Category Archives: TRO

Accusations of Medicaid/care Fraud Run Rampant in SC: There Are Legal Remedies!

As if South Carolina didn’t have enough issues with the recent flooding, let’s throw in some allegations of Medicaid fraud against the health care providers. I’m imagining a provider under water, trying to defend themselves against fraud allegations, while treading water. It’s not a pretty picture.

Flash floods happen fast, as those in SC can attest.

So, too, do the consequences of allegations.

Shakespeare is no stranger to false accusations. In Othello, Othello is convinced that his wife is unfaithful, yet she was virtuous. In Much Ado About Nothing, Claudio believes Hero to be unfaithful and slanders her until her death. Interestingly, neither Othello and Claudio came to their respective opinions on their own. Both had a persuader. Both had a tempter. Both had someone else whisper the allegations of unfaithfulness in their ears and both chose to believe the accusation with no independent investigation. So too are accusations of Medicaid/care fraud so easily accepted without independent investigation.

With the inception of the Affordable Care Act (ACA), We have seen a sharp uptick on accusations of credible allegations of fraud.  See blog for the definition of credible allegation of fraud.

The threshold for credible allegation of fraud incredibly low. A mere accusation from a disgruntled employee, a mere indicia of credibility, and/or even a computer data mining program can incite an allegation of fraud. Hero was, most likely, committing Medicare/acid fraud too.

The consequences of being accused of fraud is catastrophic for a  health care provider regardless whether the accusation is accurate. You are guilty before proving your innocence! Your reimbursements are immediately suspended! Your entire livelihood is immediately crumbled! You are forced to terminate staff! Assets can be seized, preventing you even the ability to hire an attorney to defend yourself!

I have seen providers be accused of credible allegations of fraud and the devastation that follows. In New Mexico. In North Carolina. See documentary. Many NC providers serve SC’s population as well. The Medicaid reimbursement rates are higher in SC.

Obviously, The ACA is nationwide, federal law. Hence, the increase in allegations/accusations of health care fraud is nationwide.

Recently, South Carolina health care providers have been on the chopping block. Othello and Claudio are in the house of Gamecocks!

South Carolina’s single state agency, DHHS, required Medicaid recipients to get a 2nd prior approval before receiving health care services for “rehabilitative behavioral health” services, such as behavioral health care services for substance abuse and mental illness (could you imagine the burden if this were required here in NC?).

Then, last year, SC DHHS eliminated such 2nd prior approval requirement.

With fewer regulations and red tape in which to maneuver, SC saw a drastic uptick of behavioral health care services. Othello and Claudio said, “Fraud! More services with only one prior approval must be prima fracie fraud!”

Hence, behavioral health care providers in SC are getting investigated. But, mind you, during investigations reimbursements are suspended. You say, “Well, Knicole, how will these health care provider agencies afford to defend themselves without getting paid?” “Good question,” I say. “They cannot unless they have a stack of cash on hand for this exact reason.”

“What should these providers do?” You ask.

Hire an attorney and seek an injunction lifting the suspension of payments during the investigation.

Turn a Shakespearean tragedy into a comedy! Toss in a dingy!

Judges have lifted the suspensions. Read the case excerpt below:

order

As you can read in the above-referenced case, despite 42 455.23(a) mandating a suspension of payments upon credible allegations of fraud, this Judge found that the state failed to carefully weigh the evidence before suspending all payments.

There are legal remedies!!

Is Health Care Fraud on the Rise? Or Just the Accusations??

Recent stories in the news seem to suggest that health care fraud is running rampant.  We’ve got stories about Eric Leak‘s Medicaid agency, Nature’s Reflections, funneling money to pay athletes, a seizure of property in Greensboro for alleged Medicaid fraud, and, in Charlotte, a man was charged with Medicaid fraud and sentenced to three years under court supervision and ordered to pay $3,153,074. And these examples are local.

Health care fraud with even larger amounts of money at stake has been prosecuted in other states.  A nonprofit up in NY is accused of defrauding the Medicaid system for over $27 million.  Overall, the federal government opened 924 criminal health care fraud investigations last year.

What is going on? Are more people getting into the health care fraud business? Has the government become better at detecting possible health care fraud?

I believe that the answer is that the federal and state governments have determined that it “pays” high dividends to invest in health care fraud investigations.  More and more money is being allocated to the fraud investigative divisions.  More money, in turn, yields more health care fraud allegations…which yields more convictions….and more money to the government.

Believe me, I understand the importance of detecting fraud.  It sickens me that those who actually defraud our Medicaid and Medicare systems are taking medically necessary services away from those who need the services.  However, sometimes the net is cast so wide…so far…that innocent providers get caught in the net.  And being accused of health care fraud when you innocent is a gruesome, harrowing experience that (1) you hope never happens; and (2) you have to be prepared in case it does.  I have seen it happen.

As previously stated, in fiscal year (FY) 2014, the federal government opened 924 new criminal health care fraud  investigations.  That’s 77 new fraud investigations a month!!  This number does not include civil investigations.

In FY 2012, the Department of Justice (DOJ) opened 2,016 new health care fraud investigations (1,131 criminal, 885 civil).

The Justice Department launched 903 new health-care fraud prosecutions in the first eight months of FY 2011, more than all of FY 2010.

These numbers show:

  • an 85% increase over FY 2010,
  • a 157% increase over FY 2006
  • and 822% over FY 1991.

And the 924  investigations opened in fiscal 2014 only represent federal investigations.  Concurrently, all 50 states are conducting similar investigations.

What is being recovered? Are the increased efforts to detect health care fraud worth the effort and expenditures?

Heck, yes, it is worth it to both the state and federal governments!

Government teams recovered $4.3 billion in FY 2013 and $19.2 billion over the last five years.  While still astronomically high, the numbers dropped slightly for FY 2014.  In FY 2014, according to the Annual Report of the Departments of Health and Human Services and Justice, the federal government won or negotiated over $2.3 billion in health care fraud judgments and settlements.  Due to these efforts, as well as efforts from preceding years, the federal government retrieved $3.3 billion from health care fraud investigations.

So the federal and state governments are putting more money into investigating health care fraud.  Why?

The Affordable Care Act.

Obviously, the federal and state governments conducted health care fraud investigations prior to the ACA.  But the implementation of the ACA set new mandates to increase fraud investigations. (Mandates, which were suggestions prior to the ACA).

In 2009, Barack Obama signed Executive Order 13520, which was targeted to reduce improper payments and to eliminate waste in federal programs.

On March 23, 2010, President Obama signed the ACA into law.  A major part of the ACA is focused on cost containment methods. Theoretically, the ACA is supposed to be self-funding.  Detecting fraud, waste and abuse in the Medicare/Medicaid system helps to fund the ACA.

Unlike many of the other ACA provisions, most of the fraud and abuse provisions went into effect in 2010 or 2011. The ACA increases funding to the Healthcare Fraud and Abuse Control Program by $350 million over the next decade. These funds can be used for fraud and abuse control and for the Medicare Integrity Program.

The ACA mandates states to conduct post payment and prepayment reviews, screen and audit providers, terminate certain providers, and create provider categories of risk.

While recent articles and media seem to indicate that health care fraud is running rampant, the substantial increase in accusations of health care fraud really may be caused by factors other than more fraud is occurring.

The ACA mandates have an impact.

And, quite frankly, the investigation units may be a bit overzealous to recover funds.

What will happen if you are a target of a criminal health care fraud investigation?

It depends whether the federal or state government is conducting the investigation.

If the federal government is investigating you, most likely, you will be unaware of the investigation.  Then, one day, agents of the federal government will come to your office and seize all property deemed related to the alleged fraud.  Your accounts will be frozen.  Whether you are guilty or not will not matter.  What will matter is you will need an experienced, knowledgeable health fraud attorney and the funds with which to compensate said attorney with frozen accounts.

If the state government is conducting the investigation, it is a little less hostile and CSI-ish.  Your reimbursements will be suspended with or without your notice (obviously, you would notice the suspension once the suspension occurred).  But the whole “raid on your office thing” is less likely.

There are legal remedies available, and the “defense” should begin immediately.

Most importantly, if you are a health care provider and you are not committing fraud, you are not safe from accusations of fraud.

Your insurance, most likely, will not cover attorneys’ fees for alleged intention fraud.

The attorney of your choice will not be able to accept funds that are “tainted” by alleged fraud, even if no fraud occurred.

Be aware that if, for whatever reason, you are accused, you will need to be prepared…for what you hope never happens.

Why My Career, as a Medicaid Litigator/Medicaid Provider Advocate, is the Best, Most Rewarding Career…Ever!

I have the best and most rewarding career…EVER! It’s not the easiest career. It’s not a 9-5 job. When I schedule family trips, I normally have to cancel the trips or cut them short.

Like next week, my extended family on my dad’s side gets together every year for a week at Emerald Isle, NC. So about 3 months ago, I put in my secured leave with the Office of Administrative Hearings (OAH) for next week. Lawyers have to request “secured leave” for vacations. That way, the courts will not schedule hearings or mediations, etc. during the requested vacation time. Secured leave is really the only way to ensure an attorney gets a vacation. In my Medicaid practice, I normally only practice in OAH. For the most part, my clients have administrative complaints, not civil complaints, which would take me to Superior Court. So, I filed my secured leave in OAH only. Well, it just so happens that one of the State’s agents has refused to comply with an Order executed by an Administrative Law Judge (ALJ) in OAH. The consequences of the agent’s refusal could be dire. So, we had no choice but to file a Writ of Mandamus in Superior Court. A Writ of Mandamus is an extremely, extraordinary motion. We filed it last week. Superior Court scheduled the Writ hearing for Monday, June 24th (supposedly the 3rd day of my family vacation). So, my vacation is shortened. My client, especially in this specific instance, is just more important than a day or two at the beach.

Anyway, going back to how my career is the best career ever…

My clients are health care providers that choose to accept Medicaid. They are behavioral healthcare providers, dentists, durable medical equipment suppliers, neurologists, primary care physicians, speech therapists, ER physicians/hospitals, hospice providers, etc.  No matter the service my clients provide, the common thread is that the provider chooses to provide services to Medicaid recipients.  In some fields, these providers willing to accept Medicaid are few and far between.  Sometimes Medicaid recipients are placed on a 3-5 month waiting list only to get to see a health care provider for the first time.

My clients are good people.  My clients are empathetic.  They understand that few providers choose to accept Medicaid. Nevertheless, these providers choose to provide services to the most needy people in North Carolina.

My clients are not greedy.  They choose to accept Medicaid despite the low reimbursement rates, despite the complex and burdensome amount of regulations, despite the need to constantly google “NC Medicaid” for Implementation Updates or Special Bulletins, despite the need to constantly attend seminars on Medicaid updates, despite the need to jump through hoops, whether it be CAHBA certifications or applications with the Managed Care Organizations (MCOs), despite the need to undergo harassing audits, and despite the risk of the Division of Medical Assistance, or one of its agents, to merely terminate their Medicaid contract without due process.  My clients understand these risks and negative aspects, yet they choose to continue to serve Medicaid recipients.

My clients serve the most needy, most mute, and most underserved population in NC.  Obviously, Medicaid recipients, by definition, are the most poor citizens in our state.

My clients are scared. They have been told by the state or its agents that they owe money, that they have “credible allegations of fraud,” or indications of “abhorrent billing practices.” These allegations are unsubstantiated.  My clients served their consumers well.  But they have to defend these McCarthian-istic allegations, and health care providers, in general, are not litigious.  My clients are scared.

My career is the best and most rewarding career ever because I represent clients, who are good people doing good things.

My career is the best and most rewarding career ever because, by helping my clients, I am helping voiceless, Medicaid recipients.

A week or so ago, a client sent me a card saying, “Knicole and Elizabeth [one of my upcoming star-associates], Thank you for all you have done.  You have saved a company, 140 jobs, and over 500 Medicaid recipients from having no provider.  I almost cried.

I have always looked at my career as: By devoting my career to Medicaid providers, I am able to serve, indirectly, Medicaid recipients.  Medicaid recipients, for the most part, sadly, cannot hire me (believe me, I wish I could work for free), but, by my work for Medicaid providers, I am able to help Medicaid recipients by helping the providers the recipients so desperately need.

But this past week, I had the opportunity to help a Medicaid recipient directly, not indirectly. And, I left the hearing with goosebumps, good feelings, and a desire for more.

One of my clients had his or her Medicaid contract terminated; let’s call this person X.  Because of X’s termination of Medicaid contract, a Medicaid consumer, a teenage girl, who had seen X weekly for 6 years, was, suddenly, disallowed to see X.  Let’s call her ‘A.’  Without X, A spiraled.  A became suicidal and homicidal, both at home and at school. She begged to see X.  Since not being able to X, A was hospitalized 2x and was taken from her family home and placed in therapeutic foster care. All because A was disallowed to see the one therapist she had become to trust over the course of 6 years.

I decided to take A’s case pro bono.

I filed a Temporary Restraining Order, Motion to Stay, and Preliminary Injunction (TRO) on behalf of A. I argued that A was stable (as stable as possible for a person suffering from her mental illnesses) while she was able to see X.  When X’s Medicaid contract was terminated, A was not able to be seen by X.  A refused to go to another provider and spiraled.  I argued that A should be able to see X while A and X’s lawsuits went forward.  A should not suffer while X’s Medicaid contract was erroneously terminated.

A’s mother testified emotionally.

The Judge has not officially ruled yet. But, at the end of  the hearing, he wanted to ensure that, while he was deciding the ruling, A would be able to receive services from X.  I informed him that, no, A was not currently receiving services from X (despite the TRO being granted the prior week before the preliminary injunction hearing).

The judge looked at counsel for the MCO (the MCO that was not allowing X to see any Medicaid recipients) and said…Why?

Long story, short, my Medicaid recipient client was emotional (in a happy way) with the outcome. While my provider clients are also emotional (in a happy way) with the outcomes, this seemed different.  Had I not agreed to work pro bono, this person may never had received relief for her daughter.

Pro bono is tough.  You go into a pro bono case understanding that your legal fees will not be paid.  But it is rewarding.  In OAH, after the final disposition of the case, an attorney may petition for attorneys’ fees.  I hope my petition is granted…not because I want these legal fees so badly (honestly, my salary stays the same whether I get these attorneys’ fees or not), but because, if my attorneys’ fees are awarded in this case, maybe, just maybe, I would be able to take on more pro bono cases and help more Medicaid recipients directly.

Regardless, in my career, I go to bed knowing that I have helped good people, good providers and, indirectly, helped Medicaid recipients.

Best….Career….Ever!!!!