April 01, 2011

February was a busy month for mug shot photographers and health professionals posing for them. The number of providers and the amounts of money involved in charges of Medicare and Medicaid fraud were staggering.

On Feb. 3, the Health and Human Ser­vices Office of Inspector General issued
its first “Top 10 Most Wanted” fugitives in health care. Among them was Susan Bendigo, accused of collecting $10 mil­lion from California’s Medicaid program for the services of licensed home-health nurses while she actually used unlicensed nurses for the work.

On Feb. 15, the Department of Justice charged 20 individuals, including three doctors, with billing Medicare $200 mil­lion for mental health services that were medically unnecessary or not provided. Various defendants allegedly paid own­ers and operators of halfway houses and assisted living facilities to deliver Medicare patients to mental health cen­ters, including dementia patients who couldn’t benefit from the services there.

<[stk 1]>On Feb. 17, the Department of Justice announced that its Medicare Fraud Strike Force had charged 111 defen­dants in nine cities, “including doctors, nurses, health care company owners and executives,” with $225 million worth of Medicare fraud. The govern­ment alleged that the defendants paid patient recruiters and even patients themselves to reveal beneficiary infor­mation so that the providers could sub­mit claims to Medicare for services that were either never provided or medical­ly unnecessary. <[etk]>

Before any of the cases above oc­curred, an Obama administration re­port said that its health-fraud prevention and enforce­ment efforts had recovered more than $4 billion in fiscal year 2010. In ad­dition, the De­partment of Justice recov­ered more than $2.5 billion un­der the False Claims Act.

Curbing Medicare and Medicaid fraud was one of the fiscal pillars of last year’s Affordable Care Act. Savings there are being counted on to fund health re­forms that will cost extra federal dollars. Now, as many states face budget deficits, they too are looking for ways to save on Medicaid, and attacking fraud in that program is becoming a priority at that level of government.

Fraud is not only billing for services that were not rendered, but also billing erroneously, even when the “intent” was not fraudulent. Recently, the St. Joseph’s/Candler Health System in Sa­vannah, Ga., agreed to pay the state more than $2.7 million to settle an in­vestigation into the system’s “crossover” claims for patients who are beneficiaries of both Medicare and Medicaid.

For these dually eligible patients, Medicare is the primary insurer and Medicaid the secondary payer. The in­vestigation into the hospital system’s billing practices found that it filed Med­icaid claims that did not reflect entire amounts the system had received from Medicare, which yielded excessive Med­icaid payments.

In announcing the settlement, Geor­gia’s Attorney General Samuel S. Olens said, “All instances of overbilling as well as fraudulent billing in the state Medic­aid system will be vigorously investi­gated by my office.”

Another fraud trap to avoid involves nursing home staff and physicians who have been excluded from participation in Medicare or Medicaid.

<[stk 2]>The Federal Civil Monetary Penalties Law imposes fines on a provider who employs or contracts with an individual or entity the provider knew, or had rea­son to know, was excluded from feder­al health care programs. Penalties are up to $10,000 for each claim plus up to three times the amount that was paid or claimed.<[etk]>

While many nursing homes, hospitals, and group practices verify that a poten­tial employee is not on the federal list of excluded individuals, they do not nec­essarily have ongoing procedures for making sure employed or contracted individuals have not fallen onto the list. The exclusion list is available online from the HHS Office of Inspector Gen­eral at oig.hhs.gov/fraud/exclu­sions/exclusions_list.asp.

Health care providers should also reg­ularly ensure that none of their em­ployees or contractors has been excluded from participation in federal contracts. This list is published by the U.S. General Services Administration at www.epls.gov. Many individual states also publish their own exclusion lists.

As both federal and state governments increase their antifraud efforts as a cost-containment strategy, health care providers must ensure that their Medicare and Medicaid claims are com­pleted properly, even if they would nev­er entertain the faintest hint of fraudulent intent. Even “careful” health care providers should review their rela­tionships with others and their proce­dures and practices to ensure that they are in compliance with the law.

Providers from individual physicians to large health care companies should revisit their internal plans for ongoing compliance, including the prompt in­vestigation of concerns that might be brought forward by an employee, a con­tractor, or anyone else who might have seen a breach in compliance with any of the many laws and regulations that gov­ern health care.

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