Compliance

Published on: June 27, 2013

OIG Announces $3.8 Billion in Expected Recoveries

The Department of Health and Human Services (HHS) Office of Inspector General (OIG) recently announced that it expects to recover an estimated $3.8 billion in overall recoveries for the first half of fiscal year 2013. This report covers October 1, 2012 through March 31, 2013.

The OIG’s semiannual report is released every 6 months to keep Congress and the HHS Secretary Kathleen Sebelius informed of the OIG’s important findings, recommendations, and activities. In connection with its Medicare and Medicaid investigations, audits, and reviews, the OIG anticipates $521 million in audit receivables and $3.28 billion in investigative receivables.

In the report’s introductory message, Inspector General Daniel R. Levinson attributed the department’s success to the OIG’s cooperative activities and effective partnerships with organizations such as the Health Care Fraud Prevention and Enforcement Action Team (HEAT). The OIG featured the following items in its semiannual report:

Published on: June 27, 2013

RACs to Carefully Review IMRT Treatment Claims

by Wachler & Associates, P.C.

The Recovery Audit Contractors (RACs) have issued a complex review targeting intensity-modulated radiation therapy (IMRT). IMRT has been used in radiation oncology to treat many different types of cancer by modulating high intensity X-ray beams directed at a tumor and thus minimizing the amount of radiation to healthy tissue. In the aggregate, IMRT uses significantly lower doses of radiation than traditional treatment.

Beginning July 18, 2013, the RACs will be looking more carefully at the medical necessity of IMRT treatment as well as whether the diagnoses listed on claims for reimbursement are also listed in the local coverage determination (LCD). Practitioners should review the coding and medical necessity sections in the LCD to determine whether the patient’s condition meets these standards. The LCD also sets forth strong documentation requirements for IMRT that should be carefully reviewed, including, among other items, the need for performing IMRT, prescription of a treatment plan, target verification methodology and documentation, an approved IMRT inverse plan (PTV), immobilization and positioning documentation, fluence distribution in the phantom, monitor units, and respiratory motion.

If you need assistance defending a Medicare audit or need help creating a compliance plan, please contact an experienced health care attorney at 248-544-0888.

Published on: June 25, 2013

Senate Finance Committee Discusses Medicare RAC Program with Providers

by Wachler & Associates, P.C.

This morning, the Senate Finance Committee, a committee responsible for the oversight of Medicare, met with providers to discuss their experience with the Medicare Recovery Audit Contractors (RACs). The Centers for Medicare & Medicaid Services (CMS) contract RACs to detect and recuperate improper Medicare program payments.

At the hearing, Chairman Max Baucus (D-Mont.) and Ranking Member Orrin G. Hatch (R- Utah) urged the seriousness of the improper Medicare payments problem. The senators issued statements stressing the importance of RACs working efficiently to ensure the best use of the Medicare trust fund. They voiced their concerns at the high numbers of RAC decisions which are overturned on appeal and the senseless red tape which frustrates providers.

Two providers and one prominent contractor gave witness testimonies to the Committee. Jennifer J. Carmody, CPA, Director of Reimbursement Services for the Billings Clinic of Billing, Montana, discussed the time and expense her organization has incurred appealing inappropriate payment denials. In her witness testimony, she disclosed, “… the combined audit activity becomes overwhelming. In total, we are currently being audited by the Medicare RAC, Medicaid, Medicare Advantage, commercial payers and others.” The Billings Clinic pays an outside contractor, EHR, to assist the clinic with their overflow of audits and appeals. Amongst other recommendations, Ms. Carmody told the Finance Committee that clearer guidance, a limit to the number of record requests, and more effective supervision of the RACs’ performance would help improve the overall RAC process.

Published on: June 20, 2013

OIG Report on “Questionable” Prescribing Practices Likely to Lead to Closer Scrutiny of Physicians

by Wachler & Associates, P.C.

Today the Department of Health and Human Services (HHS) Office of Inspector General (OIG) issued a report revealing new data on prescribers with questionable billing patterns under the Medicare Part D program. The OIG conducted this study to investigate rising concerns of Medicare prescriber fraud.

According to the OIG’s report, over 700 of nearly 87,000 general-care providers had “questionable” Part D prescribing patterns. A total of 2,238 general-care providers were labeled as outliers, but 736 doctors had what the OIG considered to be “extreme” prescriber patterns. A majority of these “extreme” outlier physicians ordered what the OIG considered to be extraordinary quantities of Schedule II or III drugs. Other examples of “extreme” patterns included doctors writing over 400 prescriptions for one patient and the number of pharmacies dispensing a single doctor’s orders. The OIG’s report noted that “Although some of this prescribing may be appropriate, such questionable patterns warrant further scrutiny.”

The Centers for Medicare and Medicaid Services (CMS) contracts with sponsors that provide drug coverage to beneficiaries enrolled in Medicare Part D. In addition, CMS contracts with a Medicare Drug Integrity Contractor (MEDIC), a contractor responsible for detecting and preventing fraud and abuse. The OIG recommended that CMS heighten its oversight of the Medicare Part D program by working in conjunction with MEDIC and the private insurers. According to the report, CMS has agreed to the OIG’s following recommendations:

Published on: June 20, 2013

Ambulance Company Owner Sentenced to $3,676,587 in Restitution to Medicare

by Wachler & Associates, P.C.

On June 18, 2013, Julian Kimble was sentenced to 17 years in federal prison and ordered to pay $3,676,587 to the Medicare program as restitution following his 2011 convictions for conspiracy to commit health care fraud and other crimes.

In November 2011, Kimble pled guilty to conspiracy to commit healthcare fraud, money laundering, and tax evasion. Kimble admitted to owning four ambulance companies – Tamimi International Inc, Monarch Ambulance, HKO Group Inc, and Houston EMS – and that he frequently billed basic life support to Medicare for ambulance transports and services that were not medically necessary or not provided at all. Kimble and the other conspirators often transported multiple beneficiaries together in cars or vans, and then billed Medicare for individual transports in ambulances with trained emergency medical personnel.

Furthermore, Kimble received kickbacks from several owners of community mental health centers in exchange for transferring patients to their facilities. The patients also received payments in exchange for assenting to be transported to different facilities in the Houston area. In total, Kimble’s ambulance companies billed Medicare nearly $8.7 million and received over $3.6 million.

Published on: June 18, 2013

New Bill Aims to Ensure Medicare Payment Accuracy and Reduce Red Tape

by Wachler & Associates, P.C.

Congressman Adrian Smith (R-NE), along with 13 co-sponsors, introduced a new bill on June 12, 2013, titled the Administrative Relief and Accurate Medicare Payments Act of 2013. This initiative, House Rule (H.R.) 2329, aims to ease administrative burdens on healthcare providers and efficiently allocate energy and resources related to Medicare payment and audits.

In addition to addressing the concerns of administrative burdens and short timeliness-of-filing requirements, the bill also seeks to improve payment accuracy. By increasing the filing period for claims and making other changes to streamline the appeals process, the Act is designed to ease the burden on hospitals.

In a press release, Congressman Smith announced,

Published on: June 11, 2013

Auditors Using Sophisticated Data Mining Techniques to Identify Fraud

by Wachler & Associates, P.C.

Auditing entities are utilizing more sophisticated electronic data mining methods than ever before. Today’s sophisticated data mining techniques enable auditors to identify greater cost recoveries, making auditing activities both more efficient and more effective.

Auditors utilize statistical data mining testing to determine whether a provider’s billing practices are statistically different from their peers’. If data patterns from a provider’s utilization rates are significantly different from that of their peers’, auditors are able to identify situations where a provider’s practices may be improper. By mining data on a regular basis, healthcare auditors isolate potential fraud and abuse.

Comparative Billing Reports (CBRs), a tool used by CMS to educate providers about their individual billing practices, detail complex statistical analysis in the form of charts and graphs and show how a practices’ utilization rates compare to those of their peer group. Safeguard Services, LLC, a company contracted by CMS, produces and sends out CBRs to certain provider types. CBRs compare both state and national standards and may help a provider detect possible billing and coding problems for their practice.

Published on: June 10, 2013

Outpatient Therapy Services Must Assign G-Codes or Face Medicare Denials

by Wachler & Associates, P.C.

As of July 1, 2013, Change Request 8005 requires outpatient therapy service providers to report new functional G-codes and modifiers on claims for physical therapy (PT), occupational therapy (OT), and speech-language pathology (SLP) services or face Medicare payment denials. The G-codes will be used to identify the primary issue being addressed by the therapy, and the modifiers will identify the severity or complexity of the patient, as well as their change over time. The policy includes a list of 42 new non-payable G-codes, 14 sets of three codes each, and seven new severity/complexity modifiers on therapy claims.

This change became effective for therapy services with dates of service on and after January 1, 2013. However, the first six months are a testing period for providers to acclimate to the new coding requirements. During this pre-July 1 testing period, claims without G-codes and modifiers will be processed. Claims for therapy services with dates of service on or after July 1, 2013 that do not have the appropriate G-codes and modifiers will be returned or rejected. In addition, providers may not bill the patient for the rejected services.

After July 1, 2013, the correct G-codes and modifiers must be included on claim forms at the outset of the therapy episode, every 10 treatment days or every 30 calendar days (whichever is less), and at discharge. According to CMS transmittal 1196, contractors are required to alert providers, with the exception of institutional providers, to include the new G-codes with modifiers on future therapy claims through a Remittance Advice Message as of April 1, 2013.

Published on: June 6, 2013

RACs to Recover Radiation Oncology Treatment Payments

by Wachler & Associates, P.C.

Earlier this year, Connolly, Inc., the Recovery Audit Contractor (RAC) for Region C, posted a new issue to its CMS-Approved Issues List targeting Stereotactic Radiation Therapy (SBRT) and Stereotactic Radiosurgery (SRS) services for providers in the following states: Arkansas, Colorado, Delaware, District of Columbia, Florida, Louisiana, Maryland, Mississippi, New Jersey, New Mexico, Oklahoma, Pennsylvania, and Texas.

According to the issue’s description, CMS has approved auditing providers who have incorrectly billed for SBRT and SRS procedures found to be, upon review, “not medically appropriate.” Connolly will be able to audit the billed SBRT/SRS claims as far back as three years from the initial determination date of the procedures, and will be focusing its audit efforts on the outpatient hospital setting. Consequently, this Connolly initiative may affect radiology oncology providers that have performed SRS and SBRT procedures in the states mentioned above.

In response to this news, providers must ensure they are keeping accurate records regarding the rationale and medical necessity for these treatment procedures, as well as maintaining and following effective compliance plans. If you need assistance in preparing for, or defending against RAC audits, or implementing a compliance program geared towards identifying and correcting potential risk areas related to RAC audits, please contact an experienced health care attorney at Wachler & Associates at 248-544-0888.

Published on: June 4, 2013

Pharmaceutical Company Violates Anti-Kickback Statute and Pleads Guilty to Fraud

by Wachler & Associates, P.C.

On Friday, May 24, 2013, ISTA Pharmaceuticals, Inc., a pharmaceutical company recently acquired by Bausch & Lomb, Inc., pled guilty to violating the Federal Anti-Kickback Statute and the Food, Drug and Cosmetic Act (FDCA). Under the terms of a civil settlement agreement and ISTA’s guilty plea, the pharmaceutical company has agreed to pay a total of $33.5 million to states and the federal government in fines and fees for conspiracy, misbranding, false submissions to government health care programs, and under whistleblower provisions of the False Claims Act.

The Anti-kickback Statute provides criminal penalties for companies who knowingly and willfully offer, pay, solicit or receive remuneration in order to induce business payable by Medicare or Medicaid. According to the Department of Justice’s press release, ISTA violated the Anti-kickback statute by offering doctors illegal inducements, such as wine tastings and golf outings, in order to persuade doctors to prescribe ISTA’s eye drug, Xibrom, to their patients.

Under the FDCA, companies may not introduce drugs into interstate commerce for uses that have not been approved by the Food and Drug Administration. Although the Food and Drug Administration approved ISTA’s eye drug, Xibrom, for pain and inflammation after cataract surgery, ISTA pled guilty to marketing Xibrom for unapproved uses, such as to prevent swelling of the retina and to prevent cystoid macular edema.