New Partnerships Create Increased Compliance and Patient Financial Services Risk September 2013

New Partnerships Create IncreasedNew Partnerships Create Increased
Compliance and Patient Financial
Services RiskServices Risk
23rd Annual HFMA
Southern California and San
Diego/Imperial Chapter Fall
Conference
September 8 – 10, 2013
jmahealthcare.comjmahealthcare.com
1

From Transactional to Operational
C liCompliance
• Significant attention and resources have been focused
on ensuring creation of hospital/physician collaboration
models comply with various regulations.
• Less attention has focused on ensuring operational or g p
implementation compliance.
• Does your new “integrated delivery system” have the
infrastructure to implement and comply with theinfrastructure to implement and comply with the
myriad of new requirements?
• This session focuses on increased risks organizations
assume in implementing various health care reformassume in implementing various health care reform
managed care approaches, discusses key issues and
critical success factors for implementation.
2

False Claims Act
• Federal False Claims Act (31 USC § 3279‐3733)
The False Claims Act establishes liability for any person who– The False Claims Act establishes liability for any person who
KNOWINGLY presents false or fraudulent claims to the US
government for payment.
– The Act includes “Qui Tam” provisions that allow privateThe Act includes Qui Tam provisions that allow private
citizens (relators) to sue violators on behalf of the government.
• California False Claims Act (CFCA)
– Enacted in 1987 (Gov’t Code 12650 et. Seq)Enacted in 1987 (Gov t Code 12650 et. Seq)
– Modeled after the Federal False Claims Act.
– Allows the government or individual (relator) to bring civil
actions to recover damages, penalties, and costs when g , p ,
government contractors, vendors or others defraud the
government.
3

Federal False Claims Act
• The Act prohibits:
l b d f l l– Knowingly presenting, or causing to be presented a false claim
for payment or approval.
– Knowingly making, using, or causing to be made or used, a
f l d i l f l f d lfalse record or statement material to a false or fraudulent
claim.
– Conspiring to commit any violation of the False Claims Act
– Falsely certifying the type or amount of property to be used by
the Government.
– Knowingly making, using, or causing to be made or used a false
record to avoid, or decrease an obligation to pay or transmit
property to the Government.
4

Strengthening Federal False Claims Act
• Section 6402. Patient Protection and Affordable Care
Act
E h d M di d M di id i t it i i– Enhanced Medicare and Medicaid program integrity provisions
– Allows OIG and Attorney General access to claims and
payment data of the DHHS and its contractors
– Anti‐Kickback Statute
• AKS violation that results in submission of a claim = False
Claim
– Reporting and Returning Overpayments
• Overpayments from the Medicare or Medicaid programs
must be reported and returned with in 60 daysp y
• Retention of any overpayment after the 60 day period may
lead to liability under the False Claims Act
5

Reverse False Claim: Retention of
OverpaymentsOverpayments
• Affordable Care Act added a new provision
i i bli i id dimposing an obligation on providers to report and
return identified overpayments within 60 days
– Overpayments broadly defined ‐‐ funds received thatOverpayments broadly defined funds received that
provider is not entitled to
– 60 day clock starts running when the provider has
“identified” the overpaymentidentified the overpayment
• No clear definition of “identified”
• Failure to investigate might trigger the 60 day clock if
the circumstances suggest deliberate disregard or
dilatory tactics
6

Reverse False Claims
• If a provider fails to return the overpayment within
h 60 d i d i b bli i ithe 60 day period it becomes an obligation creating
exposure under the False Claims Act
• This means a claim might be fine when submitted• This means a claim might be fine when submitted
but become a false claim when facts are later
discovered, for example:
– Bills submitted in good faith that did not meet coverage
requirements
– Bills submitted in good faith for services providedBills submitted in good faith for services provided
pursuant to a referral prohibited by the Stark law
7

Reverse False Claims
• Huge potential liability
– Discovery of a systemic billing error
– Discovery of a longstanding contract with a physician
gro p that does not compl ith Starkgroup that does not comply with Stark
• Government proposed regulations for 60 day rule
10 year look back period proposed???– 10 year look back period proposed???
– Current reopening rules provide for a 4 year look back
period
8

C False Claims Amendment
• 2012 California’s False Claims Act Amended0 California s False Claims Act Amended
– California Government Code sections 12650 through
12656
– The Amendment took effect January 1, 2013
• The Amendment largely conforms the CFCA to the
f d l F l Cl i A ("FCA") b difederal False Claims Act ("FCA") by expanding
liability under the CFCA and the rights of qui tam
plaintiffs (called relators)plaintiffs (called relators).
9

False Claims Amendment
• States have a financial incentive to enact state false
claims laws that are at least as effective as the FCA
• By doing so, states qualify under the federal Deficit
Reduction Act of 2005 ("DRA") for an additional 10
h f h d i hpercent share of the amount recovered using the
state law.
10

Key Amendments to CFCAy
• Increases penalties.
– Penalties increased to $5,500 to $11,000 for each false
claim.
• Broadens the definition of "claim."
– The definition includes claims submitted to a "contractor,
grantee, or other recipient, if the money, property, or
service is to be spent or used on a state or any politicalservice is to be spent or used on a state or any political
subdivision's behalf or to advance a state or political
subdivision's program or interest . . . ."
11

Key Amendments to CFCA (cont)y ( )
• Defines "obligation."
– The CFCA incorporates the federal FCA's definition of anThe CFCA incorporates the federal FCA s definition of an
"obligation."
– An obligation includes retention of an overpayment,
thereby giving rise to liability under the CFCA forthereby giving rise to liability under the CFCA for
retention of an overpayment
• Amendments favorable to relators
– Make relators eligible for an award even if they planned
and initiated the violation upon which the CFCA action
was based
– Eliminate the requirement that a claim must have been
presented to an officer, employee, or agent of the state
12

Key Amendments to CFCA (cont)y ( )
– Clarify that the CFCA's anti‐retaliation provisions apply
when relators are discriminated against for furthering anwhen relators are discriminated against for furthering an
action under the CFCA or for trying to stop a violation of
the CFCA (currently, these provisions apply only after a
relator disclosed information about the false claim to therelator disclosed information about the false claim to the
government)
– Expand the anti‐retaliation provisions to include
d dd lcontractors and agents in addition to employees
– Grant relief to relators who are discriminated against,
including reinstatement with the same seniority status, g y
twice the amount of back pay plus interest, and
compensation for special damages.
13

What is a False Claim?
• Liability under the federal False Claims Act occurs where
a defendanta defendant
1. Knowingly presents (or causes to be presented) a false or
fraudulent claim for payment
l k b d d f l2. Knowingly makes, uses, or causes to be made or used, a false
record or statement material to a false or fraudulent claim
3. Conspires with others to commit a violation of the False
Claims Act
4. Knowingly makes, uses, or causes to be made or used, a false
record or statement to conceal, avoid, or decrease anrecord or statement to conceal, avoid, or decrease an
obligation to pay money or transmit property to the Federal
Government.
14

What is “Knowingly”?g y
• Any person with respect to the information does
any of the following:
– Has actual knowledge of the information
d l b f h h f l f h– Acts in deliberate ignorance of the truth or falsity of the
information
– Acts in reckless disregard of the truth or falsity of theActs in reckless disregard of the truth or falsity of the
information.
• Proof of specific intent to defraud is not required
15

False Claims Act: Potential Areas
• Include
– Coding false claims
– DRG false claims fraud
– PPS false claims fraud
– Some Medicare kickbacks
Outpatient PPS false claims fraud– Outpatient PPS false claims fraud
– Stark law violations
– DME fraudDME fraud
– DRG fraud
16

False Billingg
1. Billing for services not rendered or products not delivered
2. Misrepresenting services rendered or product provided
( )(e.g., upcoding, inappropriate coding)
• Misrepresenting the nature of the patient’s condition (e.g., DRG
fraud, DRG creep).
3. Ungrouping or unbundling services or products billed
4. Billing for medically unnecessary services
• Furnishing services in excess of the patient’s needs, based on theirFurnishing services in excess of the patient s needs, based on their
diagnosis
• Furnishing a battery of diagnostic tests, where, based on the
diagnosis, only a few were needed
• Misrepresenting the diagnosis to justify the services or products.
5. Duplicate billing
17

False Billing (cont)g ( )
6. Falsifying records to meet or continue to meet the
conditions of participationconditions of participation
• Alteration of dates
• Forging of physicians’ signatures
• Adding of additional information after the fact. g
7. Increasing units of service, which are subject to a payment
rate.
8. Billing procedures over a period of days when all treatment8. Billing procedures over a period of days when all treatment
occurred during one visit (i.e. split billing)
9. Billing Medicare improperly based on a higher fee schedule
or unit schedule than that used for non‐Medicare patients.or unit schedule than that used for non Medicare patients.
10. Submitting bills to Medicare that are the responsibility of
other insurers under the Medicare Secondary Payer rule.
18

FCA and Quality of Care? Q y
• DOJ attorney
– “We are starting to look at quality of care cases as
potential FCA cases.”
E er claim to a federall f nded health care program– Every claim to a federally funded health care program
impliedly certifies that the services provided meet the
standard of care
– Therefore, services that fail to meet the standard of care
are false.
19

False Claims Act: Key Issuesy
• Who is coding, billing and collecting for integrated
delivery system?
– Hospital?Hospital?
– Physician?
– Upcoding, inappropriate coding, unbundling, double billing,
etc.etc.
– Integration and accuracy of hospital and physician information
systems
• Providers must establish policies/processes forProviders must establish policies/processes for
preventing fraud
• Organizations must have ongoing internal audits and
processes for timely reporting of irregularities to ensureprocesses for timely reporting of irregularities to ensure
compliance
20

Physician Owned Distributorshipsy p
• PODs are physician owned entities that sell or• PODs are physician owned entities that sell or
arrange for the sale of devices, including physician
owned entities that purport to design orowned entities that purport to design or
manufacture their own devices
– In some cases all of the POD’s sales are the result of
orders from the POD’s physician owners for use in
procedures that the physician owners perform on their
own patients at hospitals or ASCsown patients at hospitals or ASCs
21

POD: Controversyy
• PODs have always been controversial
• Several years ago the OIG expressed concerns
about the business model
• Despite these concerns‐‐‐ no government
enforcement
• Number of PODs multiplied
– Organized in a variety of ways
– Some PODs included safeguards to address concerns of
OIG
22

Special Fraud Alertp
• March 2013 OIG issued a Special Fraud Alert
– PODs characterized as “inherently suspect” under the
Anti‐kickback Statute
– Concerns:
• Corruption of medical judgment
• Overutilization
• Increased costs to Federal Programs and Beneficiaries
• Unfair competition
• Fraud Alert included warning to hospitals/ASCs• Fraud Alert included warning to hospitals/ASCs
using PODs— potential AKS liability
23

PODs: Red Flagsg
• Some red flags
– Investor selection based on potential to refer
– Requiring divestment if referrals not made
– Disproportionate distributions
– Physicians tying use of hospital to purchase of POD
devicesdevices
– POD is sham– no real business activities
• Implantable devices particular concern becauseImplantable devices particular concern because
they are “physician preference items”
24

Sunshine Act
• Affordable Care Act included new reporting obligations
• Starting August 1, 2013 manufacturers and Group
Purchasing Organizations (GPOs) must track all:
– Direct or indirect transfers of value to Physicians or Teaching irect or indirect transfers of value to Physicians or Teaching
Hospitals (or to third parties at the request of a physician or
teaching hospital)
– Ownership interests held by a physician or an immediate p y p y
family member (other than an ownership interest in a publicly
traded security of mutual fund)
• First report on transfers of value and ownershipFirst report on transfers of value and ownership
interests due March 31, 2014; annually thereafter
25

Sunshine Act
• Manufacturer (which include distributors who take
title to goods) is an entity that produces, prepares,
propagates, compounds or converts a covered drug
de ice biological or medical s ppl nless soleldevice, biological, or medical supply, unless solely
for the entity’s own use
• Group Purchasing Organization is any entity that• Group Purchasing Organization is any entity that
operates in US that purchases or arranges for the
purchase of a covered drug, device, biological orpurchase of a covered drug, device, biological or
medical supply not solely for the GPO’s own use
26

Sunshine Act
• Covered drug, device, biological or medical supply
means any such item that is payable under
Medicare/Medicaid or SCHIP, including as a part of
a b ndled pa ment and is either a prescribed dr ga bundled payment, and is either a prescribed drug
or a device that requires premarket approval
27

Sunshine Act
• Physicians: as defined under Medicare, except a
bona fide employee of the manufacturer
• Teaching Hospitals: Any hospital that receives IME
or DGME. CMS will publish a list annually.
28

Guidelines for Tracking g
• Employed Physicians: A payment provided directly to a physician
who is employed by a teaching hospital should be reported in thewho is employed by a teaching hospital should be reported in the
physician’s name. If the payment was not passed through the
teaching hospital in its entirety, then the report must identify the
portion of the payment retained by the teaching hospital and the
portion passed through to the physicianportion passed through to the physician.
• Group Practices: Payments provided to a group practice should be
attributed to: (a) the individual physician who requested the
payment or on whose behalf the payment was made, or (b) the p y p y , ( )
physician who is intended to benefit from the payment.
• Indirect Payments: Payments provided to one recipient, but paid
through another recipient, should be reported in the name of the
i i t th t lti t l i d th trecipient that ultimately received the payment.
29

Sunshine Act: Exclusions
• Payments or Other Transfers of Value of Less than
$10 l i h d$10, unless in aggregate these payments exceed
$100 in a calendar year
• Existing Personal Relationships: Payments or st g e so a e at o s ps: ay e ts o
transfers to a covered recipient made solely in the
context of a personal, non‐business‐related
l ti hi d t d t b t drelationship do not need to be reported.
•Educational Materials that directly benefit patients or
are intended to be used by or with patients. Example: y p p
Models provided to explain a procedure to patients.
30

Sunshine Act: Exclusions
•Trial Loans of Covered Devices: This exclusion covers loans of
devices and devices under development, as well as supplies of
disposable or single use devices intended to last no more thandisposable or single‐use devices intended to last no more than
90 days. For a single product, the total number of days for the
loan should not exceed 90 days for the entire year.
 Discounts or rebates  Dividends from publicly traded mutual funds
•Other Exclusions: The following payments do not need to be
reported:
[ Discounts or rebates  Dividends from publicly traded mutual funds
 Warranty services  Product samples not intended to be sold and intended
for patient use
I ki d it f h it bl
[
 In‐kind items for charitable purposes
31

Sunshine Act: Reportingp g
– Name: Provide the physician’s full name as reported in the National Plan
and Provider Enumeration System (NPPES).
– Business Address: Provide the full street address of the physician’s
primary practice location.
– Specialty and NPI: Provide the physician’s individual NPI. Identify the
provider’s specialty by using a single provider taxonomy code, asprovider s specialty by using a single provider taxonomy code, as
reported in NPPES.
– Date of Payment: You may report either (a) the total payment on the
date of the first payment as a single line item, or (b) each individual
payment as a separate line item. Regardless of the methodology youpayment as a separate line item. Regardless of the methodology you
choose, use it consistently.
– Third Parties: If the payment was not made to the recipient directly,
name the third party that received the payment before passing it
through to the recipient.through to the recipient.
– Ownership Interest: Indicate whether the payment was provided to a
physician holding ownership or investment interests in your company.
32

Reporting (cont)p g ( )
Context: You may explain each payment by providing brief
contextual information.
Related Covered Drug, Device, Biological or Medical Supply: You g, , g pp y
must report the product associated with each payment. You may
report up to five associated products for each payment. For
devices and medical supplies, you may report either the name
under which the device or supply is marketed or the therapeuticunder which the device or supply is marketed or the therapeutic
area or product category.
Form of Payment and Nature of Payment: You must categorize
the payment according to its form and nature.
F Th t iForm: The categories are:
• Cash or cash equivalent
• Stock, stock option or any other ownership interest
• In‐kind items or services
• Dividend, profit or other return on investment
33

Reporting (cont)
Nature: The categories are:
 Consulting fee  Grant
 Honoraria  Travel and lodging (including the specific destinations)
 Gift  Current or prospective ownership or investment interestGift Current or prospective ownership or investment interest
 Entertainment  Space rental or facility fees (teaching hospitals only)
 Food and beverage  Compensation for serving as faculty or as a speaker for an accredited or certified
continuing education programcontinuing education program
 Education
 Research  Compensation for services other than consulting, including serving as faculty or
as a speaker at an event other than a continuing education program, or
l kCh it bl t ib ti promotional or marketing activities Charitable contribution
 Royalty or license
34

Reporting:  Ownershipp g p
All ownership and investment interests held by a physician or an immediate
family member of a physician. For 2013, you only need to report interests held
on or after August 1, 2013. The report must include the following information:
• Name: Provide the physician’s full name as reported in the National Plan
and Provider Enumeration System (NPPES).
• Who Holds the Interest? Indicate whether the interest is held by theWho Holds the Interest? Indicate whether the interest is held by the
physician or an immediate family member of a physician.
• Business Address: Provide the full street address of the physician’s primary
practice location.
S i lt d NPI M k t th h i i ’ i di id l NPI U• Specialty and NPI: Make sure to use the physician’s individual NPI. Use a
single provider taxonomy code, as reported in NPPES, to identify the
specialty.
• Size of Investment: Indicate the dollar amount invested.
• Value and Terms: Explain the value and terms of each ownership or
investment interest.
• Payments: Any payments provided to the physician owner or investor.
35

Sunshine Act: Research
• Payments made pursuant to a research protocol or
research agreement may be postponed until the
earlier of 4 years from the date of transfer of value
or FDA appro al of the prod ctor FDA approval of the product
36

Following Submission . . .g
• CMS notifies covered recipients
• 45 day period following submission for discussion
• Covered recipients can dispute reports
• If dispute is not timely resolved data will be published• If dispute is not timely resolved data will be published
with notation – “disputed”
• Data released to general public in searchable formatg p
– The Press?
– Personal Injury Lawyers?
Public Watch Dogs?– Public Watch Dogs?
– Relators?
37

3 Day Payment Ruley y
• Medicare’s 3‐day (or 1‐day) payment window
applies to outpatient services furnished by hospitals
and hospitals’ wholly owned or wholly operated
ph sician practicesphysician practices.
– Bundling of the technical component of all outpatient
diagnostic services and related non‐diagnostic servicesdiagnostic services and related non diagnostic services
(e.g. therapeutic) with inpatient stay claim.
– Impact on hospital/physician joint venture billing.
38

Three‐day payment windowy p y
• The three‐day rule defines certain preadmission services as
inpatient operating costsinpatient operating costs
– They are bundled and billed as part of the inpatient claim
– Payment is made as part of the applicable diagnosis‐related group
paymentpayment
• All preadmission diagnostic and related non‐diagnostic
services occurring three calendar days prior to admission are
l t drelated
– Prior to June 25, 2010, outpatient nondiagnostic services were
considered related if there was an exact match between the first‐
listed diagnosis code and the inpatient principal diagnosis codelisted diagnosis code and the inpatient principal diagnosis code
– CMS now defines "related" as "clinically associated with the reason
for a patient's inpatient admission."
39

3 Day Payment Rule
O t ti t S i T t d I ti t S iOutpatient Services Treated as Inpatient Services
• Within 3 days of inpatient admission for hospitals
paid under Inpatient Prospective Payment System
(IPPS)
• Within 1 day for facilities excluded from IPPS
– Inpatient Psychiatric Facilities and units
– Inpatient Rehabilitation Facilities and units
– Long Term Care Hospital
Children’s hospitals– Children’s hospitals
– Cancer hospitals
40

3 Day Payment Rule
Outpatient Services Treated as Inpatient Services (cont)
• Facilities Excluded from Payment Window
Provisions
– Ambulance
l d l– Maintenance renal dialysis services
– Skilled Nursing Facilities
Home Health Agencies– Home Health Agencies
– Hospices
– Critical Access HospitalsCritical Access Hospitals
– Rural Health Clinics/Federally Qualified Health Centers
41

Three‐day payment windowy p y
• Clinically unrelated non‐diagnostic preadmission
services may be separately billedservices may be separately billed
• Condition code 51 (attestation of unrelated
outpatient nondiagnostic services)outpatient nondiagnostic services)
– Used to identify those services that are unrelated and for
which separate outpatient reimbursement is appropriate.
– Condition code 51 on the outpatient claim for the
unrelated services
42

Three‐day payment window (cont)y p y ( )
• Documenting unrelated services
– Providers must clearly document why they provided the
outpatient services
– Documentation must also support the fact that these pp
services are not clinically associated with the inpatient
stay
– Providers must document that they are treating an– Providers must document that they are treating an
unrelated condition
– Care of that condition should not be included in the
i ti t d i i if th i ffi i t id th t itinpatient admission if there is sufficient evidence that it
is not related
43

44

Three‐Day Payment Window
Key IssuesKey Issues
• Who is coding, billing and collecting for integrated
delivery system?delivery system?
– Hospital?
– Physician?Physician?
• Audit patients with 3 day LOS or less
– Sample claims and medical records combined due to 3Sample claims and medical records combined due to 3
day rule
– Evaluate appropriateness
• Combining services as inpatient
• Billing therapeutic services as outpatient
45

Key Issuesy
• What was agreed to during the transactional portion of the
“deal?”
• What was promised to further “business development?”• What was promised to further “business development?”
• Do the enabling documents articulate
– Objectives
• Operational in addition to strategic and financial?
• Timing
• Responsibilities
– Including key personnel within and outside of hospital?
• Is there a business plan incorporating operational
implementation issues?p
• Have the strategic and business plan objectives been
communicated to operational personnel?
46

Critical Success Factors
C T E SCreate Teams to Ensure Success
• Operational Implementation Teamp p
– Hospital executives involved in creating transaction
• Chief Strategy Officer
–Director of Business Development
• Chief Financial Officer
• Chief Medical Officer
• Chief Compliance Officer
• Risk Manager
47

C t T t E S ( t)Create Teams to Ensure Success (cont)
– Partner executives involved in creating transaction
• Physician leaders
• Physician business manager(s)
Ad itti– Admitting
• Registration
– Finance
• Business Office
• Billing/Collecting
– Health Information ManagementHealth Information Management
– Information Technology
• CIO
48

• Leverage existing hospital policies and procedures
where possiblep
– Fraud & Abuse
– Corporate Compliance
• Create new polices and procedures for Physician
Payment Sunshine Act and Physician‐owned
distributorships (‘PODs”)
49

• Operational Implementation Team Functions
– Integrate business plan into operations
• Connect strategy to operations
– Develop written policies and procedures
– Communicate to relevant departmentsCommunicate to relevant departments
– Educate and train staff and physicians
» Have at least quarterly in‐services
Develop auditing and monitoring plan– Develop auditing and monitoring plan
• Who
• What
• When
– Create corrective action policies and procedures
50

Key Components of
O ti l I l t ti PlOperational Implementation Plan
• Determine Objectives and Controls and How TheyDetermine Objectives and Controls and How They
Identify Non‐Compliance
• Assess the Risk Level
• Identify patterns, practices or specific activities
increase risk of non‐conformance
• Determine appropriate response
51

Key Components of
O ti l I l t ti Pl ( t)Operational Implementation Plan (cont)
• Document results of risk assessment• Document results of risk assessment
• Prepare communication program to educate
executives physicians and staff on performanceexecutives, physicians and staff on performance
• Prepare prevention program and assign
responsibility for oversightresponsibility for oversight
– CFO, CCO, etc. along with operational director
52

Joseph Mack, MPA
P.O. Box 23
Dana Point, CA 92629
(949) 481 0602
Robert Homchick, Esquire
Davis Wright Tremaine LLP
Suite 2200
1201 Thi d A(949) 481‐0602
Joseph.Mack@jmahealthcare.com
1201 Third Avenue
Seattle, WA 98101
(206) 757‐8063
roberthomchick&dwt.com
53

New Partnerships Create Increased Compliance and Patient Financial Services Risk September 2013

Recomendados

Recomendados

Mais conteúdo relacionado

Mais procurados

Mais procurados (15)

Semelhante a New Partnerships Create Increased Compliance and Patient Financial Services Risk September 2013

Semelhante a New Partnerships Create Increased Compliance and Patient Financial Services Risk September 2013 (20)

Último

Último (20)

New Partnerships Create Increased Compliance and Patient Financial Services Risk September 2013