how to make $4.1billion in 12 months: healthcare fraud and abuse enforcement
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How to Make $4.1Billion in 12 Months: Healthcare Fraud and Abuse Enforcement. Mark Bartlett Davis Wright Tremaine, LLP. Why Is This Man Smiling?. Health Care Fraud Enforcement: Top DOJ Priority. - PowerPoint PPT PresentationTRANSCRIPT
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How to Make $4.1Billion in12 Months: Healthcare Fraud and Abuse EnforcementMark BartlettDavis Wright Tremaine, LLP
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Why Is This Man Smiling?
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Health Care Fraud Enforcement: Top DOJ Priority
Government recovered almost $4.1 billion in health care fraud actions during FY11, up 58% percent from 2009
More than 700 criminal convictions
"This is an unprecedented achievement -- and it represents the highest amount ever recovered in a single year," said Attorney
General Eric Holder
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Health Care Fraud Enforcement: Top DOJ Priority
December 19, 2011 DOJ Press Release– Over $3 billion in FCA civil settlements and
judgments in Fiscal Year 2011• 2nd consecutive year over $3 billion• $270 million HCF investigation funding increase
FY12 $2.4 billion recovered from fraud involving
federal health care programs – Over $6.6 billion recovered under FCA since
January 2009
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FCA: Settlements/Judgments
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
500
1000
1500
2000
2500
3000
3500
$$ in
milli
ons
Source: DOJ “Fraud Statistics – Overview” (Dec. 7, 2011)
Settlements or Judgments in Cases Where Government Declines Intervention As Percentage of Total FCE Recoveries
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Health Care Fraud Statutes
False Claims Act (Civil)– Imposes liability on any person who knowingly
submits, or causes to be submitted, a false or fraudulent claim to the Federal Government
Anti-Kickback Statute (Criminal)– Prohibits knowingly and willfully offering, paying,
soliciting, or receiving any remuneration to induce or reward referrals of items or services reimbursable by a Federal health care program
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Health Care Fraud Statutes
Stark Law (Civil)– Prohibits a physician from making a referral to
an entity in which the physician has an ownership interest or compensation arrangement
Health Care Fraud (Criminal)– Prohibits knowingly and willfully executing a
scheme or artifice to defraud any health care benefit program
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PPACA Anti-Fraud Provisions Anti-Kickback Statute
– Codifies lower scienter– Violation constitutes “false claim” under FCA
False Claims Act– Narrows definition of “public disclosure”
Overpayments– Providers must report and return any
overpayment within 60 days Increase provider exposure to administrative,
civil and criminal liability
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2011 Health Care Fraud Criminal Enforcement
September 7, 2011– DOJ charges 91 individuals with Medicare fraud-
related offenses, including fraudulent billings over $295 million, the largest single takedown in Strike Force history
September 16, 2011– Lawrence Duran, the owner of a mental health
care company, American Therapeutic Corporation, was sentenced to 50 years in prison for orchestrating a $205 million Medicare fraud scheme
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Moving Beyond CIA’s Expansion of the Park Doctrine
Inspector General Levinson – excluding corporate officers influences corporate behavior without impacting patient access to care– 883 individuals and entities excluded 10/10 to
03/11 Purdue Frederick Oxycontin prosecution
– $600 million criminal fines and civil sanctions– Corporate executive misdemeanor pleas
• 4 months later, 20 year exclusion (reduced to 12)
New Goal: Exclusion even where no guilty plea
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A Brave New World: Fraud Detection in 2012
CMS use of predictive modeling and algorithms
Electronic billing
Stop pay first and ask questions later
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CMS Benefit Integrity Contractors
Recovery Audit Contractors– Tasked with identifying and collecting improper
Medicare payments, paid on contingency basis
Comprehensive Error Rate Testing– Analyze error rate data and develop plans to
reduce improper payments
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Responding to Subpoenas
Grand Jury Subpoenas– Used in criminal cases only– Determine if you are target or simply third party
Parallel Proceedings – Administrative Investigative Demands– Get as much information as possible as quickly
as possible HHS OIG Subpoenas
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Execution of a Search Warrant
Always be polite and cooperative, but never consent to expanded search or voluntary interviews– Inform agents that they are not to speak to
anyone Gain as much information as possible
– Ask the purpose of the visit– Names and titles of all agents– Copy of search warrant (mandatory) and
affidavit (discretionary)– Monitor all items that are removed
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We Are All Boy Scouts
“BE PREPARED” Designate a single contact person to meet
with all government visitors– In-house attorney, head of security, human
resources• Have at least one back-up point person
Ensures company speaks with one voice and permits company to control documents
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Never Talk to Strangers
EDUCATE ALL EMPLOYEES– Employees have the right to talk or not talk to
investigators– Employees have the right to talk with counsel
before deciding whether to consent to a voluntary interview
– Employees have the right to have counsel present during any interviews
Remember: it is the employee’s decision, not the company’s decision, whether to consent to be interviewed
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The Best Defense
A robust, real Corporate Compliance Program can solve many problems
Mandatory ethics training Commitment from the top Effective response to problems