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.

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Copyright © 2020 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: Using sanction-screening tools vs. outsourcing the entire process

In order to save time and costs, more and more health care organizations have been moving to outsource functions that are not core business activities. Compliance programs have been part of that trend: (1) 80 percent of compliance offices use vendors to provide hotline services, (2) 50 percent of compliance offices use vendors to provide policy development tools, and (3) two-thirds of compliance offices use vendors to provide E-learning tools. Included in the growing list of outsourced tasks has been the movement to address the rapidly growing cost and time commitment obligations related to sanction-screening. Two-thirds of compliance offices use a vendor search engine tools to assist in sanction-screening that saves an organization from downloading the sanction databases and developing a search engine. This is a trend driven by the rapid development of many new databases against which to screen employees, medical professionals, contractors, vendors, etc., including the following:

  • OIG List of Excluded Individuals and Entities (LEIE)
  • GSA Excluded Parties List System (EPLS)
  • 40 Medicaid states now have sanction data bases requiring monthly screening
  • Drug Enforcement Administration (DEA)
  • FDA

All this has increased the burden of sanction-screening exponentially, not only for the compliance office, but also human resource management for new hires and periodic screening of current employees and procurement with vendors and contractors. Medical credentialing is involved as result of having to screen physicians who are granted staff privileges. Using vendors has been a great help, but the most difficult part of the process is resolving “potential hits.” This can be a considerable effort and many organizations have to dedicate staff for investigation and resolution of these hits. It is complicated by the fact that most sanction data does not provide sufficient information to make positive identification. As a result of this heavy burden, many have moved beyond simply using a vendor tool to outsourcing the entire process to vendors. The following address selecting a sanction-screening vendor and outsourcing the process.

 

Tips for selecting sanction-screening vendor

 

Tips for outsourcing the sanction-screening process

  • Determine the cost of moving from use of a vendor search engine tool to outsourcing the screening, along with investigation and resolution of “potential hits.”
  • Inquire as to the methodology they follow in resolving potential “hits,” a critical part of any screening effort.
  • Ensure the vendor provides a certified report of the results that can be made part of the compliance office records.
  • Review an example of the type of reports they would provide to determine if it meets the documentary needs of the organization.

 

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: Appealing exclusions–practical advice

Attorneys and consultants frequently have sanctioned clients desperately wanting to appeal and overturn the HHS Office of Inspector General (OIG) decision on exclusion, adding them to the List of Excluded Individuals and Entities (LEIE). The desperation is driven by the fact that exclusion is tantamount to putting them out of business. Few health care providers of services and products can function without access to federal health care programs and trying to continue servicing in that area after exclusion represents further violation of law with increased penalties.

Tom Herrmann, J.D., served over 20 years in the Office of Counsel to the Inspector General and as Appellate Judge for the Medicare Appeals Counsel and is frequently engaged to assist in Medicare appeals. He explained that there is, indeed, a process for appeal on exclusion to an HHS Administrative Law Judge (“ALJ”), the HHS Departmental Appeals Board (“DAB”), and ultimately the federal courts.  However, he warns that trying to appeal exclusions imposed by the OIG is not generally advisable, in that they are rarely overturned.  This is because most exclusion actions, both mandatory and discretionary, are derivative of a prior official action, whether it is court conviction or licensure board revocation.  Upon appeal, the underlying predicate action for exclusion may not be challenged through the established administrative and judicial review process.  The governing regulations provide further that an ALJ may not “review the exercise of discretion by the OIG to exclude an individual or entity under section 1128(b) of the Act, or determine the scope or effect of the exclusion.”   Moreover, the ALJ is prohibited from setting “a period of exclusion at zero, or reduce[ing] a period of exclusion to zero, in any case where the ALJ finds that an individual or entity committed an act described in section 1128(b) of the Act.”

Furthermore, an excluded party can affect entities with who affiliated. Should a provider permit an excluded party to be involved in services, it will create a liability to that organization.  As a condition of participation in Medicare/Medicaid, it is the affirmative duty and responsibility of the organization to ensure that any provider of services or products that is included in claims submitted for payment to those programs are licensed, qualified and NOT excluded.  To engage excluded parties places in jeopardy the entity’s status as a provider.  Furthermore, it is the OIG’s position that all claims submitted that include anything from a sanctioned provided may be considered false and potentially fraudulent.  Providers should take steps to avoid being poisoned by excluded parties.  Sanction screening can be a challenge because of multiple exclusion databases and variations of names and data.

Practical tips

Organizations should consider the following:

  • The fact that most exclusions arise from court or licensing agency actions underscores the importance of sanction screening and conducting background investigations prior to engaging employees, contractors, and vendors, to ensure they have not been subject to adverse actions by these authorities.
  • Screen parties before engaging them and thereafter periodically (e.g. monthly) against the LEIE or relevant State sanction lists.
  • Ensure data used in screening is accurate and up to date. Frequently, sanctioned parties disguise their exclusion with a name change (e.g. spouse surname), variations on name (particularly significant in the case of names that are transliterated).
  • Include on any application for employment or for medical privilege a statement that they are not under investigation and have not been subject of adverse action by any duly authorized enforcement agency.
  • Check the enrollment and exclusion status of physicians and other non-physician practitioners that routinely order or prescribe, as any services ordered or prescribed by an excluded health care practitioner will not be eligible for program payments.
  • If a party is verified to be on an exclusion list, take immediate action to terminate the party; determine the monetary exposure of the services involving that party that was billed to Federal health care programs; and disclose the findings to the OIG.

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.