Category Archives: Office of Inspector General
On July 13, 2017, Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced the Department of Justice’s (DOJ) biggest-ever health care fraud takedown. 412 health care providers were charged with health care fraud. In total, allegedly, the 412 providers schemed and received $1.3 billion in false billings to Medicare, Medicaid, and TRICARE. Of the 412 defendants, 115 are physicians, nurses, and other licensed medical professionals. Additionally, HHS has begun the suspension process against 295 health care providers’ licenses.
The charges include allegations of billing for medically unnecessary treatments or services that were not really provided. The DOJ has evidence that many of the defendants had illegal kickback schemes set up. More than 120 of the defendants were charged with unlawfully or inappropriately prescribing and distributing opioids and other narcotics.
While this particular sting operation resulted from government investigations, not all health care fraud is discovered through government investigation. A great deal of fraud is uncovered through private citizens coming forward with incriminating information. These private citizens can file suit against the fraudulent parties on behalf of the government; these are known as qui tam suits.
Being a whistleblower goes against what most of us are taught as children. We are taught not to be a tattletail. I have vivid memories from elementary school of other kids acting out, but I would remain silent and not inform the teacher. But in the health care world, tattletails are becoming much more common – and they make money for blowing that metaphoric whistle.
What is a qui tam lawsuit?
Qui tam is Latin for “who as well.” Qui tam lawsuits are a type of civil lawsuit whistleblowers (tattletails) bring under the False Claims Act, a law that rewards whistleblowers if their qui tam cases recover funds for the government. Qui tam cases are a powerful weapon against Medicare and Medicaid fraud. In other words, if an employee at a health care facility witnesses any type of health care fraud, even if the alleged fraud is unknown to the provider, that employee can hire an attorney to file a qui tam lawsuit to recover money on behalf of the government. The government investigates the allegations of fraud and decides whether it will join the lawsuit. Health care entities found guilty in a qui tam lawsuit will be liable to government for three times the government’s losses, plus penalties.
The whistleblower is rewarded for bringing these lawsuits. If the government intervenes in the case and recovers funds through a settlement or a trial, the whistleblower is entitled to 15% – 25% of the recovery. If the government doesn’t intervene in the case and it is pursued by the whistleblower team, the whistleblower reward is between 25% – 30% of the recovery.
These recoveries are not low numbers. On June 22, 2017, a physician and rehabilitative specialist agreed to pay $1.4 million to resolve allegations they violated the False Claims Act by billing federal health care programs for medically unreasonable and unnecessary ultrasound guidance used with routine lab blood draws, and with Botox and trigger point injections. If a whistleblower had brought this lawsuit, he/she would have been awarded $210,000 – 420,000.
On June 16, 2017, a Pennsylvania-based skilled nursing facility operator agreed to pay roughly $53.6 million to settle charges that it and its subsidiaries violated the False Claims Act by causing the submission of false claims to government health care programs for medically unnecessary therapy and hospice services. The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by 7 former employees of the company. The whistleblower award – $8,040,000 – 16,080,000.
There are currently two, large qui tam cases against United Health Group (UHG) pending in the Central District of California. The cases are: U.S. ex rel. Benjamin Poehling v. UnitedHealth Group, Inc. and U.S. ex rel. Swoben v. Secure Horizons, et al. Both cases were brought by James Swoben, who was an employee and Benjamin Poehling, who was the former finance director of a UHG group that managed the insurer’s Medicare Advantage Plans. On May 2, 2027, the U.S. government joined the Poehling lawsuit.
The charges include allegations that UHG:
- Submitted invalid codes to the Center for Medicare and Medicaid Services (CMS) that it knew of or should have known that the codes were invalid – some of the dates of services at issue in the case are older than 2008.
- Intentionally avoided learning that some diagnoses codes or categories of codes submitted to their plans by providers were invalid, despite acknowledging in 2010 that it should evaluate the results of its blind chart reviews to find codes that need to be deleted.
- Failed to follow up on and prevent the submissions of invalid codes or submit deletion for invalid codes.
- Attested to CMS each year that the data they submitted was true and accurate while knowing it was not.
UHG would not be in this expensive, litigious pickle had it conducted a self audit and followed the mandatory disclosure requirements.
What are the mandatory disclosure requirements? Glad you asked…
Section 6402(a) of the Affordable Care Act (ACA) creates an express obligation for health care providers to report and return overpayments of Medicare and Medicaid. The disclosure must be made by 60 days days after the date that the overpayment was identified or the date any corresponding cost report is due, if applicable. Identification is defined as the point in which the provider has determined or should have determined through the exercise of due diligence that an overpayment exists. CMS expects the provider to proactively investigate any credible information of a potential overpayment. The consequences of failing to proactively investigate can be seen by the UHG lawsuits above-mentioned. Apparently, UHG had some documents dated in 2010 that indicated it should review codes and delete the invalid codes, but, allegedly, failed to do so.
How do you self disclose?
According to CMS:
“Beginning June 1, 2017, providers of services and suppliers must use the forms included in the OMB-approved collection instrument entitled CMS Voluntary Self-Referral Disclosure Protocol (SRDP) in order to utilize the SRDP. For disclosures of noncompliant financial relationships with more than one physician, the disclosing entity must submit a separate Physician Information Form for each physician. The CMS Voluntary Self-Referral Disclosure Protocol document contains one Physician Information Form.”
The Office of Inspector General (OIG) recently disseminated hundreds of recoupment letters to providers in New York who had percentage-based contracts with billing agents. OIG is seeking recoupment for services spanning a five-year period, plus 9% interest. See example redacted letter from OIG.
42 CFR 447.10 prohibits the re-assignment of provider claims and applies only to Medicaid. It is recommended that you pay your billing agent a flat fee or on a time basis.
North Carolina Medical Society also discourages fee splitting. On the NCMS website, the Society warns that “Except in instances permitted by law (N.C. Gen. Stat. § 55B-14(c)), it is the position of the Board that a licensee cannot share revenue on a percentage basis with a non-licensee. To do so is fee splitting and is grounds for disciplinary action.”
Not all States prohibit fee splitting, and if Medicare or Medicaid is not involved, then we look to state law. But if Medicare or Medicaid is involved, then federal law matters. Some States prohibit fee splitting for doctors, chiropractors, and hospitals, while other states do not prohibit fee splitting for massage therapists. So it is important to know your State’s laws.
Lawyers also have fee-splitting prohibitions. To split fees with a nonlawyer constitutes the practice of law without a license (and probably multiple other ethical concerns).
Physicians, group practices and management services organizations should continue to carefully examine their current and proposed arrangements to ensure compliance with the fee-splitting prohibition applicable to your State. If you are unsure, consult an attorney.
OIG may have started these audits in New York, but, as New York State says “Excelsior” – ever upward – we can be sure that OIG will continue across the country.
Anti-Kickback statutes (AKS) and Stark law are extremely important issues in health care. Violations of these laws yield harsh penalties. Yet, many healthcare professionals have little to no knowledge on the details of these two legal beasts.
The most common question I get regarding AKS and Stark is: Do AKS and Stark apply to private payers? Health care professionals believe, if I don’t accept Medicare or Medicaid, then I don’t need to worry about AKS and Stark. Are they correct??
The general and overly broad response is that the Stark Law, 42 USC § 1395nn, only applies to Medicare and Medicaid. The AKS, 42 USC § 1320a-7b(b)),applies to any federal healthcare program.
Is there a difference between AKS and Stark?
Answer: Yes. As discussed above, the first difference is that AKS applies to all federal healthcare programs. This stark difference (pun intended) makes the simple decision to not accept Medicare and Medicaid, thus allowing you to never worry about AKS, infinitely more difficult.
Let’s take a step back… What are AKS and Stark laws and what do these laws prohibit? When you Google AKS and Stark, a bunch of legal blogs pop up and attempt to explain, in legalese, what two, extremely esoteric laws purport to say, using words like “renumeration,” “knowing and willful,” and “federal healthcare program.” You need a law license to decipher the deciphering of AKS and Stark. The truth is – it ain’t rocket science.
The AKS is a criminal law; if you violate the AKS, you can be prosecuted as a criminal. The criminal offense is getting something of value for referrals. You cannot refer patients to other health care professionals in exchange for money, reduced rent, use of laboratory equipment, referrals to you, health services for your mother, marketing, weekly meals at Ruth’s Chris, weekly meals at McDonalds, oil changes, discounted theater tickets, Uber rides, Costco coupons, cooking lessons, or…anything of value, regardless the value.
Safe harbors (exceptions to AKS) exist. But those exceptions better fit squarely into the definition of the exceptions. Because there are no exceptions beyond the enumerated exceptions.
AKS is much more broad in scope than Stark. Other than Medicare and Medicaid, AKS applies to any health care plan that utilizes any amount of federal funds. For example, AKS applies to Veterans Health Care, State Children’s Health Programs (CHIP), Federal Employees Health Benefit Program, and many other programs with federal funding. Even if you opt to not accept Medicare and Medicaid, you may still be liable under AKS.
Stark law, on the other hand, is more narrow and only applies to Medicare and Medicaid. I find the following “cheat sheet” created by a subdivision of the Office of Inspector General to be helpful in understanding AKS and Stark and the differences between the two:
One other important aspect of Stark is that is considered “strict liability,” whereas AKS requires a proving of a “knowing and willful” action.
Feel free to print off the above chart for your reference. However, see that little asterisk at the bottom of the chart? It applies here as well.
Have you ever watched athletes compete in the high jump? Each time an athlete is successful in pole vaulting over the bar, the bar gets raised…again…and again…until the athlete can no longer vault over the bar. Similarly, the Center for Medicare and Medicaid Services (CMS) continue to raise the bar on health care providers who accept Medicare and Medicaid.
In February, CMS finalized the rule requiring providers to proactively investigate themselves and report any overpayments to CMS for Medicare Part A and B. (The Rule for Medicare Parts C and D were finalized in 2014, and the Rule for Medicaid has not yet been promulgated). The Rule makes it very clear that CMS expects providers and suppliers to enact robust self auditing policies.
We all know that the Affordable Care Act (ACA) was intended to be self-funding. Who is funding it? Doctors, psychiatrists, home care agencies, hospitals, long term care facilities, dentists…anyone who accepts Medicare and Medicaid. The self-funding portion of the ACA is strict; it is infallible, and its fraud, waste, and abuse (FWA) detection tools…oh, how wide that net is cast!
Subsection 1128J(d) was added to Section 6402 of the ACA, which requires that providers report overpayments to CMS “by the later of – (A) the date which is 60 days after the date on which the overpayment was identified; or (B) the date any corresponding cost report is due, if applicable.”
Identification of an overpayment is when the person has, or reasonably should have through the exercise of reasonable diligence, determined that the person received an overpayment. Overpayment includes referrals or those referrals that violate the Anti-Kickback statute.
CMS allows providers to extrapolate their findings, but what provider in their right mind would do so?
There is a six-year look back period, so you don’t have to report overpayments for claims older than six years.
You can get an extension of the 60-day deadline if:
• Office of Inspector General (OIG) acknowledges receipt of a submission to the OIG Self-Disclosure Protocol
• OIG acknowledges receipt of a submission to the OIG Voluntary Self-Referral Protocol
• Provider requests an extension under 42 CFR §401.603
My recommendation? Strap on your pole vaulting shoes and get to jumping!
When providers receive Tentative Notices of Overpayment (TNOs), we appeal the findings. And, for the most part, we are successful. Does our State of NC simply roll over when the federal government audits it??
A recent audit by Health and Human Services (HHS) Office of Inspector General (OIG) finds that:
“We recommend that the State agency:
- refund $1,038,735 to the Federal Government for unallowable dental services provided to MPW beneficiaries after the day of delivery; and
- increase postpayment reviews of dental claims, including claims for MPW beneficiaries, to help ensure the proper and efficient payment of claims and ensure compliance with
Federal and State laws, regulations, and program guidance.”
MPW is Medicaid for Pregnant Women. Recently, I had noticed that a high number of dentists were receiving TNOs. See blog. I hear through the grapevine that a very high number of dentists recently received TNOs claiming that the dentists had rendered dental services to women who had delivered their babies.
Now we know why…
However, my question is: Does NC simply accept the findings of HHS OIG without requesting a reconsideration review and/or appeal?
It seems that if NC appealed the findings, then NC would not be forced to seek recoupments from health care providers. We already have a shortage of dentists for Medicaid recipients. See blog and blog.
And if the federal auditors audit in similar fashion to our NC auditors, then the appeal would, most likely, be successful. Or, in the very least, reduce the recouped amount, which would benefit health care providers and taxpayers.
Whenever NC receives a federal audit with an alleged recoupment, NC should fight for NC Medicaid providers and taxpayers!! Not simply roll over and pay itself back with recoupments!
This audit was published March 2015. It is September. I will look into whether there is an appeal on record.
OIG Finds Questionable Billing! California Medicaid Dentists: Expect Withholdings or Other Penalties!
Currently, dentists who accept Medicaid are ripe for pickings as targets for regulatory audits from both the federal and state governments. Actually, this is true for any provider that accepts Medicaid. It just happens that, recently, I have noticed an uptick in dental audits both in North Carolina and nationwide. Some dentists, who accept pregnancy Medicaid, may even bear the burden of determining pregnancy prior to a teeth cleaning…however, that is a topic for another day. Although, I tell you what, if my dentist asked whether I were pregnant prior to cleaning my teeth, he may have an abnormally red cheek the remainder of the day and I may join Crossfit.
Generally, dentists tend to not accept Medicaid. The reimbursement rates barely cover overhead. Add high regulatory compliance requirements, the likelihood of undergoing audits, and the government’s robust and zealous desire to tackle fraud, waste, and abuse (FWA), and it is no wonder why most dentists opt to not accept Medicaid. See blog. And blog.
Those dentists (and other providers) that do make the decision to accept Medicaid, these brave and noble souls, are subject to onerous audits; the result of a recent California audit is probably sending shock waves through the California dental community.
335 dental providers in California have been targeted by OIG as having questionable billing issues. Sadly, this is only the beginning for these 335 providers. Now the state will audit the providers, and these 335 providers may very well become the subject of a payment withhold in the near future.
What will happen next?
I will look into my crystal ball, otherwise known as experience, and let you know.
First, the Office of Inspector General (OIG) recently published a report called: “QUESTIONABLE BILLING FOR MEDICAID PEDIATRIC DENTAL SERVICES IN CALIFORNIA.”
One can only imagine by the title that OIG found alleged questionable billing. Otherwise the title may have been, “A Study into Medicaid Billing for Medicaid Pediatric Dental Services,” instead of “Questionable Billing.” With such a leading title, a reader knows the contents before reading one word.
What is questionable billing?
Importantly, before addressing what IS questionable billing, what is NOT questionable billing? Questionable billing is not abhorrent billing practices. Questionable billing is not wasteful billing or abusive billing. And questionable billing is certainly not fraudulent billing. That is not to say that some of these questionable billing will be investigated and, perhaps, fall into one the aforementioned categories. But not yet. Again, these dentists have a long journey ahead of them.
In this context, questionable billing seems to mean that the OIG report identifies dentists who perform a higher number of services per day. OIG analyzed rendering dental providers’ NPI numbers to determine how many services each rendering provider was providing per day. Then OIG compared the average Medicaid payment per kid, number of services per day, and number of services provided per child per visit. OIG determined a “threshold” number for each category and cited questionable billing practices for those dentists that fell egregiously outside the thresholds. Now, obviously, this is a simplistic explanation for a more esoteric procedure, but the explanation is illustrative.
This study of California Medicaid dentists is not first dental study OIG has undertaken. Recently, OIG studied Medicaid dentists in New York, Louisiana, and Indiana. What stands out in the California Medicaid dental study is the volume of dentists involved in the study. In Indiana, OIG reviewed claims for 787 dentists; in New York it reviewed claims for 719 dentists, and in Louisiana, OIG studied 512 dentists’ claims, all of whom rendered services to over 50 Medicaid children.
In California, OIG studied 3,921 dentists.
Why such a difference?
Apparently, California has more dentists than the other three states and more dentists who accept Medicaid. So, if you are Medicaid dentists, apparently, there is more competition in California.
Juxtapose that, in California, in 2012, only 3 periodontists, 3 prosthodontists, 2 endodontists, and 1 oral pathologist provided services to 50 or more children with Medicaid in California.
Going back to the audit findings…
OIG considered dentists who exceeded its identified threshold for one or more of the seven measures to have questionable billing.
OIG identified 329 general dentists and 6 orthodontists out of 3,921 providers as having with questionable billing. But these findings are only the beginning of what will, most likely, become a long and tedious legal battle for these 335 providers. Lumping together so many dentists and claiming questionable billing practices will inevitably include many dentists who have done nothing irregular. Many other dentists, will have engaged in unintentional billing errors and may owe recoupments. But I foresee a very small number of these dentists to actually have committed fraudulent billing.
Here is an example found in the OIG’s report, OIG identified that 108 dentists provided stainless steel crowns to 18% of the children served by these dentists, compared to an average of only 5% of children receiving stainless steel crowns by those served by all general dentists (non-Medicaid).
Another example is that 98 dentists provided pulpotomies to 18% of the children, while the statewide percentage is 5% to undergo pulpotomies.
Do these examples show that 108 dentists providing stainless steel crowns and that 98 dentists providing pulpotomies are improperly billing?
Of course not.
It is only logical that dentists who accept Medicaid would have a significantly higher number of pulpotomies compared to dentists who service the privately insured. Usually, although not always, a Medicaid recipient will have more issues with their teeth than those privately insureds. In order to qualify for Medicaid, the family must live in poverty (some more than others with the expansion of Medicaid in some states). Some of kids in this population will have parents who do not harp on the importance of dental hygiene, thus allowing many kids in this population to have decay in their teeth. Obviously, this is a generalization; however, I am confident that many studies exist to back up this generalization.
Therefore, if you accept my generalization, it makes sense that Medicaid dentists perform more pulpotomies than private insurance dentists.
And stainless steel crowns go hand in hand with pulpotomies. Unless you extract the tooth after the removal of the decay, you will need to provide a stainless steel crown to protect the tooth from future damage.
What will happen next?
OIG admits in its report that “our findings do not prove that providers either billed fraudulently or provided medically unnecessary services, providers with extreme billing patterns warrant further scrutiny.”
Which is precisely what will happen next…”further scrutiny”…
The OIG report recommends to California that it:
• Increase its monitoring of dental providers to identify patterns of questionable billing
• Closely monitor billing by providers in dental chains
• Review its payment processes for orthodontic services
• Take appropriate action against dental providers with questionable billing
It is that last recommendation, taking appropriate action, which will determine the future course for these 335 Medicaid providers. Because, as many of you know if you have followed my blog, the California Department of Health Care Services (DHCS) has a large toolbox with a considerable amount of tools for which it may yield its power against these providers…right or wrong. The same goes for all state Medicaid agencies. When it comes to a Medicaid provider and a Medicaid state agency, there is no balance of powers, in fact, there is only one power. Instead the scales of justice have one arm on the ground and the other raised in the air. There is an imbalance of power, unless you arm yourself with the right allies.
Possible future actions by DHCS:
• Payment suspensions
• Withholds of all reimbursements
• Post payment review
• Prepayment review
And combinations thereof.
DCHS stated that “it will review the dental providers referred by OIG and will determine by December 2015 what appropriate action may be warranted. Should there exist any provider cases not previously evaluated by existing program monitoring efforts, DHCS will take appropriate action through the available channels.”
First, December 2015 is a short timeframe for DCHS to audit 335 providers’ records and determine the proper course of action. So, expect a vendor for DCHS to be hired for this task. Also, expect that an audit of 335 providers in 7 months will have flaws.
These California dentists and orthodontists need to arm themselves with defense tools. And, quickly. Because it is amazing how fast 7 months will fly by!!
The report also states that OIG will be undertaking a study in the future to determine access to dental care issues. I will be interested in the result of that study.
These possible penalties that I already enumerated above are not without defenses.
These 335 CA Medicaid dental providers have administrative remedies to prevent these possible penalties. In other words, these 335 CA Medicaid dental providers do not have to take this lying down. Even though it appears that an imbalance of power exists between the state agency and the providers, these providers have appeal rights.
The second that any of these providers receive correspondence from DCHS, it is imperative that the provider contact its attorney.
Remember, some appeals have very short windows for which to appeal. Do not miss an appeal deadline!!
With flu season well under way, access to care to primary care physicians for Medicaid recipients is (as it is always) extremely important. During flu season, in particular, emergency rooms (ERs) are full of people suffering from flu-like systems. Many of those in the ER are uninsured, but many of those in the ER have a valid Medicaid card in their wallet.
So why would a Medicaid recipient present themself to the ER instead of contacting a primary care physician? In many instances, the Medicaid recipients do not have access to primary care. Many physicians simply refuse to accept Medicaid. Some managed care organizations (MCOs) refuse to contract with a number of physicians sufficient to address the needs of its catchment area.
A December 2014 audit conducted by the Office of Inspector General (OIG) found that access to primary care for Medicaid recipients is in serious question…especially with the onslaught of states moving Medicaid to managed care systems.
32 states contract with 221 MCOs. From each of the 32 states, OIG requested a list of all providers participating in Medicaid managed care plans. Remember that, here in NC, our MCOs only manage behavioral health care. We have not yet moved to managed care for our physical health care. However, this may change in the not so distant future…
Our Senate and House are attempting to pass Medicaid reform. The House is pushing for accountable care organizations (ACOs), which would be run by physicians, hospitals, and other health care organizations. The Senate, on the other hand, is pushing for MCOs. I urge the Senate to review this OIG report before mutating our health care system to managed care.
Federal regulations require MCOs to maintain a network of providers sufficient to provide adequate access to care for Medicaid recipients based on population, need, locations of providers, and expected services to be utilized.
However, as we have seen in NC, the MCOs are not properly supervised and have financial incentives to terminate provider contacts (or refuse to contract with providers). In NC, this has resulted in hundreds, perhaps thousands, of behavioral health care providers going out of business. See MCOs Terminating Providers and Restricting the Freedom of Choice of Providers for Medicaid Recipients: Going Too Far? and NC MCOs: The Judge, Jury, and Executioner.
The consequences of MCOs picking and choosing to contract with a select few are twofold: (1) the non-selected providers go out of business; and (2) Medicaid recipients lose access to care and choice of providers.
Because of #2, OIG conducted this audit, which, sadly, confirms the veracity of #2.
To conduct the audit, OIG contacted 1800 primary care physicians and specialists and attempted to make an appointment. OIG wanted to determine (1) whether they accepted Medicaid; (2) whether they were taking new Medicaid patients; and (3) the wait time for an appointment. OIG only contacted physicians who were listed on the states’ Medicaid plans as a participating provider, because Medicaid recipients rely on the states’ lists of participating providers in locating a physician.
Yet, the results of the OIG audit are disturbing, to say the least.
51% of the providers could not offer appointments to enrollees, which raises serious questions as to the adequacy of the MCO networks.
- 45% did not accept Medicaid
- 35%: could not be found at the location listed by the plan,
- 8% were at the location but said that they were not participating in the plan.
- 8% were not accepting new patients.
The average wait time was 2 weeks for those physicians accepting Medicaid. Over 25% had wait times of more than 1 month, and 10 percent had wait times longer than 2 months.
I guess they can always go to the ER.
Lately, I have heard the phrase NOT “in good standing” with DMA too often. Whenever I hear not “in good standing,” I have this image of the movie “Fred Clause.” Remember when Vince Vaughn, who is playing Santa’s younger brother, is asked to stamp the children’s Christmas list with “naughty” or “nice?” At first, he stamps the lists correctly…or per Santa’s orders. Then Fred Clause gets angry and stamps every Christmas list “Nice.” Well, being NOT “in good standing” with DMA is like being on the “naughty” list for Santa Clause, especially when Santa, as in the movie “Fred Clause,” contracts out Santa’s very important job to a third-party, Fred Clause, who begins to determine “naughty” and “nice” completely arbitrarily and without due consideration to the individual child’s facts or circumstances.
If you are reading this and thinking….”NOT “in good standing?”…I’ve never heard of such a thing….,” then take a moment, think about all the ways you are blessed (BTW: not knowing what “not in good standing” is one of those blessings). Take a moment and pat yourself and your team/staff on the back.
If you are reading this and thinking… “Yeah!…What the heck is NOT “in good standing?”…is there such a thing…is this legal?” Then this blog is for you.
What IS not “in good standing?”
Well, we know the consequences are drastic. If you are found to be “not in good standing,” the MCOs refuse to contract with you or terminate an already existing Medicaid contract. DMA terminates your Medicaid contract. You are not reimbursed for Medicaid services rendered. In drastic cases, you are forced to close your business. Go bankrupt. Fire all staff. And never service Medicaid recipients again.
And for all those above-referenced consequences…all because “You are not in good standing with DMA.” What???? What is “not in good standing with DMA?” Is that like getting an ‘F’ in drafting PCPs? Or a ‘C’ in treatment plans? Maybe a B- in service notes?
What IS “in good standing?”
According to the Division of Medical Assistance (DMA) website, “[t]he N.C. Medicaid Program recognizes the need to promote access to care by enrolling all providers in a timely manner and is committed to ensuring the provision of quality care for our citizens. The enrollment process includes credentialing, endorsement, and licensure verification to ensure that all providers are in good standing in the community.” (emphasis added).
To me, “good standing in the community” means: (1) not committing criminal acts; (2) maybe..being a good neighbor; (3) charitable services; (4) not littering; (5) helping stray animals get back to their owners…
But, obviously, “in good standing” means something completely different to DMA. So, I looked for a definition. And looked. I found the July 2012 Medicaid Bulletin that states:
Clarification of the Division of Health Service Regulation Good Standing Status
The N.C. Division of Health Service Regulation (DHSR) has provided clarification on its definition of good standing status. Effectively immediately, DHSR good standing status is associated with a facility – not an entire agency or an individual associated with an agency or facility. DHSR determines whether facility is in good standing based on current and active administrative actions against the facility.
Actions included in the determination that a facility is not in Good Standing include:
- Active Type A or Imposed Type B, based on Provider Penalty Tracking Database [criteria in NCGS 122C-23(e1) – non-compliance in Article 3, Client Rights].
- Current Intent to Revoke – Intent to Revoke is active and has not been rescinded.
- Active Suspension of Admissions – Suspension of Admissions has not been lifted
- Active Summary Suspension – Summary Suspension was issued and has not been lifted.
- Active Notice of Revocation – Notice of Revocation is current, and may be in appeal.
- Revocation in Effect – Notice of Revocation was issued and the final outcome is that the license for this facility has been revoked and is no longer active.
Local Management Entities-Managed Care Organizations (LME-MCOS) will receive a Good Standing Notice to help determine which agencies under the 1915 b/c waiver have received a determination of good standing from the DHSR. If a facility is not in good standing, LME-MCOs can withhold a decision about whether to contract with the specific facility for 90 days. During this 90-day period, LME-MCOs can check back with DHSR to determine if any resolution or changes to the action have occurred prior to making a final decision.
I also found an actual definition in DMA’s Endorsement Policy (from back in April 2011):
(11) “Good Standing – DHHS” means the same as defined in 10A NCAC 22P.0402.
(12) “Good Standing – LME” means the provider has a history of compliance with DMA Clinical Policy specific to service delivery and does not have an open Plan Of Correction (POC) with the LME. A POC must be timely submitted, approved, and implemented before the POC action can be closed. A POC is fully implemented when the POC is being followed and all out of compliance findings have been minimized or eliminated as determined by the LME in a maximum of two follow-up reviews. The POC action is closed when the provider receives the official notification from the LME stating the action is closed.
Ok, so the definitions helped…a little.
So I went to 10A NCAC 22P.0402 (which can be found below, courtesy of Benchmarks):
10A NCAC 22P .0402 GOOD STANDING AND CONFLICTS OF INTEREST
(a) A provider is in good standing with the Division of Medical Assistance when all of the following conditions are met, regardless of any appeal filed by the provider or any stay of such action entered by the Office of Administrative Hearings:
(1) The provider or any entities which share the same Employee Identification Number (EIN) as the provider do not owe any outstanding (more than 30 days past due) accounts receivable to DMA or its designee, including Medicaid overpayments, recoupments, program reimbursements, cost settlements, cost assessments, penalties and interest. A provider that entered into an approved payment plan in accordance with Subchapter 22F and Chapter 108C of the North Carolina General Statutes is considered to be in good standing if the provider has not defaulted on the payment plan;
(2) The provider or any entities which share the same Employee Identification Number (EIN) as the provider have not been terminated, suspended, had its Medicaid payments withheld, or been placed on probation in the previous 12 month period;
(3) The provider or any entities which share the same Employee Identification Number (EIN) as the provider is not undergoing prepayment claims review;
(4) The owner(s) or managing employee(s) of the provider agency were not previously the owners or managing employee(s) of a provider agency which had its participation in the N.C. Medicaid program involuntarily terminated for any reason or owes an outstanding accounts receivable to DMA or its designee, irrespective of whether the provider agency is currently enrolled in the N.C. Medicaid program;
(5) The provider and its owners and managing employee(s) are not listed on the U.S. Health and Human Services Office of Inspector General Exclusion list;
(6) The provider, any entities which share the same Employee Identification Number (EIN) as the provider, or its corporate parent, have no unresolved tax or payroll liabilities owed to the U.S. or North Carolina Department of Revenue;
(7) The provider and its owner(s) or managing employee(s) or any entity sharing the same EIN as the provider have no unresolved payroll liabilities owed to the U.S. or North Carolina Department of Labor. Unresolved payroll liabilities owed to the N.C. Department of Labor is defined as:
(A) The provider or its owner(s) or managing employee(s) or any entity sharing the same EIN as the provider having one or more unpaid judgments for wages owed under Chapter 95, Article 2A, the North Carolina Wage & Hour Act, in which the N.C. Department of Labor or Commissioner of Labor is the Plaintiff; or
(B) If one or more of the owner(s) or managing employee(s) of the entity requesting good standing was the owner or managing employee of any other organization against whom the North Carolina Department of Labor has one or more unpaid judgments for wages owed under Chapter 95, Article 2A, the North Carolina Wage & Hour Act, in which the N.C. Department of Labor or Commissioner of Labor is the Plaintiff.
(8) The provider or any entities which share the same Employee Identification Number (EIN) as the provider have not abandoned or destroyed patient medical records or staff records in violation of federal or state law, rule or regulation;
(9) The owner(s) or managing employee(s) of the provider agency were not previously the owners or managing employee(s) of a provider agency which abandoned or destroyed patient medical records or staff records in violation of federal or state law, rule or regulation; and
(10) If incorporated or otherwise applicable, the provider has a current Certificate of Existence issued by the N.C. Secretary of State’s Office.
(b) A provider is in good standing with DMH/DD/SAS when all of the following conditions are met, regardless of any appeal filed by the provider or any stay of such action entered by the Office of Administrative Hearings:
(1) Any approved Plan(s) of Correction (POC) pending with the DMH/DD/SAS Accountability Team has been implemented by the provider and the action has been closed by DMH/DD/SAS. A POC is implemented when the POC is being followed and all out of compliance findings have been minimized or eliminated as determined by a maximum of two DMH/DD/SAS follow-up reviews. The POC action is closed when the provider receives the official notification from the DMH/DD/SAS Accountability Team stating the action is closed; and
(2) The provider has not had any endorsement or credentialing to provide an enhanced or child/adolescent residential treatment service involuntarily withdrawn by any Local Management Entity/Managed Care Organization, and upheld by the DMH/DD/SAS Appeals Panel, in the previous 12 month period.
(c) A provider is in good standing with the Division of Health Service Regulation if it meets the requirements for enrollment and licensure set forth in G.S. 122C-23 (e1), regardless of any appeal filed by the provider or any stay of such action entered by the Office of Administrative Hearings.
(d) The owners, operators, and managing employees of a CABHA may not be employed by, or on the Board of, any Local Management Entity (LME), Prepaid Inpatient Health Plan (PIHP), Managed Care Organization (MCO), accreditation agency, or for-profit hospital.
History Note: Authority G.S. 108A-54; 42 U.S.C. 1396a; 42 C.F.R. 431.51; S.L. 2009-451, Section 10.58(d); Temporary Adoption Eff. December 28, 2010.
Ok, after reading all those definitions, I am sure you understand what NOT “in good standing” means, right? I mean, could it get any clearer?
Let’s break it down. For the sake of simplicity, I will use 10A NCAC 22P.0402, for no other reason except, of all the definitions, this administrative code is actually codified. First of all, 10A NCAC 22P.0402 is a bit confusing from the onset, as the code is drafted with conflicting negatives. As in, a provider is “in good standing” if (a) the provider does NOT owe…. So I’ve tried to make the code a bit easier to read.
1. A provider is NOT “in good standing” if the provider owes any outstanding (more than 30 days past due) accounts receivable to DMA or its designee, including Medicaid overpayments, recoupments, program reimbursements, cost settlements, cost assessments, penalties and interest.
Ok, easy enough…if you owe money to DMA, you are not “in good standing.” However, this is what disturbs me: the beginning of 10A NCAC 22P.0402 states regardless of any ongoing appeal or stay. That language means that if you get a Tentative Notice of Overpayment (TNO) stating that you owe $500,000, but you disagree with the findings and appeal, despite the appeal, you are still NOT “in good standing.”
2. A provider is NOT “in good standing” if “the provider ha[s]  been terminated, suspended, had its Medicaid payments withheld, or been placed on probation in the previous 12 month period.”
Again, easy enough to understand. But, again, I am disturbed by the fact that, according to the Code, even if you disagree with the termination or suspension, during any appeal, you will still be on the “naughty” list.
Allow me to get on my soapbox for a moment (as if you have a choice). You can get placed on prepayment review (for whatever reason), which automatically suspends all Medicaid reimbursements, CCME, or whatever 3rd-party entity can conduct a prepayment review improperly (not in actual accordance with DMA policies), and basically, botch your accuracy ratings to create an impossibility of reaching 70%…[Remember, this whole prepayment review process is not appealable according to NCGS 108C-7, which, I believe, is in direct violation of federal law] and the entire time during which your Medicaid reimbursements are suspended erroneously, you are considered NOT “in good standing,” which, we have already determined, has dire consequences.
My problem with the prepayment review process, in general, is that placing a provider on prepayment review with no due process is an obvious infringement on the legal rights of the persons involved. Federal law does not allow a state to simply not allow a provider appeal rights. On the contrary, federal law makes it very clear in numerous places that an appeal process SHOULD be in place. Yet NC does not allow a provider to appeal prepayment review status.
Because NC does not afford appeal rights for prepayment review, but the entire time a provider is on prepayment review the provider receives zero Medicaid reimbursements and the provider is considered not “in good standing,” both of which have drastic consequences for the provider, NC is, in essence, unilaterally deciding to usurp a provider’s property interest and a U.S. citizen’s right to life, liberty, and the pursuit of happiness without due process.
Yet, the entire time during which the provider is getting Constitutional deprivation to the detriment to the provider, the provider is not “in good standing” with DMA.
The process reminds me of the Don Henley song “Dirty Laundry:”
Kick ’em when they’re up
Kick ’em when they’re down
Kick ’em all around
Not to mention the fact that 42 C.F.R. 455.23 states:
(a) Basis for suspension
(1) The State Medicaid agency must suspend all Medicaid payments to a provider after the agency determines there is a credible allegation of fraud for which an investigation is pending under the Medicaid program against an individual or entity unless the agency has good cause to not suspend payments or to suspend payment only in part; (2) The State Medicaid agency may suspend payments without first notifying the provider of its intention to suspend such payments; (3) A provider may request, and must be granted, administrative review where State law so requires.
Ok, going back to the definition and consequences of not “in good standing.” The third subsection of 10A NCAC 22P.0402 reads:
3. A provider is NOT “in good standing” if “the provider is undergoing prepayment claims review.
4. A provider is NOT “in good standing” if the provider was “involuntarily terminated for any reason or owes an outstanding accounts receivable to DMA or its designee.”
Again, if the provider was involuntarily terminated based on a flawed prepayment review, then see #2. If providers owes money, see #1.
5. A provider is NOT “in good standing” if the provider is NOT listed on the U.S. Health and Human Services Office of Inspector General (OIG) Exclusion list;
OIG has the authority to exclude individuals and entities from Federally funded health care programs. One can only hope that those placed on the exclusion list is rightfully placed on the exclusion list,
6. A provider is NOT “in good standing” if the provider has any unresolved tax or payroll liabilities owed to the U.S. or North Carolina Department of Revenue;
Ok, I get it. The IRS cannot be questioned (despite recent unveilings of misdeeds by the IRS). Death and taxes…
7. A provider is NOT “in good standing” if the provider has any unresolved payroll liabilities owed to the U.S. or North Carolina Department of Labor.
Department of Labor is like the IRS…got it.
8. A provider is NOT “in good standing” if the provider has abandoned or destroyed patient medical records or staff records in violation of federal or state law, rule or regulation;
Do not abandon or destroy records….Check.
9. A provider is NOT “in good standing” if the owner(s) or managing employee(s) of the provider agency were previously the owners or managing employee(s) of a provider agency which abandoned or destroyed patient medical records or staff records in violation of federal or state law, rule or regulation; and
Do not own or manage a provider agency that previously abandoned or destroyed records….Check.
(10) A provider is “in good standing” if the provider, incorporated or otherwise applicable, has a current Certificate of Existence issued by the N.C. Secretary of State’s Office.
So, really, I do not take issue with the ENTIRE definition of what is not “in good standing.” Only subsections 1-4.
Like I said, the entire process reminds me of Vince Vaughn (the 3rd party contractor) angrily stamping all the children’s Christmas lists as “Nice.” Except in the case of being not “in good standing,” Vince Vaughn (the 3rd party contractor) is angrily stamping all the lists as “Naughty.”
Concurrent with the onslaught of Medicaid audits by North Carolina, Department of Health and Human Service (DHHS), Division of Medical Assistance (DMA), the federal HHS Office of Inspector General (OIG) is conducting its own Medicare audits. While, obviously, Medicare and Medicaid target different populations, many of the federal regulations are analogous. So I thought it would be prudent to point out some common errors HHS is finding in hospital billing as to Medicare.
According to the Report on Medicare Compliance (RMC), (to which, I am sure, everyone reading this blog subscribes), the three most common errors the OIG auditors are finding are as follows:
- Emergency Department (ED) admission source codes for psychiatric admissions
- Lupron (HCPCS code J1950)
- Tooth extractions (HCPCS D7140)
- Lymphocyte donor cell infusions (CPT 38242)
Obviously, the common errors for Medicaid billing may be different. For example, I know that Medicaid auditors are specifically reviewing records for short inpatient stays at hospitals; whereas any issue with records for short stays was not included by the RMC as a common error.
However, that said, I would be willing to bet the ED admission code errors for psychiatric admissions would be just as common in Medicaid as Medicare.
Most of the errors for admissions’ codes relate to inner-transfer of patients within the hospital (such as Patient X came in complaining of A, but gets transferred to be treated for D).
Remember, though, keep this audit stuff in perspective. The amount of documents that an auditor must review is enormous. Some providers are going through multiple audits at the same time. The auditors, generally, give short turnaround times for the providers to gather the documents and send the documents to the auditor, sometimes 10-15 days. (I have seen 5 days a couple of times). So, now imagine the sheer volume of documents, the complexity of the Medicaid policies and rules, and the amount of human error on the part of the auditor…add those together for an unattractive sum.
Just by way of example, RMC stated that a hospital last year received 3,400 medical-records requests (That is not the number of records that were requested; that is the number of records request. Each records request could be many records). This hospital’s records requests were increased last year from 1800 in 2011.
So, while the auditors are looking for document errors in millions of records, make sure the auditor is not making errors in reviewing the millions of documents.