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In May 2021, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) added several new items to its work plan. The OIG work plan sets forth various projects including OIG audits and evaluations that are underway or that OIG plans to address during the fiscal year and beyond. These are some of the highlights of the new additions to the work plan of which providers and suppliers should be aware.

First, OIG will audit payments made to healthcare providers under the general distributions of the Provider Relief Fund. This includes approximately $92 billion across all three phases of the general distributions. Provider who received these funds were required to meet certain requirements, such as submitting revenue information and supporting documentation to the Health Resources and Services Administration (HRSA), which used this information to determine eligibility and payments. OIG will perform a series of audits of funds related to the three phases of the General Distribution to determine whether payments were: (1) correctly calculated for providers that applied for these payments, (2) supported by appropriate and reasonable documentation, and (3) made to eligible providers.

Second, OIG will conduct a nationwide, three-part study of the effects of the COVID-19 pandemic on nursing homes. The first part will analyze the extent to which Medicare beneficiaries residing in nursing homes were diagnosed with COVID-19 and describe the characteristics of those who were at greater risk. The second part will describe the characteristics of the nursing homes that were hardest hit by the pandemic (i.e., homes with high numbers of beneficiaries who had COVID-19). The third part will describe the strategies nursing homes used to mitigate the unprecedented challenges of COVID-19.

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Appealing an overpayment demand can be a challenging task for healthcare providers. Whether the demand stems from claim denials or an audit, the appeals process can involve significant amounts of documentation; complex medical, legal, or coding issues; contract or regulatory review; attorneys; and independent experts. The process may also take months or years to resolve. While some providers with strong cases will likely benefit from pursuing the full appeals process, others may ask if there is a quicker and simpler way. Is it possible to settle the overpayment demand for less than the original demand? The answer often depends on the type of payor.

Commercial insurance plans are often the most likely to entertain the possibility of settlement. Commercial plans perform much the same cost/benefit analysis as any other business and, while it may vary greatly from case to case, may be willing to discuss a final settlement of an overpayment demand. However, it is often helpful for the provider to engage with the early levels of whatever appeal process is available, including submitting documentation and refuting the plan’s assertions and arguments, in order to strengthen the provider’s position.

Where Medicaid is the ultimate payor, a provider may find limited flexibility to discuss settlement. In these cases, the provider is likely dealing directly with a state agency or a state contractor. However, because much of the funding for state Medicaid programs is federal funding, state agencies and contractors are often required to answer to federal authorities regarding the use of Medicaid funds. This dynamic often restricts the state’s ability to resolve overpayments with the provider and requires them to fully litigate the alleged overpayment through the available appeals process.

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Federal regulations provide 22 distinct reasons that the Centers for Medicare & Medicaid Services (CMS) may use to revoke a healthcare provider’s or supplier’s Medicare billing privileges. Any revocation can have devastating impacts on a provider, but the grounds for revocation are often misunderstood. These are some of the most common reasons CMS will assert in revoking Medicare billing privileges.

Noncompliance: CMS may revoke a provider for noncompliance with Medicare enrollment requirements. This is somewhat of a catch-all and is often used when CMS or a contractor alleges technical issues with the myriad of requirements for a provider to maintain Medicare enrollment, such as issues with a provider’s surety bond, insurance policy, or business telephone lines. This reason for revocation is unique in two ways: the contractor often has authority to revoke without asking CMS to make the decision and the provider may have the opportunity to submit a Corrective Action Plan (CAP) demonstrating that they have addressed the issue.

Felony Convictions: CMS may revoke a provider when the provider or any of its owners or managers have been convicted in the last 10 years of any felony that CMS deems detrimental to the Medicare program or beneficiaries. This most often includes financial crimes such as insurance fraud or healthcare fraud but can include many others. A guilty plea or pretrial diversion program may still constitute a conviction. Moreover, even where a provider has previously disclosed the felony conviction, CMS may still use it as a reason to revoke. Where a provider is revoked for a felony, CMS will often make the revocation retroactive and back-date it to the date of the conviction.

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Two significant areas of the Provider Relief Fund (PRF) are ripe for updates by the US Department of Health and Human Services (HHS): the current June 30, 2021 deadline for recipients to spend PRF payments and the long-awaited reporting requirements. The PRF is a $175 billion fund created by Congress through the CARES Act and administered by HHS to provide financial relief to healthcare providers during the COVID-19 pandemic. HHS has subdivided the PRF into various general and targeted distributions.

Currently providers who received payments under the PRF generally have until June 30, 2021 to use the funds. The funds must be used in specific ways as specified by HHS and often require careful documentation and accounting. The June 30, 2021 deadline was initially set early in the pandemic, but HHS has released guidance as recently as March 2021 that reinforces the deadline and provides that HHS expects that providers with unused PRF fund after June 30 will return any unused funds to HHS. However, as the pandemic and the corresponding public health emergency declaration appear likely to extend beyond June 30, 2021, providers are likely to continue to have PRF-eligible expenses well after HHS’s deadline. It would therefore likely benefit many providers for HHS to extend the June 30, 2021 deadline. Indeed, the American Hospital Association (AHA) recently penned a letter to HHS requesting providers be allowed to use PRF fund until the end of the declared public health emergency.

Another reason to extend the June 30, 2021 deadline would be that HHS has yet to release when providers will be required to submit PRF reporting. The statutes that created the PRF and the terms and conditions of the payment to which recipients were required to attest both require recipients to file reports with HHS regarding use of the funds. While HHS has released some details on the form and content of reports and set up a reporting portal, HHS has repeatedly pushed back the release of detailed reporting requirements and the due date of reports. The first reports had initially been due on February 15, 2021, but HHS has pushed this date back. HHS has not released a new date when reports are due but has indicated that recipients will receive a notification when reporting must be completed. A concrete reporting timeline that aligns with an extension of the June 30, 2021 deadline to spend PRF funds would likely be welcomed by providers struggling to plan and budget, while also providing critical care during a public health emergency.

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The US Department of Health and Human Services (HHS) has announced a new program to pay healthcare providers for COVID-19 vaccine administration to underinsured patients, the COVID-19 Coverage Assistance Fund (CAF). CAF is administered by the Health Resources & Services Administration and functions as a claims reimbursement program. Where vaccine administration to uninsured patients is covered by HRSA’s Uninsured Program, CAF is intended to reimburse providers for vaccine administration to patients who have insurance, but whose health plan either denied or only partially paid the claim for vaccine administration. CAF reimburses for COVID-19 vaccine administration at the national Medicare rate.

To submit claims to CAF, providers must first enroll in the program and attest that they (1) have submitted a claim to the patient’s primary health insurance plan and there is a remaining balance from that health insurance plan that either does not include COVID-19 vaccination as a covered benefit or covers COVID-19 vaccine administration but with cost-sharing; (2) have verified that no other third party payer will reimburse them for COVID-19 vaccine administration fees for that patient encounter, or other patient charges related to that COVID-19 vaccination, including co-pays for vaccine administration, deductibles for vaccine administration, and co-insurance; (3) will accept defined program reimbursement as payment in full; (4) agree not to balance bill the patient; and (5) agree to program terms and conditions and may be subject to post-reimbursement audit review.

COVID-19 vaccine administrations occurring on or after December 14, 2020 are eligible for reimbursement by CAF. CAF will reimburse for COVID-19 vaccine administration at the national Medicare rate, which is as follows:

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Two nurse practitioners, with Medicare patients based in Montana, recently pled guilty to conspiracy to commit healthcare fraud. The two NPs were among 345 other healthcare professionals charged in a nationwide healthcare fraud and opioid action undertaken by the United States Department of Justice (DOJ) in September 2020.  This alleged fraudulent activity has resulted in charges for defendants in various healthcare professions, including, genetic testing laboratories, pharmacies, and durable medical equipment (DME) companies.

Since September 2020, DOJ has been investigating a largescale telefraud scheme which alleges that a marketing network brought in hundreds of thousands of unaware participants through the use of telemarketing calls, direct mail, television advertisements, and internet advertisements. The telemedicine executives charged in the action allegedly paid healthcare providers to request DME, medications, and laboratory and diagnostic testing that were medically unnecessary and either without any patient interaction or with only a short telephone conversation with patients the providers had never met or seen. Often, the test results, medications, or DME ordered were not provided to the beneficiaries, were not medically necessary or of use to the beneficiaries, or were the result of false diagnoses. The two individual NPs pled guilty to conspiracy to commit healthcare fraud through their involvement in a plan related to DME, specifically braces used in orthotics. The two NPs received illegal payments from telemedicine companies in exchange for signing orders for braces received by unlicensed telemarketers with no formal training. Medicare patients received the braces without having been seen by a healthcare provider. The orthotics ordered by the nurses for Medicare patients were not medically necessary, and Medicare will only pay for services that are medically necessary and reasonable and supplies used to diagnose and treat a patient’s condition.

Since 2016, the Department of Health and Human Services Office of Inspector General (HHS OIG) has recorded a significant increase in telefraud, healthcare fraud related to telemedicine. Prior to the COVID-19 Public Health Emergency (PHE), Medicare only reimbursed providers for telehealth services for routine appointments in specific circumstances. In addition, the telehealth visit was required to be a real-time, two-way interactive communication using video technology, with a patient and provider who had a previous established relationship. However, as a result of the COVID-19 pandemic, the Center for Medicare and Medicaid Services (CMS) expanded Medicare’s telehealth benefits and allows for the billing of evaluation and management (E/M) audio-only telemedicine visits for the duration of the COVID-19 PHE.

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A St. Louis, Missouri based chiropractor has become the first person charged under the new COVID-19 Consumer Protection Act, with the government alleging numerous civil violations and seeking civil monetary penalties. The allegations serve as a cautionary tale for healthcare providers marketing and selling goods and services relating to the COVID-19 pandemic.

The COVID-19 Consumer Protection Act was enacted in December 2020 and makes it unlawful, for the duration of the ongoing COVID-19 public health emergency, for any person, partnership, or corporation to engage in unfair or deceptive acts or practices in or affecting commerce that are associated with the treatment, cure, prevention, mitigation, or diagnosis of COVID-19. The Act is similar to Section 5(a) of the FTC Act, but adds increased penalties for violations relating to the COVID-19 pandemic. The Act authorizes injunctive relief and Civil Monetary Penalties of up to $42,792 per violation.

In this case, the first under the Act, the government alleged that the chiropractor and his company violated the Act by making claims about the efficacy of their products that were not supported by scientific literature. Specifically, that the chiropractor sold various vitamin supplements and claimed that they prevented or treated COVID-19. The government also alleged that the chiropractor claimed the vitamin supplements were more effective that the available COVID-19 vaccines. The government alleged that the chiropractor made these claims in numerous videos posted on various social media and other websites and misrepresented the results of studies concerning the efficacy of the vitamin supplements in treating or preventing COVID-19. According to the allegations, these claims constituted violations of the Act because, even though there are studies showing correlation between vitamin deficiencies and elevated risk from the virus, there are no randomized clinical trials that establish the vitamin supplements caused positive health outcomes in connection with COVID-19.

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In general, liability waivers can be a useful tool for businesses and individuals to avoid personal injury lawsuits and liability. Typically, liability waivers are associated with participating in a dangerous activity, such as skiing, boating, gym classes, or school activities. The individual participating in the activity signs the waiver, acknowledging that he or she accepts the risks associated with the activity and agrees to release the business or individual from liability related to these risks. However, in response to the COVID-19 pandemic, liability waivers by patients for COVID-19 related risks are becoming increasingly common. While these waivers are likely enforceable, providers should be aware of potential legal issues if patients are asked to sign COVID-19 liability waivers.

Each state evaluates the enforceability of liability waivers differently. For example, in some states, such as Louisiana, Virginia, and Montana, personal injury liability waivers are all invalid. However, in most states, including Michigan, these liability waivers are generally enforceable, subject to certain restrictions. In Michigan, parties may contract against liability for harm caused by ordinary negligence, but not gross negligence, or willful and wanton misconduct. Therefore, a party will not be protected from liability if it intentionally or recklessly engaged in the conduct that caused harm. Although not explicitly stated in laws or statutes in Michigan, other important factors for providers to consider in drafting these liability waivers include:

  • Clear language. The waiver should clearly state that the individual is releasing the business or provider from liability. The terms should also be easy for the parties to understand.
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On April 15, 2021, the Department of Health and Human Services Office of Inspector General (OIG) issued a statement reminding providers that the COVID-19 vaccine must be provided at no cost to the public. OIG issued this message as a result of complaints from patients about charges from providers for receiving the COVID-19 vaccine. All supply of the COVID-19 vaccine in the United States has been purchased by the United States Government and is only to be used by providers through the Centers for Disease Control and Prevention’s (CDC) COVID-19 Vaccination Program. Because the vaccine is being supplied by the federal government, any provider participating in the CDC COVID-19 Vaccination Program must comply with the terms of the program and offer the vaccine to recipients for free.

Providers participating in the CDC COVID-19 Vaccination program must sign a CDC COVID-19 Vaccination Program Provider Agreement. Providers are responsible for compliance with the requirements in the agreement. Compliance with the program requires that providers administer the vaccine at no cost to the patient. All organizations and providers enrolled in the program:

  • Must administer the COVID-19 vaccine with no out-of-pocket charges to the patient
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Appealing Medicare claim denials and overpayments is a common yet often misunderstood part of providing care to Medicare beneficiaries. Any healthcare provider should be familiar with the appeals process and some common issues that may arise. Although Medicare audits were temporarily suspended due to the COVID-19 pandemic, they have since resumed.

When a Medicare contractor denies a claim, whether as part of a pre-pay, post-pay, or other type of review or audit, the provider generally has a right to a lengthy appeal process. The process often begins before the denial of the claim itself. The provider may receive Additional Document Requests (ADRs) from the contractor demanding information or documentation on a claim or claims. These requests should be reviewed carefully, however they often contain boilerplate language and it may be difficult to determine which specific documentation the contractor is requesting.

Once a claim has been denied, the first level of appeal is Redetermination before the same contractor that made the initial denial. A provider must request Redetermination within 120 days of the claim denial, or the appeal may be forfeit. A shorter deadline applies to stop recoupment on overpayment demands stemming from the denials. The second level of appeal is Reconsideration before a Qualified Independent Contractor (QIC). The QIC is separate from the contractor that initially denied the claims. A provider often has the opportunity to submit additional documentation at Redetermination and Reconsideration. A provider may also retain an expert to review the contractor’s assertion or submit write-ups on the individual claims.

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