audits, appeals, and compliance …oh my!...and regulations on the claims they audit. ... •...

WAYNE H. van HALEM President

The van Halem Group 101 Marietta St NW

Suite 1850 Atlanta, GA 30303

(404) 343-1815, ext 113 [email protected]

Audits, Appeals, and Compliance …Oh my!

October 4, 2017

Kelly Grahovac Senior Consultant

The van Halem Group 101 Marietta Street NW


(404) 343-1815 ext. 114 [email protected]

AUDIT UPDATE: WHAT’S HAPPENING

Can it be true?

• CMS and contractors have indicated a more “provider-friendly” approach to DMEPOS claims

• “Provider-friendly” equates to reducing appeal backlog • DMEPOS is the largest contributor to the appeal backlog

– Account for approximately 50% of all pending hearings – 7 of the top 10 appellants at OMHA are DME suppliers

Impact of “Provider-Friendly” Approach

• New friendlier appeal processes • New Change Requests reducing unnecessary burden

– CPAP suppliers can assume medical necessity if 13 rental payments made to other suppliers (CR 9741)

– No new order for change in supplier (CR 9886) – Reduced POD requirements pending

• Will it last?

National DMEPOS and HHH RAC

• November 1, 2016 – RAC contract awarded to Performant Recovery

• RAC audits are going on now • Identified focused areas for new RACS and will be meeting

monthly with CMS to identify audits • Will be looking at postpayment claims than have been

submitted within the previous 3 years from the date the claim was paid

Other RAC Program Changes

• Establishing ADR limits based on a provider’s compliance with Medicare rules

• RACs must wait 30 days to allow for a discussion request before sending the claim to the DME MAC for adjustment

• SOW also says that RACs are expected to support CMS in a minimum of 50% of the cases that make it to the ALJ.

• CMS also says in the SOW that the agency has the authority to settle appeals without RAC approval or input.

Other RAC Program Changes

• RACs will not receive their contingency fees until the 2nd level of appeal has been exhausted. – Ensures that the RAC is properly applying Medicare rules

and regulations on the claims they audit. • RACs must maintain an accuracy rate of 95% and an overturn

rate of less than 10%. Failure to meet these requirements will result in: – Decreased ADR limits OR – Elimination of certain reviews until the problems are

corrected

RAC Issues – Automated

Date Posted CPAP without OSA Diagnosis 9/8/2017

Nebulizers 2/2/2017

Hospital beds with mattresses billed with Group I or Group II support surfaces

4/12/2017

Group 3 PWC Underpayments 5/17/2017

DME while beneficiary is in an inpatient stay 2/16/2017

Spring Powered Devices Billed for >1 in a 6 Month Period 1/5/2017

CPM Billed without Total Knee Replacement 2/2/2017

Glucose Monitor 1/5/2017

Multiple DME Rentals in one month 3/31/2017

RAC Issues - Complex

Date Posted PAP Devices for the treatment of OSA 9/19/2017 Spinal Orthoses 8/2/2017 Chest Wall Oscillation Devices 2/8/2017 Tracheotomy suction catheters, suction pumps, catheters and other supplies

2/8/2017

AFO/KAFO 7/7/2017 Negative Pressure Wound Therapy Pumps 4/28/2017 PMDs not subject to PA Demonstration 6/6/2017 Nebulizers 4/14/2017 Osteogenesis stimulators 2/14/2017

Group 2 Support Surfaces 2/15/2017 Blood Glucose Monitors with Integrated Voice Synthesizer 5/12/2017 Enteral Nutrition Therapy 5/11/2017

Responding to the audit

• Complex audits – 45 days to respond • Records can be submitted three ways:

– Paper records via mail (tracking suggested) – Records saved to CD/DVD via mail (tracking suggested) – esMD

• Can check status on RAC website – will need login/password

• RAC has 30 days to complete review

Audit Results

• Supplier will receive an Initial Findings letter (automated) or Review Results letter (complex)

• Request Discussion Period – Must be requested within 30 days of Review Results Letter date – Must provide medical documentation to support reason you disagree

with RAC findings

• Adjustment file sent to DME MAC after 30 days if no discussion period requested

• Extrapolations – Performant is currently not extrapolating error results

Appealing the RAC Decision

• Following discussion period, DME MAC will issue overpayment demand letter

• If overpayment assessed supplier can: – Pay overpayment in full/Request Redetermination – Allows

for 120 days to appeal to Redetermination – Allow DME MAC to recoup/do not appeal – Delay Recoupment/Request Redetermination – Must

appeal within 30 days to stop recoupments; interest will accrue until overpayment amount has been satisfied

Unified Program Integrity Contractors

• Implementation of the UPIC initiative to begin in 2016 – Combines the audit and investigation work currently

conducted by the ZPICs (and their responsibilities) with the Audit Medicaid Integrity Contractors (Audit MICs) to form the UPIC

• Contracts with ZPICs/PSCs and MICs will end as the UPIC is implemented in specific geographic regions

• Implementation of the UPICs will be over a multi-year period in order to allow current contractors to transition out

• Goal: Streamline audit structure

UPICs

• Umbrella contracts awarded in May 2016 • Potential 10 year, $2.5 billion contract vehicle • Awardees:

– AdvanceMed – Health Integrity – Safeguard Solutions – Strategic Health Solutions – TriCenturion – HMS Federal – Noridian Healthcare Solutions

UPICs

• 4 task orders awarded thus far: – AdvanceMed on 5/24/2016 for UPIC Jurisdiction 1

(Midwest) • Contract amount = $76,874,623.22

– Safeguard Services was awarded contract for Jurisdiction 5 (Northeast) but no details have been released publicly

– Health Integrity was awarded Zone 2 but currently under protest so no formal announcements made

– Strategic Health Solutions has been awarded a contract – CMS intends to have remaining contracts assigned in 2017

UPIC Jurisdictions

Managed Care Risk

• Increased pressure on Medicare Advantage/HMO plans to conduct program integrity functions

• Applying policies consistently as Medicare • Increased prepayment review and extrapolated overpayments • Must be treated the same as Medicare • December 2015 – CMS released a request for information that

outlines an expansion of Medicare’s RAC program – ACA requires the RAC program to be expanded into

Managed Care, so the plan themselves will be audited – Trickle-down effect to providers

Managed Care Risk

• In-Network providers – Plan determines audit and appeal process

• Out-of-Network providers – Medicare Managed Care Manual Publication 100-16

Supplemental Medical Review Contractor

• Strategic Health Solutions performs a large volume of Medicare Part A, Part B, and DMEPOS claims nationally.

• Strategic will focus on lowering improper payments in Medicare Fee-For-Service programs and increasing efficiencies in medical review functions.

• Projects include issues identified by the OIG, CERT and CMS internal data analysis

• Focus on national claims data analysis versus MAC jurisdiction data

Supplemental Medical Review Contractor

• Completed Projects – Power Mobility Devices – Vacuum Erection Devices – Nebulizers – Diabetic Testing Strips

• Current Projects – Oxygen and Oxygen Equipment – PAP Supplies

DME MAC

• Positive Airway Pressure (PAP) (HCPCS E0601) • Ankle-Foot/Knee-Ankle-Foot Orthosis (HCPCS L1970, L4360,

L4361) • Diabetic Supplies (A4253) • Spinal Orthoses (HCPCS L0628 – L0640, L0643, L0648) • Knee Orthoses (HCPCS L1832, L1833) • Therapeutic Shoes for Persons with Diabetes (HCPCS A5500)

DME MAC

• Urological Supplies (HCPCS A4351, A4352, A4353) • Manual Wheelchairs (K0001 – K0004) • Hospital Beds (E0260) • Oxygen and Oxygen Equipment (E1390, E0431, E0434, E0439) • Pressure Reducing Support Services (E0277) • TENS (E0730, E0720)

DME MAC

• DME MAC Vent Letter • Result of OIG Report called “Escalating Medicare Billing for

Ventilators Raises Concerns.” • Requiring suppliers to perform a self-audit on claims that the

OIG has determined through examination of data that claim may have been overpaid for one of the following reasons: – Diagnosis of sleep apnea – Concurrent equipment – Accessories

DME MAC

• DME MACs will no longer be performing widespread reviews • There will be up to 3 rounds of provider-specific audits

– Initially 20-40 claims. If low error rate, supplier is removed and will only be randomly audited for the next year.

– If the denial rate is high, supplier will get a one on one educational session and after a couple of months they will receive a second round of 20-40 to see if there is improvement.

– If after the 3rd round there is not improvement, the supplier will be referred to CMS.

Revocations

• CMS issued a NEW Final Rule for safeguards to reduce Medicare fraud – December 3, 2014 – Under authority of the ACA, CMS can and will deny or

revoke enrollment of entities and individuals that pose a program integrity risk to Medicare for the following:

• “… providers and suppliers that have a pattern and practice of billing for services that do not meet Medicare requirements. This is intended to address providers and suppliers that regularly submit improper claims in such a way that it poses a risk to the Medicare program.”

Revocations

• NSC Revocations for not being open during posted hours of operations

• 2 year revocation with no ability to submit a CAP • For any satellite offices, check PECOS file and change hours of

operation to “By Appointment Only” even if open regularly • Providers of custom prosthetics and orthotics qualify for this

exemption • Announced April 2016 – HHS revising revocation authority to

allow them to revoke billing privileges for providers who have an insufficient or absent compliance program

Payment Suspensions

• 42 CFR 405.371(a)(1) affords contractors the authority to implement a payment suspension based on “reliable evidence that an overpayment exists or that the payments to be made may not be correct.

• 180 days with one chance to submit a rebuttal • Can be renewed every 180 days • Claims submitted are reviewed and if paid, money is put into

an escrow account until such time the audit is completed. • Seeing this occur in instances that previously wouldn’t warrant

such action

OCR/HIPAA Audits

• Performing desk audits and onsite audits • Selected entity will receive an email requesting specific data

from OCR – desk audit to follow • OCR may follow-up a desk audit with onsite visit • Audits are primarily a compliance improvement activity to

enable OCR to better understand compliance efforts with particular aspects of the HIPAA Rules.

• In the event a serious compliance issue is identifed, OCR may initiate a compliance review to further investigate.

Audit Support Services (Proactive)

• Monthly Compliance Packages – Online Education and Training – Quarterly Audits and Corrective Action Plans – Anonymous Compliance Hotline for employees (Telephone and Web) – Compliance Newsletter

• Clinical PreScreen Review Services • Proactive Claims Audit

– Claims data analysis to identify risk – Technical and clinical review of medical and supplier records – Comprehensive Audit Findings report

Audit Support Services (Reactive)

• Audit Assistance – Technical and clinical review of medical and supplier records – esMD Transmission – Tracking and Reporting

• Appeal Preparation/Submission

APPEALS UPDATE: WHAT’S HAPPENING

Appeal Changes

• Since October 2016, CMS has limited the scope of appeal contractors to review additional claims and issues outside of what the previous denial reason was for prepayment of postpayment denials/overpayments. – Code in question – Date(s) of service in question – Denial reason

Appeal Changes

• Serial Appeals – MLN Matters # SE17010 • April 26, 2017 - CMS recently directed the DME MACs to

change the process by which they adjudicate appeals of serial claims.

• Once the reason for denial for one claim in a series is resolved at any appeal level, the DME MACs will identify other claims in the same series that were denied for the same or similar reasons, and take that determination into consideration when adjudicating such claims.

Appeal Changes

• DMEPOS Pilot Program to allow for a discussion period at the Reconsideration level

• Selected providers will have the opportunity to participate in a formal recorded telephone discussion with the QIC and offer verbal testimony.

• Providers will be able to discuss the facts of the case and provide any additional documentation that would assist in reaching a favorable determination.

• The Reopening process allows potential cases to be remanded back from the ALJ

Telephone Discussion Process

• Provider submits the initial appeal request • C2C will determine if appeal meets the criteria for a telephone

discussion • C2C will notify the provider of the scheduled discussion date

by a mailed notification letter which includes a contact information form to be remitted indicating election to participate

ALJ Hearings Update

• Current cases pending for an ALJ Hearing nearing 1 million

• Average processing time for appeals decided in fiscal year 2017 is 1057.2 days

• Hired more judges • Opened up new offices in Seattle, WA and Kansas

City, MO

ALJ Hearings Update

• December 6, 2016 – Judge issued decision in American Hospital Association lawsuit

• HHS must eliminate the backlog by 2021 – 30% by the end of 2017 – 60% by the end of 2018 – 90% by the end of 2019 – Completely by the end of 2020

ALJ Hearings Update – Quarterly Status Update

• March 6, 2017 – HHS says that they will be unable to clear the backlog unless they settle claims without seeing if they have merit

• Its 687,382 claim backlog is projected to reach more than 1 million by the end of fiscal year 2021

• OMHA would violate their statutory obligations if they resolved appeals without deciding on merits

• Congress adjourned without taking action on Obama’s proposals, but the Trump administration wants to take care of backlog while still taking into account the merit of each claim.

ALJ Hearings Update

• August 11, 2017 – DC Circuit Court overturned the judge’s decision saying he acted too hastily and did not examine HHS’s claims that it was impossible for them to resolve the backlog.

• Judge now needs to take a deeper look at HHS’s assertations that they cannot resolve the backlog.

ALJ Hearings Update

FY14 FY15 FY16

Average cost per appeal $943 $1,107 $1,232

Average claims per decided appeal 2.2 2.9 5.1

Average cost per claim $428 $381 $242

• Over 10 years, government will pay $12.37 million in interest payments for all of Part B service claims that will be overturned at the ALJ.

Settlement Conference Facilitation Pilot

• Pilot alternative dispute resolution process designed to bring the appellant and CMS together to discuss the potential of a mutually agreeable resolution for claims appealed to the ALJ

• If a resolution is reached, a settlement document is drafted by the settlement conference facilitator to reflect the agreement and the document is signed by the appellant and CMS at the settlement conference session

Settlement Conference Facilitation Pilot – Phase 2

• The amount of each individual claim must be $100,000 or less. For the purposes of an extrapolated statistical sample, the extrapolated amount must be $100,000 or less.

• At least 20 claims must be at issue, or at least $10,000 must be in controversy if fewer than 20 claims are involved;

• There cannot be an outstanding request for OMHA statistical sampling for the same claims;

• ALJ Requst must have been filed by September 30, 2015 • One thing for DMEPOS providers to keep in mind is that claims

will not be adjusted so subsequent supply or repair claims for that patient will not get paid.

3-Pronged Strategy – NEW FINAL RULE

• HHS has developed a three-pronged strategy to address the backlog: 1. Invest new resources at all levels of appeal to increase

adjudication capacity and implement new strategies to alleviate the current backlog.

2. Take administrative actions to reduce the number of pending appeals and encourage resolution of cases earlier in the process.

3. Propose legislative reforms that provide additional funding and new authorities to address the appeals volume.

Change: Medicare Appeal Council decisions

• Permit designation of Medicare Appeals Council decisions (final decisions of the Secretary) as precedential (binding authority) to: – Provide more consistency in decisions at all levels of appeal, – Reducing the resources required to render decisions, and – Possibly reducing appeal rates by providing clarity to appellants and

adjudicators.

• Take into consideration decisions that address, resolve, or clarify recurring legal issues, rules or policies, or that may have broad application or impact, or involve issues of public interest.

Change: Medicare Appeal Council decisions

• Notice of precedential decision published in Federal Register and on Council website

• Binding on CMS and HHS components, SSA • Legal analysis and interpretation of Medicare authority or

provision is binding in future appeals where same authority or provision applies and is still in effect

• Factual findings are binding in future appeals involving the same parties if the relevant facts are the same and evidence is presented that underlying factual circumstances are unchanged

Change: Expand OMHA’s Adjudicator Pool

• Allowing attorney adjudicators to: – Decide appeals for which a decision can be issued without

a hearing, – Review dismissals issued by a QIC or Independent Review

Entity (IRE), – Issue remands to CMS contractors, and – Dismiss requests for hearing when an appellant withdraws

the request. • This change will allow ALJs to focus their efforts on conducting

hearings and adjudicating the merits of more complex cases

Change: Simplify proceedings

• Simplify proceedings when CMS or CMS contractors are involved by limiting the number of entities (CMS or contractors) that can be a participant or party at the hearing (although additional entities may submit position papers and/or written testimony or serve as witnesses).

Change: Clarify regulations

• Clarify areas of the regulations that currently causes confusion and may result in unnecessary appeals to the Medicare Appeals Council.

Change: Create process efficiencies

• Create process efficiencies by eliminating unnecessary steps (e.g., by allowing ALJs to vacate their own dismissals within 6 months of issuance rather than requiring appellants to appeal a dismissal to the Medicare Appeals Council);

• Streamlining certain procedures (e.g., by using telephone hearings for appellants who are not unrepresented beneficiaries, unless the ALJ finds good cause for an appearance by other means); and

• Require appellants to provide more information on what they are appealing and who will be attending a hearing

Change: Address areas of improvement

• Address areas for improvement previously identified by stakeholders to increase the quality of the process and responsiveness to customers, such as: – Establishing an adjudication time frame for cases

remanded from the Medicare Appeals Council – Revising remand rules to help ensure cases keep moving

forward in the process – Simplifying the escalation process, and – Providing more specific rules on what constitutes good

cause for new evidence to be admitted at the OMHA level of appeal.

OTHER ISSUES

Medicaid MCOs – Single Source Contract

• MCOs in several states executing “Sole Source Contracts” that: – Give exclusive rights for providing identified products and services and – Exclude all other providers/suppliers for these products and services

• May result in reduction in services to enrollees AND a financial impact on the excluded providers/suppliers

• IMPORTANT: Monitor MCO network contracts and address these Sole Source Contracts to avoid being excluded from servicing your state Medicaid enrollees

CURES Act Adjustments - Oxygen

• Oxygen contents (E0443) claims were mass reprocessed = new remittance advices

• Miscellaneous code “E1399CC” on oxygen claims if a new CMN replaced an older CMN

• NOTE: A different HCPCS code from the original claim may disrupt billing software’s auto-posting feature

CURES Act Adjustments - Oxygen

• Oxygen Concentrators - Claims denying rather than paying the last month of rental, i.e. only 35 rental payments were made

• Denial code N370 - Billing exceeds the rental months approved by the payer

• DME MACs aware of this system issue and are working on resolution

• Claims brought to their attention will be adjusted

CURES Act Adjustments - CPAP

• Providers have reported a potential systems issue resulting in low or negative reimbursement for E0562 humidifier rentals after adjustments

• DME MACs have confirmed they are aware of the issue in recent ACT calls

Non-Participating/Unassigned

• MYTH: Billing non-assigned = No liability • REALITY: Billing non-assigned means that you are telling

Medicare that you are not accepting the fee schedule – Suppliers are still required to follow guidelines, gather documentation

and file a claim for the patient

• MYTH: Asking patients for the money upfront results in losing referrals and business

• REALITY: Beneficiaries are slowly becoming more comfortable with this arrangement

Questions

COMPLIANCE: A COMMON SENSE APPROACH

Compliance and Ethics in Business

• Francesco Gino’s book Sidetracked focuses on inaccurate views of ourselves, or more specifically, the fact that we tend to overestimate or underestimate our capabilities in different situations.

• Most people tend to have a more favorable view of themselves and their abilities and place higher value on their own opinions - this is especially true for more commonplace activities and decisions.

• We see this a lot when it comes to compliance. We think we’re doing better than we are.

1997 US News and World Report Study

• Bill Clinton – 51% • Princess Diana – 60% • OJ Simpson – 19% • Oprah Winfrey – 66% • Michael Jordan – 65% • Hillary Clinton – 53% • Mother Theresa – 79% • The Respondent’s themselves? - 87%

• Effective internal controls; • Demonstration to employees of a strong commitment to

honest and responsible conduct; • Ability to obtain an accurate assessment of employee and

contractor behavior; • An increased likelihood of identification and prevention of

criminal and unethical conduct; • The ability to quickly and accurately react to employees

compliance concerns; • Improvement of the quality, efficiency, and consistency of

providing services;

Provider Benefits

Provider Benefits

• Increased efficiency on the part of employees; • Centralized source for distributing information on statutes,

regulations, policies, and other program directives; • Improved internal communication; • A methodology that encourages employees to report potential

problems; • Procedures that allow the prompt investigation of alleged

misconduct; • Initiation of immediate, appropriate, and decisive corrective

action;

Provider Benefits

• Early detection and reporting minimizing the loss to the Government and supplier’s exposure to penalties;

• Enhancement of the structure of the supplier’s operations and the consistency between: any related entities, different departments, different locations, and separate business units.

Fundamental 7 Elements

1. Written policies, procedures and Code of Conduct 2. Compliance Officer and/or Committee 3. Training and Education 4. Effective lines of Communication 5. Internal monitoring and auditing 6. Enforcing standards through well-publicized disciplinary

guidelines 7. Responding promptly to detected offenses and undertaking

corrective action

Compliance Program: WHY?

• Section 6401 of the Affordable Care Act (ACA) provides that a “provider of medical or other items or services or supplier within a particular industry sector or category” shall establish a compliance program as a condition of enrollment in Medicare, Medicaid or the Children’s Health Insurance Program (CHIP)

• Suggested for all health care providers by the Office of the Inspector General (OIG) since the late 1990s

• Public/Private Partnership in protecting the Medicare Trust Fund

Recent Provisions

• December 3, 2014 - CMS issued a Final Rule that under the authority of the Affordable Care Act, CMS can and will DENY or REVOKE enrollment and/or billing privileges of providers and suppliers who have a “pattern and practice” of submitting improper claims and are a found to pose a program integrity risk to Medicare.

Recent Provisions

• July 2015 - Department of Justice (DOJ) establishes a Compliance Counsel to assist in investigations & prosecutions to determine if providers / suppliers have an effective compliance program.

Recent Provisions

• Announced April 2016 – HHS revising revocation authority to allow them to revoke billing privileges for providers who have an insufficient or absent compliance program

• Currently only being used in instances where compliance issues have been identified; however, could be used in other instances in the future

Recent Provisions

• February 8, 2017 - DOJ publishes “Evaluation of Corporate Compliance Programs” – List of factors that prosecutors can use when evaluating a

company’s compliance program – Filip Factors

• The existence and effectiveness of an organization’s pre-existing compliance program

• The corporation’s remedial efforts to implement an effective compliance program or improve an existing one

https://www.justice.gov/criminal-fraud/strategy-policy-and-training-unit/compliance-initiative

DOJ Factors

1. Analysis and Remediation of Underlying Conduct 2. Senior and Middle Management 3. Autonomy of resources 4. Policies and Procedures 5. Risk Assessment 6. Training and Communications

DOJ Factors

7. Confidential Reporting and Investigation 8. Incentives and Disciplinary Measures 9. Continuous Improvement, Periodic Testing, and Review 10. Third-Party Management; and 11. Mergers and Acquisitions

DOJ Compliance Focus

• Effectiveness of the compliance program – Policies and procedures are appropriately implemented,

communicated and evaluated • Communication of program with employees

– Appropriate and repeated employee compliance training – Ease of employees to report concerns

• Compliance included at decision-making level • Compliance team has necessary resources to perform functions • Compliance must be part of company culture, not just a paper program • Risk awareness – ability to identify, analyze, and address risks affecting

company

Recent Provisions

• March 27, 2017 – OIG, in conjunction with HCCA, releases “Measuring Compliance Program Effectiveness: A Resource Guide

• The guide contains more than 400 metric that address the elements of an effective compliance program and ways to measure such metrics.

OIG/HCCA Guidance

• Access • Accountability • Review/Approval

Process • Quality • Assessment • Code of Conduct

• Updates • Understanding • Compliance Plan • Confidentiality

Statements • Enforcement

Element 1 – Policies and Procedures

OIG/HCCA Guidance

Element 2 – Compliance Program Administration

• Board of Directors • Compliance Budget • Compliance Committees • Accountability • Compliance Officer • Staffing • Compliance Plan • Culture

• Incentives • Performance Evaluations • Risk Assessments • Compliance Work Plan • Legal Counsel’s Role • Job Descriptions of

Management

OIG/HCCA Guidance

Element 3 – Screening of Employees, MDs, Vendors, Agents

• Accountability for Screening • Conflict of Interest • Employee Accountability • Employee Disclosure • Employee Screening • Exit interviews

• High-Risk Screening • Licensure • Response to exclusion • Response to Screening • Vendor • Vendor Screening

OIG/HCCA Guidance

Element 4 – Communication, Education, and Training

• Training • Accountability • Awareness • Board • Communication

• Competency • Culture • Incentives • Vendors

OIG/HCCA Guidance

Element 5 – Monitoring, Reporting, and Internal Reporting

• Reporting System • Risk Assessments • Monitoring and Auditing

Work Plan • Audit Process

• Corrective Action Plans • Auditors • Non-retaliation • Vendor Oversight

OIG/HCCA Guidance

Element 6 – Discipline for Non-Compliance

• Consistency • Awareness • Documentation • Promotion Criteria

OIG/HCCA Guidance

Element 7 – Investigations and Remedial Measures

• Guidelines for conducting investigations

• Content of Investigation files

• Quality and consistency of investigations

• Tracking and trending investigations

• Escalation of Investigations

• Communication of Investigation outcomes

• Training of investigators • Professionalism and

competency of investigators • Independence of

investigators • Involvement of counsel • Timeliness of response

OIG/HCCA Guidance

Element 7 – Investigations and Remedial Measures

• CAPs/Remedial Measures • Root-Cause Analysis • Adherence to non-

retaliation policy • Government

inquiries/investigations

• Monitoring results • Awareness of Investigation

Process • Contract provisions

regarding investigations

Things to consider…

• Just because you are accredited, does not mean you are compliant or have a compliance program – 2 different requirements

• Compliance Officers are compliance “professionals” and in senior positions within large organizations reporting directly to the board

• Once 1 PTAN is revoked, all PTANs are reviewed for revocation • HHS considers a supplier that does not have a comprehensive

compliance program to be negligent and treats those that have no program differently when there are compliance issues

Let’s assess your compliance program…

Written Policies and Procedures

• 1.1 - Are compliance expectations included in a written Code of Conduct or Code of Ethics?

• 1.2 - Has the compliance program been implemented within the organization?

• 1.3 - Does the compliance program provide guidance to employees and others associated with the provider on how to identify and communicate compliance issues to compliance personnel?


• 1.4 - Does the compliance program describe how potential compliance problems are investigated and resolved?

• 1.5 - Is there a robust library of policies that cover a broad spectrum of topics? (i.e. record retention, audit management, ineligible persons, compliance with anti-kickback, Stark, FCA, etc)

• 1.6 - Are policies reviewed and revised on a periodic basis?

Compliance Officer and Compliance Committee

• 2.1 - Is the responsible compliance position an employed position?

• 2.2 - Does the responsible compliance position have responsibility for day to day operation of the compliance program?

• 2.3 - Does the person have responsibilities other than compliance?

• 2.4 - If the answer to question 2.3 is “Yes,” are sufficient resources made available to satisfactorily carry out their compliance duties?

Compliance Officer and Compliance Committee

• 2.5 - Does the person report to the CEO or other senior staff (and not through the legal department or the CFO)?

• 2.6 - Is there a compliance committee? • 2.7 - Does the compliance officer and committee periodically

communicate with the governing board on the activities of the compliance program?

Training and Education

• 3.1 - Is there evidence of a compliance training program which includes the Code of Conduct/Ethics; expectations of the compliance program; and how the compliance program operates?

• 3.2 - Are new employees, board members and affiliates trained in compliance so that they could identify circumstances of fraud, waste and abuse?

• 3.3 - Is the compliance training made part of orientation for new employees, board members and affiliates?

• 3.4 - Is the training evaluated and updated on a periodic basis?

Internal Audit Plan

• 4.1 - Are post-payment audits of claims conducted quarterly? • 4.2 - Are random claim samples chosen based upon a risk

assessment? • 4.3 - Are claims samples reflective of the universe of claims? • 4.4 - Is there a report of findings prepared quarterly for the

senior leadership or Board members? • 4.5 - Have results from previous audits been addressed and

benchmarked within the report? • 4.6 - Does the report include a Corrective Action Plan?

Open Lines of Communication

• 5.1 - Are there accessible mechanism(s) for employees to communicate compliance related concerns to the responsible compliance position?

• 5.2 - Do the accessible mechanisms referred to in 5.1 include methods for anonymous or confidential communication?

• 5.3 - Are the available lines of communication and examples of the types of issues to be reported to the responsible compliance position well publicized throughout the provider (i.e.: orientation/education sessions, posters, pamphlets, intra/internet, etc)?

Well-publicized disciplinary guidelines

• 6.1 - Do disciplinary policies exist which encourage good faith participation in the compliance program with the provider?

• 6.2 - Do disciplinary policies set out expectations for reporting compliance issues and for assisting in their resolution?

• 6.3 - Do disciplinary policies outline sanctions for failing to report suspected problems; participating in non-compliant behavior; or encouraging, directing, facilitating or permitting non-compliant behavior?

• 6.4 - If disciplinary action was taken, was discipline fairly and consistently applied regardless of the perpetrator’s position with the provider?

Risk Analysis

• 7.1 - Does the provider routinely identify compliance risk areas specific to the type of service provided?

• 7.2 - Does the provider routinely conduct self-evaluation of risk areas, including internal audits and as appropriate external audits?

• 7.3 - Does the provider routinely evaluate potential or actual non-compliance as a result of its self-evaluations and audits?

• 7.4 - Is the audit work plan based on certain risk factors (OIG Work Plan, external or internal audit findings, etc)

Responding Promptly to Detected Offenses

• 8.1 - Does the provider respond to compliance issues as they are raised?

• 8.2 - Does the provider investigate potential compliance issues?

• 8.3 - Does the provider respond to compliance issues that are identified in the course of self-evaluations and audits?

• 8.4 - Does the provider correct compliance issues promptly and thoroughly and implement procedures, policies and systems that may be necessary to reduce the potential for recurrence?

Non-Retaliation Policy

• 9.1 - Does the compliance plan or organization policy state intimidation or retaliation will not be permitted against individuals who in good faith participate in the compliance program, including but not limited to reporting potential issues?

• 9.2 - Are allegations of intimidation or retaliation fully and completely investigated?

• 9.3 - Is the disciplinary action uniformly and consistently applied across the organization regardless of title or position?

Results?

Explaining Compliance to your Boss…

Practical Solutions

• Standards of Conduct – Develop standards of conduct for all employees that

include a clearly delineated commitment to compliance by senior management;

– Should function in the same fashion as a constitution, a foundational document that details the fundamental principles, values, and framework for action;

– Should explicitly state the organization’s mission, goals, and ethical principles;

– Should promote integrity, support, objectivity, and foster trust

Practical Solutions

• Policies and Procedures – Review OIG Compliance Program Guidance for DME

Suppliers and draft simple and basic policies documenting how you will avoid the risk areas they have already identified for you

– Use external resources, but remember it can’t just be a dusty manual on a shelf.

– It must be customized to your organization – Maintain electronic copy on company server for all to

access and only CO or designee can update – Assess them on a regular basis


• Every compliance program should require the development and distribution of written compliance policies, standards, and practices that identify specific areas of risk and vulnerability.

• These should be provided to all individuals who are affected by the particular policy, including agents and independent contractors who may affect billing decisions.

Special Areas of Concern

• Billing for services not provided; • Billing for services that the supplier believes may be

denied; • Billing patients for denied charges without a signed

notice; • Duplicate billing; • Billing for items or services not ordered; • Using a billing agent whose compensation arrangement

violates the reassignment rule; • Upcoding;


• Unbundling; • Billing for new equipment and providing used equipment; • Continuing to bill for rental items after they are no longer

medically necessary; • Resubmission of denied claims with different information; • Refusing to submit a claim to Medicare; • Inadequate management and oversight of contracted

services, which results in improper billing; • Charge limitations;


• Billing for substantially excessive amounts of items or supplies; • Billing for an item that does not meet the quality of the item

claimed; • Capped rentals; • Failure to monitor medical necessity on an on-going basis; • Billing for certain items or supplies prior to receiving a

physician’s order; • Falsifying information on the claim form, CMN, DIF and /or

accompanying documentation;


• Completing documentation reserved for completion only by the treating physician;

• Altering medical records; • Manipulating the patient’s diagnosis; • Failing to maintain medical necessity documentation; • Inappropriate use of place of service codes; • Improper use of modifiers; • Routine waiver of deductibles and coinsurance; • Providing incentives to referral sources;


• Compensation programs that offer incentives for services ordered and revenue generated;

• Joint ventures between parties, one of whom can refer business to the other;

• Billing for items or services pursuant to a prohibited referral under the Stark law;

• Improper telemarketing; • Improper patient solicitation and high-pressure marketing; • Co-location with referral sources;


• Non-compliance with supplier standards; • Providing false information on the supplier enrollment form; • Not notifying the NSC in a timely manner of changes; • Misrepresenting as an agent of Medicare; • Knowing misuse of a supplier number; • Failing to meet individual payor requirements.

Claims Development and Submission

• Medical Necessity • Physician Orders • CMNs/DIFs • Selection of HCPCS Codes • Valid Supplier Numbers • Assignment • Liability Issues (ABN on file) • Routine Waiver of Deductibles and Coinsurance • Capped Rentals • KX Modifiers

Anti-Kickback and Self-Referral Concerns

• Contracts with referral sources are reviewed by counsel and comply with statutes and regulations;

• Supplier will not submit claims for patients who were referred pursuant to contracts or financial arrangements that were designed to induce such referrals;

• Supplier does not offer a physician more than fair market value for space rented to store items or supplies;

Anti-Kickback and Self-Referral Concerns

• Supplier does not offer or provide gifts, free services, or other incentives or things of value to patients, relatives of patients, physicians, home health agencies, nursing homes, hospitals, contractors, assisted living facilities, or other potential referral sources for the purpose of inducing referrals;

• Policies and procedures should specifically reference and take into account the OIG’s safe harbor regulations.

Marketing

• Compliance program should require honest, straightforward, fully informative and non-deceptive marketing;

• Ensure that its marketing information is clear, correct, and fully informative;

• Salesperson must not offer physicians, patients or other potential referral sources incentives, in cash or in kind, for their business;

• Must not engage in any marketing activity that implies that beneficiaries are not obligated to pay their coinsurance or can receive “free” services;

Marketing

• OIG has a longstanding concern that percentage compensation arrangements for sales and marketing personnel may increase the risk of such persons violating the anti-kickback statute;

• Suppliers are prohibited from making unsolicited telephone contacts to Medicare beneficiaries;

• Suppliers are also prohibited from using Social Security or Medicare symbols, emblems, or names.

• Lead generation services • Direct-to-beneficiary marketing

Practical Solutions

• Compliance Officer – Hire qualified person or compliance “professional”

internally – Do not subcontract these duties – Provide necessary resources for CO to accomplish their

duties – Consider joining Health Care Compliance Association

(HCCA) for valuable resources (http://www.hcca-info.org/)

Compliance Officer

• Designating a compliance officer with the appropriate authority is critical to the success of the program.

• Primary responsibilities should include: – Overseeing all elements and monitoring the

implementation of the compliance program; – Reporting on a regular basis to senior management

and compliance committee on the progress of implementation of the compliance program;

– Periodically revising the program in light of changes in the organization’s needs;

Practical Solutions

• Compliance Committee – 1 representative from each department or team, including

sales and marketing – Meet quarterly to evaluate policies and procedures and

discuss compliance concerns – Take meeting minutes and report back on previous

concerns – Communicate the compliance message

Compliance Committee

• Analyzing the organization’s regulatory environment and the legal requirements;

• Assessing existing policies and procedures; • Working with appropriate departments to develop

standards of conduct and policies and procedures; • Recommending and monitoring the development of

internal systems and controls; • Determining the appropriate strategy/approach to

promote compliance with the program and detection of any potential violations;

Compliance Committee

• Developing a system to solicit, evaluate, and respond to complaints and problems;

• Monitoring internal and external audits and investigations; • The compliance committee is an extension of the compliance

officer.

Take a break…

Compliance – The Musical

Practical Tips

• Training & Education – While in-person training can be very effective, there are

also many online resources available today that automate this process and include reporting, tracking, and testing

– Understand what must be included (FCA, AKS, Stark, etc) – Always include proficiency testing, sign-in sheets, and

make sure everyone attends at least annually – Should be part of new-hire training – within first 30 days – Provide additional training on a quarterly basis based on

new updates or results of quarterly audits

General Sessions

• Training programs should include sessions highlighting: – Supplier’s compliance program – Summarizing fraud and abuse statutes and regulations,

Federal, State and private payor health care program requirements

– Claim submission procedures – Marketing Practices

• Suppliers may also wish to offer such training sessions to interested independent contractors and physicians. As part of the initial training, the standards of conduct should be distributed to all employees.

Claim Development and Billing Training

• Specific Government and private payor reimbursement principles;

• Providing and billing items or services without proper authorization;

• Proper documentation of services rendered; • Improper alterations to documentation; • Compliance with the supplier standards; • Duty to report misconduct.

Sales and Marketing Training

• General prohibition on paying or receiving remuneration to induce referrals;

• Routine waiver of deductibles and/or coinsurance; • Disguising referral fees as salaries; • Offering free items or services to induce referrals; • High pressure marketing; • Duty to report misconduct.

Format of the Training Program

• A variety of teaching methods should be implemented. • Keep in interesting • Targeted training should be provided to corporate officers,

managers and other employees whose actions affect the accuracy of the claims.

• All training materials should be designed to take into account the skills, knowledge and experience of the individual trainees.

Continuing Education on Compliance Issues

• It is essential that compliance issues remain at the forefront of the DMEPOS supplier’s priorities.

• Suppliers must continue to disseminate the compliance message.

• One effective mechanism for maintaining a consistent presence of the compliance message is to publish a monthly newsletter.

Practical Tips

• Internal Audit Plan – Keep it reasonable and not overly burdensome – Make samples reflective of universe of claims – Consider up front QA checks, but also you must conduct

postpayment audits – Develop a consistent audit tool – Compile results in an Executive Summary – Benchmark results from quarter to quarter and location to

location – Consider external auditors or experts – Develop and implement corrective action plans

Auditing and Monitoring

• Testing billing staff on their knowledge of reimbursement coverage criteria;

• On-site visits to all facilities and locations; • Ongoing risk analysis and vulnerability assessments; • Assessment of existing relationships with physicians, and other

potential referral sources; • Unannounced audits, mock surveys, and investigations; • Examination of the supplier’s complaint logs; • Checking personnel records to determine whether any

individuals who have been reprimanded for compliance issues in the past are among those currently engaged in improper conduct;


• Interviews with personnel involved in management, operations, sales and marketing, claim development and submission;

• Questionnaires developed to solicit impressions of the supplier’s employees;

• Interviews with physicians or other authorized persons who order services;

• Interviews with independent contractors who provide services to the supplier;

• Reviews of medical necessity documentation;


• Validation of qualifications of physicians or other authorized persons who order services;

• Evaluation of written materials and documentation outlining policies and procedures;

• Utilization/trend analyses that uncover deviations.

The Reviewers Should…

• Possess the qualifications and experience necessary to adequately identify potential issues;

• Be objective and independent of line management; • Have access to existing audit and health care resources,

relevant personnel, and all relevant areas of operation; • Present written evaluative reports on compliance activities; • Specifically identify areas where corrective actions are

needed.

Practical Tips

• Open lines of communication – Is staff comfortable addressing concerns with manager or

CO? – Quarterly Newsletters – Anonymous Method of reporting (Telephone Hotline,

Web-based Reporting, Anonymous Emails, and Locked box – Compliance Alerts or Games – Are you Compliant? – Online options for on-going compliance message –

including around HIPAA privacy and security – Central location (library) and delivery method for updates

and changes

Effective lines of Communication

• Procedure should be provided to employees to seek clarification from Compliance Officer if they have questions on a policy.

• Compliance Officer must keep a log of all complaints and investigations and report to Senior Management.

• Employees must know how and who to contact in order to report a violation and can do so without fear of retribution.

Disciplinary Guidelines

• Well publicized discipline policy and actions • New employee policy • Quickly responding to detected offenses • Conducting comprehensive investigations • Develop Corrective Action initiatives

Compliance as an Element of a Performance Plan

• The elements of the compliance program is a factor in evaluating the performance of all employees.

• Discuss with all employees and contractors the compliance policies as a condition of employment;

• Inform all supervised personnel that strict compliance with these policies is a condition of employment;

• Disclose to all personnel that the supplier will take disciplinary action up to and including termination for violation of these policies or requirements.

HIPAA Compliance Requirements

• Policies and Procedures • Privacy Officer/Security Officer • Training and Education • Security and Risk Assessment

– Administrative Safeguards – Physical Safeguards – Technical Safeguards

• Breach tracking and reporting • Inventory and location control

Compliance Tips

• Compliance Programs with effective monitoring • Proper transferring of liability • Getting patients requalified • Quality Assurance • PreScreening • Working with beneficiaries • Data analysis • Innovation

HIPAAwise – The van Halem Group Solution

• Affordable online dashboard that implements a complete HIPAA Compliance Program

• Reasonable one-time implementation fee and monthly license fee starting at just $33.95 per month for VGM members

• If you utilize HIPAAwise and get audited by OCR, we will assist with your audit at no cost to you.

HIPAAwise

HIPAAwise

• Quarterly HIPAA Security Training and Awareness Program with reporting and tracking

• Comprehensive Security Risk Assessment • Policies and procedures as directed by HIPAA • Breach management • Business Associate Agreement management (with

electronic signature capability) • Inventory and location tracking • Comprehensive reference library

Let’s talk about the money

How much do we spend on compliance?

• Some of the largest DME suppliers with very comprehensive compliance programs still only spend about 2-4% of their overall budget on compliance.

• A good compliance officer can mitigate the cost of compliance and get a good ROI

• Conduct a cost vs. benefit analysis

Cost vs Benefit

“Organizations that have effective compliance and ethics programs attract and retain good staff and are more trusted by their communities and potential customers. Good compliance and ethics programs have an impact on revenue that must be

considered when you calculate cost. Trusted companies get more revenue than companies that can’t be trusted.”

-Roy Snell, CEO – Health Care Compliance Association

Cost Benefit Analysis

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PT HH DME

Cost Benefit Analysis

Did Pay Would have Paid

Compliance Package Special – 1st Month Free

Questions

Stay Connected The van Halem Group - A Division of VGM Group, Inc. @vanHalemGroup The Details Matter – blog.vanhalemgroup.com

Contact Information

Kelly Grahovac Sr. Consultant

The van Halem Group - A Division of VGM Group, Inc 101 Marietta St NW


404-343-1815 [email protected]

audits, appeals, and compliance …oh my!...and regulations on the claims they audit. ... •...

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