OIG Enforcement Initiatives Relating to Hospitals. Outline of Presentation

Transcription

1 OIG Enforcement Initiatives Relating to Hospitals S. Craig Holden Ober Kaler 1 Lew Morris Adelman Scheff & Smith,LLP Outline of Presentation 2013 OIG Work Plan Issues for Hospitals Trends in Individual Liability Recent Cases of Note Recent Advisory Opinions of Note New OIG Tools Suspension of payment Mandatory Compliance Programs 60 Day Repayment Voluntary Disclosure 2 1

2 OIG Work Plan for 2013 Selected Hospital Audit Initiatives New Initiatives Inpatient Medicare billing DRGs possible 14 day window Hospital owned physician practices billing providerbased Transfer policy compliance Payments for canceled surgeries Payments for mechanical ventilation Discharges to swing beds in other hospitals QIOs 3 OIG Work Plan for 2013 Selected Hospital Audit Initiatives Continuing initiatives of note Same day readmissions Accuracy of present on admission indicators Medicare inpatient and outpatient payments to acute care hospitals Acute care hospital inpatient transfers to inpatienthospice care Trends in outlier payments 4 2

3 OIG Work Plan for 2013 Legal/Investigative Initiatives Compliance with Corporate Integrity Agreements (CIA s) Review of entities who settle cases without a CIA Compliance training 5 Ripped from the Headlines Fourteen Hospitals to Pay U.S. More Than $12 Million to Resolve False Claims Act Allegations Related to Kyphoplasty (Feb., 2012) Hospital Chain HCA Inc. Pays $16.5 Million to Settle False Claims Act Allegations Regarding Chattanooga, Tenn., Hospital (Sept., 2012) Missouri Hospital System Agrees to Pay $9.3 Million to Resolve False Claims Act and Stark Law Violations (Nov., 2012) WakeMed enters into $8 million settlement to resolve investigation concerning outpatient hospital visits billed to Medicare as inpatient hospital stays (Dec., 2012) 6 3

4 OIG Organization Inspector General Principal Deputy Inspector General Office of Audit Services Office of Evaluations and Inspections Office of Management and Policy Office of Investigations Office of Counsel

5 EXCLUSION UNILATERAL MONITORING CORPORATE INTEGRITY AGREEMENT LOW PRIORITY RELEASE - SELF-DISCLOSURE 9 9 OIG Exclusion Authorities Key authorities: 42 USC 1320a 7(a) Mandatory exclusions (a)(1) Conviction of program related offense (a)(2) Conviction of patient abuse (a)(3) Felony conviction of health care fraud Permissive exclusions (b)(7) Fraud or kickbacks (b)(15)(i) Individuals with an ownership or control interest in a convicted or excluded entity (b)(15)(ii) Officers or managing employees of a convicted or excluded entity 10 5

6 Trends in Individual Liability DOJ criminal actions Recent pharmaceutical manufacturer cases under the Park doctrine Synthes/Norian 10/10 corporate plea to felony off label marketing/improper clinical trials.» $23.5 million settlement amount» Divestiture required» CIA Four executives plead to Park misdemeanors» Jail sentences in each case 11 Trends in Individual Liability Stryker Biotech, LLC. Settlement 1/30/12 Corporate misdemeanor plea with $15 million fine Charges dropped against CEO and other individual employees WellCare indictments Company settled for $137.5 million in April, 2012 Indictment of five former executives of Medicaid HMO, including former CEO,CFO and GC Awaiting trial Unsuccessful indictment and prosecution of GSK in house counsel 12 6

7 Recent Individual Exclusion Actions Purdue Executives Court upheld OIG discretionary exclusions of executives who had pled to Park misdemeanors Convictions met statutory test of related to fraud Lack of intent irrelevant 12 year period struck as arbitrary and capricious Friedman v. Sebelius, 686 F3d 813 (DC Cir. 2012) KV Pharmaceuticals CEO (Hermelin) excluded under (b)(15) after Park plea by company 13 Will exclude OIG Guidance re Exclusions Owners if knew or should have known of conduct Officer or managing employees ( operational or managerial control or directs day to day operations) No statutory knowledge requirement Will only go after those who knew or should have known Rebuttable presumption that this standard is met 14 7

8 OIG Guidance re Exclusion Circumstances of the misconduct and seriousness of the offense Nature of sanction Amount of harm How pervasive Individual s role Position Individual s actions Compliance efforts Cooperation/disclosure Size/record of entity 15 WakeMed Recent Cases of Note Allegations of fraudulent billing of one day stays in cases where observation was ordered Tentative deferred prosecution agreement requiring an $8 million payment WakeMed prohibited from making disparaging remarks regarding the prosecutors case Judge rejected agreement Current status unclear 16 8

9 Recent Advisory Opinions of Note Advisory Opinion OIG approves a hospital s provision of an electronic interface to ordering physicians Could be used to order lab and other diagnostic test Hospital would provide maintenance and software updates Physicians responsible for EHR and hardware OIG concludes Integrally related to hospital s services No independent value 17 Recent Advisory Opinions of Note Advisory Opinion OIG approves hospital/physician co management arrangement that includes performance bonuses at the hospital, cardiac catheterization labs Requestor is a rural hospital in a medically underserved area Operates 4 cath labs Only cath labs in a 50 mile radius 18 9

10 Recent Advisory Opinions of Note AO continued Co management agreement with local 18 member cardiology group General cardiologists Interventional cardiologists 6 of whom do cath procedures Electrophysiologists Only group in the area performing cath procedures 19 Recent Advisory Opinions of Note AO continued Co management terms Fixed annual fee Performance fee up to amount of fixed fee Performance criteria (over a set baseline) Employee satisfaction (5%) Patient satisfaction (5%) National survey data Start times Reduced time between cases 20 10

11 Recent Advisory Opinions of Note AO continued Quality measures (30%) Based on national cardiology measures» Door to balloon time» Prescription of beta blockers» Various others Cost savings (60%) Based on percentage reduction of cost per case» Single vendor purchasing of stents» Certain items limited to an as needed basis» Various others 21 Recent Advisory Opinions of Note AO continued Safeguards Cost savings measures developed based on evidence and clinical outcomes External valuation of FMV of both fees Independent third party review of performance fee factors and clinical outcomes 22 11

12 Recent Advisory Opinions of Note AO continued Physician commit to not: Stint on care Increase referrals to the hospital Cherry pick patients for procedures at the cath labs Accelerate patient discharges Physicians agree that, to the extent that the payments result in practice group dividends, they will be distributed pro rata to the group members, including those who do not refer. 23 Recent Advisory Opinions of Note AO continued CMP analysis Fixed fee, patient satisfaction, employee satisfaction and quality components do not implicate the CMP Cost saving component does implicate the CMP by creating and incentive to reduce or limit services 24 12

13 Recent Advisory Opinions of Note AO continued CMP analysis Safeguards sufficient to protect beneficiaries Certification that no adverse effect on patient care, with continued monitoring Doctor free to use any product they deem medically appropriate No patient specific standards Incentives limited in scope and duration Physician commitments 25 Recent Advisory Opinions of Note AO continued Kickback analysis Implicates the statute Approves based on: FMV certification Compensation does not vary with referrals No other cath labs in the area Specificity of measure makes clear that they are designed to reward quality Limited duration 26 13

14 Recent Advisory Opinions of Note AO continued Remaining questions Same result if not the only players in the market? How can a pro rata distribution of revenue by the group work in practice? No cherry picking Really? Another way of saying you have to refer your good patients? 27 Recent Advisory Opinions of Note AO OIG refuses to bless two anesthesia arrangements with safe harbored physician owned ASCs Arrangement A Exclusive arrangement with anesthesia provider Provider pays per patient fee (private pay patients only) for management services Pre op nursing assessments Space for provider s physicians and records Transfer of billing information 28 14

15 Recent Advisory Opinions of Note OIG analysis of Arrangement A Carve out of government patients ineffective since arrangement is exclusive as to all patients The cost of the services under the arrangement are already included in the facility fee paid to the ASC by Medicare and other payers Double payment creates a clear kickback risk 29 Recent Advisory Opinions of Note Arrangement B ASC would establish a wholly owned subsidiary for the sole purpose of providing anesthesia to the ASC s patients Sub would contract with provider to provide all administrative functions relating to anesthesia for a set fee paid out of anesthesia receipts Anesthesia personnel would either be employed by the sub on be engaged as independent contractors 30 15

16 Recent Advisory Opinions of Note OIG analysis of Arrangement B Because sub is not an ASC, the ASC safe harbor does not apply, thus flow of dividends up to ASC and then to physician owners not protected, Arrangements with provider and anesthesia personnel could be protected by either the employment or personal services safe harbor Analogizes arrangement to the Contractual Joint Venture Special Advisory Alert Permits physician owners to do indirectly what they cannot do directly 31 Recent Advisory Opinions of Note Critique of OIG analysis ASC safe harbor clearly does permit physician owners to do this directly Medicare ASCs expressly permitted to purchase anesthesia services and bill for them directly with safe harbor protection MLN Matters MM6358 Fact that a wholly owned sub was chosen makes no substantive difference 32 16

17 New Tools: Payment Suspension 6402(h) of PPACA First statutory authority for payment suspensions. CMS may suspend payments to a Medicare provider or supplier pending an investigation of a credible allegation of fraud. States must suspend payments to Medicaid provider or supplier, unless the State determines there is good cause not to suspend such payments. CMS Regulation February Mandatory Compliance Programs 6401 of PPACA makes compliance programs mandatory......but only after implementing regulations establish the core elements for mandatory compliance programs Growing numbers of providers are establishing (or updating) compliance programs in anticipation of them becoming mandatory

18 60 Day Repayment Requirement 6402 of PPACA requires reporting and repayment of overpayments within 60 days of identification (or due date of next cost report, if applicable) What s identification? Violations actionable under FCA Regulatory guidance expected soon

19 37 37 Breakdown of CMS Settlements 38 19