Fraud and Medicare Compliance - PSOW 2015

1. Fraud & Medicare Compliance
Thomas N. Shorter, Esq., FACHE
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PSOW 28th Annual Workshop
September 23, 2015
Tundra Lodge Hotel & Convention Center
Green Bay, WI

2. Overview
• Legal Framework
−Governmental Oversight
−Other groups to know
−Laws to Know
• Recent Fraud Activity
• Compliance Program Guidance
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3. Legal Framework - Governmental Oversight
Federal
OIG – Office of Inspector General
DHS - U.S. Department of Health & Human
Services
DOJ – Department of Justice
CMS – Center of Medicare/Medicaid Services
State
AG - Wisconsin Attorney General’s Office
DHS - Wisconsin Department of Health Services
OIG - Office of Inspector General
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4. Additional Groups to Know
ZPICs – Zone Program Integrity Contractors
Primary goal – to identify cases of suspected fraud,
develop them thoroughly and in a timely manner, and take
immediate action to ensure that Medicare Trust Fund
monies are not appropriately paid out and that any
mistaken payments are recouped.
ZONE 3 – Cahaba Safeguard Administrators
−Operational April 24, 2012
−IL, IN, KY, MI, MN, OH and WI
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5. Additional Groups to Know cont.
RACs – Recovery Audit Contractors
To identify and correct Medicare improper
payments through the efficient detection and
collection of overpayments made on claims of
health care services provided to Medicare
beneficiaries, and the identification of
underpayments to providers so that the CMS can
implement actions that will prevent future improper
payments in all 50 states.
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6. Laws to Know
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Anti-kickback Statute
False Claims Act

7. Laws to Know - Anti-kickback Statute
42 U.S.C. § 1320a-7b.
Unlawful to: knowingly and willfully, solicit or
receive any remuneration (directly or indirectly, overtly or
covertly, in cash or in kind).
In return for referring any item or service reimbursable
by federal health care programs, or purchasing, leasing,
ordering or arranging for (or recommending any of the
same) any good, facility or service reimbursable by federal
health care programs.
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8. Laws to Know - Anti-kickback Statute
Unlawful to: Knowingly and willfully, offer to pay
any remuneration (directly or indirectly, overtly or
covertly, in cash or kind).
To induce: Referring for any item or service
reimbursable by federal health care programs, or
purchasing, leasing, ordering or arranging for (or
recommending any of the same) any good, facility
or service reimbursable by federal health care
programs.
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9. Law to Know – Anti-kickback Statute
3 necessary elements:
• Intentional Act
• Direct and Indirect Payment of Remuneration
• To Induce the Referral of Patients or Business
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10. Laws to Know - Anti-kickback Statute
Statutory Exceptions and Safe Harbors
• Discounts;
• Employees;
• Group Purchasing Organizations;
• Sale of a practice;
• Referral Services;
• Warranties;
• Investment Interests;
• Space Rental;
• Equipment Rental;
• Personal Services and Management Contracts; and
• Waiver of Deductibles and Coinsurance.
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11. What is Remuneration?
An extremely broad scope, whether in case or in kind,
and whether made directly or indirectly, including:
− Kickbacks;
− Bribes;
− Rebates;
− Gifts;
− Above or below market rent or lease payments;
− Discounts;
− Furnishing of supplies, services or equipment either
free, above or below market;
− Above or below market credit arrangements; and
− Waiver of payment due.
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12. Laws to Know - False Claims Act
31 U.S.C. §§ 3729-3733 – “Lincoln Law”
Prohibits a person from “knowingly” submitting claims or
making a false record or statement in order to secure payment of
a false or fraudulent claim by the federal government.
A person:
has actual knowledge of the information,
acts in deliberate ignorance of the truth or falsity of the
information, and
acts in reckless disregard of the truth or falsity of the information.
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13. Laws to Know – False Claims Act cont.
Key elements
• False Claims
• Intent
• Materiality
• Causation
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14. Laws to Know – False Claims Act cont.
Key Healthcare Theories
• Upcoding/billing for Services not Rendered
• False Certification of Compliance with
Regulations
• Quality of Care/Worthless Services
• Improper Retention of Overpayments
• “Causing” submission of False Claims
Does not cover false tax returns.
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15. Recent Fraud Activity
Florida - 9 hospitals agreed to a $6.2M
settlement for allegations of billing Medicare for
unnecessary ambulance transports.
California – 5 ambulance companies agreed to
settle kickback allegations for $11.5 M.
Pennsylvania – ambulance company
developed a Medicare fraud scheme of $2
million in inappropriate bills.
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16. Recent Fraud Activity cont.
Connecticut – 2 ambulance services will
pay $595,000 to resolve inappropriately
billing Medicare and Medicaid.
Wisconsin – MTM recently audited by DHS
after receiving complaints by Medicaid and
BadgerCare Plus members throughout the
State.
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17. Compliance Program Guidance for
Ambulance Suppliers
Federal Register, Vol. 28, No. 56,
March 24, 2003, 14245-14255.
Basic Elements:
• Development of Compliance Program.
• Designate a Compliance Officer and Committee.
• Conduct effective training and education.
• Develop Internal Monitoring and Reviews.
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18. Compliance Program
• Basic Elements (continued)
• Respond Appropriately to Detected Misconduct.
• Develop effective lines of communication.
• Conduct internal auditing and monitoring.
• Enforce standards through well-publicized
disciplinary guidelines.
• Respond promptly to detecting offenses and take
appropriate corrective action.
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19. The presentation and materials are intended to provide information on legal issues and should not be construed as legal advice. In addition, attendance at a Godfrey & Kahn, S.C.
presentation does not create an attorney-client relationship. Please consult the speaker if you have any questions concerning the information discussed during this seminar.
OFFICES IN MILWAUKEE, MADISON, WAUKESHA, GREEN BAY AND APPLETON, WISCONSIN
AND WASHINGTON, D.C.
Thank You
Thomas N. Shorter, Esq., FACHE
One East Main Street, Suite 500
Madison, WI 53703
608.284.2239, tshorter@gklaw.com
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