AHLA. BB. Rules of the Road in Investigating and Disclosing Overpayments. Tiana L. Korley Principal Healthcare Fraud Analyst Mitre Windsor Mill, MD

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1 AHLA BB. Rules of the Road in Investigating and Disclosing Overpayments Tiana L. Korley Principal Healthcare Fraud Analyst Mitre Windsor Mill, MD Jesse A. Witten Drinker Biddle & Reath LLP Washington, DC Fraud and Compliance Forum October 6-7, 2014

2 Rules of the Road in Investigating and Disclosing Overpayments Tiana L. Korley AHLA Fraud and Compliance Institute October 6-7, 2014 Disclaimer 2 The author s affiliation with the MITRE Corporation is provided for identification purposes only, and is not intended to convey or imply MITRE s concurrence with, or support for, the positions, opinions or viewpoints expressed by the author. 1

3 3 Discussion Topics Identifying an overpayment Special considerations Medicaid Part C and Part D Self-Referral Status of rulemaking Practical considerations Current enforcement actions 4 What is an overpayment? Statutory definition at 1128J(d) Proposed rule provides examples Medicare payments for noncovered services Medicare payments in excess of the allowable amount for an identified covered service Errors and nonreimbursable expenditures in cost reports Duplicate payments Receipt of Medicare payment when another payor had the primary responsibility for payment 2

4 When is an overpayment identified? 5 A person has identified an overpayment if the person has actual knowledge of the existence of the overpayment or acts in reckless disregard or deliberate ignorance of the existence of the overpayment. Reopening Period 6 Revised to be commensurate with 10 year lookback Consider impact of new legislation to expand recovery period Section 638 American Taxpayer Relief Act of 2012 Designed to ensure recovery period exceeds reopening period in response to OIG concerns Also likely included for scoring purposes Saves $500 million over 10 years Outstanding Question - If 10 year lookback period is finalized and reopening rules are amended, would Congress subsequently amend statutory provision to ensure recovery period extends to at least 10 years? Does it matter? 3

5 7 Medicaid Incentives vary depending upon fee for service vs. managed care GAO Report May 2014: Increased Oversight Needed to Ensure Integrity of Growing Managed Care Expenditures OIG Management Challenge 4: Protecting the Integrity of an Expanding Medicaid Program Specifically addresses Medicaid managed care How to return overpayments/information reporting States usually have substantial discretion Will we have 56 different methodologies? Government s position expressed in proposed rule is that there is an existing obligation to report and return Medicaid-related overpayments in a manner consistent with the statutory provision 8 Parts C/D Considerations An overpayment exists when, after "applicable reconciliation," an MA organization or Part D sponsor is not entitled to the funds it has received and retained. Applicable reconciliation" definition For MAOs, the "applicable reconciliation" date will be the final risk adjustment data submission deadline, which effective July 22, 2014, will be set for January 31 of the year following the payment year. For Part D, the "applicable reconciliation" date will be the later of either the annual deadline for submitting prescription drug event (PDE) data, or the annual deadline for submitting direct and indirect remuneration (DIR) data. Provision not nearly as controversial as Part A/B proposed rule Received only 30 timely comments on NPRM section 4

6 Self-Referral Overpayments 9 SRDP vs MAC Tolling of obligation to return overpayment Due to length of time it takes to resolve overpayments disclosed under SRDP, there may be a substantial amount of uncertainty Proposed legislation to expedite return of certain Self-Referral overpayments Form-related revisions may smooth this process Forms do not appear to capture all of the required information in the proposed regulation Perhaps timing is an issue Consider refunding small amounts to the MAC due to SRDP timing and cost But does existing reporting form capture this nuance? There may be an other line in at least some forms related to reason for the voluntary refund; does reporting as other absent additional information trigger additional scrutiny? Reaction to Proposed Rule 10 5

7 11 Status of Rulemaking Parts A/B Published NPRM February 2012 Statutory deadline for final rule February 2015 Included in Spring Unified Agenda (CMS-6037-F) Parts C and D Final rule published May 2014 Outstanding Questions Special form for A/B returns Content of form for collection for Medicaid overpayments will this be standardized? How will government utilize this provision to recover overpayments? 6