tota mountain central conference 2014 sugar land marriott town square 16090 city walk - sugar land,...

TOTA Mountain Central Conference 2014

Sugar Land Marriott Town Square 16090 City Walk - Sugar Land, TXNovember 7, 2014 at 4:00 p.m.

Health Care Fraud

21039964v1 © 2014 Anderson Kill P.C. All Rights Reserved.

DisclaimerThe views expressed by the participants in this program are not those of the participants’ employers, their clients, or any other organization. The opinions expressed do not constitute legal advice, or risk management advice. The views discussed are for educational purposes only, and provided only for use during this session.


Your Speaker

Richard Y. Cheng, OTR, JDAnderson Kill P.C.

ph. 972-728-8753 [email protected]


Presentation Overview

Healthcare Fraud Statistics InvestigationsPotentially Problematic Conduct SanctionsCivil and Administrative StatutesCriminal Statutes StarkResponding to Government InquiriesProtective Measures


Annual Loss Due to HealthCare Fraud-FY 2013 Federal government won or negotiated $2.6 billion for

healthcare fraud.

Medicare Trust Fund received transfers of $2.85 billion, including over $576 million in Medicaid.

Over $25.9 billion since program started in 1997.


2012 Federal Healthcare Statistics

1013 New Criminal Cases Opened (1910 Defendants)2014 Open Criminal Investigations (3535 Defendants)80 Cases Filed (843 Defendants)718 Convicted 1083 Civil Investigations Opened1079 Pending Civil Cases3214 Exclusions (Individuals and Entities)


Investigations Federal Government—CMS, OIG and DOJ State Government—Texas Health and Human Commission OIG &

AG.Private Insurers and intermediariesWhistleblowers/Qui Tam –state and federal. Main reason for FCA

and Stark Law violations. State Licensing Boards—may lead to referral to other state

agencies which could result in further investigations.


Most Common Conduct

Services not rendered—documentation and time provided.

Up-coding—non-existing upgrade procedure or beyond what is necessary

Unbundling—common in clinical laboratory settings

False medical necessity certification

Kickbacks/Improper relationships

Retention of overpayments


Inducements to Beneficiaries,Referral Sources and Employees

Offers of gifts or gratuities to beneficiariesCost-sharing waivers and discounts Free Transportation Preventative care serviceGifts to referral sourcesPayments Based on Production/CommissionsCo-pay waivers


Billing Inadequate resolution of overpayments Lack of integrity in computer systems Software programs that encourage billing personnel to insert data in fields

suggesting services were rendered Knowing misuse of provider ID numbers Outpatient services with inpatient stay Billing for discharge instead of transfer Improper use of modifiers Internal coding practices Coding without supporting clinical documentation—”Assumption Coding” Altering documentation Billing for services provided by unqualified or unlicensed personnel


Quality of Care Sufficient StaffingComprehensive Care PlanAppropriate Medication Safety Services rendered

EXAMPLE: In Texas, the AG Medicaid Fraud Control Unit investigates patient neglect and abuse if the provider is a Medicaid provider and receiving Medicaid funds.


Home Health Over utilization and under utilization regarding number of visits or length of home

health coverage Knowingly billing for inadequate or substandard care Billing for unallowable costs of home health coordination Unqualified personnel False dating of amendments Falsified plans of care Forged beneficiary signatures Discriminatory admission and discharge Knowing misuse of provider certification numbers Duplication of services Knowing or reckless disregard of willing and able caregivers Licensing requirements and Medicare Conditions of Participation (CoP) Knowing failure to return overpayments


Skilled Nursing Facilities/Nursing Facilities Services not rendered

Medical necessity

Double billing

Unbundling

False cost reports--Medicare-certified institutional providers are required to submit an annual cost report to a Medicare Administrative Contractor (MAC).

Standard of care

Kickbacks


Sanctions Administrative

Civil—corporate integrity agreement (CIA) and on-going monitoring

Monetary hold/suspension of payments

License renewal

Exclusions

Criminal—money and prison time

Forfeitures—seize assets, accounts and property

State Board—license suspension/revocation


Exclusion/Suspension of Payments/Revocation of Enrollment Mandatory Exclusion--OIG is required by law to exclude from participation in

all Federal health care programs

Permissive Exclusion--OIG has discretion to exclude individuals and entities on a number of grounds, including misdemeanor convictions related to health care fraud other than Medicare or a State health program, fraud in a program (other than a health care program) funded by any Federal, State or local government agency

Suspension—”credible allegation of fraud” (state and federal)

Revocation of Enrollment—home health if fail to maintain or produce documents


False Claims Act (31 USC § 3729) Knowingly presents, or causes to be presented, a false or fraudulent claim for payment

or approval Knowingly make, uses, or causes to be made, a false record or statement material to a

false or fraudulent claim Has possession, custody, or control of property or money used, or to be used, by the

Government and knowingly delivers, or causes to be delivered, less property than all of that money or property

Knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the Government, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government

Conspires to do the above acts


Whistleblower/Qui Tam Actions(31 USC § 3730)Private parties can bring actions in the name of the United States

Recover 15%-30%, attorneys fees and costs

Main source of investigations for healthcare fraud


Civil Monetary Penalty Laws(42 USC § 1320-7a) Knowingly (or should know) presenting a claim for services or items not

provided Knowingly (or should know) presenting a claim for services or items that are

not medically necessary Knowingly (or should know) being an office/entity, holding ownership/ control

or managing employees of a CMS excluded entity Knowingly (or should know) presenting a claim that violates Medicare

assignment requirement, Medicaid rules or Medicare participation. Arranging or contracting with an individual or entity that the person knows or

should know is excluded Offering remuneration to Medicare or state health beneficiary that is likely to

influence the beneficiary Violating the federal or any state based Anti-kickback statutes


Health Care Fraud (18 USC § 1347)To knowingly and willfully execute or attempt to execute, a

scheme –

To defraud any health care benefit program, or

To obtain, by means of false or fraudulent, or pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any health care benefit program


Criminal False Claims Act (18 USC § 287)

A defendant presented a claim against the US or any agency or department of the US

The claim was false, fictitious or fraudulent, AND

The defendant knew the claim was false, fictitious or fraudulent.


False Statements (18 USC § 1001)A statement,

That is false,

Material,

Made knowingly and willfully, AND

In a matter within the jurisdiction of a departmentor agency of the US


Anti-Kickback Statute (42 USC § 1320-7b)

Knowing and willful conduct involving the solicitation, receipt, offer or payment of any kind of remuneration in return for referring, directly or indirectly, an individual or for recommending or arranging the purchase, lease or ordering of an item or service that may be wholly or partially paid for by any federal health care program.

Person need not have actual knowledge of this section or specific intent to violate this section.

Texas Anti-solicitation Statute—broader and goes beyond government healthcare programs and includes private insurance payer sources.


Penalties for Violating Anti-Kickback Statute Criminal Statute Felony Not more than 5 years, not more than $25,000 cash, or both per

violation

Civil Sanctions Exclusion for Medicare/Medicaid Civil Monetary Penalty (“CMP”) of up to $50,000 plus damages of up

to 3x the amount of the kickback.


Intent

Pre-PPACA—an individual must have actual knowledge of, and the specific intent to, violate the AKS.

Post-PPACA—a person need NOT have actual knowledge of the AKS or have a specific intent to commit an AKS violation; still requires knowing and willful intent.


Texas Patient Solicitation Act (“TPSA”)

Person knowingly offers to pay or agrees to accept, directly or indirectly, overtly or covertly any remuneration in case or in kind to or from another for securing or soliciting a patient or patronage for or from a person licensed, certified, or registered by a state health care regulatory agency.


Potential Kickback Violations Routine waivers of co-pays or deductibles (aka cost-share waivers). Joint ventures with Medicare/Medicaid pay Hospital arrangements—credentialing, medical directors, recruitment

and retention Prescription Drug Marketing—inducement by manufacturer (e.g.

frequent flier program or research grant) Lab discounts—additional work done, direct benefits or discount on

composite rate. Home health, skilled nursing facilities/nursing facilities, hospices and

ambulances. Office rental Gifts to Medicare/Medicaid Beneficiaries


Texas Criminal Statutes

Medicaid Fraud—Texas Penal Code § 35A.01 and 35A.02

Theft—Texas Penal Code § 31.03

Securing Execution of document by deception—Texas Penal Code § 32.4

Any other applicable statute


Stark Self-Referral Prohibitions42 USC § 1395nn—Elements The existence of a “financial relationship” between a physician or

immediate family member

A referral by that physician (or a group practice referral if the physician controls referrals by the group practice)

To an entity providing designated health services (DHS), AND

The absence of an applicable exception


Stark—Key Definitions Financial Interest—includes both direct and indirect ownership and

investment interest and compensation arrangements

Ownership or investment interest—may be through equity, debt, or other means, and includes an interest in an equity that holds an ownership or investment interest in any entity that furnishes DHS

Compensation Arrangement—is any arrangement involving remuneration, as defined in the regulations, whether direct or indirect, between a physician (or a member of a physician’s immediate family) and an entity.


Stark—Designated Health Services (DHS) Clinical lab servicesOT, PT, and outpatient SLP servicesRadiology and certain other imaging servicesRadiation therapy services and suppliesDME and suppliesParenteral and enteral nutrients, equipment and suppliesProsthetic, orthotics and prosthetic devices and suppliesHome Health ServicesOutpatient Prescription Drugs Inpatient and outpatient hospital services


Statutory Exceptions Discounts Employee-Employee Group Purchasing Waivers of Part B Coinsurance Managed Care Plans Pharmacy Waivers/Part D Cost-sharing Federally Qualified Health Centers (“FQHCs”) and Medicare Advantage

Organization FQHCs and Donor E-prescribing—must meet standards adopted by the Secretary of DHHS


Regulatory Safe Harbors Investment Interests Space rental Equipment rental Personal services and management contracts Sale of practice Referral services Warranties Discounts Employees Investments in group practices Many more….


Patient Protection and Affordable Care Act—Self Reporting re Stark Violations§ 6409 of ACA –requirement to establish a protocol for the

disclosure of actual or potential violations of Stark. Secretary/CMS is authorized to reduce amounts due and owing for all violations.

Some risks involved with self reporting and exceptions.


Obstruction of Justice Do not destroy documents

Do not withhold documents

Do not alter documents

Do not tell employees not to talk to the government

Do not tell employees what to say

Do not lie or misrepresent anything


Document Hold Memo

Inform everyone there is an audit or investigation

No paper or electronic data (emails) should be altered or deleted

Nothing transferred

Automatic deletion policy—suspend

Certification from employees

Personal computers/phones


Proactive Measures Compliance program Ethics policies Internal reporting policies and incentives Compliance officer/consultant Training on coding, charting and billing Internal audits P & P for handling investigations Physician monitoring Supplier monitoring Legal reviews Document discussions with the government


Recent Cases Alliance Healthcare—plea entered on 2/21/13; husband and wife sentenced to 37

months for roles in $1.3 health care fraud conspiracy. Ordered to pay restitution of $853,702.

Thaw/Kincaid—plea entered 7/20/13; owners of hyberbaric oxygen therapy companies pled guilty to conspiracy to commit health care fraud. Pled to 5 years in prison, $250k fine or twice pecuniary gain/loss to victim, restitution. Sentencing 11/13/13.

Cyparian Akamnonu—plea entered 9/5/13; sentenced to 10 years in prison and ordered to pay $25M in restitution. Co-defendants had trial 1/13/14. Case involved recruiting beneficiaries to receive home health care services for which they did not qualify.

Euless Healthcare Corp.—defendants convicted of conspiracy to commit health care fraud. One defendant, Comfort Gates, was sentenced on 11/4/13 to 72 months in prison and ordered to pay restitution of $830K.


Thank You!Richard Y. Cheng is a shareholder at Anderson Kill, based in the Dallas, TX office. He focuses his practice in the healthcare and hospitality industries, with particular concentration in the long-term care and rehabilitation industries, serving skilled nursing facilities, assisted living facilities, home health agencies, hospices and rehabilitation providers. He counsels clients with respect to corporate transactions, healthcare insurance recovery, and regulatory and compliance matters.

Richard won the 2011 Dallas Business Journal Best Corporate Counsel Rising Star award, was recognized twice as a finalist for the D CEO Magazine/ACC best corporate counsel award, awarded the National Diversity Council Legal Diversity Champion Award in 2012, received the 2011 and 2012 TOTA Distinguished Service awards and recognized by Texas Tech HSC for the 2010 Distinguished Alumni Award.

Prior to his legal career, Richard worked as a licensed occupational therapist in Dallas, Texas. He has served as an adjunct faculty at Saint Catherine University, Nova Southeastern University, has presented at multiple conferences and lobbied in Washington D.C. through the AOTA. Richard has published extensively on legal matters concerning the occupational therapy industry and healthcare. He was the former author of "Legal Line," a column in ADVANCE for OT and authored a legal chapter (Legal Dimension in Occupational Therapy) in the textbook "OT Manager, 5th Edition."

tota mountain central conference 2014 sugar land marriott town square 16090 city walk - sugar land,...

Documents

jd anderson

health care fraud slide

civil investigations

civil cases

open criminal investigations

federal healthcare statistics

health care fraudfy

state agencies