Kusserow on Compliance: Oncology remains high federal enforcement priority

Oncology continues to be a high enforcement priority for the DOJ, OIG, FBI, and CMS.  The latest fraud investigation by the DOJ involves CCS Oncology, large and prominent providers of cancer care. The reported question being investigated relates to possible billing irregularities involving Medicare and Medicaid. As with most cases related to oncology irregularities, the predication was by a “whistleblower.” The complaint alleges CCS billed for more expensive procedures than were actually performed, billed for procedures that never were performed, and performed medically unnecessary procedures on patients, among other violations, according to the source. The stream of cases is long enough to outline key factors that have led to settlements with the DOJ and OIG. Compliance Officers, whose portfolio of responsibilities include oncology services may wish to review the following to ensure none of these factors are at work in a manner that may trigger investigation.

Common Oncology Enforcement Issues

  1. Employees knowingly submitted false records to Medicare and Medicaid to increase revenue
  2. Claims submitted for services performed without required physician supervision
  3. Offering unnecessary treatments and services to patients
  4. Recruitment and treatment of terminal patients that should have been referred to hospice care
  5. Re-treatment of patients in excess of prescribed dosage limits
  6. Claims for services when physician reviews had not taken place
  7. Claims where treatment occurred without prior required IGRT scan
  8. Physicians allowed registered nurses to fill out prescriptions for medications
  9. Offering inducements (“kickbacks”) to patients by waiving their co-pays
  10. Conducting not necessary fluorescence in situ hybridization (FISH) tests for bladder cancer
  11. Filing payment claims for GAMMA functions by improperly trained physicians and staff
  12. Seeking payments for tests whose results doctors had not reviewed
  13. Billing E&M services on the same day as a related procedure
  14. Double and over-billing Medicare for services that lacked supporting documentation
  15. Improperly billing for radiation treatment without proper physician supervision
  16. Submitting false claims for magnetic resonance imaging (MRI) services
  17. Billing for services that were not documented in the patients’ medical records
  18. Billing twice for the same services
  19. Misrepresentation of the level of a service provided to increase reimbursement
  20. Routinely waived patient copayments as an inducement, then billing Medicare for them.
  21. Claims for services not performed, medically necessary, and/or properly documented
  22. Claims for services rendered to patients referred by physicians benefiting from referral
  23. Purchasing cancer treatments from unlicensed sources for oncology practice
  24. Diluting patients’ chemotherapy treatments and delivering in a manner designed to extend period of treatment time
  25. Claims for medically unnecessary or properly documented intensity-modulated radiation therapy (IMRT)
  26. Unsupported add-on claims for “special treatment procedures” and “specialty physics consults”
  27. Violating the Stark Laws and Anti-Kickback statute by rewarding referring physicians

 

Kusserow on Compliance: Overlap between physician-owned hospitals and distributers could result in violations of the Stark Laws and Anti-kickback Statute

The HHS Office of Inspector General (OIG) issued a new report about the limited available information to identify physicians who have concurrent ownership interests in physician owned distributors (PODs) and hospitals. The agency raised concerns about the lack of transparency among Medicare providers and the vendors that sell them implantable devices. Lack of transparency of ownership may prevent identification of providers who may be violating the referral and billing prohibitions of the Stark Law or the Anti-Kickback Statute (AKS). This problem may also have implications for patient safety and quality of care, in that physician ownership may affect physicians’ clinical decision making in performing surgeries or ability to choose a device in which they have a financial interest rather than another device that may be more appropriate for the patient.

This new report followed up on its October 2013 report (Spinal Devices Supplied by Physician Owned Distributors: Overview of Prevalence and Use), where it found that PODs supplied the devices used in nearly one in five spinal fusion surgeries that were billed to Medicare. CMS expressed continued interest and concern about the overlap between owners of physician-owned hospitals and PODs of spinal devices. The OIG examined the hospitals used in the prior report that self-identified as physician-owned and reported having purchased spinal devices from PODs. The report also used publicly available information (e.g. websites for hospitals and PODs, as well as state business registration websites) and information from CMS’s Provider Enrollment, Chain and Ownership System (PECOS) to attempt to determine whether a physician had an ownership interest in both a hospital and a POD that sold spinal devices to the hospital.

During data collection for the original report, 119 hospitals self-identified as having purchased spinal devices from PODs. Of these 119 hospitals, 12 self-identified as physician-owned and reported that they purchased spinal devices from 12 PODs. All of these hospitals self-identified as physician-owned on their web sites, and five of them identified physician-owners by name. The report also researched the ownership of the 12 PODs from which the 12 physician-owned hospitals reported having bought spinal devices. Two of these PODs identified physician-owners by name on their websites. The report identified the physician-owners of an additional three PODs from our review of state business registration websites and identified one physician who had an ownership interest in both a hospital and a POD that supplied spinal devices to that hospital. The OIG noted, however, that it is possible that additional physicians had such ownership interests that were not detected using what information it had available.

The results of the study demonstrate a need for increased transparency with regard to ownership information for PODs and, to a lesser extent, of hospitals. The Physician Payments Sunshine Act (Sunshine Act) requires manufacturers and group purchasing organizations to report to CMS any ownership and investment interests held by physicians. The OIG intends to monitor CMS’s implementation of the Sunshine Act and be on guard for those arrangements that may rise to a violation of law or regulations.

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 © 2015 Strategic Management Services, LLC. Published with permission.

 

Kusserow on Compliance: CMS moves to ease Stark rules for providers and for CMS

In the face of the landmark Tuomey case decisions that have added teeth to the enforcement of the Stark laws, CMS has learned what providers have known for years: vagueness in the law requires more interpretation. CMS has been overwhelmed by the number of self-disclosures that require interpretation, especially those involving technical violations. Previously, the agency may not have been sympathetic to calls from providers about the burden, but once the Office of Inspector General (OIG) announced that it would not handle any Stark referrals not implicating the Anti-Kickback Statute (AKS), CMS was forced to accept all the self-disclosures. Once that occurred, need for some clarifications in the regulations became dramatically clear. In response to this problem, CMS published a Proposed rule, which, if implemented, would update the Stark law regulations to account for recent changes relating to health care reform and advancements in patient care and payment methodologies (Proposed rule, 80 FR 41686, July 15, 2015). CMS is requesting information from the health care community on whether “additional guidance or rulemaking is needed to relax or remove barriers to health reform initiatives without compromising fraud and abuse prevention.”

The focus of the Proposed rule is on some of the technical requirements, which should not rise to enforcement levels. These changes were included in the 2016 Medicare physician fee schedule regulation and address many potential modifications to the Stark law, including the creation of new exceptions and guidance on CMS’ interpretation of existing Stark law exceptions. The most significant changes would involve: (1) new exceptions under the law for time-sharing arrangements with physicians; (2) recruitment incentives for non-physician practitioners; and (3) recognition that certain technical violations, such as expired agreements, would not necessarily arise to a fraud or abuse enforcement action.

Time-sharing agreements

CMS proposed a new Stark exception for time-share arrangements recognizing that it is a common practice for hospitals to rent space to physicians for a small amount of time during a defined period of time to permit patient visits at a location other than their primary office, for the convenience of the patients, the physician, or both. Under the Proposed rule, this would be permitted if physicians pay their hospital-landlord on a prorated basis for the time they occupy the space, and for the staff and equipment they use. However, such rentals would have to comply with Stark exception requirements (e.g., leases, equipment rentals), the agreement would have to be in writing, and it would have to reflect payment at fair-market value (FMV).

Non-physician practitioners

CMS has taken note of the fact that there is a looming shortage of primary care physicians and has proposed a limited exception for hospitals, federally qualified health centers (FQHCs), and rural health clinics (RHCs) to provide remuneration to physicians to assist with recruitment and employment of non-physician practitioners who receive remuneration from the hospital. This could add more non-physician practitioners to fill the gap. The exception would include many of the standard Stark safeguards, such as a written agreement signed by the hospital and the physician as well as remuneration that does not take into account the volume and value of referrals. Comments are also being sought as to whether this exception should also apply to non-physician practitioners who are recruited as independent contractors.

Technical issues

CMS also noted receiving numerous self-referral disclosures that are procedural in nature with providers saying they are unclear whether an arrangement has to be memorialized in a single document that covers all aspects of the arrangement. CMS reported that while a single document provides “the surest and most straightforward means” of compliance, “a collection of documents evidencing the course of conduct between the parties may satisfy the writing requirement.” This could extend to a variety of arrangements.

Comments

CMS is requesting comments from the industry to assist them with these changes. The agency can expect nothing but support from the industry for these proposed changes. For those interested in reviewing the entire draft rule and provide comments, such must be done by September 8, 2015. This is also an opportune time for hospitals to have their physician arrangements reviewed for current compliance and to understand the implications of the Proposed rule changes. This should not be done by anyone involved in development of them, but by independent experts under direction of legal counsel.

 

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 © 2015 Strategic Management Services, LLC. Published with permission.

 

Kusserow on Compliance: Physicians personally face increased enforcement risks for corrupt arrangements

In a previous blog post, I reported on the new Office of Inspector General (OIG) fraud alert warning physicians that they could face liability under the Anti-Kickback Statute (AKS) (42 U.S.C. § 1320(a)) unless their compensation arrangements, such as medical director agreements, reflect fair market value (FMV) for bona fide services the physicians actually provide. Although improper compensation relationships has remained the highest enforcement priority for both the OIG and the Department of Justice (DOJ), they tended to focus on the deep pockets of the provider organization for enforcement, not physicians who were benefiting from the arrangement. However, in the last three years there has been a sea change that is placing physicians more at personal risk, as evidenced by a series of new OIG pronouncements regarding physician payments and recent enforcement actions against individual physicians, including those on the following topics: 1) physician-owned entities; 2)  laboratory payments to referring physicians; and 3) physician compensation arrangements that may result in significant liability.

The OIG is making it clear that they will be placing more effort on pursuing individual doctors benefiting from corrupt arrangement, not just the organizations that pay them. Physicians should take heed from these OIG warnings before they enter into compensation arrangements such as medical directorships and ensure that those arrangements reflect FMV for bona fide services the physicians actually provide, or risk not only criminal and civil prosecution, but also administrative sanctions that may include monetary penalties and exclusions from federal health care programs.

Physicians involved in arrangements should carefully review the terms and conditions of the compensation agreements before entering into them. Further evidence of this new added focus by the agencies is the fact that the OIG has received increased funding for its enforcement actions. As a result, the OIG will be adding attorneys who will focus on taking administrative enforcement actions against physicians for their part in “corrupt arrangements.”

Facts/factors involving physicians arrangement enforcement

  • Whistleblowers are the source of most cases, many using the False Claims Act (FCA) (31 U.S.C. § 3729) qui tam provision.
  • All claims arising from a corrupt arrangement with physicians are considered tainted, therefore, meaning false and fraudulent.
  • Most OIG Corporate Integrity Agreements (CIAs) relate to physician arrangements.
  • Enforcement actions take into account payment for the physicians’ volume or value of referrals, whether services were not paid for at FMV, and/or whether physicians failed to provide the services called for under the agreements.

Notwithstanding the extremely high enforcement priority on this subject, most compliance officers fail to include this area in serious ongoing monitoring and auditing. In most cases, this reluctance arises out of the fact that arrangements generally involve either inside or outside legal counsel and compliance officers do not feel competent to question them. The fact that there are so many enforcement actions suggests that reliance on this belief would be a mistake. Any organization that has arrangements with physicians should consider having an outside independent audit of them by experts.

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 © 2015 Strategic Management Services, LLC. Published with permission.