Program Integrity Fraud, Waste

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Program IntegrityFraud, Waste Abuse

• Sandhills Center LME

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NC Medicaid

• Based on its budget, Medicaid is one of the
  largest health care companies in NC.
• Serves 1.5 million people annual expected to
  increase by 500,000 700,000 by 2014.
• Must have a system in place to prevent improper
  payments and reduce fraud abuse.

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Definitions

• Fraud Deception or misrepresentation made by a
  health care provider with the knowledge that the
  deception could result in some unauthorized
  benefit to him or herself or other person.
  Includes any act that constitutes fraud under 42
  CFR 455, the federal laws governing Program
  Integrity for Medicaid.

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Definitions

• Waste The over utilization of services, or
  other practices that result in unnecessary costs
  generally not considered caused by criminal
  negligent actions but rather the misuse of
  resources.

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Definitions

• Abuse Provider practices that are inconsistent
  with sound fiscal, business or clinical practices
  and result in an unnecessary cost to the Medicaid
  program, or in reimbursement for services that
  are not medically necessary or fail to meet
  recognized standards for health care or clinical
  policy.

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Fraud Abuse Laws

• False Claims Act Knowingly submits, or causes
  another person or entity to submit, false claims
  for payment of government funds
• Filing false claims may result in fines of up to
  3 times the programs loss plus 11,000 per claim
  filed.

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Fraud Abuse Laws

• Anti-Kickback Statute A criminal law that
  prohibits the knowing and willful payment of
  remuneration to induce or reward patient
  referrals or the generation of any business
  involving any item or service payable by any
  federal healthcare program.

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Fraud Abuse Laws

• Self-Referral Law, commonly known as the Stark
  Law Pertains to physician referrals under
  Medicare and Medicaid. This law prohibits
  physicians from referring patients to receive
  services from entities with which the physician
  or an immediate family member has a financial
  relationship.

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Fraud Abuse Laws

• False Claims Act Whistleblower Employee
  Protection Act This law was enacted to protect
  employees from being discharged, demoted,
  suspended, threatened, harassed or discriminated
  against because the employee testifies or assists
  with an investigation of the employer.

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Fraud Abuse Laws

• Exclusion Statute This law explains that the
  Office of Inspector General (OIG) is legally
  required to exclude individuals/entities from
  participation in all federal health care programs
  if convicted of certain offenses.

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Fraud Abuse Laws

• Civil Monetary Penalties Law This law allows
  the OIG to seek civil monetary penalties and
  assessments based on the type of violation.
  Penalties range from 10,000 to 50,000 per
  violation.

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Mission of Program Integrity

• Ensure compliance, efficiency and accountability
  with the NC Medicaid Program by detecting and
  preventing fraud, waste and program abuse and
• Detect improper payments of Medicaid dollars
  through cost avoidance activities, recoupments
  and ongoing education of providers and members.

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Program Integrity Objective

• To eliminate fraud, waste and abuse within the
  Sandhills Center Provider Network by implementing
  a proactive data driven process to identify and
  address potential discrepancies and red flags.

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Interventions Strategies

• Provide education, training and/or guidance for
  both Medicaid members and providers of Medicaid
  services
• Support efforts of providers who identify and
  resolve issues themselves
• Hold provider agencies accountable when no
  systems are in place to guard against fraud,
  waste and abuse

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Interventions Strategies Contd

• Support use of tools such as payment suspension,
  post payment reviews, audits, and sanctions and
• Encourage and maintain open lines of
  communication between the program and the public
  on the effectiveness of PI activities, which
  include recoupment and cost reduction.

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Interventions Strategies Contd

• Monitor providers regularly to determine
  compliance
• Take corrective action if failure to comply
• Implement mechanisms to detect under and over
  utilization of services
• Implement mechanisms to assess quality and
  appropriateness of care
• Ensure providers are credentialed.

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Expected Benefits

• Enhance Provider Education
• The shift to a more proactive/preventive model
• Improved guidance on reimbursement policies
  provider enrollment requirements and
• Improved detection

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Examples of Medicaid Fraud

• Billing for phantom patients who really did not
  receive services
• Billing for medical services or goods that were
  not actually provided
• Billing for more services than could be provided
  in 24 hours in a day
• Paying a kickback in exchange for a referral for
  services or goods

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Examples of Medicaid Fraud

• Concealing ownership in a related company
• Using false credentials for staff
• Providing services by untrained staff
• Billing for unnecessary tests and/or
• Overcharging for health care services or goods
  that were provided.

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Session Law 2011-399

• Also known as Senate Bill 496
• Modified the General Statutes by adding a new
  chapter, 108C titled Medicaid and Health Choice
  Provider Requirements.
• Applies to providers enrolled in Medicaid or
  Health Choice
• Includes the following provisions
• Provider Screening which assigns a risk level to
  providers of limited, moderate or high.

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Session Law 2011-399

• Criminal History Record Checks
• Payment Suspension and Audits (includes voluntary
  self-audits)
• Prepayment Claims Review
• Threshold recovery amount (150)
• Provider Enrollment Criteria
• Provider Cooperation with Investigations Audits
• Appeals by Medicaid Providers Applicants

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Provider Self-Audit Process

• Process has been in place since 1999 now being
  expanded to incorporate new activities based on
  Session Law 2011-399.
• In accordance with NC Session Law 2011-399, low
  or moderate risk providers do have the
  opportunity to conduct self-audits as a method of
  contesting the outcome of a PI audit.

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Suspension of Payments

• In accordance with 42 CFR 455.23, payments may be
  suspended if/when a credible allegation of fraud
  is received and investigation pending.
• Note DMA is the only authorized entity that can
  suspend payment based on a credible allegation of
  Fraud/Waste/Abuse.

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DMA Contract Requirements Fraud and Abuse

• Policy and Procedure Driven
• Procedure to verify services paid by Medicaid
  were actually delivered
• PP that clearly articulate SHCs commitment to
  comply with all standards
• Designation of a compliance officer and committee
  accountable to management
• Effective Training Education
• Effective lines of communication between the
  compliance officer and staff

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DMA Contract Requirements Fraud and Abuse Contd

• Enforcement of Standards through well-publicized
  disciplinary guidelines
• Internal monitoring and auditing
• Prompt response to detected offenses including
  corrective action initiatives
• Development and maintenance of Compliance Plan
  and
• Notification to DMA-PI of all credible
  allegations of fraud or abuse.

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Sandhills Center PI Efforts

• Implementation of Regulatory Compliance Plan
• Designation of a Regulatory Compliance Officer
• Establishment of a Regulatory Compliance
  Committee
• Education and Training
• Monitoring Activities internal and external

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Sandhills Center PI Efforts

• Development of Program Integrity Team whose
  responsibilities include but are not limited to
• Data mining and analysis
• Determining confidence levels for data
• Conducting investigations for referrals of F/W/A
• Referral of cases of suspected F/W/A to
  appropriate oversight agencies

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Identification of Potential F/W/A

• Sources include
• Data Analysis Reports
• Post payment Claims Reviews
• Requests from SHC Internal Departments
• Calls or Complaints

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Activities to Detect PreventFraud and Abuse

• Examples include
• Review of OIG database and National Practitioner
  Data Bank (NPDB) for exclusions
• Falsification of Provider Qualifications
• Authorization requests for non-covered services
• Extending the length of treatment or delays in
  discharging
• Duplicate entry of claims for the same member by
  the same provider
• Pattern of large volume of complaints against a
  provider

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References

• 42 CFR 438 (Managed Care)
• 42 CFR 434 (Contracts)
• 42 CFR 455 456 (PI Utilization Control)
• False Claims Act (31 USC 3729-3733)
• Anti-Kickback Statute (42 USC 1320a-7b(b)
• Self-Referral Law (42 USC 1395nn)
• Exclusion Statute (42 USC 1320a-7)
• Civil Monetary Penalties Law (42 USC 1320a-7a)