Kusserow on Compliance: OIG Civil Monetary Penalties Law enforcement actions for the second half of 2019

Many remain unaware of the Civil Monetary Penalties Law (CMPL). It comes into action when the DOJ believes false claim cases don’t rise to a level sufficient for prosecution in the courts. The OIG is authorized under the CMPL to impose administrative penalties, assessments, and exclusions against a person who, among other things, submits, or causes to be submitted, claims to a federal health care program that the person knows, or should know, are false or fraudulent. The exclusions statute also authorizes OIG to exclude a person who violates the CMPL. Those who appeal the OIG imposed penalties can appeal to an HHS Administrative Law Judge (ALJ). It is rare that an ALJ has overturned the OIG. During this semiannual reporting period, the OIG concluded cases involving more than $30 million in CMPs and assessments.

THE CMPL can be thought of as the administrative version of the False Claims Act. This means that any person who submits, or causes to be submitted, to a federal health care program a claim for items and services that the person knows, or should know, is false or fraudulent is subject to a penalty of up to $15,270 for each item or service falsely or fraudulently claimed, an assessment of up to three times the amount falsely or fraudulently claimed, and exclusion.

For the purposes of the CMPL, “should know” is defined to mean that the person acted in reckless disregard or deliberate ignorance of the truth or falsity of the claim. The law and its implementing regulations also authorize actions for a variety of other violations, including submission of claims for items or services furnished by an excluded person; requests for payment in violation of an assignment agreement; violations of rules regarding the possession, use, and transfer of biological agents and toxins; and payment or receipt of remuneration in violation of the anti-kickback statute.

Additional authorities for the OIG use of CMPL have been added in recent years. The Patient Protection and Affordable Care Act (ACA) added more grounds for imposing CMPs. These include, among other types of conduct, knowingly making, or causing to be made, any false statements or omissions in any application, bid, or contract to participate as a provider in a federal health care program (including Medicare and Medicaid managed care programs and Medicare Part D). The ACA authorizes a penalty of up to $55,262 for each false statement, as well as activities relating to fraudulent marketing by MCOs, their employees, or their agents. The 21st Century Cures Act added more grounds for imposing CMPs, assessments, and exclusion from federal health care programs for fraudulent conduct in an HHS grant, contract, or other agreement. The OIG may assess CMPs of up to $10,000 per claim and assessments of up to three times the amount claimed for knowingly presenting a false or fraudulent claim. In addition, the OIG may impose a penalty of up to $50,000 and assessments of up to three times the amount of funds at issue: (1) for each instance of knowingly making a false statement in a document required to be submitted in order to receive funds under an HHS contract, grant, or other agreement; (2) for knowingly making or using a false record or statement that is material to a false or fraudulent claim; and (3) for knowingly making or using a false record or statement material to an obligation to pay or transmit funds or property owed to HHS. The OIG may impose a penalty of up to $10,000 per day and assessments of up to three times the amount at issue for knowingly concealing, or knowingly and improperly avoiding or decreasing, an obligation owed to HHS with respect to an HHS grant, contract, or other agreement. Finally, The OIG may impose a penalty of up to $15,000 per day for failing to grant timely access to OIG upon reasonable request for audits or to carry out other statutory functions in matters involving an HHS grant, contract, or other agreement.

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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Kusserow on Compliance: OIG program exclusions reported for second half of 2019

Total of 2640 new exclusions added to the LEIE in 2019

Under the Social Security Act, the HHS Office of Inspector General (OIG) is able to exclude individuals and entities from participation in Medicare, Medicaid, and other Federal health care programs. Exclusions are required (mandatory exclusion) for individuals and entities convicted of the following types of criminal offenses: (1) Medicare or Medicaid fraud; (2) patient abuse or neglect; (3) felonies for other health care fraud; and (4) felonies for illegal manufacture, distribution, prescription, or dispensing of controlled substances. The OIG is also authorized (permissive exclusion) to exclude individuals and entities on several other grounds, including misdemeanors for other health care fraud (other than Medicare or Medicaid); suspension or revocation of a license to provide health care for reasons bearing on professional competence, professional performance or financial integrity; provision of unnecessary or substandard services; submission of false or fraudulent claims to a federal health care program; or engaging in unlawful kickback arrangements. The Patient Protection and Affordable Care Act (ACA) added another basis for imposing a permissive exclusion, that is, knowingly making, or causing to be made, any false statements or omissions in any application, bid, or contract to participate as a provider in a federal health care program, including managed care programs under Medicare and Medicaid, as well as Medicare’s prescription drug program.

During this semiannual reporting period, the OIG excluded 1,347 individuals and entities from Medicare, Medicaid, and other federal health care programs. Most of the exclusions resulted from convictions for crimes relating to Medicare or Medicaid, patient abuse or neglect, financial misconduct, controlled substances, or as a result of license revocation. The OIG completed the deployment of a new service for State Medicaid Fraud Control Units (MFCUs) to report convictions through a central web-based portal for exclusion. This improved reporting from those agencies. A list of excluded individuals and entities can be found at https://exclusions.oig.hhs.gov/.

 

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 LinkedIn.

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Copyright © 2020 Strategic Management Services, LLC. Published with permission.

Kusserow on Compliance: False Claims Act settlements on the risk spectrum

OIG reported results of action taken in FY2019

The government’s primary civil tool for addressing health care fraud is the False Claims Act (FCA) and most of these cases are resolved through settlement agreements in which the government alleges fraudulent conduct and the settling parties do not admit liability. Based on the information it gathers in an FCA case, the OIG assesses the future trustworthiness of the settling parties (which can be individuals or entities) for purposes of deciding whether to exclude them from the federal health care programs or take other action. The OIG applies published criteria to assess future risk and places each party to an FCA settlement into one of five categories on a risk spectrum. OIG bases its assessment on the information OIG has reviewed in the context of the resolved FCA case and does not reflect a comprehensive review of the party.

The OIG published its FCA risk spectrum report for 2019. The amount of settlements was not part of this report but will be provided separately later. There were fifteen entities excluded based on FCA violations. Another 40 entities entered into Corporate Integrity Agreements (CIAs), which was at about the same rate as in recent past years. Also reported were two cases where the entity was placed on Heightened Security, rather than signing a CIA. In addition there were twelve self-disclosures related to FCA violations reported.

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 LinkedIn.

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Copyright © 2019 Strategic Management Services, LLC. Published with permission.

Kusserow on Compliance: CMS issues final rule on affiliation disclosure requirements for the provider enrollment process

CMS issued a final rule on September 10 that sets forth requirements mandating providers and suppliers who submit an application for enrollment or revalidation for Medicare, Medicaid, or the Children’s Health Insurance Program (CHIP) disclose current or previous (up to five years) affiliations with a provider or supplier who has uncollected debt; has been or is subject to a payment suspension under a federal health care program; has been excluded from participation from Medicare, Medicaid, or CHIP; or has had billing privileges denied or revoked. CMS said a history of bad actors trying to escape the ramifications of inappropriate or fraudulent behavior by re-entering the program in some capacity, and/or shifting their activities to another enrolled Medicare provider or supplier with which they are affiliated, provided the motivation for the rule. In addition to furnishing the disclosure information, the provider must submit: (a) an organizational diagram identifying all of the entities listed in this section and their relationships with the provider and with each other; and (b) if the provider is a skilled nursing facility, a diagram identifying the organizational structures of all of its owners.

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 LinkedIn.

Subscribe to the Kusserow on Compliance Newsletter

Copyright © 2019 Strategic Management Services, LLC. Published with permission.