Anti-Kickback, Stark and Enforcement Update

Transcription

1 Anti-Kickback, Stark and Enforcement Update By LYNDA M. JOHNSON 1

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3 Stark Cases based on False Claims Act Stark-based FCA suits US ex rel Emanuele v. Medicor Associates, 2017 WL (W.D. Pa. 2017): Court grants partial summary judgment finding Stark violations arising out of incomplete/unsigned Medical Director agreements. Failure to have a written agreement not a mere technicality 3

4 Stark Cases based on False Claims Act Stark-based FCA suits University Behavioral Health of El Paso, LLC (Feb. 9, 2017): $860,000 settlement of FCA lawsuit alleging Anti-Kickback Act and Stark Law violations arising out of personal services agreement with physician Stark Cases based on False Claims Act Some hope for providers: United States ex rel Bingham v. BayCare Health System, 2015 WL (M.D. Fla. 2015): Claims that physicians use of hospital parking garage ran afoul of Stark law dismissed on Summary Judgment. Applying an indirect analysis court found no link between the alleged improper parking benefits and the physicians Medicare referrals 4

5 Anti-Kickback based on False Claims Act AKS-based FCA suits UnitedStatesexrel.Brownv.CelgeneCorp,2016WL (C.D. Cal. 2016) AKS-based claims arising out of pharma company paying physicians to perform promotional speaking services dismissed on Summary Judgment Court concluded that even if some speakers generally encouraged audience members to prescribe the company s drugs, that would not be enough to establish liability under the AKS Anti-Kickback based on False Claims Act If such generalized promotion were viewed as recommending under the AKS, then the AKS would effectively criminalize all promotion of medical goods and services, including televisions ads and magazine inserts Recommendation was only intended to encompass recommendations that pertain to specific patients 5

6 Anti-Kickback based on False Claims Act Indiana University Health/HealthNet (April 27, 2017) $18M settlement Indiana University Memorial Hospital alleged to have provided HealthNet a free $10M line of credit in exchange for the referral of OB/GYN patients to the hospital 60-Day Rule Under 42 U.S.C. 1320a-7k(d) an overpayment must be reported and returned by the later of The date which is 60 days after the overpayment was identified; or The date any corresponding cost report is due, if applicable 6

7 60-Day Rule Any overpayment retained after the deadline is an obligation under the False Claims Act 31 U.S.C. 3729(a)(1)(G) and 31 U.S.C. 3729(b)(3) Reverse FCA liability CMP and Exclusion liability for retention of overpayments under 42 U.S.C. 1320a-7a(a)(10) 60-Day Rule: Final Regulations 42 C.F.R (Parts A and B) An overpayment is identified when the person has, or should have through the exercise of reasonable diligence, determined that the person has received an overpayment and quantified the amount of the overpayment) Reasonable diligence not defined but commentary explains it includes: Proactive compliance activities conducted in good faith by qualified individuals to monitor for receipt of overpayments Reactive investigations conducted in good faith in a timely manner in response to obtaining credible information of a potential overpayment Establishes a six year look back period 7

8 60-Day Rule: Identified Overpayment is identified if the person fails to exercise reasonable diligence and the person in fact received an overpayment. 60-Day Rule: Affirmative Obligation? Does the 60-Day Rule effectively require an organization to monitor the accuracy of its Medicare claims? We believe that undertaking no or minimal compliance activities to monitor the accuracy and appropriateness of... Medicare claims would expose a provider or supplier to liability under... this rule based on the failure to exercise reasonable diligence Fed. Reg. 7653, at 7661 UnitedHealthcare Insurance Co. v. Price, 2017 BL (D.D.C. 2017) Court rules UnitedHealthcarehas standing to challenge 60-Day Rule UnitedHealthcarealleges requiring proactive compliance activities to identify overpayments improperly imposes a negligence standard for FCA liability 8

9 60-Day Rule: Reasonable Diligence? After notice provider must investigate exercising reasonable diligence The amount of time a provider may take to conduct its investigation is not addressed in the text of regulation Preamble: reasonable diligence is demonstrated through the timely, good faith investigation of credible information, which is at most 6 months from the receipt of the credible information, except in extraordinary circumstances. 81 Fed. Reg. 7653, at 7662 Total of 8 months except for in extraordinary circumstances 60-Day Rule: Refund Process and Tolling Provider to refund overpayments through normal channels Follow MAC s normal processes 60-Day Clock is tolled if disclosure made: To CMS under the Self Referral Disclosure Protocol To OIG under the Self Disclosure Protocol NOTE: Disclosure to DOJ or local US Attorney does not appear to toll the 60-Day Clock Trap for the unwary? 9

10 60-Day Rule: Questions What proactive compliance activities must be undertaken? What facts or circumstances will trigger an obligation to initiate an investigation? What constitutes reasonable diligence? Extraordinary circumstances? When does the 60-day clock start running? Medicare Fraud Strike Force Established in 2007 Teams with DOJ, the United States Attorneys Offices, OIG, FBI, local law enforcement, and others Harnesses data analytics and the combined enforcement resources of multiple agencies Faster investigation and prosecution Operating in 9 jurisdictions Almost 3000 defendants charged for more than $11 billion in fraud 10

11 Fraud Takedown June 2016 Largest ever take down 36 Federal judicial districts Multiple federal agencies 24 Medicaid Fraud Control Units Over 1000 law enforcement personnel 350 HHS OIG Special Agents 301 individuals charged $900 Million in alleged false billing 11

12 Criminal Cases Against Physicians Aria Sabit, M.D. (January 9, 2017) Detroit-Area Neurosurgeon with link to PODs Unnecessary spinal infusion surgeries $2.8 million false billing scheme 20-year prison sentence Criminal Cases Against Physicians David Pon, M.D. (March 13, 2017) Orlando-Area Ophthalmologist Falsely told patients they had wet agerelated macular degeneration Performed and billed for fake treatments 10-year prison sentence 12

13 Criminal Cases Against Physicians Jacque Roy, M.D. (April 13, 2016) Dallas-area physician Convicted for running a large-scale, sophisticated home health care fraud scheme - $375 million alleged damages Kickbacks, false certification of medical necessity, false claims about home health services 3 owners of home health agency were also convicted Dr. Roy has not yet been sentenced Criminal Cases Against Physicians Salomon Melgen, M.D. (April 28, 2017) Palm Beach-Area Ophthalmologist Convicted by jury on 67 counts 13

14 Criminal Cases Against Physicians Isaac Thompson (July 2016) Florida primary care physician Inflated diagnoses for Medicare Advantage patients to receive increased reimbursement from MA plans First conviction of a physician for risk adjustment fraud Sentenced to four years in prison Excluded for 25 years OIG Administrative Enforcement Labib Riachi, M.D. (November 4, 2016) New Jersey OB/GYN with a subspecialty in urogynecology OIG alleged false claims for pelvic floor therapy: Not personally performed Failed to supervise Not provided Unlicensed/unqualified personnel Not medically necessary Excluded for 20 years following FCA settlement 14

15 OIG Administrative Enforcement Susan Toy Owner of billing company for Dr. Riachi Excluded for 5 years and paid $100,000 Roben Brookhim(January 11, 2017) New Jersey dentist After losing his dental license and being excluded, Brookhimbilled under the name and provider number of another dentist $1.1 million CMP and 50-year exclusion OIG Administrative Enforcement Genetic Testing Providers submitted claims for HCPCS code G0452 (molecular pathology procedure; physician interpretation and report) where: No consultation request; No written narrative report by a consultant physician; and No exercise of medical judgment by consultant physician required 25 CMP settlements for $871,000 15

16 OIG Administrative Enforcement Hartford Hospital (Connecticut) (April 18, 2017) $2.4M settlement to resolve allegations that Hartford submitted claims where patients received home health services within three days of the patients' release from Hartford that were improperly coded as discharged rather than as a post-acute care transfer Collaboration with OIG s Consolidated Data Analysis Center OIG Administrative Enforcement Haroutyoun Margossian, M.D. (May 15, 2017) New York physician specializing in female urinary incontinence OIG alleged Dr. Margossian failed to: (1) employ licensed individuals to perform the urodynamic and pelvic floor therapy (PFT) services; and (2) properly supervise the individuals performing the urodynamic and PFT services Excluded for seven years 16

17 CMS Administrative Enforcement Revocation CMS has authority to revoke a provider s enrollment 42 C.F.R Recent revocation action 42 C.F.R (a)(7) Misuse of billing number. Dr. Kermit White ZPIC noticed spike in Dr. White s Medicare claims and that there were claims for types of services he did not usually bill for ZPIC concluded White was allowing another physician (JT) to use his number CMS Administrative Enforcement Acting on the ZPIC s recommendation, Wisconsin Physician Services (the MAC) revoked Dr. White s billing privileges Dr. White appealed claiming that JT had reassigned his claims to White s practice ALJ denied appeal and DAB upheld revocation reassignment not properly documented Revocation is authorized whenever a supplier permits another to use its billing number for any purpose, unless an exception applies. Moral: Be careful with your provider number and pay attention to the 855R filing requirements 17

18 OIG Administrative Enforcement Payment Suspension Suspension of Payment is defined as the withholding of payment by a contractor of an approved Medicare payment before any determination of the amount of the overpayment or until the resolution of a credible allegation of fraud. 42 CFR Medicaid equivalent: 42 CFR Broad authority to impose suspension based on Credible Allegation of Fraud 18 months maximum duration absent special circumstances Contractors determination to impose suspension is not appealable. 42 CFR FY 2016: 508 active suspensions, 291 imposed during FY 2016 Suspension, like revocation, can be a death sentence HHS sensitive to due process concerns ZPIC Audits Provider s Worst Nightmare 18

19 QUESTIONS? Lynda M. Johnson Friday, Eldredge & Clark, LLP