Archive for the ‘OIG’ Category

Proper Coding, Homebound Status, and Awareness of Common Edits: Paid But Will You Retain Your Revenue? An Update.

Tuesday, January 22nd, 2013

No matter which MAC or RAC reviews your agency, high risk probes are on the rise. The intermediaries are mandated by CMS to monitor areas of greater risk. The RACs are paid by contingency on aberrant findings and their algorithms are making findings easier. When MACs or RACs find trends of concern they will launch probes. Some of these high risk areas include revenue in relation to diagnoses in relation to visits, certain stand alone diagnoses or diagnoses in combination with certain numbers of episodes or number of visits.

In late 2012, RAC auditors began sending out chart requests expansively. They were and continue to target specific issues such as medical necessity, seeking to have those specific issues approved by CMS. Once approved, other RACs can investigate those same issues in their areas. One issue all RACs are looking at involves specific numbers of therapy in specific episodes with specific diagnoses.

NAHC’s Mary St Pierre, VP, Regulatory Compliance, identified in the fall of 2012, that Comprehensive Error Rate testing (CERT) contractor inquiries are also on the rise. The CERTs are the QA component of MAC billing. In addition, they also oversee Z-PIC claim payments and the denials issued. They are looking at Face to Face documentation of medical necessity and homebound status documentation.

The OIG remains focused on both home health and hospice citing “Six Measures of Questionable Billing” especially in home health.

The OIG has announced that, in 2009 and again in 2010, Medicare-Medicaid paid over $54 billion in improper payments. There have been 2500 persons/entities indicted from Federal health care programs. There have been 625 criminal actions with over 400 civil actions including actions involving the False Claims Act. There have been another 2400 investigations that yielded expected results. The GAO has reported that improper payments due to fraud and abuse are escalating.

Dollars and processes have been approved to target areas of high risk. Monitoring that the principal diagnosis code accurately portrays the patient’s focus of care is a MAC missive. Probe edits are one such process expected by CMS from the MACs to achieve that goal. Monitoring for homebound status is yet another area of review.

The Edits

Specificity requirements to support codes have always been expected but are being actively scrutinized now. Expect specificity and complexity to rise even higher with ICD-10.

Coding Specialists must also keep clients or their agency aware of edits and trend areas with insufficient documentation to substantiate proposed diagnosis.

A second recertification of Lymphoma will trigger a long used edit.

Recertifications with a primary diagnosis of Diabetes and a secondary diagnosis of CHF will be monitored if the edit continues after a MAC quarterly review. Because the FIs have found merit, this edit has continued for years.

Other Edits include:

Recertifications with a primary diagnosis of Alzheimer’s disease, Schizophrenia disorders, or Long Term use of anticoagulants with no therapy ordered.

Claim Denial Potential

The above diagnoses run a great risk for denial because of probe edits and recertifications. Those records are reviewed also for homebound status. There must be “clear documentation that it is with considerable and taxing effort for the beneficiary to leave home, otherwise the episode or specific visits could be denied for lack of homebound status. (74% of ADRs reviewed for lack of homebound status were denied).”

Common documentation deficiency areas include lack of progress in:

* Repetitive clinical notes frequently seen stating the same things over and over with no patient progress identified; how is it that the clinician is unable to teach a new med successfully within a visit or two?

* Notes from different disciplines that reflect a lack of plan coordination

* Visit notes that do not substantiate orders and goals on Plan of Care/485.

* Clinical interventions without orders.

* If a chronic diagnosis is the primary reason for ongoing care, the skilled nurse should be VERY VERY clear as to why (s)he is still making visits.

* If visit notes do not EACH stand alone and justify care, the clinical visits are at risk.

The casemix co-morbidities; such as CHF, CAD, COPD, DM, Parkinson’s disease should be included in the diagnoses list. If they are standing alone, the nurse should carefully justify the skilled need because of the chronic disease.

* In justifying observation and assessment, note if:

* There is significant change in meds, treatments, or conditions

* There is teaching, reteaching, and training needed

* The condition or disease symptomology has exacerbated or changed in another way

* Teaching on new medications must include instruction or intervention on the related diagnosis.

The clinician providing injections such as insulin require specific documentation to support the need; specifically, why the patient cannot self inject the med such as tremors, impaired cognitive function, and no willing and capable caregiver.

Though we have heard this over and over, one of the most common home health reasons for denial is that the documentation does not support medical necessity.

Therapy is STILL under scrutiny

Functional ability improvement is expected or why is therapy present?

Therapy may be covered if the patient or caregiver received teaching that is reasonable and necessary.

In 2008, claims chosen with 10-11 therapy visits and discharge in episode two had a 74% rate of denial essentially due to poor or insufficient documentation displaying no or low progress and/or incongruence between care and OASIS assessment. The 2012-13 expectations are rigorous and denials are imminent if documentation is insufficient or inadequately substative.

The therapy treatment plan must:

* Relate to the exact diagnosis that has required therapy intervention.

* Identify visit frequency and duration.

* Identify the present and prior functional level.

* State specifically the procedures, treatments, and/or exercises to be performed.

* Clearly list the reasonable and measureable goals to be achieved.

* Care must be specific, safe, and effective supported by the diagnoses according to accepted practice.

* Specify the rehab potential.

* Specify the discharge plan.

Additional Ways to Decrease Risk

Adequate documentation begins with the correct diagnosis and being alert for edits. Besides agency PI projects, consider professional coding teams to decrease risk. Third party coding and auditing can provide the buffer needed to diminish risk and increase compliance. It is hard for one or two or a few in-house coders to not only keep up with the average 350 coding changes each year but to also locate the ever changing edits of each FI. The edits are usually disclosed AFTER the MAC probe results. Third party coding firms, like Select Data, monitor the FI sites, newsletters, and alerts to dig for present edits.

Agencies need to be aware the edits will increase over the next year as CMS, the RACs, the MACs, and the Z-PICs ready for ICD-10 and the move from the present 17,000 codes to over 68,000 codes or a 400% increase in codes. Will there be a 400% increase in edits also? Will there be a 400% increase in claim denials? Let us hope not.

Protecting justly due reimbursement starts with proper data gathering, coding to the highest level of specificity with sufficient documentation, and coding specialists looking out for the specific documentation needed. Do you have the coding specialists that you need in place to assist you in protecting your justifiably deserved reimbursement?

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Posted in CMS, Compliance, ICD-10-CM Coding, MACs, NAHC, OIG, RACs | No Comments »

The OIG and their Focus on Six Measures of Questionable Billing

Thursday, August 23rd, 2012

Though, the Gap Analysis and ICD-10 Transitional Coding Plan was scheduled for this week. Please expect it next week. We believe, you will want to be aware of the OIG address to Congress earlier this month.

 On August 2, 2012, The Office of the Inspector General addressed Congress identifying how and why they studied home health and what they found. Those findings were frightening:

   - Approximately one of every four home health agencies had questionable billing

   - Eighty (80) % of home health agencies with questionable billing were located in four states

               ~Texas

               ~Florida

               ~California

               ~Michigan

Overall, 97% of home health agencies with questionable billing were located in NON Certificate of Need states. Florida, once a Certificate of Need state, but no longer, had the largest representation of agencies with questionable billing practices. Over 52% of the 1,251 Florida agencies will now be scrutinized due to questionable billing practices. The percentage of Florida agencies with questionable practices in billing were six times the national average. Texas reigned in at five times the national average. 

 Excerpts of OIG testimony before Congress on August 2, 2012

   The OIG stated that payment of the claim  is no assurance that the claim is considered correct. It has met initial CMS  standards of payment but can be reviewed with payment recoupment for up to 36 months. The OIG intends to increase reviews and create even more sophisticated algorithms bent on targeting inappropriate billing practices.

 The OIG further Stated:

“We first identified all home health claims with dates of service ending in 2010. In total, we identified approximately 6.96 million Medicare claims for both full and partial home health episodes billed by November, 2003 to identify Home Health Agencies that had questionable billing, we first identified those HHAs that submitted at least 20 claims in 2010. These included 92 percent (10,341) of the 11,203 HHAs and accounted for 6.88 million claims.

We next identified HHAs that had questionable billing. 

We developed six measures of questionable billing based on the results of past OIG analyses and fraud investigations related to home health services, as well as on input from CMS staff and contractors. We considered a HHA’s billing to be unusually high, or questionable, on each of the six measures if it was greater than the 75th percentile plus 1.5 times the interquartile range.”
 
The six measures of questionable billing developed included:

¥ High average outlier payment amount per beneficiary. Medicare makes outlier payments to HHAs that provide services to beneficiaries
who require high cost care. This  measure was based on the total outlier payments each HHA was paid in 2010 relative to the number of
beneficiaries for whom the HHA billed Medicare in 2010. 

¥ Each HHA total outlier payments was calculated relative to total Medicare payments in 2010. An agency was targeted if it showed a higher than average number of visits per beneficiary. We based this measure on the total number of visits each HHA billed in 2010 relative to the number of beneficiaries for whom the HHA billed Medicare in 2010.

¥ High percentage of beneficiaries for whom other HHAs billed Medicare. When multiple HHAs bill for services provided to the same beneficiary in a given period, there is potential for fraud (i.e., beneficiary sharing). We based this measure on the percentage of each HHA’s beneficiaries for whom at least one other HHA billed Medicare in 2010.

¥ High average number of late episodes per beneficiary. In a sequence of episodes, late (i.e., third and subsequent) episodes have higher payment rates than early episodes. We based this measure on the total number of late episodes each HHA billed in 2010 relative to the number of beneficiaries for whom the HHA billed Medicare in 2010.

¥ High average number of therapy visits per beneficiary. Beneficiaries who required a greater number of therapy services have episodes with higher payment rates. We based this measure on the total number of therapy visits each HHA billed in 2010 relative to the number of beneficiaries for whom the HHA billed Medicare in 2010.

¥ High average Medicare payment amount per beneficiary. We based this measure on the total payment for home health services that each HHA received in 2010 relative to the number of beneficiaries for whom the HHA billed Medicare in 2010.

 The OIG will be implementing process edits and sophisticated algorithms designed to weed out those agencies that practice poor billing implementation. MACs are to identify questionable claims and either flag the practices and/or deny payment. CMS has instructed MACs and Z-PICs to monitor the billing applying the above six measures.

 Additionally, the OIG has instructed CMS to consider lowering the outlier cap as 78% of HHA with total outlier payments greater than 5% of total Medicare payments also exceeded the threshold “for our measure of questionable billing specific to outlier payments, indicating potential fraud” stated the OIG.

 The OIG sent a separate memorandum to CMS stating that “appropriate action regarding claims that are associated with inappropriate payments is expected.”

 Agencies in all states, but especially in Florida, California, Texas, and Michigan had better review their billing practices because the OIG has spoken and CMS and the auditors are coming.

 The OIG officially had five recommendations and actions expected:

1. CMS is to implement claims processing edits to prevent inappropriate payments

2. CMS is to increase the monitoring of billing in home health services

3. CMS should enforce and consider lowering the 10 percent cap on the total outlier payments

4. CMS should consider imposing a moratorium on new HHA enrollments in Florida and Texas

5. CMS should take appropriate action regarding inappropriate payments and HHA with questionable billing

 CMS response, “we concur with the recommendations.”

Those agencies located in the four identified states will be under scrutiny. Agencies, get ready. Begin your own audits proactively so you can demonstrate your active compliance program.

Update your Corporate Compliance Plan, because you may need to demonstrate your quality orientation and commitment to billing compliance.

Posted in CMS, Compliance, Home Health, ICD-10-CM Coding, ICD9-CM Coding, Medicare, OIG | No Comments »

The RACs are Coming… The RACs are Coming… And Coding is a Target

Tuesday, January 31st, 2012

RACs have recovered over 96% of all audited claims resulting in take-backs of over 2 billion dollars. Is it any wonder that the home health industry is concerned about their new focus in our industry? The RACs have been identified. The MACs, who will work with the RACs are all now in place.

RACs are contingency based, so, they are motivated to seek out variances.  They can audit 1% of the average monthly Medicare episodes of care (maximum 200) every 45 days per NPI.

Home Health agencies should anticipate to see audits of outlier payments for insulin injections. They should expect, based on coding algorithms to see records reviewed. Are you monitoring your coding and documentation closely? Expect audits.  Fiscal Intermediaries have identified reasons for claim denials and identified high risk areas for non-compliance. Those targeted areas include areas involving coding, homebound status, the documentation of the skilled services delivered, and the overall medical necessity of care administered.

Agencies should be cautious that the codes affixed are well supported by the documentation of the clinician. Too frequently, there has been partial denial of therapy resulting in medical review down-code. Too often and easily, FIs have found clinical documentation incongruent with OASIS M items. Too many times, the reviewers have found that the documentation does not support the focus of care, the sequence for coding, or the medical necessity of the skilled services billed.

In the RAC demonstration project, 35% of the findings pertained to coding. Expect Home Health coding to become one of the chief areas of focus. Remember, the RACs will be looking at variance which will allow them to view consistency of a client’s OASIS, coding, clinical documentation, and the plan of care.

The RAC attack: how to prepare and manage the audits

The Centers for Medicare and Medicaid  (CMS) has implemented, in home health, the  audit process that has proven successful in other areas of the health care industry.  The RAC auditors have been authorized to recover “improper payments “of preapproved areas of risk.  In the demonstration project, high areas of risk included incorrectly coded records, therapy appropriateness, and medically unnecessary services. The RACS use public information from the Office of Inspector General (OIG) and the General Accounting Office (GAO) to focus improper payment audits.

RACs have recovered over 96% of all audited claims resulting in high take-back dollars. Is it any wonder that the home health industry is concerned about their new focus?

RACs are contingency based, so, they are motivated to seek out variances.  They can audit 1% of the average monthly Medicare episodes of care (maximum 200) every 45 days per NPI.  The question is: what action should the home health agency consider now?

Choose a RAC Leader and RAC Response Team

First of all, agencies should appoint a RAC Team Leader who will identify the single point of contact and establish a RAC Response Team. This dynamic team should represent the components of the clinically driven revenue cycle management (RCM) process. Specifically, 1) physicians and clinicians;, nurses, therapists, social workers, 2) quality improvement and documentation specialists, 3) casemanagers, 4) coders, 5) HIM, 6) chargemaster/billing/RCM specialists, 7)  data analysts, 8) Education/Training Specialists, 9) corporate compliance, 10) legal, 11) department heads, 12) mitigation sub-committee that will actually analyze and track each RAC record , and others will be called as needed.  This team will need to address both past and present tactical and oversight issues while prioritizing areas of risk. Additionally, they will review the agency’s ability to complete processes, including audits, and tracking the appeal response.

RAC audits represent significant risk to revenues, profit margins, and workflow stability.  The education of the RAC Response Team is vital in developing the most thorough, yet, efficient approach to establishing RAC risk review and protocol preparedness. Have the team ready.

Identify Vulnerabilities

RAC Response Team education should include lessons learned from the home health industry past: Operation Restore Trust (ORT), May 1995, a two year project in five states resulting in $187.5 million in fines, recoveries, and civil money penalties.  After four years, ORT was credited with a 45% decrease in improper payments, recovery of over $524 million in judgments and settlements and prevention of nearly $11 billion paid in inappropriate claims.

In general, ORT found issues with medical necessity, lack of homebound status, and lack of documentation to support care provided.  Sound familiar? ORT targeted agencies by volume of claims, frequency of medical review issues, LUPA episodes, outliers, therapy thresholds, as well as medical necessity determinations and coding errors.

The recent RAC demonstration results reflected similar focus areas. Agencies should heed those trends identified.

The RAC Response Team should become familiar with regulatory requirements and timeliness. Inservices as well as FAQ sheets with key regulatory highlights and a list of appropriate links to review could be provided. The leader should become familiar with the RAC website as well as monitor the CMS website, alerts, and transmittals.

The RAC Demonstration project showed a 7% payment recovery because of inadequate response to medical record requests so, a process will be needed, to mitigate information flow and manage RAC audit activities thus, create the RAC mitigation sub-committee. This committee or team should function as a subsection of the RAC Response Team, aiding the RAC Team Leader in tracking claims under review.

Identify the patient and document flow, identifying tasks and tools. Diagram patient care flow from intake > admission> medication profile review> discipline specific careplan development > coding >  plan of care development > RAP drop> discipline visits > outcome achievement> QA process review >to final claim submission and A/R management.

Retrospective chart audits as well as present processes and concurrent chart audits should be completed to identify risk. The RAC Response team may decide to contract with third party specialists for comprehensive consulting services to assist the team. The services can include:

  • ICD-9-CM Coding Review (Soon to be ICD-10 CM)
  • Documentation adequacy to substantiate the Plan of Care and the Codes
  • Billing and Revenue Cycle Management (RCM) Review
  • Process and Workflow Analysis
  • Clinical and RCM Resource
  • Presenting OASIS C and Evidenced-Based Practice correlations
  • Conducting RAC training sessions to prepare identified personnel for audits

Comprehensive third party clinical/RCM review of care delivered can assign potential organization susceptibility.  The chart audits can distinguish:

  • If the admission was medically necessary and the plan appropriate and covered all disciplines.
  • If the clinical visits support the plan and the notes
  • If the coding met convention and had adequate documented support
    • Focus on case mix diagnoses
    • Review diagnoses sequencing
  • If therapy, treatment and procedures were appropriate
  • If the reason qualifying homebound status was documented each visit and used objective measureable language
  • Other criteria mutually identified by the RAC Response Team and the outside specialists

The RAC Team should consider reviewing the agency overall compliance process, keeping basic CMS regulations in mind.

There have been no limits placed upon the number of sixty day episodes per beneficiary as long as they remain eligible for the home health benefit.  Payment is adjusted to the patient’s need. It becomes the home health agency’s responsibility to assess the patient accurately. Based upon answers to OASIS items describing the patient’s condition and projected therapy needs, a case-mix adjustment is determined. It is the agency’s responsibility to be certain the assessment is accurate, the care is appropriate, and expected outcomes are achieved. Congruency is a key.

Though no limits have been placed on the number of episodes, the Medicare home health benefit is intended to address short term medical needs designed to be met within 60 days. Ongoing recertification is meant to be the exception, not the norm. That recertification must be signed and dated and have backup support of clinical visit and progress notes, copies of summary reports sent to the physicians, and discharge planning. 42 C.F.R. 484.48.  Sometimes, agencies forget that recertification episodes must be clearly justified and are being reviewed carefully. The RAC Team may wish to call for an audit of patients with two episodes and higher.

Expect recertification assessments to become a focus of review.

Because, the RAC audits have focused on medical necessity, it is vital that the intake process and admission policies be reviewed to ensure compliance.  Involve case managers to discuss how they determine projected visit numbers as well as reconcile their careplan focused visits to the Plan of Care. That Plan of Care is the physician ordered medical certification substantiating the need for home health services. 42 C.F.R. 409.43(c) (3).

The coding processes have historically been one of the highest targeted areas of concern because of inaccurate coding in relation to the assessment and documentation submitted. Improper sequencing of codes with incongruence between assessment and plan of care create chart concerns. Chargemaster functions are to be reviewed to determine how identified problems are corrected. Consider third party coders or third party billing sources who know the rules and assist you to remain compliant.

Billing processes are diverse and should be order centric. A record and process review is necessary to map out areas of high risk, such as physician orders and signatures reconciled prior to final claims dropped. Timeliness requirements should be noted when the process is diagrammed.  Billing can become complex when changes and corrections must be made, so a clear tracking process must be maintained. Personnel must be kept current in billing code changes and CMS requirements.

Anytime adjustments or corrections must be made to the billing, there is a risk for duplicate billing. A strong, consistently reviewed process is needed to track beneficiary eligibility, routine billing requirements, billing adjustments, timeliness, and order centricity.  This review process will go a long way toward preventing automated audits. Remember, the automated audits are intended to locate the simple errors.

The Complex reviews are seeking errors that require more intense review; through medical record reviews.  If a RAC demand letter should arrive, the agency may wish to use that informal discussion period, to discuss the RAC’s reason for the repayment. The agency

You should discuss with the RAC auditor how they can submit supportive documentation. If the RAC agrees to see additional information, they can stop the recoupment process If they do not agree the agency can continue with the appeal process.

Providers/agencies have 120 days (from the date on the demand letter) to file an appeal.  This appeal can halt recoupment but, without a valid appeal, recoupment starts on day 41 per CMS.  Appeal prevention oriented agencies need strong process review and implementation. They need to start their own review now.

Coding and Documentation. Coding and Documentation. Coding and Documentation. They just keep becoming more and more important!

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Posted in CMS, Compliance, Home Health, ICD-10-CM Coding, ICD9-CM Coding, MACs, Medicare, OIG, RACs, Surveys | No Comments »

CMS released the final regulation which implement a new form of healthcare organization, the Accountable Care Organization (ACO)

Saturday, November 5th, 2011

On October 20, 2011the US Department of Health and Human Services released the final rule implementing the ACO Shared Savings Program and the complementary regulations and guidance from CMS/OIG as well as the DOJ/FTC. It should be noted that the final rules are materially different from the proposed rules of March, 2010.

ACOs were created by the Affordable Care Act (ACA) signed into law March 2010. The dual purpose, of this network provider model, is to reduce the increasing cost of healthcare and to include incentives to create this new way of providing care for individuals. Coupled with the ACO rules, CMS had unveiled the Shared Savings Program (SSP), a program created by Congress to allow the ACOs to share in the savings and potentially share the costs of care to Medicare beneficiaries.

The final regulations were released. The proposed rules did not stimulate the interest expected. CMS has since changed the final rule to focus on the themes of flexibility, accountability, and innovation. It also provides clear guidance aimed at encouraging the development of the ACO participation in the Shared Savings Program. The purpose of ACOs is to realize savings and quality care through the coordination of services among the various providers, including hospitals, individual physicians, group practices, hospitals, home health agencies, and community health centers, or any combination of the above. Applications for the implementation of ACOs are currently being accepted through January 1, 2012, and the first ACOs will begin April, 2012.

The three goals of the ACOs stressed under the Shared Savings program will be to promote: 1) effective, patient-centered care for individuals; 2) preventive oriented and education oriented care for specific populations; and 3) cost savings (and profit) for the ACOs and CMS in general as well as decreasing waste in the system.

To be eligible to participate in the Shared Savings Program, ACOs must be accountable for at least 5000 beneficiaries a year for each of the three years of the agreement. To be eligible to share the savings, ACOs will be required to report on four quality measure domains.

It is apparent that this new healthcare model will be very patient-centered, not only addressing the medical needs of its participants, but also the social, nutritional and community needs as well. The cost sharing for the ACOs is determined by not-yet established benchmarks for 33 quality measures (QMs) broken down into the four domains:

  • Care Coordination/Patient Safety (6 measures)
  • Preventive Health (8 measures)
  • At-Risk Populations/frail elderly health (12 measures)
  • Patient/Caregiver Quality Standards (7 measures).

The QMs include population focused areas that are approached in a patient-centered manner. These indicators include timeliness of physician appointments, effective communication, tobacco use, diabetes and other comorbidity control, as well as preventive screenings. Depending on the success of the outcome-driven education and approach to the care as well as patient ratings and surveys, specific provider scores could garner up to 60% of the savings realized by the organization. It is anticipated that the new system will save over $960 million over the next three years for the Medicare program, per CMS.

This new form of healthcare organization will utilize technology to link providers. “An ACO will be rewarded for providing better care and investing in the health and lives of patients,” said Donald M. Berwick, M.D., CMS Administrator. “ACOs are not just a new way to pay for care but a new model for the organization and delivery of care.”

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Posted in ACO, Affordable Care Act (ACA), CMS, CMS Guidelines, Compliance, Home Health, Legislation, Medicare, OASIS-C, OIG | No Comments »

Aggressive New Tools Used to Curb Fraud

Wednesday, March 23rd, 2011

Aggressive New Tools Used to Curb Fraud: Testimony of Inspector General Levinson March 9, 2011

Recently, the Inspector General spoke to the Senate regarding the efforts of the Department of Health and Human Services (HHS) and the Office of the Inspector General (OIG) to combat fraud and abuse. He addressed the fact that the majority of health care providers are honest, but there is an aggressive minority “of career criminals and sham providers.”

In FY 2010 the OIG opened 1700 health care fraud investigations. In addition, that FY also saw “more than 900 criminal and civil actions and more than $3 billion in investigative recoveries and $1 billion in audit receivables.”

The health care fraud schemes “commonly” included:

  • Purposely billing for services not provided
  • Purposely billing for services not medically necessary
  • Misreporting costs and data to increase payments
  • Paying or receiving kickbacks
  • Illegal marketing

Perpetrators include street criminals “who believe it safer to steal from Medicare than to traffic illegal drugs” to “Fortune 500 companies that pay kickbacks to physicians in return for referrals.”

Organized Crime

The Inspector General identified increasing infiltration by organized crime. He noted that the government recently charged 73 defendants, involving $163 million with fraudulent billing. The indictments charge members of the Armenian-American organized crime syndicate with the fraudulent billings and “using violence to ensure payments to its leadership.” They are charged with establishing 118 phony clinics in 25 states using stolen physician identities.

The OIG states the schemes to commit fraud are becoming more sophisticated. They also migrate to other states and can become viral.

Waste and Abuse of Taxpayer Dollars

The OIG is identifying no tolerance of the “10.5 percent  of the Medicare fee-for-service claims paid ($34.3 billion) that did not meet program requirements.” The OIG states the claims should not have been paid based on analysis finding “insufficient documentation, miscoded claims, and medically unnecessary services accounting for almost all of these errors.”

The OIG is also concerned that it has overpaid in areas such as DME. Medicare has paid over $17,000.00 for pumps used to treat pressure ulcers when, in reality, the suppliers paid $3,600.

The OIG and Its New Technological Partners

Because of the sophistication of “the criminal activity and complexity of the scams,” the HHS and Department of Justice (DOJ) collaborated with antifraud efforts grounded in the Health Insurance Portability and Accountability Act of 1996 (HIPAA) creating the Health Care Fraud and Abuse Control (HCFAC) Program. This has been an escalating aggressive program with a high return on dollars invested.

In 2009, HCFAC spearheaded the most aggressive of all fraud enforcement programs. The HHS Secretary and the Attorney General announced the formation of HEAT: Health Care Fraud Prevention and Enforcement Action Team. This team was to build upon the Medicare Strike Force teams that had convicted 116 in South Florida and secured over $186 million in criminal fines. Using a “data driven approach to identify unexplainable billing patterns and investigating these providers for possible fraudulent activity” (Holder, E. May 20, 2009) the team quickly added more sophisticated technology, clinical personnel/program experts,  forensic auditors, top level law enforcement personnel, and data analysts to the strike force. In addition, this team had senior officials from the DOJ and HHS with direct access to Congress.

Because of their success operationally and financially (in FY 2008-2010, for every $1.00 spent the return was $6.80), in 2010, their budget included a 50% increase to funding in excess of $311 million. The industry should be aware!

Last month, strike forces engaged in one of the largest Federal health care fraud takedowns ever. In simultaneous raids in 9 cities, 111 defendants were arrested and charged with over $225 million in false billing. The 111 included doctors, nurses, company owners, and other executives with charges from violating the anti-kickback statute to money laundering and identity theft.

“With the approval of the Attorney General, the Council of the Inspectors General on Integrity and Efficiency (CIGIE) has established procedures to permit special agents from within the Inspector General Community to work together on operations like the HEAT Strike Forces, thereby maximizing efficiency.” Because of the expertise of the team, they are not just raiding when they suspect an issue, they have months of data analyzed prior to the arrest and are then able to raid, arrest, and initiate payment suspensions.

The key to their incredible success are a series of edits that hone in on aberrant data. The data are monitored and certain changes or new edits are added quarterly. The team, for example, was able to identify that Medicare’s average spending per beneficiary for inhalation drugs was five times higher in south Florida than in the rest of the country and they recently responded.  Improper payments for blood glucose strips led to an edit that monitors overlapping dates of services.

Later, in March 2011, the OIG will release its latest edition of: Compendium of Unimplemented OIG Recommendations. This is a must read to have a better idea of recommendations that may still be implemented.

Enhanced Tools and The Affordable Care Act (ACA)

The ACA strengthens law enforcement activities, encourages more audits, and “encourages greater coordination among Federal agencies” by looking at program and payment vulnerabilities, increasing compliance monitoring, and enhances program oversight. It authorizes more robust screening processes for new providers, allows temporary enrollment moratoria when the Secretary learns of fraud “hot spots”, provides for enhanced payment oversight as needed and is mandating compliance programs.

The ACA sanctions “enhanced authority to suspend payments for credible allegations of fraud.”  There have been important “changes to the False Claims Act, the Federal anti-kickback statute, OIG’s administrative authorities, and the Federal Sentencing Guidelines which will help the government to more effectively prosecute those who defraud or abuse Federal health care programs.” Program exclusions will now be used more; not allowing convicted individuals to participate in a Medicare program for a specific number of years and monitoring to be certain they are not violating the exclusion by working with family members in a Medicare program. The OIG has also stated the exclusions will be used with executives of larger organizations.

The OIG has web site guidance used to evaluate whether a section of the exclusion should be imposed. To read more, visit http://oig.hhs.gov . This site also identifies ways patients and providers can reduce fraud.

The OIG is promoting compliance with a HEAT Provider Compliance Training Initiative offering free compliance training. The seminars have been scheduled in Tampa, Kansas City, Baton Rouge, Denver, and Washington, DC throughout the Spring of 2011.

The OIG has also published A Roadmap for New Physicians: Avoiding Medicare and Medicaid Fraud and Abuse, a summary of laws with guidance for physicians to be in compliance.

Additionally, the OIG is now publishing a list of the ten most wanted health care fraud fugitives defrauding taxpayers of $136 million and the 1.888.476.4433 number to call.

The OIG has also created a tip line at 1.800.HHS.TIPS (1.800.447.8477) and an improved website: www.hhs.gov/stop medicarefraud.gov

The RAC, MAC, MIC, Z-PIC audits will continue. Education of clinicians is a must. Home health providers know there is a focus on documentation and medical necessity. Select Data has created a four part series on Insufficient Documentation, Skilled Nursing, Therapy, and Medical Necessity. Visit our website: SelectData.com  or Youtube for the entire free four part series.

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