Opioid Fraud and Abuse Detection Unit established by the Attorney General to focus on opioid-related health care fraud. This collaboration led to the selection of 12 judicial districts around the country where OIG has assigned Special Agents to support 12 prosecutors identified by the DOJ to focus solely on investigating and prosecuting opioid-related health care fraud cases.

The OIG collaborates with a number of HHS agencies, including CMS and the Agency for Community Living (ACL), on fraud- and opioid-related initiatives to educate providers, the industry, and beneficiaries on the role each one plays in the prevention of prescription drug and opioid-related fraud and abuse. The OIG is engaging ACL’s Senior Medicare Patrol and State Health Insurance Assistance Program through presentations on the prevention of fraud, waste, and abuse. The OIG is also working with the DEA to provide anti-fraud education at numerous Pharmacy Diversion Awareness Conferences held across the United States, which are designed to assist pharmacy personnel with identifying and preventing diversion activity.

OIG currently has numerous opioid-related audits or evaluations underway that address:

  • questionable prescribing patterns in Medicaid;
  • Medicaid program integrity controls;
  • Medicare program integrity controls in the prescription drug benefit;
  • CDC’s oversight of grants to support programs to monitor prescription drugs;
  • FDA’s oversight of opioid prescribing through its risk management programs;
  • SAMHSA’s oversight of opioid treatment program grants;
  • beneficiary access to buprenorphine medication-assisted treatment; and
  • opioid prescribing practices in the Indian Health

In the OIG’s data brief entitled Opioids in Medicare Part D: Concerns about Extreme Use and Questionable Prescribing and other reports, the OIG noted the following:

  • 60,000 individuals died from drug overdoses in 2016, of which two-thirds involved opioids
  • The CDC reported 75 percent new heroin users having abused prescription opioids prior to using heroin.
  • One in three Medicare Part D beneficiaries received opioids (14.4 million beneficiaries)
  • 500,000 beneficiaries received high amounts of opioids
  • 90,000 beneficiaries were at serious risk of opioid misuse or overdose for receiving extreme amounts of opioids and those who appeared to be “doctor shopping”
  • 70,000 beneficiaries received extreme amounts of opioids
  • 22,308 beneficiaries appeared to be doctor shopping for more opiods
  • 400 prescribers had questionable opioid prescribing for beneficiaries at serious risk
  • Prescribers with questionable billing wrote 265,260 opioid prescriptions for beneficiaries at serious risk at a cost under Part D for $66.5 million

The OIG is planning to release a new data brief on opioid use in Medicare Part D as a follow-up to a previous data brief, Opioids in Medicare Part D: Concerns About Extreme Use and Questionable Prescribing (OEI-02-17-00250) to: (1) determine the extent to which Medicare Part D beneficiaries received high amounts of opioids; (2) identify beneficiaries who are at serious risk of opioid misuse or overdose; and (3) identify prescribers with questionable opioid prescribing patterns for these beneficiaries.  In conjunction with this, they will release an analysis toolkit to assist the public and private sector in analyzing prescription drug claims data.  It will provide steps for using prescription drug data to analyze patients’ opioid levels and identify those at risk of opioid misuse or overdose or who appear to be doctor shopping.

The OIG has made numerous pending recommendations to improve HHS programs to better protect beneficiaries at risk of opioid misuse or overdose, including:

  • Restrict certain beneficiaries to a limited number of pharmacies or prescribers, implementing the new lock-in authority.
  • Require plan sponsors to report to CMS all potential fraud and abuse and any corrective actions they take in response; and provide guidance on how Part D sponsors identify and investigate these matters.
  • Improve Medicaid CMS does not have complete and accurate data needed to effectively oversee the Medicaid program, including opioids. OIG call for CMS to establish a deadline for when national T-MSIS data will be available for multistate program integrity efforts.

 

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.

Connect with Richard Kusserow on Google+ or LinkedIn.

Subscribe to the Kusserow on Compliance Newsletter

Copyright © 2017 Strategic Management Services, LLC. Published with permission.