Kusserow on compliance: OIG report on Medicare payments for clinical diagnostic lab tests

The OIG analyzed claims data for lab tests that CMS paid under Medicare’s Clinical Laboratory Fee Schedule, under Medicare Part B. Effective this year, CMS replaced payment rates with new rates for clinical diagnostic laboratory tests. This was the first reform in three decades to Medicare’s payment system for lab tests. Congress mandated that the OIG monitor Medicare payments for lab tests and the implementation and effect of the new payment system for those tests. The OIG concluded the new payment system for lab tests took for this year has resulted in significant changes to the Medicare payment rates for lab tests. The OIG used the data collected to date as a benchmark against which to measure the effects of changes to the payment system when new data from 2018 become available. The OIG report provided the fourth set of annual baseline analyses of the top 25 lab tests. The OIG identified the top 25 tests based on Medicare payments in 2017 and found:

  • In 2017, Medicare paid $7.1 billion for Part B lab tests, at about the same level for last 4-years.
  • The top 25 tests totaled $4.5 billion, 64 percent of the total and about the same rate for prior years.
  • A total of 50,000 labs received payment in 2017 and three labs received $1.1 billion, 15 percent of the total payments.
  • The top 25 tests were similarly concentrated among a few labs: 1 percent of labs received 55 percent of all Medicare payments for the top 25 lab tests in 2017.

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

Kusserow on Compliance: Exit interviews as a compliance communication channel

Tom Herrmann, JD, had served in a senior capacity with the Office of Counsel to the Inspector General (OIG) at HHS. He pointed out that the OIG, in its compliance guidance, calls for the development of effective lines of communication with employees as very important to the successful implementation of a compliance program and the reduction of any potential for fraud, abuse and waste. This include implementation and use of hotlines (including anonymous hotlines), e-mails, written memoranda, newsletters, and other forms of information exchange to maintain these open lines of communication. One significant channel of communication is the use of exit interviews to debrief departing employees prior to their departure. A major factor influencing the advancement of exit interviews in connection with compliance programs has been the rise in the number of “whistleblowers.” Most of these come from people reporting on an organization they had recently left.  As such, there is great value in debriefing those departing the job that includes asking question about any observed violations of law, regulation, Code of Conduct, or policies. Optimally, an exit interview process should be done in time to permit possible remedial actions before they leave employment.  He has found that exit interviews can also be useful in avoiding other costly litigation involving unlawful harassment, discrimination, safety violations, etc.  It is very important to keep a record of the interviews conducted and responses.

Carrie Kusserow has been developing, enhancing and monitoring exit interview programs for over 15 years. She noted that many organizations conduct employee exit interviews (also called exit surveys) to gather data for improving working conditions and retaining employees. This has been common in human resource management for generations and this type of communication can be useful in taking actions to correct deficiencies, reduce turnover, identify potential compliance-related problems, and maintain a productive work environment. However, exit interviews may also be used to alert an organization to company compliance issues, potential whistle-blowers, or quality of care issues. At a minimum, an exit interview should include compliance program oriented questions that relate to compliance education, policies, anonymous reporting procedures, and attitudes towards the compliance program. The following are examples:

  1. How effective was your training on the compliance program, Code of Conduct and policies?
  2. Were you trained on how to report concern and problems confidentially or anonymously?
  3. Did you believe that those reporting compliance issues would be protected from retaliation?
  4. Are you aware of any ethical or compliance issues; and if so did you report them?
  5. How could the company strengthen its message regarding ethics and compliance?
  6. Is everyone in the work force treated fairly?
  7. Do you believe management fully supports the compliance program?
  8. Are you leaving due to any compliance concerns about your job or work environment?
  9. Are you aware of any improper or illegal conduct in the workplace? If so, who and what?
  10. Have you reported compliance issues or concerns that are unaddressed? If so, explain.

 

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: Four physicians charged in $200M prescription fraud scheme

A CEO and four physicians were charged in a superseding indictment in an investigation of a $200 million health care fraud scheme that involved a network of Michigan and Ohio pain clinics, laboratories, and other medical providers. Additional charges included wire fraud conspiracy, money laundering, and distribution of over 4.2 million medically unnecessary dosage units of controlled substances and medically unnecessary injections to Medicare beneficiaries, some of whom were addicted to narcotics. These included oxycodone, hydrocodone and oxymorphone. Some of the opioids were resold on the street.

When a medical review was made of the injection claims, it was found that 100 percent of the claims were not eligible for Medicare reimbursement. In order to conceal the continued billing of these fraudulent claims to Medicare, the defendants created new shell companies and continued to engage in the same billing of fraudulent claims, often changing only the name of the company on the door to the medical practice and/or inventing new suite numbers to conceal the continuation of the fraudulent practices at the same location. Defendants also owned a diagnostic laboratory to enable them to order medically unnecessary urine drug testing from the laboratory. When Medicare conducted a medical review of claims submitted by the laboratory, it determined that 95 percent of the claims were not eligible for Medicare reimbursement and ordered the diagnostic laboratory to repay $6.9 million in improper payments.

Another scheme involved money laundering in connection with a $6.6 million wire transfer and the withdrawal of $500,000 in cash, which was hidden in plastic bags in the closet of the house.  The indictment alleges that transferred proceeds derived from the conspiracy were used to allow the defendants to live an extravagant lifestyle and spend millions of dollars on luxury items—clothing from retailers like Hermes, rare Richard Mille watches, and exotic automobiles such as a Lamborghini and Rolls Royce Ghost. The proceeds were also used to purchase a mansion and other real estate in the Detroit, Michigan area and to sit courtside or in the first row of NBA basketball games, including the NBA Finals.

 

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: Emerging government enforcement priorities for 2018

At the HCCA conference in April, there were several presentations regarding the government’s enforcement priorities. There were a number of emerging issues that were the subject of considerable attention: the opioid crisis, electronic health record (EHR) fraud, and telehealth/telemedicine. By far, the area given the most attention was the opioid crisis.  More than a dozen presenters included comments in their presentations on this subject, including presenters from the DOJ, OIG, CMS, and the OCR. This is not surprising in that last October the President declared this to be a national public health care crisis and marshaled regulatory and enforcement agencies to actively focus on steps to alleviate it. Other agencies not present at the HCCA are included in this effort, such as the FDA, FCC, CDC, Indian Health Service, Veterans Administration, Department of Defense TRICARE program, and others. At the federal and state level, there is increased legislative, regulatory, and enforcement actions activity related to substance abuse and behavioral health services. In January, the Attorney General announced the DEA was increasing its focus on pharmacies and prescribers who dispense unusual or disproportionate amount of such drugs. He also has created the Prescription Interdiction and Litigation (PIL) task force to aggressively deploy and coordinate all available criminal and civil law enforcement tools to address the crisis. Both DOJ and OIG presenters noted the July 2017 “take down” of 412 defendants in 41 different judicial districts. The defendants included over 100 doctors, nurses, and other medical license professionals. Together these individuals were responsible for over $1.3 billion in false billings.

The second most reported topic concerned cyber and IT security of Protected Health Information (PHI). This was a main topic in the presentation by OCR, but was alluded to in seven other presentations on cybersecurity and threats and complying with HIPAA Privacy and Security standards. The OCR reported that since 2009, there have been 2178 reports of breaches over 500 files with more than 300,000 cases of breaches affecting fewer than 500 files. The OCR has responded to over 170,000 complaints that resulted in over 25,000 cases being resolved with corrective action measures.  The OCR expects about 17,000 new complaints this year.  The top 10 recurring issues involve: (1) disclosure of sensitive paper information, (2) business associate agreements, (3) risk analysis, (4) failure to manage risks, such as with encryption, (5) lack of transmission security, (6) failure of ongoing auditing, (7) no patching of software, (8) insider threats, (9) improper disposal of records, and (10) insufficient backup of information and contingency planning.

Several sessions focused on physician arrangements and how they could implicate the Anti-Kickback Statute and Stark Laws.  Statistics from DOJ indicated the continuing trend of increased number of qui tam cases that has grown from 426 in 2015 to around 500 in 2017 with annual settlements averaging about $2.5 billion per year.

New cases involving Meaningful Use Fraud were reported with the promise that more new cases were under development.  Another area getting a lot of enforcement attention by the DOJ and OIG relate to telehealth and telemedicine. Cases surfacing now are focusing on claims arising from billings for these areas that did not qualify as such.  Only certain telehealth services are covered by Medicare and providers should take care to follow CMS guidance on what qualifies.

It is interesting to compare these priorities with results for the 2018 Compliance Benchmark Survey of compliance officers. There was no mention of the opioid crisis, as it was just an emerging national issue at the time the survey was taken. HIPAA security/cyber-security was the highest priority. It is troubling that corrupt arrangements with referral sources remains the number one regulatory and enforcement priority for the OIG and DOJ but is ranked fifth in priority to respondents. The other major and continuing enforcement priority related to claims submissions and that ranked third in priority by compliance officers.  A complementary webinar relating to this survey will be presented on May 9th.

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.