Health Care Enforcement and Compliance Matters

Prevention, Compliance, Advocacy

A Compliance Officer’s Wish List for 2012

By Frank Sheeder on Posted in Culture, Enforcement, Ethics, Government Initiatives, Reform

I was visiting with some of my compliance colleagues recently and came up with an interesting Wish List for 2012: 

  • Additional resources.
  • Clearer regulations :)
  • Increased stakeholder support for compliance activities.
  • More predictable and quicker voluntary disclosure processes.
  • A better way to keep track of regulatory developments and new business arrangements.
  • Acknowledgement by regulators and enforcers that mistakes happen and not everything is fraud. 
  • More compliance involvement in proposed transactions and arrangements – before they get done.
  • The ability to learn about potential compliance concerns before they turn into more significant problems.

 What would you add to the list?

12 Enforcement and Compliance Predictions for 2012

By Frank Sheeder on Posted in Culture, DOJ, Enforcement, Government Initiatives, ICD, Implantable Cardiac Devices, Long Term Care, Medicaid, Medicare, OIG, Reform, Settlements

This has been an interesting year for the health care industry, and I believe the coming year will be even more exhilarating.  Here are my 12 enforcement and compliance predictions for 2012.  Please comment with yours.  We’ll see how we do. . . .

 

  1. Regardless of what happens with the health care reform law, the current market forces toward collaboration, integration, efficiency and quality will continue.
  2. At the same time, there will be much more Stark and Anti-kickback enforcement as the government steps up its scrutiny of hospital-physician relationships.
  3. Medicaid enforcement will increase dramatically as the federal government pressures the states and the states endeavor to deal with funding pressures.
  4. HIPAA enforcement will increase, and there will be more unfortunate and costly breaches as we implement more electronic records.
  5. The DOJ/HHS HEAT initiative will ensnare some mainstream, institutional providers.
  6. The HHS-OIG will more aggressively target hospitals through its current intensive hospital audits.
  7. Many of the Implantable Cardioverter Defibrillator (ICD) investigations of hospitals across the country will be resolved.
  8. The government and whistleblowers will increasingly target long term care, home health and community care.
  9. While there will be large hospital settlements, device and pharmaceutical companies will write the biggest checks.
  10. The HHS-OIG will seek to exclude more individuals who are associated with organizations that had compliance lapses.
  11. The Health Care Compliance Association (HCCA) will continue to grow steadily and to serve its members’ needs assiduously.
  12. There will be increased demand for strong compliance professionals as smart leaders continue to recognize their value.

What are your predictions?

 

 

A 10-Year Old’s View of Health Care Enforcement

By Frank Sheeder on Posted in DOJ, Enforcement, Fraud, Medicaid, Medicare, OIG, Reform

My Daughter’s Depiction of Health Care Enforcement — I Call it Enforcica  —

One of the more challenging and rewarding aspects of being a health care attorney is taking a complex regulated environment and breaking it down in a way that is understandable, regardless of the audience.  In the compliance world, this means communicating the rules and how to follow them, the players and their influences and motivations. 

Over the weekend, while on a long car ride, my abilities to meet this challenge were put to the test by perhaps my toughest grader: my ten-year-old daughter. 

When she asked me what was keeping me so busy at work, I gave her my regular elevator speech:

I help people who provide health care to follow the rules and I defend them when somebody says they didn’t.

Being the precocious observer that she is (and because she has heard that a few times before), she found that answer to be completely unsatisfactory.  Pushing further, she asked: “Why is it so hard to follow the rules?”  After all, she doesn’t have any problem doing so, whether at home or school.  (Fortunately, this happens to be true.) 

I then explained what’s going on right now with Medicare and Medicaid enforcement.  Loving to sketch as she does, she took my words and put them into pictures.  When we arrived at our destination, she handed me this:

Enforcica

I think the kid gets it.   But all art, whether that of a ten-year-old or a Cubist master, is subject to interpretation.

We recently took a family trip to Spain, where we saw some wonderful art, including that of Picasso.  In discussing his famous work Guernica, Picasso said:

. . . this bull is a bull and this horse is a horse… If you give a meaning to certain things in my paintings it may be very true, but it is not my idea to give this meaning. What ideas and conclusions you have got I obtained too, but instinctively, unconsciously. I make the painting for the painting. I paint the objects for what they are.

So, what do you see?  I’d be interested in your interpretive comments.  For now, I’m calling the piece Enforcica.

 

Medicaid RACs: Tool of transparency or torment?

By Frank Sheeder on Posted in Enforcement, Government Initiatives, Medicaid, RACs

The Medicaid RACs are coming soon, and prudent providers are getting ready for life in the formicarium (translated:  ant farm).

My colleage and blog co-editor, Rebecca Jones McKnight, wrote a clever and interesting Feature Focus in the December 2011 issue of the Health Care Compliance Association’s monthly publication, Compliance Today.  She wonders whether CMS is looking at Medicaid providers the way we looked at ants when we were kids.  (I’ll give you a hint:  it involved various uses of magnifying glasses . . .)  You can read it here.

The Price of a Compliance Failure? Ask Penn State.

By Frank Sheeder on Posted in Culture, Ethics

Stakeholders often raise “the price of compliance” as they endeavor to justify their lack of support.  We hear about how:

  • The compliance function is a cost center.
  • The odds are small that this will become a problem.
  • Compliance Officers make a mountain out of a mole hill.
  • We are an ethical organization and therefore don’t need to dedicate resources to compliance.
  • We are too important  — nobody will ever dare to come after us.
  • Our reputation will protect us.

These are risky pushback themes that engender substantial financial, legal and reputational costs in a high percentage of cases.  The better question is, What is the price of a compliance failure?

While we don’t know all of the facts about the current Penn State situation and we should never assume or judge, the circumstances already validate some transcendent truths about compliance.  Organizations cannot simply “check a box” indicating that they have policies or that they technically fulfill legal requirements.  Action and inaction have consequences, and those consequences are not abstract principles — they are real.  What lessons can we learn?

  • Leaders must insist on developing a culture of compliance that permeates an organization.
  • Much is expected of powerful leaders.
  • Not speaking up when there is a compliance concern can be costly for you and your organization.
  • Looking the other way because you fear losing your job is not a good strategy.
  • Going through the normal chain of command does not always absolve someone of responsibility.
  • You can lose a solid reputation, which was built over generations, in a nanosecond.
  • Compliance training is essential.  If individuals are not trained to recognize signs of potential concerns and empowered to raise them, serious problems can flourish.
  • One unfortunate decision can lead to cascading consequences that are far more damaging than the initial problem.

Domino Effect by renjith krishnan

Look for more insights as the facts come out.  We will tally up the price of compliance failures later.

For now, here’s a challenging question: 

What are you doing in your organization to avoid running afoul of these realities?

Announcing the New and Improved Health Care Compliance Blog

By Frank Sheeder on Posted in Welcome

Dear Colleague: 

I appreciate your interest in The Health Care Compliance Blog.  Because I recently joined DLA Piper as Chair of the Health Care Enforcement and Compliance practice,  I have moved the blog to my firm’s platform.  This will allow for more robust content from a wider array of DLA Piper authors.

The blog is now called Health Care Enforcement and Compliance Matters blog to better reflect the issues it covers.

If you have subscribed to posts by email, you will continue to receive them.  Also, you can still access the blog directly and through the RSS feed.

I am always glad to hear from colleagues about topics they would like us to address on the blog. Please contact me if you have some ideas.  

Thanks for your continued interest and support.

Regards,
Frank Sheeder

Heads Up! HHS-OIG is Emphasizing Medicaid Enforcement

By Frank Sheeder on Posted in Enforcement, Government Initiatives, Medicaid, OIG, Uncategorized

I have been saying for a while that there will be a renewed emphasis on Medicaid enforcement.  Here’s some more objective evidence of this trend:  The HHS-OIG has published Proposed Revisions of Performance Standards for State Medicaid Fraud Control Units.

The current standards were promulgated in September 1994, in the aftermath of the last big health care reform effort.  It is telling that, among all of the many things OIG and CMS could be doing right now, OIG has once again focused on this issue.  It also supports my other theme:  “When reform doesn’t work, the enforcers step in.” I don’t say this to make a political statement about reform, but rather simply to make the obvious observation that a variety of stakeholders are disappointed with the state of reform — whether they are pro- or anti-PPACA.  The one thing we can all seem to agree on, however, is that there is too much “fraud.”  So regardless of what happens with reform, the enforcement will continue to increase, just like it did after the reform efforts in 1994.

The proposed rules apply to state Medicaid Fraud Control Units (MFCUs), which must investigate and prosecute Medicaid fraud cases under state law, on a statewide basis.  If a state has a “certified” MFCU, the federal government pays 75% of the cost to run it.  Accordingly, it is beyond question that when these standards become final, states will step up their MFCUs’ efforts to meet them.  That can portend trouble for unwitting providers. Continue Reading

Some Interesting RAC Results

By Frank Sheeder on Posted in Medicare, RACs

CMS has released its report to Congress about RAC activities for FY 2010.   The results are a mixed bag.  Here are some highlights:

  • There were $92.3 million in identified and corrected improper Medicare payments.
    • $75 million were overpayments.
    • The RACs returned $17 million in underpayments.  That’s 18% of the identified improper payments, which is much better than the 4% identified underpayment rate in the pilot project.
    • Region D was the clear “winner” with $43.4 million in recoveries followed by Regions C ($27.5 million), B ($15.5 million) and A ($5.9 million).  According to CMS, the contractors for Regions D (Connolly) and C (HDI) did better because they had previous experience.
  • Over half of the recovered overpayments were from inpatient claims ($41 million).  The rest were represented by DME ($19 million), outpatient ($9 million), physician ($5 million), and SNF, home health and other claims ($900,000).
    • Here are the top issues by Region:
      • Region A:  Ventilator support of 96+ hours
      • Region B:  Extensive Operating Room Procedure Unrelated to Principal Diagnosis
      • Region C:  DMEPOS provided during an inpatient stay (billing for bundled services separately)
      • Region D:  DMEPOS provided during an inpatient stay (billing for bundled services separately)
  • The average overpayment recoverd was $408.
  • The RACs identified and demanded repayment of $136 million in repayments, so there is still $61 million, or 45% of the indentified overpayments, to be recovered.
  • Providers only appealed 8,000 claims, which is only about 5% of the identified overpayments. They prevailed in half of the appeals.

Here are the tables showing the recoveries by State.  (It’s good to be in West Virginia. . . .)

The report is called  Implementation of Recovery Audtiting at the Centers for Medicare & Medicaid Services.  It’s worth a read.

The Government is Going After Health Care Execs

By Frank Sheeder on Posted in Culture, Enforcement, Government Initiatives

Image by graur razvan ionut - FreeDigitalPhotos.net

I just returned from the HCCA/AHLA Fraud & Compliance Forum which was, as usual, a strong conference. One of the resounding themes was the government’s growing emphasis on holding health care executives and board members responsible for organizational non-compliance. The effort is no longer aimed solely at people who are associated with drug and device manufacturers — it has spread to provider organizations as well.

In the current enforcement environment, senior leaders and directors can expect:

  • To be questioned by regulators and enforcers
  • To be investigated for what they knew, should have known, or could have done to stop organizational misconduct
  • To face the threat of permissive exclusion (there are 20 statutory bases for permissive and mandatory exclusion)

As mentioned in previous posts, the OIG has testified and published guidance about its permissive exclusion authority in October 2010. See OIG Holding Individuals Accountable for Orgs’ Non-Compliance; OIG Focusing on Exclusion of Individuals –Modern Healthcare. The OIG’s promulgations are required reading.

What should compliance professionals do?

  • Explain these trends and risks to senior leaders and directors; get lawyers or other “external prophets” involved if your message is not getting through
  • Communicate more extensively with leaders and directors about compliance issues
  • Respond promptly to potential non-compliance; the new 60-day “report and repay” provisions make this even more critical

Don’t be shy about asking for more resources if there are gaps in the compliance infrastructure or insufficient resources (I know this last one is tough, but the stakes are high)

Medicaid RACs Will Soon Spring to Life: Another Head Grows on the Hydra of Government Oversight and Inquiry

By Frank Sheeder on Posted in Government Initiatives, Medicaid, RACs, Reform

Here is a good summary of the new Medicaid RAC regulations.  Thanks to my colleague Becca McKnight for putting it together.  The original appears on DLA Piper’s Health Care Law Matters Blog.

Contributed by Frank E. Sheeder III and Rebecca Jones McKnight as part of our ongoing Fraud & Abuse Matter series.

Health care providers may feel like Hercules sometimes: they face many labors on the health care compliance front. With myriad government audits, inquiries, and investigations, compliance-minded providers may feel—despite their efforts—like they are facing the multi-headed hydra of legend.

Prepare to face an adapted beast.

Although it looks similar to one you may have faced before, it presents quite a challenge nonetheless.

On September 14, 2011 CMS issued its anxiously awaited final rule on state Medicaid Recovery Audit Contractor (RAC) programs. The final rule implements section 6411 of the health care reform law, the Patient Protection and Affordable Care Act, requiring states to establish a program with one or more recovery audit contractors in order to identify underpayments and overpayments to Medicaid, and to recoup the overpayments.

CMS issued a proposed rule on Medicaid RACs on November 10, 2010. The original due date for states to implement RACs was April 1, 2011. It became clear, however, that this was not a realistic timeframe. On February 1, 2011, CMS announced that the proposed implementation date would be pushed back to await the final rule.

Now the time is at hand. Under the final rule, states must have Medicaid RAC programs in place by January 1, 2012. What can providers expect?

Continue Reading