Policy Number: Location: Origination Date: Date of Last Review: All 6/5/2014 6/5/2014

Transcription

1 Policy Name: False Claims Department/Service Line: Compliance/Ethics Policy Number: BSWH.CMPL.ETH.006.P Location: Origination Date: Date of Last Review: All 6/5/2014 6/5/2014 Approved By: BSWH Corporate Compliance Committee Print Date/Time Stamp 11/20/2015 8:44 AM S C O P E This False Claims Policy (Policy) applies to Baylor Scott & White Health (BSWH) and its Controlled affiliates (collectively, BSWH System) and their respective vendors, contractors, agents, employees, affiliated providers, physicians, other health care professionals, and senior management (Collectively, BSWH System Personnel). P U R P O S E The purpose of this Policy is to promote awareness and compliance by BSWH System Personnel with all Applicable False Claims laws. Under this Policy, BSWH System Personnel have a duty to know about Applicable False Claims Laws and this Policy, and to report violations of Applicable False Claims Laws and this Policy. This Policy is adopted to promote compliance by BSWH System Personnel with Applicable False Claims Laws and to avoid fraud and abuse in federal and state health care programs. Enforcement of and compliance with Applicable False Claims Laws and the avoidance of fraud and abuse support BSWH s mission to serve all people by providing personalized health and wellness through exemplary care, education, and research as a Christian ministry of healing. To further the purposes of this Policy, this Policy reflects and includes certain provisions of the federal False Claims Act, 31 U.S.C (2009) (FFCA), the Federal Administrative Remedies for False Claims and Statements, 31 U.S.C (2009) (FARFCS), the Texas Medicaid Fraud Prevention Act, Tex. Hum. Res. Code (2013) (TMFPA), and the Patient Protection and Affordable Care Act, Publ. L , 124 Stat. 119 (2010) (PPACA), summaries of which are included as Attachments A1, A2, A3, and A4, respectively. Full copies of the FFCA, the FARFCS, the TMFPA and the PPACA are available to all BSWH System Personnel from the Chief Compliance Officer. P O L I C Y The BSWH System is committed to comply with the FFCA, the FARFCS, the TMFPA, the PPACA and any other Applicable False Claims Laws. Responsibilities: In response to compliance guidance provided by the Office of Inspector General (OIG) and to promote compliance with Applicable False Claims Laws, BSWH hereby implements this Policy for all BSWH system Personnel who may be involved in the development or submission of claims for reimbursement (or involved in the To access the most current version Page 1 of 8 of this document, go to the employee Intranet at

2 provision of patient are for which claims for reimbursement are filed with various public or private payers) (together, Covered BSWH System Personnel). 1. Standards of Conduct All BSWH System Personnel must commit to compliance with this Policy. All BSWH System Personnel must maintain the highest of ethical standards when taking action that implicates Applicable False Claims Laws. BSWH System Personnel may be held individually accountable under Applicable False Claims Laws for noncompliance with such laws. 2. Examples of Proscribed Activities; Affirmative Obligation to Understand Proscribed Activities Identified by OIG; Compliance Policies and Individual Responsibility With respect to claims for reimbursement under Medicare, Medicaid and other federal health care programs, the OIG has identified several billing-related activities that are especially problematic under a false claims analysis. The OIG s special areas of concern include: billing for items or services not actually rendered; providing medically unnecessary services; UpCoding; DRG Creep; outpatient services rendered in connection with inpatient stays; teaching physician and resident requirements for teaching hospitals; duplicate billing; false cost reports; unbundling; billing for discharge in lieu of transfer; patients freedom of choice; and failure to refund credit balances All Covered BSWH System Personnel shall develop an understanding of such activities, commit to the avoidance of such activities, and, when appropriate or as may be required, participate in any related training and educational programs offered by BSWH System All Covered BSWH System Personnel shall review and consider the FFCA, the FARFCS, the TMFPA, and the PPACA, summaries of which are attached hereto as Attachments A1, A2, A3, and A4, respectively. All BSWH System Personnel are expected to comply with such laws The BSWH Law Department, the Chief Compliance Officer, and any other appropriate personnel shall carefully review and consider any and all Special Fraud Alerts published by the OIG that relate to hospitals. 3. Medical Necessity Reasonable and Medically Necessary Services 3.1. Covered BSWH System Personnel shall submit claims to Medicare for services that the hospital has reason to believe are medically necessary and that were ordered by a physician or other appropriately licensed individual. The term medical necessity has specific meaning under the Medicare program and under other government and private health insurance plans. Covered BSWH System Personnel shall familiarize themselves with and apply appropriately the medical necessity definitions applicable under Medicare and other plans. A comprehensive and current summary of such medical necessity definitions is attached hereto as Attachment A For certain procedures or services, Medicare may have issued a National Coverage Determination (NCD) that sets forth specific requirements that must be met for a given procedure or service to be a covered service under Medicare; or an NCD may specify when a particular item or service is False Claims Page 2 of 8

3 not covered under Medicare. Billing Staff shall monitor and adhere to applicable NCDs, if any, when billing Medicare for items or services subject thereto. 4. Additional Examples of Proscribed Activities Additional examples of proscribed activities are more fully described in Attachment A5. All Covered BSWH System Personnel shall review Attachment A5 and understand such proscribed activities. 5. Monitoring Compliance The Chief Compliance Officer is responsible for the oversight of this Policy, as more fully described in BSWH s Reporting Compliance Concerns Policy. In particular, BSWH s Chief Compliance Officer, in consultation with the BSWH Law Department, is responsible for receiving and acting upon all information suggesting the existence of possible fraud, abuse or other wrongdoing; and, in consultation with the BSWH Law Department, for directing all internal investigations arising from this information. Internal investigations of alleged violations of billing pursuant to private insurance contracts shall begin with a review of the applicable contract. External investigations involving federal, state or local law enforcement and/or regulatory agencies are coordinated and directed by the BSWH Chief Legal Officer pursuant to the BSWH System policy on Government Investigations and Inquiries. In the event an internal investigation identifies compliance concerns that may necessitate self-disclosure to a federal, state or local law enforcement or regulatory agency, the BSWH Chief Legal Officer, in consultation with the BSWH Chief Compliance Officer, shall determine the procedure and substance for any such disclosure. 6. Reporting Noncompliance BSWH System Personnel who discover any noncompliance with this Policy or any violation of the Applicable False Claims Laws shall report such discovery in accordance with BSWH s Reporting Compliance Concerns Policy. BSWH System Personnel who report any such concern or violation in good faith will not be subject to retaliation or retribution, as more fully described in BSWH s Non-Retaliation/Non-Retribution Policy. BSWH System Personnel may also report a discovery of noncompliance with the FFCA directly to the federal government consistent with the FFCA s Qui Tam provisions. In particular, and as more fully described in the FFCA and Attachment A1 hereto, under the Qui Tam provisions of the FFCA, a private individual may bring a civil action on his behalf and on behalf of the federal government for violations of the FFCA. BSWH System will not retaliate against any BSWH System Personnel who either engage in lawful acts in furtherance of an action under the FFCA or other efforts to stop one (1) or more violations of the FFCA. See False Claims Act, 31 U.S.C (2009). D E F I N I T I O N S When used in this Policy these terms have the following meaning: False Claims Page 3 of 8

4 Applicable False Claims Laws Applicable False Claims Laws includes the FFCA, the FARFCS, the TMFPA, the PPACA, and any other laws and regulations relating to health care fraud, waste and abuse and the proper billing of Medicare, Medicaid and other government-funded health care programs, and all applicable laws relating to proper billing under private health care programs. Billing Staff All BSWH System Personnel who are responsible for or participate in any part of (a) the handling or preparation of bills submitted to, or (b) correspondence about such bills with, public or private health care programs, including, but not limited to, personnel who are members of BSWH s Health Information Management Department. CPT Current procedural terminology: A set of five-digit codes corresponding to medical services that are frequently used for billing both public and private insurers. CPT codes are established and updated annually by the American Medical Association. See CMS website, (last visited June 5, 2014). Clinical Staff All BSWH System Personnel who provide healthcare services to BSWH System patients, or who provide documentation of such services. Coding Staff All BSWH System Personnel who are responsible for or participate in the assignment of CPT codes, or any other codes, to medical goods and/or services provided to BSWH System patients, for the purpose of receiving reimbursement from a public or private health care program. Controlled Having more than 50% ownership, directly or indirectly, of the stock in a corporation, profits, or capital interest in a partnership or limitedliability company, or beneficial interest in a trust. Includes having the power to appoint and remove, directly or indirectly, a majority of the nonprofit s governing body. This policy will not apply to certain Controlled affiliates managed by a third party including, but not limited to, Texas Health Ventures Group LLC and BIR JV LLP. DRG Diagnosis-related group: The operating costs of acute care hospital inpatient stays under Medicare Part A are managed under a prospective payment system. Under such inpatient prospective pay system, each case is categorized into a DRG for purposes of payment. See CMS website, visited June 5, 2014). DRG Creep The practice of billing using a DRG code that provides a higher payment rate than the DRG code that accurately reflects the service furnished to the patient. See Publication of the OIG Compliance Program Guidance for Hospitals, 63 Fed. Reg. 8987, 8990 n.16 (February 23, 1998). HCPCS Healthcare Common Procedural Coding System: A set of alpha and numeric codes that describe services and procedures and that are established by Medicare and used for Medicare billing purposes. HCPCS codes include AMA CPT codes, as well as additional codes for products, supplies, and services not covered by CPT codes. See CMS website, False Claims Page 4 of 8

5 (last visited June 5, 2014). Related Party An organization that furnishes services, facilities, or supplies to a provider and that is related to the provider by common ownership or control. Common ownership exists if an individual or individuals possess significant ownership or equity in the provider and the institution or organization serving the provider. Control exists if an individual or individuals possess significant ownership or equity in the provider and the institution or organization serving the provider. See 42 C.F.R (a)-(b) (2011). UpCoding The classification of patients into higher-weighted disease groups for services paid on a prospective basis in order to receive higher levels of reimbursement than warranted given the services provided to a patient. See Publication of the OIG Compliance Program Guidance for Hospitals, 63 Fed. Reg. 8987, 8990 n. 15 (February 23, 1998). P R O C E D U R E S 1. Procedures for Claim Development and Claim Submission With respect to claim development and claim submission: 1.1. All Clinical Staff must provide for proper and timely documentation of all physician and other professional services prior to billing to ensure that only accurate and properly documented services are billed by Billing Staff The Billing Staff must submit claims only when appropriate documentation is maintained and available for audit and review. The documentation, which may include patient records, shall record the length of time spent in conducting the activity leading to the record entry and the identity of the individual providing the service The Billing Staff shall, consistent with appropriate guidance from medical staff, make certain that physician and hospital records used as a basis for a claim submission are appropriately organized in a legible form so they can be audited and reviewed The Billing Staff shall make certain that the codes for diagnosis and procedures r e p o r t e d on reimbursement c l a i m s are based on patient medical records and other documentation. The documentation necessary f o r accurate d i a g n o s i s and procedure c o d e assignment shall be available to the Coding Staff The Billing Staff shall rely upon such automated or manual processes as may be necessary to avoid the submission of claims for outpatient services that are rendered in connection with an inpatient stay to Medicare beneficiaries that may not be billed separately; periodic automated or manual pre-billing reviews and/or post-billing audits shall be used to confirm the efficacy of such processes in preventing the submission of claims for outpatient services which may not be billed separately. False Claims Page 5 of 8

6 2. Procedures for Submission of Claims for Laboratory Services With respect to claims for clinical and diagnostic laboratory testing services: 2.1. The Billing Staff may bill for laboratory services only after they are performed The Billing Staff may bill only for medically necessary services The Billing Staff may bill only for tests actually ordered by a physician and provided by or on behalf of the hospital laboratory The Billing Staff must use the CPT or HCPCS code that accurately describes the service the physician ordered and the hospital laboratory or its designee performed The Coding Staff must (a) submit diagnostic information obtained from qualified personnel only, and (b) contact the appropriate personnel to obtain diagnostic information in the event that the individual who ordered the test failed to provide such information If the Billing Staff obtain diagnostic information from a physician or physician s staff after receipt of a specimen and request for services, the receipt of such information is to be documented and maintained. 3. Procedures for Submitting Claims for Services Provided by Physicians at Teaching Hospitals With respect to claims submitted on behalf of teaching physicians: 3.1. The Billing Staff may bill only for services actually provided Every physician who provides or supervises the provision of services to a patient is responsible for the correct documentation of the services rendered The physician who provided or supervised the provision of services to the patient must sign the appropriate documentation and place it in the patient record Every physician is responsible for assuring that in cases where that physician provided evaluation and management (E&M) services, a patient s medical record includes appropriate documentation of the applicable key components of the E&M service provided or supervised by the physician (e.g., patient history, physician examination, and medical decision-making), as well as documentation to adequately reflect the procedure or portion of the service performed by the physician Every physician shall document his or her presence during the key portion of any service or procedure for which payment is sought. False Claims Page 6 of 8

7 4. Procedures for Preparing Cost Reports With respect to cost reports: 4.1. No costs shall be claimed unless based on appropriate and accurate documentation Allocations of costs to various cost centers must be accurately made, and such allocation of costs must be supportable by verifiable and auditable data Unallowable costs shall not be claimed for reimbursement Accounts determined by BSWH s Cost Reimbursement Staff and the applicable Hospital Financial Officer to possibly contain both allowable and unallowable costs must be analyzed to determine any unallowable amount that shall not be claimed for reimbursement Costs must be properly classified Prior-year audit adjustments made by the fiscal intermediary must be implemented and either not claimed for reimbursement or clearly identified as protested amounts on the cost report A ll Related Parties must be identified on Worksheet A submitted with the cost report, and all Related Party charges must be reduced to cost The Chief Financial Officer (or his or her authorized designee) must promptly notify the Medicare fiscal intermediary (or any other applicable payor) of any errors discovered after the submission of a BSWH affiliate s cost report. R E F E R E N C E S Much of the contents of this Policy are driven by the federal Deficit Reduction Act of Generally, the Deficit Reduction Act of 2005 establishes the federal law requirements for providing employees with written information and policies containing information about the federal False Claims Act, related state laws, whistleblower protections under such federal and state laws, and the employer s policies and procedures for detecting and preventing such fraud, waste, and abuse. See Deficit Reduction Act of 2005, Pub. L. No , 6032, 120 Stat. 4, ). The proscribed activities and responsibilities of BSWH System Personnel set forth in the Responsibilities and Procedures sections of the front part of this Policy primarily derive from the hospital compliance guidance issued by the OIG in See Publication of the OIG Compliance Program Guidance for Hospitals, 63 Fed. Reg (February 23, 1998). The additional proscribed activities and responsibilities of BSWH System Personnel set forth in Attachment A5 to this OIG Supplemental Compliance Program Guidance for Hospitals, 70 Fed. Reg (January 31, 2005). False Claims Page 7 of 8

8 R E L A T E D I N T E R N A L D O C U M E N T S Document Number BSWH.CMPL.ETH.005.P BSWH.CMPL.ETH.014.P BSWH.CMPL.ETH.009.P Document Name Code of Conduct Non-Retaliation/Non-Retribution Policy Reporting Compliance Concerns Policy Compliance Education and Training icy Government Investigations and Inquiries Policy A T T A C H M E N T S Attachment Number BSWH.CMPL.ETH.006.A1 BSWH.CMPL.ETH.006.A2 BSWH.CMPL.ETH.006.A3 BSWH.CMPL.ETH.006.A4 BSWH.CMPL.ETH.006.A5 BSWH.CMPL.ETH.006.A6 Attachment Name Summary of Federal False Claims Act Summary of Federal Administrative Remedies for False Claims and Statements Summary of Texas Medicaid Fraud Prevention Act Summary of Patient Protection and Affordable Care Act Additional Proscribed Activities Summary of Medical Necessity Definitions False Claims Page 8 of 8

9 Attachment Name: Summary of Federal False Claims Act Attachment Number: Date of Last Review: BSWH.CMPL.ETH.006.A1 6/5/2014 SUMMARY OF THE FEDERAL FALSE CLAIMS ACT Disclaimer: The following summa,-y of the Federal False Claims Act, 31 U.S.C {2009) {FFCA), is only a summary and not a complete or precise statement of the FFCA. For a complete copy of the FFCA, please contact the Chief Compliance Officer or the BSWH Law Department. OVERVIEW The FFCA imposes liability on any person who knowingly presents or causes to be presented a false or fraudulent claim for payment or approval by the federal government. The purpose of the FFCA is to discourage fraud against the government and encourage those with knowledge of fraud to come forward with such information. The FFCA allows private individuals (whistleblowers) to file lawsuits on behalf of the government against persons who have violated the FFCA. Under the statute, these whistleblowers generally are entitled to receive between % of the total amount of recovery, and they are protected from any subsequent employer retaliation that may occur as a result of initiating such an action. KEY PROVISIONS OF THE FEDERAL FALSE CLAIMS ACT Liability for Certain Acts-31 U.S.C Cal Any of the following actions may constitute a violation of the FFCA: 1. Knowingly presenting (or causing to be presented) a false or fraudulent claim for payment or approval; 2. Knowingly making or using (or causing to be made or used) a false record or Statement material to a false or fraudulent claim; 3. Conspiring to commit a violation of any of the actions described in 1 and 2 above or 4-7 below; 4. Possessing custody or control of property or money used or to be used by the Government knowingly delivering (or causing to be delivered) less than all of that money or property; 5. Being authorized to make or deliver a document certifying receipt of property used, or to be used, by the Government and, intending to defraud To access the most current version Page 1 of 4 of this document, go to the employee Intranet at

10 the Government, making or delivering the receipt without completely knowing that the information on the receipt is true; 6. Knowingly buying or receiving as a pledge of an obligation or debt, public property from an officer or employee of the Government, or a member of the Armed Forces, who may not lawfully sell or pledge the property; or 7. Knowingly making or using (or causing 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 concealing or knowingly and improperly avoiding or decreasing an obligation to pay or transmit money or property the Government. The 2009 Amendments to the FFCA contained in the Fraud Enforcement and Recovery Act of 2009, Pub. L. No , 123 Stat. 116 (2009) (FERA), expanded the scope of liability under the FFCA. In particular, FERA imposes liability under the FFCA for improper retention of government overpayments. The Patient Protection and Affordable Care Act, Pub. L , 124 Stat. 119 (2010) (See Attachment A4), also provides for liability under the FFCA for failure to return any discovered government overpayments. Penalties.31.U.S.C. 3729(a) Any person found to violate the FFCA shall be liable to the Government for a civil penalty of not less than $5,500, but not more than $11,000, plus three (3) times the amount of damages which the Government sustains as a result of the violation. Such a person shall also be liable to the Government for the costs of a civil action brought to recover such penalties or damages. Notwithstanding the above, the court may assess not less than two (2) times the amount of damages the Government sustains because of the act of a person if it finds: 1. The person committing the violation voluntarily disclosed all information known to the person about the violation to Government officials responsible for investigating false claims violation within 30 days after the date which the person first obtained the information: 2. Such person fully cooperated with any Government investigation of such violation; and 3. At the time such person disclosed such information about the violation, no criminal prosecution, civil action, or administrative action had commences and Summary of Federal False Claims Act

11 the person did not have actual knowledge of the existence of an investigation into such violation. Definitions.31 U.S.C. 3729(b) Knowing and Knowingly Under the statute, Knowing and Knowingly means that a person, with respect to information: 1. Has actual knowledge of the information; 2. Acts in deliberate ignorance of the truth or falsity of the information; or 3. Acts in reckless disregard of the truth or falsity of the information. Claim Claim means any request or demand, whether under a contract or otherwise, for money or property and whether or not the United States has title to the money or property that: 1. Is presented to an officer, employee, or agent of the United States; or 2. Is made to a contractor, grantee, or other recipient, if the money or property is to be spent or used on the Government s behalf or to advance a Government program or interest, and if the United States Government: a. Provides or has provided any portion of the money or property requested or demanded; or b. Will reimburse such contractor, grantee, or other recipient for any portion of the money or property which is requested or demanded; and Claim does not include request or demands for money or property that the Government has paid to an individual as compensation for Federal employment or as an income subsidy with no restrictions on that individual s use of the money or property. Bills submitted to a Medicare carrier or fiscal intermediary are Claims under the FFCA. Exclusion.31 U.S.C. 3729(d) The FFCA does not apply to claims, records, or statements made under the Internal Revenue Code of 1986, as amended. CIVIL ACTIONS FOR FALSE CLAIMS Responsibilities of the Attorney General.31 U.S.C. 3730(b) Summary of Federal False Claims Act

12 The attorney General must diligently investigate any false claims violations and is authorized to bring a civil action against any person who has violated the FFCA. Private or Qui Tam Actions.31 U.S.C. A private individual may bring a civil action on his behalf and on behalf of the Government. The suit is filed and served on the Government, and the complaints and all related information must be filed in camera under seal and must remain under seal for at least 60 days. The action must be brought in the name of the Government and can only be dismissed if the court and Attorney General give written consent and state their reasons for dismissal. Once a qui tam suit is filed, no other person, other than the Government, may bring a related action based on the same underlying facts as the pending action. Award to Qui Tam Plaintiff.31 U.S.C. 3730(d) (1) (2) If the Government prosecute n action brought by qui tam plaintiff, that individual my receive between 15-25% of the total amount recovered (plus reasonable expenses and attorney s fees). In cases where the Government does not prosecute and the qui tam plaintiff litigates or settles the action on his or her own, the qui tam plaintiff may receive between 35-30% of the total amount recovered (plus reasonable expenses and attorney s fees). Protection for Whistlblowers.31 U.S.C. 3730(h) Under the FFCA, any employee who initiates an investigation, provides testimony or assistance in an action filed or to be filed under the FFCA and consequently suffers retaliation, will be entitled to all relief necessary to make the employee whole, including reinstatement with the same seniority status as the employee would have had but for the discrimination, two (2) times the amount of back pay plus interest, and compensation for any special damages sustained (plus reasonable costs and attorney s fees). Frivolous Lawsuits.31 U.S.C. 3730(d) (4) If the Government does not proceed with the action and the person bringing the action conducts the action the court may award to the defendant its reasonable attorney s fees and expenses if the defendant prevails in the action and the court finds that the action was based on a clearly frivolous or vexatious claim or the action was brought primarily for the purposes of harassment. Summary of Federal False Claims Act

13 Attachment Name: Summary of Federal Administrative Remedies for False Claims & Statements Attachment Number: Date of Last Review: BSWH.CMPL.ETH.006.A2 06/05/2014 SUMMARY OF FEDERAL ADMINISTATIVE REMEDIES FOR FALSE CLAIMS AND STATEMENT ACT Disclaimer: The following summary of the Federal Administrative Remedies for False Claims and Statements Act, 31 U.S.C (2009) (FARFCS), is only a summary and is not a complete or precise statement of the FARFCS. For a complete copy of the FARFCS, please contact the Chief Compliance Officer or the BSWH Law Department. Liability for False Claims 31 U.S.C. 3802(a)(1) Any person who makes, presents, or submits, or causes to be made, presented, or submitted, a claim that that person knows (or has reason to know): 1. Is false, fictitious, or fraudulent; 2. Includes or is supported by any written statement which asserts a material fact which is false, fictitious, or fraudulent; 3. Includes or is supported by any written statement that: a. omits a material fact; b. is false, fictitious or fraudulent as a result of such omission; and c. is a statement in which the person making, presenting or submitting such a statement has a duty to include such material fact; or 4. Is for payment for the provision of property or services which the person has not provided as claimed. Shall be subject to, in addition to any other remedy prescribed by law, a civil penalty of not more than $5,000 for each claim. Except in cases where the Government has not made payment on a false claim, any person who submits a false claim is subject to an assessment, in lieu of damages sustained by the United States as a result of such claim, of not more than twice the amount of such claim or portion of such claim, to be determined by the court. Liability for False Statements 31 U.S.C. 3802(a)(2) Any person who makes, presents, or submits, or causes to be made, presented, or submitted, a written statement that: To access the most current version of this Page 1 of 2 document, go to the employee Intranet at for NTX or Insite for CTX

14 Baylor Scott and White Health 1. The person knows or has reason to know: a. asserts a material fact which is false, fictitious or fraudulent; or b. omits a material fact and is false, fictitious or fraudulent as a result of such omission; Shall be subject to, in addition to any other remedy prescribed by law, a civil Penalty of not more than $5,000 for each statement. Summary of Federal Administrative Remedies for False Claims & Statements Page 2 of 2

15 Attachment Name: Summary of Texas Medicaid Fraud Prevention Act Attachment Number: Date of Last Review: BSWH.CMPL.ETH.006.A3 06/05/2014 SUMMARY OF TEXAS MEDICAID FRAUD PREVENTION ACT Disclaimer: The following summary of the Texas Medicaid Fraud Prevention Act, Tex. Hum. Res. Code (2013) (TMFPA), is only a summary and not a complete or precise statement of the TMFPA. For a complete copy of the TMFPA, please contact the Chief Compliance Officer or the BSWH Law Department. Overview The TMFPA combats Medicaid fraud and abuse by subjecting violators to civil and criminal prosecution. KEY PROVISIONS OF THE TEXAS MEDICAID FRAUD PREVENTION ACT Unlawful Acts Hum. Res Any of the following actions may constitute a violation of the TMFPA Act: 1. K no w ing l y m a k in g o r c a us in g to b e m a d e a fa ls e s ta tem ent o r misrepresentation of a material fact to permit a person to receive a benefit or payment under the Medicaid program that is not authorized or that is greater than the benefit or payment that is authorized; 2. Knowingly concealing or failing to disclose information that permits a person to receive a benefit or payment under the Medicaid program that is not authorized or that is greater than the benefit or payment that is authorized; 3. Knowingly applying for and receiving a benefit or payment on behalf of another person under the Medicaid program and converting any part of the benefit or payment to a use other than for the benefit of the person on whose behalf it was received; 4. Knowingly making, causing to be made, inducing, or seeking to induce the making of a false statement or misrepresentation of material fact concerning: a. The conditions or operation of a facility in order that the facility may To access the most current version of this Page 1 of 5 document, go to the employee Intranet at for NTX or Insite for CTX

16 qualify for certification or recertification required by the Medicaid program, including certification or recertification as: i ) h o s p i t a l ; i i ) a nursing facility or skilled nursing facility; i i i ) a hospice; i v ) an intermediate care facility for the mentally retarded; v ) an assisted living facility; or v i ) a home health agency; or b. Information required to be provided by a federal or state law, rule, regulation, or provider agreement pertaining to the Medicaid program; 5. Except as authorized under the Medicaid program, knowingly paying, charging, soliciting, accepting, or receiving, in addition to an amount paid under the Medicaid program, a gift, money, a donation, or other consideration as a condition to the provision of a service or product or the continued provision of a service or product if the cost of the service or product is paid for, in whole or in part, under the Medicaid program; 6. Knowingly presenting or causing to be presented a claim for payment under the Medicaid program for a product provided or a service rendered by a person who: a. is not licensed to provide the product or render the service, if a license is required; or b. is not licensed in the manner claimed; 7. Knowingly making a claim under the Medicaid program for: a. A service or product that has not been approved or acquiesced in by a treating physician or health care practitioner; b. A service or product that is substantially inadequate or inappropriate when compared to generally recognized standards within the particular discipline or within the health care industry; or c. A product that has been adulterated, debased, mislabeled, or that is otherwise inappropriate; 8. Making a claim under the Medicaid program and knowingly failing to indicate the type of license and the identification number of the licensed health care provider who actually provided the service Summary of Texas Medicaid Fraud Prevention Act Page 2 of 5

17 9. Knowingly entering into an agreement, combination, or conspiracy to defraud the state by obtaining or aiding another person in obtaining an unauthorized payment or benefit from the Medicaid program or a fiscal agent; 10. A managed care organization that contracts with the Health and Human Services Commission or other state agency to provide or arrange to provide health care benefits or services to individuals eligible under the Medicaid program and knowingly: a. Failing to provide to an individual a health care benefit or service that the organization is required to provide under the contract; b. Failing to provide to the commission or appropriate state agency information required to be provided by law, commissison or agency rule or contractual provision; or c. Engaging in a fraudulent activity in connection with the enrollment of an individual eligible under the Medicaid program in the organization s managed care plan or in connection with marketing the organization s services to an individual eligible under the Medicaid program; 11. Knowingly obstructing an investigation by the Texas Attorney General of an alleged unlawful act under this section; 12. Knowingly making, using, or causing the making or use of a false record or statement to conceal, avoid, or decrease an obligation to pay or transmit money or property to the State of Texas under the Medicaid program; or 13. Knowingly engaging in conduct that constitutes a violation under Section (b) (relating to false claims made under the federal medical assistance programs). Civil Remedies Hum. Res A person who violates the TMFPA is liable to the State of Texas for restitution of the value of any direct or indirect payment or benefit plus interest and two (2) times the value of such payment or benefit. There is a civil penalty of $5,000 to $15,000 for each violation that results in an injury to an elderly person, a disabled person or a person younger than 18 years of age, and a penalty of $1,000 to $10,000 for each violation that does not result in an injury to one of the three types of persons described above. A court may assess a penalty of not more than two (2) times the value of the payment or benefit if the violator discloses all information about the violation no later than 30 days after that person first obtains such information and the Texas Attorney General has yet to begin an investigation. The Texas Attor- Summary of Texas Medicaid Fraud Prevention Act Page 3 of 5

18 ney General may bring an action for civil remedies under the TMFPA together with a suit for injunctive relief under the TMFPA. A ward to P riva te Plaintiff s Hu m. Re s TMFPA actions can be prosecuted by the Texas Attorney General or by a private individual. A private individual must serve a copy of the petition and a written disclosure of substantially all material evidence and information the person possesses in relation to the TMFPA action on the Texas Attorney General, who then chooses whether to intervene. If the state does not intervene in a TMFPA action brought by a private individual, the action is dismissed. However, if the state proceeds with an action brought by a private plaintiff, the private plaintiff is entitled to receive between 15-25% of the total recovery, depending on the extent to which the plaintiff contributed to the prosecution of the action. If the court determines that the action is primarily based on public disclosures of information, the court may award an amount the court deems appropriate, but not more than 7% of the proceeds of the action. The court will consider the significance of the information and the contributions of the private plaintiff. Whistleblower Protections Hum. Res A person who reports a false claims violation and is consequently discharged, demoted, suspended, threatened, harassed or discriminated against by his/her employer is entitled to reinstatement with the same seniority status as the person would have had but for the discrimination, not less than two (2) times the amount of back pay, plus interest, and compensation for special damages sustained as a result of the discrimination. Award to Defendant for Frivolous Lawsuits Hum. Res A defendant in a civil action brought under the TMFPA that is found to be frivolous shall be entitled to recover, in addition to all other cost allowed by law, fees, expenses and reasonable attorney s fees incurred by the party in in defending the action. Such an action will be dismissed and judgment will be awarded to the defendant, see Tex. Civ. Prac. & Rem. & Rem (1985). Knowing or Knowingly Hum. Res For purposes of the TMFPA, a person acts knowingly with respect to information if the person: 1.has knowledge of the information; 2.acts with conscious indifference to the truth or falsity of the information; or Summary of Texas Medicaid Fraud Prevention Act Page 4 of 5

19 3. acts in recki ess disregard of the truth or falsity of the information. Proof of the person's specific intent to commit an unlawful act under Section is not required in a civil or administrative proceeding to show that a person acted knowingly with respect to information under this chapter. Summary of Texas Medicaid Fraud Prevention Act Page 5 of 5

20 Attachment Name: Summary of Patient Protection & Affordable Care Act Attachment Number: Date of Last Review: BSWH.CMPL.ETH.006.A4 06/056/2014 SUMMARY OF PATIENT PROTECTION AND AFFORDABLE CARE ACT Disclaimer: The following summary of the Patient Protection and Affordable Care Act, Pub. L , 124 Stat. 119 (2010) (PPACA), is only a summary and not a complete or precise statement of the PPACA. For a complete copy of the PPACA, please contact the Chief Compliance Officer or the BSWH Law Department. Overview The PPACA provides for liability under the federal False Claims Act 31 U.S.C (2006) (FFCA), for improper retention of government overpayments. KEY PROVISIONS OF THE PATIENT PROTECTION AND AFFORDABLE CARE ACT Reporting and Returning of Overpayment 31 U.S.C. 6402(d)(1) If a person has received an overpayment, the person shall: 1. Report and return the overpayment to the Secretary, the State, an intermediary, a carrier, or a contractor, as appropriate, at the correct address; and 2. Notify the Secretary, the State, intermediary, carrier, or contractor to whom to overpayment was returned in writing of the reason for the overpayment. D ead l i n e F o r R e p o r ti ng a nd R e t urn i ng O ver pa y ments 3 1 U.S. C. 6402(d)(2) An overpayment must be reported and returned under the paragraph above by the later of 1. The date which is 60 days after the date on which the overpayment was identified; or 2. The date any corresponding cost report is due, if applicable. Enforcement 31 U.S.C. 6402(d)(3) Any overpayment retained by a person after the deadline for reporting and returning the overpayment is an obligation, as defined in the EFCA, for purposes of the FFCA. To access the most current version of this Page 1 of 2 document, go to the employee Intranet at for NTX or Insite for CTX

21 Baylor Regional Medical Center at Grapevine Obligation, as defined in the FFCA means an established duty, whether or not fixed, arising from an express or implied contractual, grantor-grantee, or licensor-licensee relationship, from a fee-based or similar relationship, from statute or regulation, or from the retention of any overpayment. False Claims Act 3729(b) 31 U.S.C (2006). It is a violation of the FFCA to knowingly or improperly avoid or decrease an obligation to pay or transmit money or property to the Government. Id. 3729(a)(1)(G). Summary of Patient Protection & Affordable Care Act Page 2 of 2

22 Attachment Name: Additional Proscribed Activities Attachment Number: Date of Last Review: bswh.cmpl.eth.006.a5 06/05/2014 ADDITIONAL PROSCRIBED ACTIVITIES Overview This Exhibit describes additional examples of proscribed activities that have been specifically identified by the OIG in its 2005 compliance guidance for hospitals. See OIG Supplemental Compliance Program Guidance for Hospitals, 70 Fed. Reg (January 31, 2005). Outpatient Procedure Coding Specific examples of proscribed activities associated with incorrect outpatient procedure coding include the following: Billing on an outpatient basis for inpatient-only procedures CMS has identified procedures for which reimbursement is typically allowed only if the service is performed in an inpatient setting. Submitting claims for medically unnecessary services by failing to follow the FI's local policies Each Fiscal Intermediary (FI) publishes local policies, including local medical review polices (LMRPs) and local coverage determinations (LCDs), that identify certain procedures that are only reimbursable when specific conditions are present. In addition to relying on a physician's sound clinical judgment with respect to the appropriateness of a proposed course of treatment, hospitals shall regularly review and become familiar with their individual FI's LMRPs and LCDs. LMRPs and LCDs shall be incorporated into a hospital's regular coding and billing operations. Submitting unbundled claims or otherwise not following the National Correct Coding Initiative guidelines CMS developed the National Correct Coding Initiative (NCCI) to promote correct coding methodologies. The NCCI identifies certain codes that shall not be used together because they are either mutually exclusive or one is a component of another. If a hospital uses code pairs that are listed in the NCCI and those codes are not detected by the editing routines in the hospital's billing system, the hospital may submit unbundled claims. Intentional manipulation of code assignments to maximize payments and avoid NCCI edits constitutes fraud. Unintentional misapplication of NCCI coding and billing guidelines may also give rise to overpayments or civil liability for hospitals that have developed a pattern of inappropriate billing. To minimize risk, hospitals shall ensure that their coding software includes upto-date NCCI edit files. Submitting incorrect claims for ancillary services because of outdated Charge Description Masters Charge Description Masters (CDMs) list all of a hospital's charges for items and services and include the under- To access the most current version of this Page 1 of 4 document, go to the employee Intranet at for NTX or Insite for CTX

23 Baylor Regional Medical Center at Grapevine lying procedure codes necessary to bill for those items and services. Outdated CDMs create significant compliance risk for hospitals. Because the Healthcare Common Procedure Coding System (HCPCS) codes and Ambulatory Payment Classifications (APCs) are updated regularly, hospitals shall pay particular attention to the task of updating the CDM to ensure the assignment of correct codes to outpatient claims. This shall include timely updates, proper use of modifiers, and correct associations between procedure codes and revenue codes. Circumventing the multiple procedure discounting rules A surgical procedure performed in connection with another surgical procedure may be discounted. However, certain surgical procedures are designated as nondiscounted, even when performed with another surgical procedure. Hospitals shall ensure that the procedure codes selected represent the actual services provided, irrespective of the discounting status. They shall also review the annual Outpatient Prospective Payment System (OPPS) rule update to understand more fully CMS's multiple procedure discounting rule. Improper evaluation and management code selection Hospitals shall use proper codes to describe the evaluation and management (ELM) services they provide. A hospital's ELM coding guidelines shall ensure that services are medically necessary and sufficiently documented and that the codes accurately reflect the intensity of hospital resources required to deliver the services. Admissions and Discharges Often, the status of patients at the time of admission or discharge significantly influences the amount and method of reimbursement hospitals receive. Therefore, hospitals have a duty to ensure that admission and discharge policies are updated and reflect current CMS rules. Examples of proscribed activities with respect to the admission and discharge processes include the following: Failure to follow the same-day rule The OPPS rules require hospitals to include on the same claim all OPPS services provided at the same hospital, to the same patient, on the same day, unless certain conditions are met. Hospitals shall review internal billing systems and procedures to ensure that they are not submitting multiple claims for OPPS services delivered to the same patient on the same day. In addition, the Medicare 72-hour rule states that, subject to certain limited exceptions, all OPPS services provided to Medicare patients within 72 hours of the hospital inpatient admission are considered to be part of the inpatient services and are to be billed on one claim. Abuse of partial hospitalization payments Under the OPPS, Medicare provides a per diem payment for specific hospital services rendered to behavioral and mental health patients on a partial hospitalization basis. Examples of improper billing under the partial hospitalization program include, without limitation: reducing the range of services offered; withholding services that are medically appropriate; billing for Additional Proscribed Activities Page 2 of 4

24 Baylor Regional Medical Center at Grapevine services not covered; and billing for services without a certificate of medical necessity. Same-day discharges and readmissions Same-day discharges and readmissions may indicate premature discharges, medically unnecessary readmissions, or incorrect discharge coding. Hospitals shall have procedures in place to review discharges and admissions carefully to ensure that they reflect prudent clinical decision-making and are properly codes. Violation of Medicare's post-acute care transfer policy The postacute care transfer policy provides that, for certain designated Diagnosis Related Groups (DRGs), a hospital will receive a per diem transfer payment, rather than the full DRG payment, if the patient is discharged to certain post-acute care settings. CMS may periodically revise the list of designated DRGs that are subject to its post-acute care transfer policy. To avoid improperly billing for discharges, hospitals shall pay particular attention to CMS's post-acute care transfer policy and keep an accurate list of all designated DRGs subject to that policy. Improper churning of patients by long-term care hospitals co-located in acute care hospitals Long term care hospitals that are co-located within acute care hospitals may qualify for Prospective Payment System (PPS) -exempt status if certain regulatory requirements are satisfied. Hospitals shall not engage in the practice of churning, or inappropriately transferring, patients between the host hospital and the hospital-within-a-hospital. Supplemental Payment Considerations Under the Medicare program, in certain limited situations, hospitals may claim payments in addition to, or in some cases in lieu of, the normal reimbursement available to hospitals under the regular payment systems. Eligibility for these payments depends on compliance with specific criteria. Hospitals that claim supplemental payments improperly are liable for fines and penalties under Federal law. Examples of specific proscribed activities that hospitals shall address include the following: Improper reporting of the costs of pass-through items Passthrough items are certain items of new technology and drugs for which Medicare will reimburse the hospital based on costs during a limited transitional period. Abuse of DRG outlier payments Recent investigations revealed substantial abuse of outlier payments by hospitals with Medicare patients. Hospital management, compliance staff, and counsel shall familiarize themselves with CMS's new outlier rules and requirements intended to curb abuses. Improper claims for incorrectly designated provider-based entities Certain hospital-affiliated entities and clinics can be designated as provider-based, which allows for a higher level of reimbursement for cer- Additional Proscribed Activities Page 3 of 4

25 Baylor Regional Medical Center at Grapevine tain services. Hospitals shall take steps to ensure that facilities or organizations are only designated as provider-based if they satisfy the criteria set forth in the regulations. Improper claims for clinical trials Since September 2000, Medicare has covered items and services furnished during certain clinical trials, as long as those items and services would typically be covered for Medicare beneficiaries, but for the fact that they are provided in an experimental or clinical trial setting. Hospitals that participate in clinical trials shall review the requirements for submitting claims for patients participating in clinical trials. Improper claims for organ acquisition costs Hospitals that are approved transplantation centers may receive reimbursement on a reasonable cost basis to cover the costs of acquisition of certain organs. Organ acquisition costs are only reimbursable if a hospital satisfies several requirements, such as having adequate cost information, supporting documentation, and supporting medical records. Hospitals must also ensure that expenses not related to organ acquisition, such as transplant and post-transplant activities and costs from other cost centers, are not included in the hospital's organ acquisition costs. Improper claims for cardiac rehabilitation services Medicare covers reasonable and necessary cardiac rehabilitation services under the hospital incident-to benefit, which requires that the services of nonphysician personnel be furnished under a physician's direct supervision. In addition to satisfying the supervision requirement, hospitals must ensure that cardiac rehabilitation services are reasonable and necessary. Failure to follow Medicare rules regarding payment for costs related to educational activities Hospitals shall pay particular attention to these rules when implementing dental or other education programs, particularly those not historically operated at the hospital. Additional Proscribed Activities Page 4 of 4

26 Attachment Name: Summary of Medical Necessity Definitions Attachment Number: Date of Last Review: BSWH.CMPL.ETH.006.A6 06/05/2014 Summary of the Medical Necessity Definitions and Rules of the Various Government and Private Plans Medicare Title XVIII of the Social Security Act, section 1862 (a)(1)(a): Notwithstanding any other provisions of this tile, no payment may be made under Part A or Part B for any expenses incurred for items or services, which are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member. Blue Cross Blue Shield of Texas (BCBSTX) Medically Necessary or Medical Necessity means those services or supplies covered under the Plan which are: 1. Essential to, consistent with, and provided for the diagnosis or the direct care and treatment of the condition, sickness, disease, injury, or bodily malfunction; and 2. Provided in accordance with and are consistent with generally accepted standards of medical practice in the United States; and 3. Not primarily for the convenience of the Participant, his Physician, Behavioral Health Practitioner, the Hospital, or the Other Provider; and 4. The most economical supplies or levels of service that are appropriate for the safe and effective treatment of the Participant. When applied to hospitalization, this further means that the Participant requires acute care as a bed patient due to the nature of the services provided or the Participant s condition, and the Participant cannot receive safe or adequate care as an outpatient. The medical staff of BCBSTX shall determine whether a service or supply is Medically Necessary under the Plan and will consider the views of the state and national medical communities, the guidelines and practices of Medicare, Medicaid, or other government financed programs, and peer reviewed literature. Although a Physician, Behavioral Health Practitioner or Professional Other Provider may have prescribed treatment, such treatment may not be Medically Necessary within this definition. Humana Medically Necessary (or Medical Necessity), unless otherwise defined by applicable law, shall mean health care services that a hospital, exercising To access the most current version of this Page 1 of 3 document, go to the employee Intranet at for NTX or Insite for CTX

27 prudent clinical judgment, would provide to a patient for the purpose of preventing, evaluating, diagnosing or treating an illness, injury, disease or its symptoms, and that are (a) in accordance with generally accepted standards of medical practice; (b) clinically appropriate in terms of type, frequency, extent, site and duration, and considered effective for the patient s illness, injury or disease; and (c) not primarily for the convenience of the patient, hospital, or other health care provider, and not more costly than an alternative service or sequence of services at least as likely to produce equivalent therapeutic or diagnostic results as to the diagnosis or treatment of that patient s illness, injury or disease. For these purposes, generally accepted standards of medical practice means standards that are based on credible scientific evidence published in peer-reviewed medical literature generally recognized by the relevant medical community, hospital specialty society recommendations and the views of hospitals practicing in relevant clinical areas and any other relevant factors. Hospital agrees that in the event of a denial of payment for services rendered to Members determined not to be Medically Necessary by Payor, that Hospital shall not bill, charge, seek payment or have any recourse against Member for such services. Notwithstanding the immediately preceding sentence, Hospital may bill the Member for services determined not to be Medically Necessary if Hospital provides the Member with advance written notice that: (a) identifies the proposed services, (b) informs the Member that such services may be deemed by Payor to be not Medically Necessary, and (c) provides an estimate of the cost to the Member for such services and the Member agrees in writing in advance of receiving such services to assume financial responsibility for such services. Cigna Medically Necessary or Medical Necessity means the expense is required to diagnose or treat an illness, injury, disease or its symptoms in accordance with generally accepted standards of medical practice; clinically appropriate in terms of type, frequency, extent, site and duration; not primarily for the convenience of the patient, physician, or other health care provider; and rendered in the least intensive setting that is appropriate for the delivery of the services and supplies. Where applicable, the health plan Medical Director may compare the cost effectiveness of alternative services, settings or supplies when determining the least intensive setting. Aetna The medical necessity definitions are contained in the member's coverage documents. These coverage documents are provided to the members each year as they are enrolled. These coverage documents also are with the member's employer. For fully insured plans, we file these coverage documents with the states and adhere to state mandated coverage. In addition, Aetna has posted our Clinical Policy Bulletins on to provide additional guidance Summary of Medical Necessity Definitions Page 2 of 3

28 on clinical information that is used in determining medical necessity of services. See the link: Scott and White Health Plan Medically Necessary means those Health Care Services which, in the opinion of Member s Participating Physician or Participating Provider, whose opinions are subject to the review, approval or disapproval, and actions of the Medical Director or the Quality Assurance Committee in their appointed duties, are: 1) Essential to preserve the health of Member; and 2) Consistent with the symptoms or diagnosis and Treatment of the Member s condition, disease, ailment or injury; and 3) Appropriate with regard to standards of good medical practice within the surrounding community; and 4) Not solely for the convenience of the Member, Member s Physician, Hospital, or other health care provider; and 5) The most appropriate supply or level of service which can be safely provided to the member. Summary of Medical Necessity Definitions Page 3 of 3