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From Health Law Daily, June 2, 2015

Semiannual OIG report shows recoveries pouring in

By Patricia K. Ruiz, J.D.

The HHS Office of Inspector General (OIG) has reported expected recoveries of more than $1.8 billion for the first half of fiscal year (FY) 2015, including almost $544.7 million in audit receivables and $1.25 billion in investigative receivables, according to the OIG’s Semiannual Report to Congress (SRC). The SRC also details the successes of the Medicare Fraud Strike Force (Strike Force), as well as accomplishments in quality of care, efficiency of payments, policies, and practices, and implementation of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) (OIG Semiannual Report to Congress, June 1, 2015).

The SRC addresses work completed by the OIG in the first half of the fiscal year, summarizing key accomplishments during that timeframe and describing significant problems, abuses, deficiencies, and investigative outcomes that relate to the administration of HHS programs and operations.

Accomplishments. In addition to its accomplishments in expected recoveries, the OIG reported 486 criminal actions against individuals and entities engaged in crimes against HHS programs, as well as 326 civil actions, including false claims, unjust enrichment lawsuits, civil monetary penalties settlements, and administrative recoveries related to self-disclosure matters. The OIG also reported the exclusions of 1,735 individuals and entities from federal health care program participation. In the first half of 2015, efforts of the Strike Force resulted in charges filed against 69 individuals or entities, 124 criminal actions, and $163 million in investigative receivables. Strike Force actions included convictions for health care fraud and conspiracy to commit health care fraud for improper beneficiary recruitment and billing unnecessary services in Louisiana, as well as fraudulent Part D claims in Florida and inappropriate patient referrals for dialysis treatment in Colorado.

The OIG helps to identify inefficient Medicare and Medicaid policies and practices that unintentionally create loopholes or other problems that hinder consistent payment determinations. For example, Medicare payments for hospice care more than doubled in five years, showing that payment reform and more accountability are needed to reduce incentives for hospices to focus solely on certain types of diagnoses and settings. Other inefficiencies appear in areas such as the payment rates for swing bed services, in the payment of providers with delinquent debts, and the reconciliation of hospital outlier payments.

The OIG also works to find and reconcile gaps in program safeguards that ensure medical necessity, patient safety, access to services, and quality of care, which all remain significant challenges to Medicare and Medicaid. The report notes that in the largest failure-of-care settlement with a nationwide skilled nursing facility (SNF), the provider agreed to pay $38 million to resolve allegations of substandard or worthless skilled nursing services, as well as allegations of billing Medicare for medically unreasonable and unnecessary rehabilitation therapy services. The OIG also focused its attention on the availability of providers in Medicaid managed care, as well as the use of preventive screening by children on Medicaid.

ACA implementation. The OIG’s ACA-related work centers around the Health Insurance Marketplace, Medicaid expansion, use of state establishment grants, and financial assistance payments. In a January 2015 report, the OIG noted previous findings of inadequacies in contract planning and procurement in the development of HealthCare.gov (CMS didn’t play by the rules when awarding HealthCare.gov contracts, January 28, 2015). The complexity of the federal Marketplace made finding the most qualified contractors a necessity, the OIG stated, but “CMS did not perform thorough reviews of contractor past performance when awarding two key contracts. The report also summarized ongoing plans to examine the operations in the payment of advance premium tax credits.

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