Kusserow on Compliance: OIG issues first 2017 Semi-Annual report—1,422 exclusions in first half of 2017

The OIG released is first semi-annual report for 2017 which included the number of exclusion actions taken. There were a total of 1,422 individuals and entities they excluded from Medicare, Medicaid, and other Federal health care programs. Most of the exclusions resulted from convictions for crimes relating to Medicare or Medicaid, for patient abuse or neglect, or as a result of license revocation. The OIG posts all such actions on its List of Excluded Individuals and Entities (LEIE).  In its compliance guidance, the OIG calls for screening of all individuals and entities engaged by or with whom they do business against the LEIE. CMS also makes such screening a condition of participation and enrollment. The OIG has a number of Administrative Sanction authorities whereby they have added steadily to the LEIE database. In the last three years the OIG added over 10,000 exclusions to the LEIE.

OIG Enforcement Authorities

Tom Herrmann, JD, is a nationally recognized health care compliance consultant.  He served for a number of years in the OIG Counsel’s Office as Chief of the Administrative Litigation Branch, and supervised the litigation of cases involving the imposition of civil monetary penalties and program exclusions. He explained that the OIG has been delegated the authorities to impose Civil Monetary Penalties, assessments, and program exclusion on health care providers and others determined to have engaged in defined wrongdoing. The effect of an OIG exclusion is that no payment may be made for any items or services furnished by an excluded individual or entity, or directed or prescribed by an excluded physician. He noted that in almost all instances where the OIG’s imposition of program exclusion or CMPs is appealed, it is upheld by a HHS Administrative Law Judge (ALJ), the HHS Departmental Appeals Board (DAB), and Federal Courts. As such, it is absolutely essential to have ongoing sanction-screening of anyone engaged by a healthcare organization.

Jillian Bower, is another highly experienced health care compliance consultant, who has assisted scores of clients in meeting the sanction-screening obligations through the Compliance Resource Center (CRC). She notes that CMS has been very aggressive in calling for sanction screening, not only of the LEIE, but Debarments posted by the General Services Administration (GSA), as well as pressuring State Medicaid Directors to establish exclusion databases and mandate monthly screening by their enrolled providers. Since then most states have moved to comply with the CMS direction. This has increased the sanction-screening burden greatly for not only for the compliance office, but also human resource management (HRM). Procurement is also affected by the number of vendors and contractors that also have to be screened. Medical credentialing is involved because physicians granted staff privileges have to be screened. In order to meet screening mandates, it is almost a necessity to use a vendor search engine tools to assist in sanction-screening. This saves downloading the sanction databases of all the entities and developing their own search engine. So using a vendor for this purpose is a step in the right direction; however the bulk of the work remains with the organization to do screening and resolving potential “hits” remains with the organization. Altogether this can be a considerable effort and many organizations have to dedicate one or many employees to meet all these obligations. Alternatively, many just outsource the entire process, including verification and certification of results to a vendor

Sanction-Screening Tips

  1. Ensure periodic sanction screening of employees, medical staff, contractors, and vendors against the LEIE, not just at time of engagement but periodically thereafter. An individual or entity may be pass a sanction screen at time of engagement, but later have a sanction imposed.

 

  1. Maintain a complete record of sanction screening to evidence meeting mandates with individual(s) responsible for sanction screening attesting to results each time screening has taken place. If using a vendor to conduct the sanction screening on behalf of the organization, they should provide a full certified report each time they perform their service.

 

  1. Develop a compliance policy and applications requiring as a condition of employment, gaining staff privileges, or engagement, attestation that the individual has 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 of engagement that employees must promptly report any notice of investigation that involves them.

 

  1. Care should be taken to meet state Medicaid screening requirements in addition to checking the LEIE. For those organizations that cross state lines, it is particularly important to ensure compliance with state sanction screening mandates that differ from state to state.

 

  1. Inasmuch as most exclusions in the LEIE arise from another underlying court, state agency, or licensure board action, it is critical as part of the credentialing process to verify that health care professionals are duly licensed and not until any restrictions. Engaging or giving staff privileges to individuals who are restricted in their license may be considered by CMS as violating conditions of participation.

 

  1. 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. Policies should be implemented to reinforce this.

 

  1. Consider using a vendor tool to assist in sanction-screening, but compare services and costs to avoid unnecessary expenditures; and consider the cost-benefits of outsourcing then entire sanction-screening process.

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

Structure call coverage arrangements to avoid Stark & AKS issues

When compensating physicians for the time they spend on-call, hospitals should draft call coverage agreements with care to avoid potential problems implicating federal laws prohibiting physician self-referral (Stark Law) and kickbacks (Anti-Kickback Statute (AKS)). In a webinar presented by the Health Care Compliance Association (HCCA), Robert G. Homchick, partner at Davis Wright Tremaine LLP, and Scott M. Safriet and Adam S. Polsky, partners at HealthCare Appraisers, Inc., discussed changes to the call coverage risk analysis based on court opinions and changes in government implementation of rules.

As with most physician compensation arrangements, the Stark Law (42 U.S.C. §1395nn) is the threshold issue when analyzing call coverage agreements; additionally, if the agreement passes muster under Stark, the AKS (42 U.S.C. §1320a-7b) risks should be relatively modest. Both analyses contain some of the same considerations, such as fair market value (FMV) and commercial reasonableness.

Homchick, Safriet, and Polsky noted the following concerns for call coverage:

  • on-call coverage is becoming more expensive, but hospitals are facing decreased reimbursement; and
  • because traditional methods of securing call coverage no longer apply to all situations, hospitals are becoming more creative to obtain coverage.

To effectively secure coverage, hospitals should consider many options, and determine which is best applied in their situation. Potential coverage options include concurrent coverage, telemedicine, bundling on-call coverage with services beyond the emergency room, on-call coverage payment for employed physicians, and use of the “activation fee” concept.

However, the webinar cautioned that not all arrangements are the same, and in situations where it is truly difficult to secure coverage, a different approach may be necessary. Additionally, hospitals should look into the underlying reasons of why securing that coverage has been difficult—for example, are there shortened response times, a physician shortage in the marketplace, or is coverage restricted or quasi-restricted.

Kusserow on Compliance: OIG expanded exclusion authorities go into effect

On February 13, 2017, the HHS Office of Inspector General (OIG) Final rule amending the regulations related to its exclusion authority goes into effect. It incorporates recent statutory changes, early reinstatement provisions, and recent policy changes, and clarifies existing regulatory provisions. It is the most substantial revision to the exclusion regulations in many years and reflects changes made by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) in 2010 and the Medicare Modernization Act (MMA) in 2003, as well as informal practices that the OIG has now codified in regulations. Most of the changes in the final rule are largely technical in nature; however they significantly expand and solidify the OIG’s authority to exclude providers.

The scope of OIG oversight now will move beyond claims submission based on the ACA’s permissive exclusion authority over an individual or entity that knowingly makes or causes to be made any false statement, omission, or misrepresentation of material fact in any application, agreement, bid, or contract to participate or enroll as a provider of services or supplier under a federal health care program. Under the new rules, the OIG’s authority has been extended to exclude based on the following:

  • conviction relating to obstruction of an investigation or audit;
  • failure to provide payment information by individuals who “order, refer for furnishing, or certify the need for” items or services paid for by Medicare or state health care programs;
  • those who refer patients or certify the need for items or services, even if they do not provide the items or services; and
  • making false statements or misrepresenting material facts in applications to participate as a provider or supplier under a federal health care program.

The OIG also will now consider materials obtained from various entities, including CMS, state Medicaid agencies, fiscal agents or contractors, private insurance companies, state or local licensing or certification authorities, and law enforcement. This information may be considered in determining the length of exclusion.  Also, a number of technical changes were made regarding key terms, such as replacing the language “who submit claims to” with “who request or receive payment from” in the definitions of “directly” and “indirectly,” thereby clarifying the scope of individuals and entities subject to oversight by the OIG.

The OIG may impose exclusion up to a 10-year period from the time the conduct occurred. It may consider a request for a waiver from a federal health care program administrator, as opposed to only waivers submitted by state health care program administrators. It also makes several changes to the aggravating and mitigating factors that the agency considers in determining whether to increase the length of exclusion above the minimum required. Mitigating factors are only considered if OIG has established one or more aggravating factors. Other changes include:

  • updating the dollar amounts for aggravating and mitigating factors that consider the financial loss to federal health care programs as a result of the misconduct from $15,000 to $50,000;
  • reworking the existing aggravating factors regarding other offenses to include considering adverse actions based on offenses separate from those forming the basis of the exclusion and adverse actions based on the same offenses; and
  • removing the mitigating factor related to availability of alternative sources of the type of health care items or services furnished by the person.

Kusserow on Compliance: OIG 2017 Work Plan projects relating to hospitals

The OIG released the 2017 Work Plan that summarizes new and ongoing reviews and activities they plans to pursue.  They removed items that were completed, postponed, or canceled, as well as those “Revised” items.  The major focus of the OIG is on the programs of CMS, which include Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP).  These programs account for more than 80 percent of HHS’s budget with total Federal program spending of $986 billion for FY 2016.  Medicare alone accounted for approximately $595 billion, which includes inpatient hospital, skilled nursing, home health, hospice, and physician services payments, as well as incentive payments for adopting health information technology, such as electronic health records (EHRs). CMS uses Medicare Administrative Contractors to administer Medicare Part A and Medicare Part B and to process claims for both parts for more than 37 million people and approximately $371 billion in payments. In addition, Medicare expended over $85 billion in Part D benefit payments in CY 2015, serving over 41 million beneficiaries. The following projects are those related to hospital.

  1. Hyperbaric oxygen (HBO) therapy. Determine whether Medicare payments related to HBO outpatient claims were reimbursed in accordance with Federal requirements.
  2. Incorrect Medical Assistance Days Claimed by Hospitals. Determine whether Medicare administrative contractors properly settled Medicare cost reports for Medicare disproportionate share hospital payments in accordance with Federal requirements.
  3. Inpatient Psychiatric Facilities. Determine whether such facilities complied with Medicare documentation, coverage, and coding requirements for stays that resulted in outlier payments.
  4. Inpatient rehabilitation (rehab) hospitals. Assess a sample of rehabilitation hospital admissions to determine whether the patients participated in and benefited from intensive therapy; and identify reasons patients were not able to participate and benefit from therapy.
  5. Intensity-modulated radiation therapy (IMRT). Determine whether the payments were made in accordance with Federal requirements.
  6. Outpatient Outlier Payments for Short-Stay Claims. Determine the extent of potential Medicare savings if hospital outpatient stays were ineligible for an outlier payment.
  7. Comparison of Provider-Based and Freestanding Clinics. Determine the difference in payments made to the clinics for similar procedures; and assess the potential impact on Medicare and beneficiaries of hospitals’ claiming provider-based status for such facilities.
  8. Reconciliations of Outlier Payments. Determine whether CMS performed necessary reconciliations in a timely manner to enable Medicare contractors to perform final settlement of the hospitals’ associated cost reports, as well as whether the Medicare contractors referred all hospitals that meet the criteria for outlier reconciliations to CMS.
  9. Hospitals’ Use of Outpatient and Inpatient Stays Under Medicare’s Two-Midnight Rule. Determine how hospitals’ use of outpatient and inpatient stays changed under Medicare’s two-midnight rule by comparing claims for hospital stays in the year prior to and the year following the effective date of that rule; and the extent to which the use of outpatient and inpatient stays varied among hospitals.
  10. Medicare Costs Associated with Defective Medical Devices. Identify the costs to Medicare resulting from additional use of medical services associated with defective or recalled medical devices.
  11. Payment Credits for Replaced Medical Devices That Were Implanted. Determine whether Medicare payments for replaced medical devices were made in accordance with Medicare requirements.
  12. Medicare Payments for Overlapping Part A Inpatient Claims and Part B Outpatient Claims. Determine whether outpatient claims billed to Medicare Part B for services provided during inpatient stays were made in accordance with Federal requirements.
  13. Selected Inpatient and Outpatient Billing Requirements. Determine hospitals’ compliance with selected billing requirements and recommend recovery of overpayments. Focus will be on those hospitals with claims that may be at risk for overpayments.
  14. Duplicate Graduate Medical Education Payments. Assess the effectiveness of preventing duplicate payments for DGME costs; and any appropriate payments.
  15. Indirect Medical Education Payments. Determine whether the IME payments were calculated properly.
  16. Outpatient Dental Claims. Roll up the results of our audits of Medicare hospital outpatient payments for dental services to provide CMS with cumulative results and make recommendations for any appropriate changes to the program.
  17. Nationwide Review of Cardiac Catheterizations and Endomyocardial Biopsies. Review Medicare payments to hospitals nationwide for outpatient RHCs and endomyocardial biopsies performed during the same patient encounter.
  18. Payments for Patients Diagnosed with Kwashiorkor. Roll up the results of our audits of Medicare hospital payments for kwashiorkor to provide CMS with cumulative results and make recommendations for any appropriate changes to the program.
  19. Review of Hospital Wage Data Used to Calculate Medicare Payments. Review hospital controls over the reporting of wage data used to calculate wage indexes for Medicare payments.
  20. CMS Validation of Hospital-Submitted Quality Reporting Data. Determine the extent to which CMS-validated hospital inpatient quality reporting data are accurate and complete.
  21. Long-Term-Care Hospitals Adverse Events in Postacute Care for Medicare Beneficiaries. Identify factors contributing to these events and determine the extent to which the events were preventable.
  22. Hospital Preparedness and Response to Emerging Infectious Diseases. Describe hospitals’ efforts to prepare for the possibility of public health emergencies resulting from emerging infectious disease threats; review use of HHS resources; and identify lessons and challenges faced by hospitals as they prepare to respond to emerging infectious disease threats.

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 © 2016 Strategic Management Services, LLC. Published with permission.