Compliance Update

HHS Office of Inspector General Releases Priorities for Fiscal Year 2012 Print E-mail
Written by David Restaino   
Tuesday, 13 December 2011 20:41

The Department of Health and Human Services' (HHS) Office of Inspector General (OIG) has been busy combating fraud and abuse over the last few years - the monies it has recovered more than doubled from 2006 to 2010, topping $4 billion in fiscal year 2010 alone. And OIG's enforcement efforts will undoubtedly increase because of the balanced budget pressure in Washington. 

With this in mind, the OIG's recently released Work Plan for Fiscal Year 2012 provides the regulated community with a roadmap of the areas that will receive additional scrutiny from OIG. These include:

● Payment systems controls that identify high cumulative Part B payments made to physicians;
● Claim submission practices of, and private contracts entered into by, physicians who have opted out of Medicare;
● Physicians' coding on Part B claims, for services performed in ambulatory surgical centers and hospital outpatient departments;
● Providers' compliance with assignment rules relating to billings that exceed Medicare-allowable amounts; and
● Part B payments for chiropractic services.

This list only skims the surface of those "new" areas of OIG focus, and does not take into account its existing areas of investigation.

Moreover, these priorities also extend beyond fines and penalties and also cover exclusion of individuals from participation in federal health care programs. For instance, in fiscal year 2010, over 3,300 individuals and entities were excluded from such participation. A recent Government Accountability Office (GAO) report criticized HHS and suggested that it should be paying greater attention to its suspension and debarment programs, by perfecting its use of staff and developing guidance to implement these programs. Assuming HHS follows even some of these recommendations, we can also expect to see more suspensions and debarments in the coming year. 

David Restaino, a partner at Fox Rothschild LLP in its Princeton, NJ office, has more than 20 years of experience representing clients in regulatory compliance and complex commercial litigation matters, including environmental and health care disputes, before multiple federal and state courts and agencies.

Last Updated on Tuesday, 20 December 2011 20:02
Compliance Corner - Fall 2011 Print E-mail
Written by   
Wednesday, 07 December 2011 00:00

CMS Imposes Medicaid Payment Restrictions on Provider-Preventable Conditions

Effective July 1, 2011, states must submit state plan amendments to the U.S. Centers for Medicare & Medicaid Services (CMS) indicating how each state will prohibit Medicaid payments to providers for provider-preventable conditions as required under the Patient Protection and Affordable Care Act.  CMS revealed that it will delay compliance action related to the new provisions until July 1, 2012.

Read the full article here.

FTC/DOJ Remove Mandatory Antitrust Review for MSSP-Participating ACOs in Final Policy Statement

On October 20, 2011, the Federal Trade Commission and Department of Justice issued a final policy statement on accountable care organizations (ACOs) participating in the Medicare Shared Savings Program (MSSP).  Significantly, the Agencies eliminated mandatory antitrust review of certain ACOs seeking to participate in the MSSP, but declined to adopt other stakeholder recommendations.

Read the full article here.

ACOs Get Broad Waivers from the Fraud & Abuse Laws

The Centers for Medicare & Medicaid Services and the Office of the Inspector General (HHS) have issued, and seek public comment on, broad waivers of the federal fraud and abuse laws for ACOs seeking to participate in the Medicare Shared Savings Program.

Read the full article here.                                                 

Last Updated on Wednesday, 07 December 2011 12:50
HHS/OCR Audits are Coming: What are Covered Entities Doing to Prepare? Print E-mail
Written by David Restaino, Esq.   
Wednesday, 30 November 2011 17:38

Those entities subject to both the HIPAA privacy and security rules should pay close attention to recent action taken by the U.S. Department of Health and Human Services ("HHS") Office for Civil Rights ("OCR"), which will increase the frequency and depth of government audits for HIPAA/HITECH compliance over the next year. This initiative may be in direct response to some critics that OCR was not doing sufficient monitoring of compliance with HIPAA/HITECH.

Preliminary Audit Procedures. Specifically, OCR awarded a contract worth over $9 million to KPMG, LLP for administration of the audits, which will begin shortly. The audits are required by the American Recovery and Reinvestment Act of 2009 (ARRA), which states at Section 13411, "The Secretary shall provide for periodic audits to ensure that covered entities and business associates that are subject to the requirements ... comply with such requirements."   Details are sketchy regarding the process to identify the entities that will be audited. However, this much is known:

● The first step will be creation of audit protocols, followed by an undertaking of the actual audits.

● OCR will base its decision to audit upon risk.

● Audits will not be based upon complaints or actual reported privacy or security breaches. 

● KPMG will assist OCR in establishing the program to audit covered entities and business associates, and their compliance with the privacy and security rules.

● HHS staff will guide KPMG's conduct during the audits.

● The audits will include site visits, interviews with leadership, documentation, an examination of operations, and an assessment of the consistency with which process is married to policy.

● Each audit will be followed by a report that will, among other things, address compliance efforts and corrective actions taken. 

Who Will Be Audited?  HHS reports that every covered entity and business associate is eligible to be audited. The initial round of recipients is expected to provide a broad assessment of a complex and diverse health care industry. Thus, the audit process is designed to have OCR audit as wide a range of types and sizes of covered entities as possible; covered individual and organizational providers of health services, health plans of all sizes and functions, and health care clearinghouses may all be considered. OCR has also made it explicitly clear that covered entities must fully cooperate with the auditors - as obligated under the HIPAA "enforcement rule." Finally, HHS reports that business associates will be included in future audits.

What can covered entities do now to be ready? For starters, they can make sure that all policies and procedures are in place now. For example, the HHS website states that covered entities will have only ten (10) days to produce documents; this is not much time if policies and procedures are not already in good order. 

Based on the above, the best way to get prepared is to make sure that compliance protocols are in place, and being followed, today. Stated differently, all covered entities and business associates should assess their compliance efforts, ensure that timely corrective actions are taken when necessary, and remain on their guard.  Documentation of the proactive assessment and corrective measures should also assist in demonstrating that the compliance efforts are effective.

David Restaino, a partner at Fox Rothschild LLP in its Princeton, NJ office, has more than 20 years of experience representing clients in regulatory compliance and complex commercial litigation matters, including environmental and health care disputes, before multiple federal and state courts and agencies.

Last Updated on Wednesday, 07 December 2011 12:46
CMS Issues One Final and Two Proposed Rules in Effort to Reduce Health Care Delivery Costs by Streamlining Regulations Print E-mail
Written by   
Thursday, 10 November 2011 11:11

CMS issued the rules on October 18, 2011, in response to President Obama's Executive Order 13563, "Improving Regulation and Regulatory Review," and consistent with the U.S. Department of Health and Human Services' Plan for Retrospective Review of Existing Rules.  Overall, the final rule and two proposed rules appear to make significant progress in eliminating duplicative and unnecessary requirements, while providing hospitals and other providers with greater control over how to best achieve patient health care objectives.  

Read the full article here..     SOURCE:
Last Updated on Sunday, 13 November 2011 13:05
Another Proposed Physician Joint Venture Bites the Dust Print E-mail
Written by Todd Rodriguez   
Thursday, 10 November 2011 11:06

Physicians are feeling the economic burn of the down economy perhaps more than the average American. Not surprisingly, creative physician joint ventures are proliferating in the healthcare industry as a means of stabilizing revenue streams and referral patterns. Unfortunately, many of these arrangements may raise questions under applicable fraud and abuse laws. One such proposed arrangement was the subject of the most recent (and negative) Advisory Opinion issued by the Office of Inspector General (OIG) of the Department of Health and Human Services.

The arrangement involved a proposed management services agreement for pathology services pursuant to which a physician-owned management company would provide pathology laboratory management services to a pathology lab. Under the management services agreement, the management company would provide all pathology services, utilities, furniture, fixtures, space and laboratory equipment. In addition, the management company would provide both marketing and billing services. For all of these services, the pathology lab would pay the management company a "usage" fee based on a percentage of the lab's revenue. Moreover, the management company would offer ownership interests to physicians in a position to refer to the pathology lab.

Noting that the arrangement could not meet any of the available safe harbors under the federal anti-kickback statute and citing the fact that the management fee would fluctuate with the volume or value of services performed by the pathology lab, the OIG found that the arrangement would pose a substantial risk of fraud and abuse and, therefore, refused to bless it.

When revenue is flat and costs are increasing, it is hard to blame physicians for at least considering potentially lucrative joint venture proposals. Of course, many such arrangements may be perfectly legal and may even be eligible for safe harbor protection under the various healthcare laws. That being said, physicians must always be mindful that penalties for violating federal and state laws can be catastrophic. For example, violation of the federal anti-kickback statute is a felony a felony, punishable by a fine of up to $25,000, up to five years in jail, or both as well as potential false claims liability. Therefore, when it comes to joint venture arrangements, the best course is to proceed with caution.

Mr. Rodriguez serves as Co-Chair of the Health Law Practice at Fox Rothschild, LLP. He is a regulatory and transactional health care attorney. To learn more click HERE.

Last Updated on Wednesday, 16 November 2011 12:23
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