Little Health Law Blog

Fraud and Abuse Update: OIG Reports Big Recoveries from Providers

June 6, 2016 | Little Health Law

us-capitol-building-2-431642-m The U.S. Department of Health & Human Services (HHS), Office of Inspector General (OIG) recently issued its Semiannual Report to Congress regarding the OIG’s success in detecting and obtaining recoveries as a result of fraud, waste and abuse in Federal healthcare programs. Our Atlanta and Augusta, Georgia based business and healthcare law firm follows healthcare industry developments with regard to compliance, fraud and abuse.

The OIG uses technology and forensic audit expertise to identify new types of healthcare fraud and take enforcement steps to curb fraud and obtain recoveries for the Federal government. The OIG’s Semiannual Report covers the OIG efforts and results during the first six months of fiscal year 2016. According to the Semiannual Report:

the OIG anticipates recoveries of more than $2.77 billion, comprising about $555 million in “audit receivables,” $2.22 billion in “investigative receivables.”
the OIG reported 428 criminal actions against individuals or entities engaged in crimes relating to Federal healthcare programs
the OIG reported 383 civil actions filed in U.S. District Court for civil monetary penalties (CMP) matters, unjust enrichment claims, and administrative recoveries based on provider self-disclosures
exclusions of 1,662 individuals and entities from participation in Federal healthcare programs

The Semiannual Report provides numerous specific case examples of the OIG’s accomplishments in combatting healthcare fraud and abuse so far this year, noted in the report as “Highlights of Our Accomplishments,” including the following:

Federal Appeals Court Affirms Medicare’s $8.9 Million Overpayment Determination based on Improper Multi-Dosing

May 24, 2016 | Little Health Law

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Vitreo Retinal Consultants of the Palm Beaches, P.A. (VRC) sued the U.S. Department of Health and Human Resources (HHS) to recover payments it made to Medicare, having previously refunded the payments to Medicare based on Medicare’s notice of overpayment. The Eleventh Circuit affirmed the decision of the U.S. District Court, which upheld the administrative decision supporting Medicare’s overpayment notice. The ophthalmologist/owner of the VRC was indicted and charged with 46 counts of healthcare fraud, according to a Department of Justice press release.

Georgia Medicare Reimbursement Attorneys

VRC treated Medicare patients who suffered from age-related macular degeneration (AMD) and similar retinal diseases with intravitreal injections of Lucentis, a Medicare Part B drug approved by the FDA. There was no dispute in the case that the drug was medically reasonable and necessary for treatment of AMD. However, the FDA labeling instructed that the full contents of the 2.0-mg vial be injected into a syringe for purposes of injecting a single 0.5-mg dose of Lucentis into the patient’s eye once a month. The label clearly stated that “[e]ach vial should only be used for the treatment of a single eye.” VRC did not follow the labeling instructions; rather, it treated up to three patients from a single vile.

Based on applicable Medicare reimbursement rates, if administered as per the FDA label, a physician would inject 0.5 mg into the patient’s eye, dispose of 1.5 mg, and receive reimbursement in the amount of approximately $2,025, the average total cost of the vial. VRC would bill Medicare $2,025 for every 0.5-mg dose it administered, however, and be reimbursed $2,025 for every dose. Since VRC would get up to three doses from a single vial, it was reimbursed up to $6,075 per vial, about three times the allowed reimbursement.

Medicare’s contractor issued a preliminary overpayment determination of $8.9 million. Reconsideration was denied and the overpayment determination was upheld by and administrative law judge and the Medicare Appeals Council. VRC filed suit, and the US District Court deferred to the agency decision.

PAY IT BACK OR ELSE: CMS’ NEW OVERPAYMENT RULE FOR REPORTING AND RETURNING SELF-IDENTIFIED OVERPAYMENTS UNDER MEDICARE PARTS A AND B

April 29, 2016 | Little Health Law

889854_freedom_2 The U.S. Centers for Medicare & Medicaid Services (CMS) recently finalized a final rule to effectuate the federal government’s ability under the Affordable Care Act (ACA) to recover self-identified overpayments, applicable to Medicare Parts A and B. CMS’ implementing overpayment rule is the latest sword in the government’s formidable arsenal to combat fraud and abuse with regard to healthcare reimbursement under federal programs. Physicians and other healthcare businesses and suppliers should take heed, as they will be subject to considerable potential financial liability and professional risks for noncompliance with the new overpayment rules. Our Atlanta/Augusta business and healthcare law firm follows developments in healthcare fraud and abuse laws.

New Teeth for ACA Fraud and Abuse Provisions

Section 6402 of the ACA requires physicians, healthcare providers and suppliers, managed care plans, and other groups to self-report and refund to the government any Medicare or Medicaid overpayments by the latter of 60 days from the date the overpayment is identified or the date any corresponding cost report is due. The failure to do so subjects the offending party to civil monetary penalties and exclusion from all federal healthcare reimbursement programs. Additionally, according to the new overpayment rules, the retained overpayment is an “obligation” under the False Claims Act (FCA), subjecting the violator to all the financial consequences that attend FCA liability. The new rule is part of CMS’ final regulations to implement the ACA’s requirements with regard to overpayments as concerns Medicare Part A and B.

April 27, 2016 Kevin Little speaks to American Osteopathic Association physicians on Stark and other self-referral laws

April 27, 2016 | Little Health Law

Kevin Little speaks to American Osteopathic Association physicians on Stark and other self-referral laws.

CMS Announces Medicare’s New Primary Care Reimbursement Initiative, “Comprehensive Primary Care Plus”

April 25, 2016 | Little Health Law

usa-dollar-bills-1431130-m CMS recently announced what it describes as the largest-ever multi-payer initiative to improve primary care in America,” known as Comprehensive Primary Care Plus (CPC+). Though much of the press release is couched in terms of improving patient care — and surely CPC+ is intended to do so — the real impetus appears to be the government’s critical need to control healthcare costs funded by federal programs.

Atlanta/Augusta, Georgia Physician Practice Lawyers

The idea is to support a new primary care delivery model that will incentivize and reward value and quality. The current Administration’s goal is to have 50% of all Medicare fee-for-service payments made via alternative payment models by 2018. The Center for Medicare and Medicaid Innovation, which exists pursuant to Section 1115A of the Social Security Act (added under the Affordable Care Act) for the purpose of testing new payment and service delivery models, developed CPC+ as part of its mission, to aid the federal government in its efforts to curb its healthcare costs and enhance the quality of healthcare delivery.

CMS Expected To Provide New Guidance For Hospitals’ Uncompensated Care

April 18, 2016 | Little Health Law

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For several years, hospital administrators have been adjusting to changes in federal rules for calculating patients’ unpaid medical bills into hospital Medicare reimbursement.

The federal government provides funding to hospitals that treat indigent patients under so-called “Disproportionate Share Hospital (DSH) programs,” which provide partial compensation to facilities based on a formula. Many of the roughly 3,100 hospitals receiving DSH payments are teaching hospitals or those in large urban areas.

The Patient Protection and Affordable Care Act changed the formula for calculating DSH payments in fiscal year 2014, significantly reducing the share hospitals received, with goals of reducing funding for the Medicare DSH payments initially by 75 percent and subsequently increasing payments based on the percent of the population uninsured and the amount of uncompensated care provided; and to reduce the Medicaid DSH program by $18.1 billion by 2020.

Healthcare Providers and Business Partners Get Ready: The Next Phase of HIPAA Audits is Here

March 28, 2016 | Little Health Law

medical-doctor-1314902-m The U.S. Department of Health & Human Services (HHS) announced its preparation to move into its next phase of audits of healthcare covered entities and their business associates. According to HHS, “[t]he 2016 Phase 2 HIPAA Audit Program will review the policies and procedures adopted and employed by covered entities and their business associates to meet selected standards and implementation specifications of the Privacy, Security, and Breach Notification Rules.” Physicians, medical practices, other providers and healthcare businesses, and their business associates, should take steps to ensure they are current and compliant with respect to HIPAA requirements.

Federal Investigation/ Medical Audit Lawyers

HHS is charged by federal law with the responsibility to enhance and protect the health and well-being of all Americans. To that end, HHS, through its Office of Civil Rights (OCR), endeavors to ensure high quality health and human services and promote advances in medicine and public health. Federal law known as the Health Information Technology for Economic and Clinical Health Act (HITECH) requires HHS to conduct periodic audits of healthcare providers and their business associates to ascertain compliance (or lack thereof) with the HIPAA Privacy Rule, the HIPAA Security Rule, and the HIPAA Breach Notification Rule. The HIPAA Privacy, Security and Breach Notification Rules, though very important to our government’s efforts to protect protected health information (PHI), are additional burdens for those in the business of providing healthcare and their business partners who might have access to PHI.

A few years ago, OCR used a “pilot” audit program to assess a sampling of covered entities’ progress in implementing HIPAA’s requirements for protecting PHI. Now, utilizing the information obtained by its pilot audit program, OCR will begin auditing both healthcare providers and their business associates. Beginning this year, OCR will review and analyze policies and procedures adopted by covered entities and business associates against the requirements of the HIPAA Privacy, Security and Breach Notification Rules.

Physician Employment and Contracting

March 7, 2016 | Little Health Law

to-sign-a-contract-2-1221951-m In making a decision to pursue medicine and healthcare as a livelihood, it is likely that most physicians today did not contemplate the extent to which legally binding contracts would govern and impact their professional lives. Few other careers carry the same potential for commitment to so much paper and binding agreements that simultaneously foster professional opportunities and create hazardous legal and professional risks (for example, a non-compete agreement that bars future employment needed to avoid selling the house and moving; a contract with a hospital system that memorializes a compensation arrangement but, unbeknownst to the doctor when he signs, violates STARK law). In this day, all physicians should be mindful of the critical importance of good contracting principles and practices.

Physician employment

The healthcare industry, perhaps more dramatically than other industries, is prone to changes, trends, and developments. A sustained trend has been physician employment (versus private practice ownership). In the 1990s, with the evolution of HMOs, the industry trended toward high levels of physician employment, a trend that petered out some during the 2000s with decreasing physician employment as HMOs dissolved. In recent years, however, the healthcare industry returned to a strong trend toward physician employment driven by numerous factors derived from healthcare “reform.” Whether the current physician employment trend is more permanent than the last one is unknown, but some experts predict that the high level of physician employment is here to stay. As reported last year in the Dallas/Forth Worth Healthcare Daily, some experts believe that physicians’ need for stability with regard to future income will drive a lasting employment trend.

Medicare Reimbursement and Legal Issues in End of Life Planning

February 29, 2016 | Little Health Law

romanticism-1309299 Of the 2.5 million people who die in the U.S. in a year about 75% of those are 65 and older. As such, Medicare is the largest insurer of the cost of medical treatment during the last year of life, according to an article by the Henry J. Kaiser Family Foundation. Given this reality, health care providers regularly encounter practical questions and concerns about end-of-life issues. Examples of patient and provider concerns in end-of-life care include: Who is authorized to make medical decisions for patients unable to understand and decide for themselves? Does a patient want to receive artificial nutrition and hydration if in a coma? Does a patient wish to be resuscitated regardless of their medical condition? How can patients communicate and provide proof of their wishes about end-of-life medical decisions in a way that their families and health providers know and understand, and the law will support?

To ensure that a patient’s wishes are followed in the immediacy of meeting medical needs at the end of life, patients and their families should plan ahead to consider their options, make decisions, and communicate their wishes to their physicians and other health care providers in advance. Recognizing the significance to patients and providers in discussing end-of-life plans, effective January 1, 2016, Congress has authorized Medicare reimbursement to health providers for time spent in such discussions.

Winter Edition (2016), Epic Publishes Lee Little’s article, Shining a Light on Pharmaceutical Payments to Physicians and Teaching Hospitals: The Physicians Payment Sunshine Act.

February 8, 2016 | Little Health Law

Epic, the magazine of the Georgia College of Emergency Physicians, publishes Lee Little’s article, Shining a Light on Pharmaceutical Payments to Physicians and Teaching Hospitals: The Physicians Payment Sunshine Act in their Winter issue.