Home Health Final Rule Extends Exclusion Screening Obligation: Failure to Screen Could Result in Termination from Medicare

Catalina photoBy Paul Weidenfeld and Catalina Jandorf 





The new Final Rule issued by CMS revising the conditions of participation for home health agencies (HHAs) requires that providers “must ensure” that agencies providing services under arrangement have not been excluded from Medicare, Medicaid or any other federal health care program.  Effective July 17, 2017, the rule also states that providers must ensure that such agencies have not had their billing privileges revoked, and that they have not been terminated or been debarred from participating in any government program.  In making these requirements a condition of participation, CMS has created an affirmative screening obligation under which they have enforcement authority.

Compliance as a Condition of Participation

By making compliance with exclusion regulations a condition of participation, CMS has raised the stakes for failing to properly screen the exclusion status of vendors or contractors for HHAs while reaffirming the agency’s longstanding concerns about the participation of excluded persons in the Medicare Program.   Specifically, CMS has a wide assortment of administrative remedies that can be imposed for failing to meet conditions of participation – including even the ability to terminate a provider from participation in the program itself – all of which are independent from the OIG’s enforcement authorities for exclusion violations.

Guidance that Doesn’t Guide

CMS logo

Under the Final Rule, CMS may now hold an HHA liable for a State Exclusion in addition to a Federal Exclusion, by including Medicaid exclusion screening as a condition of participation.  However, as there is no universal list of all Medicaid excluded entities and individuals and the newly published final rule provides no guidance on how this requirement can be met, CMS has created an affirmative obligation without any guidance on how to fulfill it.  

In the response to a commenter’s concerns about the difficulties involved in meeting these requirements CMS stated that it “appreciates the opportunity to clarify [the] requirement” but it did not actually speak to the State issue.  The agency discussed the Federal exclusion lists but failed to address how an HHA could screen for a Medicaid exclusion.  It provided that self-certification is an appropriate mechanism in identifying denial of Medicare or Medicaid enrollment or in verifying debarment from government programs, but maintained that an HHA will still be held responsible for failing to properly screen a contracted entity that is providing “services under arrangement”.  This lack of guidance in screening requirements could be potentially problematic for a home health agency that relies solely on self-certification or just screening the Federal exclusion lists to weed out excluded entities. 

Conclusion

We think it is clear at this point that the mandated screening requirements consist of checking the List of Excluded Individuals and Entities (LEIE) and the System for Award Management (SAM) for a Medicare exclusion upon hire and every 30 days thereafter.  However, since the final rule does not clearly articulate what agencies must do to meet these requirements – particularly insofar as they involve Exclusions imposed by State and their Medicaid Fraud Control Units – home health agencies are left without clear guidance as to how to meet this requirement and are well advised to employ a broad exclusion screening protocol.

The best way to remain in compliance and avoid a Medicare or Medicaid Exclusion is to screen all employees, contractors, and vendors every month against all 38 state lists in addition to the LEIE and SAM.  To eliminate the risk of being barred from participation in the Federal health care programs, contact the Exclusion Experts at 1-800-294-0952 or online for a free consultation.

Paul Weidenfeld is a nationally recognized expert in health care fraud litigation and the Federal False Claims Act.  A former Department of Justice National Health Care Fraud Coordinator, he is currently in private representing health care providers and individuals, and a co-founder of Exclusion Screening, LLC.

Catalina Jandorf is a 3L at American University Washington College of Law.  She has experience working in health care as a law clerk at the Department of Health and Human Services Office of Counsel to the Inspector General and Inova Health System Office of the General Counsel.

Medicaid Providers That Are Excluded or Terminated for Cause Often Continue to Participate in Other States According to a New OIG Audit

 

medicaid providersOIG Audit Findings

In a recently released audit, the OIG found that despite the ACA requirement that states terminate Medicaid providers already terminated in another state, 12% of providers already terminated for cause in 2011 in one state (295 out of a sample of 2,539) were still participating in other state Medicaid programs as of January of 2014! There is a lack of state to state coordination identified in both this audit and one issued last March, and a lack of state to Federal coordination identified in separate OIG audit reports. This strongly reinforces our suggestion that providers screen their employees, vendors and contractors on all available State Exclusion Registries in addition to the LEIE and the SAM!

Exclusion, Termination and the ACA

In practical terms, to implement section 6501 of the ACA, states must first find the providers who are terminated from federal healthcare programs. Then, states must identify whether any terminated providers are participating in their Medicaid program. Finally, they must take action to terminate the provider from its own Medicaid program.

According to the report, this is defeated by a general lack of coordination caused in large part by a lack of uniformity of terminology among not only the states, but in existing Federal and state databases. For instance, exclusion and termination are synonymous in many states, but they have distinctly different meanings for CMS. This is also true with such terms as suspension, disbarment, revocation and sanction. Furthermore, what constitutes “cause” in one state may not in another state. The audit also notes that some states have a basic misunderstanding about the relationship between licensure and exclusion or termination. Those states often conclude that if Medicaid providers have an active license from the relevant state board, the state Medicaid agency should defer to the judgment of that board and not terminate the providers for cause.

Principle OIG Recommendations

The OIG reiterated its recommendation from March 2014 that CMS require state Medicaid agencies to report all terminations for cause. The OIG found that a lack of a comprehensive data source of providers terminated for cause creates a challenge for state Medicaid agencies. It also recommended that CMS work with states to develop a uniform terminology, that CMS furnish guidance to state agencies that termination is not contingent on the provider’s active licensure status, and that it require states to enroll providers who participate in their managed care programs.

The Message to Medicaid Providers

This audit report stresses, once again, the importance of screening all state Exclusion databases as well as the LEIE and the SAM. This message reinforces two important ideas: 1) States do not reliably share their information either with other states or with the Feds; and 2) a significant percentage of excluded or terminated physicians, nurses and other employees will take advantage of this lack of coordination to their advantage and your disadvantage!

OIG Exclusion

Paul Weidenfeld, Co-Founder and CEO of Exclusion Screening, LLC, is the author of this article. He is a longtime health care lawyer whose practice has focused on False Claims Act cases and health care fraud matters generally. Contact Paul should you have any  questions at: pweidenfeld@exclusionscreening.com or 1-800-294-0952.

Exclusion Alert: Assistant Inspector General Tells Congress That Exclusion Violations Plague Part D

OIG Exclusion Violations Plague

Assistant Inspector General Testifies before Congress

Ann Maxwell, the Assistant Inspector General for Evaluation and Inspections, recently testified before Congress. She argued that the Centers for Medicare and Medicaid Services (CMS) had not exercised “sufficient oversight of plan sponsors,” and “needed to strengthen its controls” in order to prevent payments for drugs “to providers excluded from Federal health care programs.” She further explained that “it is important that claims for drugs prescribed by excluded providers be denied to protect beneficiaries from inappropriate or even harmful services.” Maxwell appeared to lay much of the responsibility on CMS noting that the “OIG found that controls failed to prevent Part D payments for drugs prescribed by excluded providers,” resulting in exclusion violations. Also, she noted CMS lacked a “claims processing edit” that would reject prescriptions written by excluded providers.

Impact of Exclusion Violations on Medicare Part D

Maxwell’s testimony coincided with the release of an OIG Portfolio “Ensuring the Integrity of Medicare Part D,” OEI-03-15-0018. Though the portfolio also focused on other Part D program integrity and exclusion issues, OIG Exclusion Violations played a major role in both the testimony and the portfolio. Ms. Maxwell, echoing a finding in the portfolio, referenced two previous OIG studies dealing with this issue. In one study, the OIG found that plan sponsors paid “gross drug costs totaling $15 million over a 3-year period for prescriptions written by excluded providers.” (“Review of Excluded Providers in the Medicare Part D Program A-07-10-06004,” click here to read).

The OIG concluded that CMS failed to have adequate controls over either the payment process or its plan sponsors. Also, they concluded that the plan sponsors lacked proper controls over their payments. In order to reduce this fraud and abuse, the OIG recommended that CMS strengthen its controls in all areas in order to prevent payments to excluded providers to gain better accountability from program sponsors and to reduce risk to beneficiaries.

Final Thoughts

This appears to be another step forward since we have been chronicling the increasing interest and involvement of the OIG in the enforcement of exclusion regulations and exclusion violations. We have previously noted, for instance, the relatively new interest of the Office of Evaluations and Inspections in exclusion enforcement. So, it is not surprising that Maxwell testified on the issue or that her section is credited with having prepared the portfolio.

As always, readers must maintain caution and compliance. Also, be sure to screen your employees, vendors and contractors!

Click to know more about OIG Exclusion

OIG Exclusion Violations Plague

Paul Weidenfeld, Co-Founder and CEO of Exclusion Screening, LLC, is the author of this article. He is a longtime health care lawyer whose practice has focused on False Claims Act cases and health care fraud matters generally. Contact Paul should you have any questions at: pweidenfeld@exclusionscreening.com or 1-800-294-0952.

HCFAC Report 2014: After Consecutive Record Years, Recoveries and Prosecutions Dip, but Exclusions Continue to Increase

health care fraud and abuse report

The Health Care Fraud and Abuse Control Program(“HCFAC”) prepares detailed yearly reports which are sometimes viewed to be a barometer of fraud and abuse enforcement efforts. Valid conclusions can’t be drawn based on small samples or on numbers alone. However, side by side comparisons of data or even over a short period of time may be suggestive of trends or general directions. It will be interesting to see if this is the case with the data recently released by HCFAC 2014 when compared to the previous two years. 

I.  Overall Health Care Fraud and Abuse Recoveries Dip Almost 25% From Record Years

After trumpeting record years in the previous two years, HCFAC 2014 reported recoveries that, while still significant, were down across the board by about 25%. Total amounts returned to the Federal government dropped from $4.2 billion in the Fiscal Year (FY) 2012 to $3.3 billion in FY 2014. The amounts reported that were won or negotiated in health care fraud judgments dropped to $2.3 billion in 2014 from $3.0 billion in 2012.

The amounts returned to the Medicare Trust Fund and recoveries in Federal Medicaid matters, perhaps the most important numbers, also sustained significant drops. The Trust Fund receipts dropped to $1.9 billion (from $2.4 and $2.85 billion). Also, Medicaid recoveries sustained a similar decline from $835.7 million in 2012 to $523 million in 2014. While there may be several explanations for this one year drop, it will be worth keeping an eye on the numbers to see what it means.

II.  DOJ Civil Numbers: Trending down, but only slightly

Due to the long delay between the opening and closing of cases, often four years and longer, there is not likely to be any correlation between a dip in recoveries and new cases in the same year. Nevertheless, the number of new civil health care fraud investigations reported by DOJ over the last three years is down about 10% from 2012 and about 20% from 2013 (782 in 2014 versus 885 in 2012 and 1,083 last year). Pending fraud matters were more stable (from 1,023 and 1,079 in the prior two years down to 957). These numbers, particularly the opening of new cases, are somewhat surprising considering the significant increase in new False Claims Act cases being brought by whistle blowers every year. It will be interesting to see if they reflect a trend or are merely an aberration.

III.  DOJ Criminal Numbers: A Mixed Bag

DOJ reported decreases in the number of new criminal health care fraud investigations (almost 20% from 2012 and about 10% from the previous year). There were also decreases in the total number of defendants convicted of health care fraud-related crimes (826 in 2012 as compared to 734 in 2014). On the other hand, the HCFAC report showed that the actual number of cases in which defendants were charged had increased (from 452 to 496). In addition, the report demonstrated that FBI investigative efforts resulted in significant increases in both operational disruptions of criminal fraud organizations (from 329 operational disruptions in 2012 up to 605 in 2014), and in dismantling criminal hierarchies (up to 142 in 2014 from 83 in 2012).

These numbers in general, and the FBI numbers in specific, may be partially explained by the Health Care Fraud Prevention and Enforcement Action Team (HEAT) program. The HEAT program emphasizes criminal investigations in health care matters, and they, too, are certainly worth keeping an eye on.

IV.  OIG Criminal and Civil Actions Increased Slightly; Exclusion Actions Up Considerably

The OIG reported a small increase in both criminal actions in crimes related to Medicare and Medicaid (849 to 867) and in civil actions brought either in Federal district court or administratively (458 to 529). However, as the report does not reconcile these numbers or actions with those reported by DOJ, it is impossible to reach any conclusions as to their meaning. On the other hand, the number of individuals and entities excluded from participation in Medicare, Medicaid, and other federal health care programs actions rose to 4,017 in 2014 from 3,214 and 3,131 in the prior two years.

A breakdown of the exclusion actions show that exclusions based on convictions for crimes related to Medicare and Medicaid increased approximately 25% since 2012 (to 1,310 from 912). It further demonstrates that exclusions based on convictions for crimes relating to other health care programs showed an even greater rise (432 in 2014 up from 287 in 2012). Other major grounds for exclusion included patient abuse or neglect and licensure revocations – both of which also rose significantly. These numbers appear consistent with, and reflective of, HHS-OIG’s increasing interest in exclusions and exclusion enforcement as a means of protecting the Medicare and Medicaid programs.

V.  Final Thoughts

The HCFAC 2014 report may simply reflect a slightly down year. On the other hand, it might be the first indication that the numbers of the previous record years may be harder to maintain and more rarely seen, as the industry embraces compliance in response to the intense enforcement efforts of recent years. Regardless of what it means, if anything, it does reflect that at least some change took place last year and that we should all stay tuned.

Paul Weidenfeld, Co-Founder and CEO of Exclusion Screening, LLC, is the author of this article. He is a longtime health care lawyer whose practice has focused on False Claims Act cases and health care fraud matters generally. Contact Paul should you have any  questions at: pweidenfeld@exclusionscreening.com or 1-800-294-0952.


 

The Health Care Fraud and Abuse Control Program (“HCFAC”) was created as part of the HIPAA anti-fraud legislation to coordinate Federal, State and local health care fraud and abuse enforcement.

Alert to Florida Providers Regarding Screening

 I.  Florida’s State Exclusion. Excluded Providers Costs OIG Over 2.7 Million

The Office of the Inspector General (OIG) recently released a study on a subset of Florida’s Medicaid payments for pharmaceutical items. The study showed that in 2009 and 2010 the State agency made $180,000 in payments for pharmaceutical items prescribed by excluded providers. OIG, comparing this number to the total number of pharmacy payments, concluded that the State agency may have paid up to $2.7 million for items that excluded providers had prescribed.[1]

OIG concluded that these over-payments occurred because the State agency did not have proper policies in place to conduct prepayment review. Specifically, the agency had not established sufficient prepayment controls to ensure that valid provider IDs were on every pharmacy claim, and that the prescribing provider identification numbers were valid before making payments.

II.  Monthly Exclusion Screening Is Essential to Maintaining Effective Compliance Programs

Furthermore, the State agency was only conducting periodic searches of the LEIE and the GSA-SAM, which are maintained by OIG and CMS, respectively. This serves as just another reminder to providers that exclusion searches, in order to be effective, must be conducted monthly and must include searches of the LEIE, the GSA-SAM, and all 37 state Medicaid lists. Failure to search every list creates a hole in your screening process and allows excluded individuals to continue billing to the Federal health care programs.

Florida has since created its own suspended provider list like a majority of the states. In addition to building this new system, it also refunded the Federal health care programs in the amount of $99,568. That expense could have been avoided with thorough monthly exclusion checks.

III. Conclusion

All providers must conduct monthly exclusion screening on the LEIE, GSA-SAM, and all 37 state Medicaid lists. OIG is aggressively cracking down on providers who employ excluded individuals and will impose Civil Monetary Penalties (CMPs) of up to $10,000 for each item or service billed to the Federal health care programs that was provided directly or indirectly by an excluded individual.

Read more on State Exclusion 

Florida's State Exclusion 

Ashley Hudson, Associate Attorney at Liles Parker, LLP and former Chief Operating Officer for Exclusion Screening, LLC, is the author of this article. Feel free to contact us at 1-800-294-0952 or online for a free consultation.


[1] Lori S. Pilcher, Florida Made Some Payments for Pharmacy Items That Excluded Providers Had Prescribed, Dep’t of Health and Human Servs., Office of the Ins. Gen., 3 (June 2014).

CMS Finds Fault with Exclusion Information Sharing Between States

CMS
I.  Take It from CMS: If You’re Excluded in One State, You’re Excluded in All States

Section 6401(b)(2) of the Affordable Care Act (ACA) required the Centers for Medicare and Medicaid Services (CMS) to create a national database where State agencies could share and access information about individuals and entities that were terminated from the Medicare, Medicaid, or CHIP programs.[1] This platform would help states comply with ACA section 6501,[2] which mandates that a provider must be terminated in all state Medicaid programs if he or she were terminated “for cause”[3] in one state. CMS created the Medicaid and Children’s Health Insurance Program State Information Sharing System (MCSIS) to make this exclusion information available to all State Medicaid agencies.[4]

  Under section 6401(b)(2), states were asked to submit the terminated provider’s name, National Provider Identifier (NPI), and other identifying information to MCSIS. This information was incorporated into MCSIS so that other states could identify providers that needed to be terminated. Even though CMS has the authority[5] to require states to submit this information, it has only asked states to comply. CMS’ failure to make reporting mandatory resulted in a very deficient database.

II.  CMS’ Comprehensive List…Not So Comprehensive

  Only thirty-three states[6] submitted information to CMS and many of the records were incomplete. For example, CMS asked states to only submit providers that were terminated “for cause,” but over 2,000 records lacked a “for cause” termination.[7] In addition, 59 percent of the records also did not include provider NPIs,[8] which the ACA specified as a mandatory database component.[9] Many other data fields, like provider type[10] and address, were blank.

  Seventeen states[11] and the District of Columbia failed to submit any data in the two years between MCSIS’s creation and the Office of the Inspector General’s (OIG) review.[12] Four states[13] submitted 72 percent, or 3,413 of 4,713 total Medicaid records.[14] The other states that reported information reported very small numbers. For example, Massachusetts only submitted two excluded providers between 2011 and 2013.[15] Even though, it excluded fifteen providers in 2012.[16]

 OIG concluded that CMS needed to improve its exclusion information-sharing process.[17] Specifically, CMS should mandate that state agencies report all “for cause” terminations.[18] OIG also stated that CMS should also remove all providers that were not terminated “for cause,” or if it would like to expand its database, then it must issue new guidance instructing the states as to which providers must be terminated under section 6501.[19]

III.  CMS Creates New List: OnePI Portal

  CMS agreed with OIG, and disclosed that it is in the process of creating a private database, the OnePI portal.[20] OnePI is accessible to only CMS, State Medicaid agencies, and CHIP. It provides a private platform for states to share information about terminated providers.

 Under this new system, CMS will require states to submit a copy of the termination letter sent to the provider. Then, CMS will review these letters to ensure that the provider should be included in the OnePI database.[21]

 CMS has not provided a proposed completion date for OnePI.[22] Furthermore, there is no information available in regard to whether this data will be incorporated into the LEIE, if it will be available to providers, or if states will be required to integrate excluded providers from other states into their Medicaid termination lists.

IV. Conclusion

This inaccurate reporting of data illustrates why it is critical to check all state Medicaid lists in addition to OIG-LEIE and GSA-SAM. You will be held responsible if you employ or contract with an excluded individual. A provider that is excluded in one state is excluded in all states. 

CMS

Ashley Hudson, Associate Attorney at Liles Parker, LLP and former Chief Operating Officer for Exclusion Screening, LLC, is the author of this article. Contact the exclusion experts at Exclusion Screening, LLCSM today for a free consultation by calling 1-800-294-0952 or online.


[1] Dep’t of Health and Human Servs. Office of the Inspector Gen., CMS’s Process for Sharing Information about Terminated Providers Needs Improvement, 1–2 (Mar. 2014).

[2] 42 C.F.R. § 455.416(c).

[3] States are only required to terminate providers from their Medicaid programs if they were terminated “for cause” under another state program. “For cause” means a provider was terminated due to fraud, integrity or quality.  Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 2.

[4] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 1.

[5] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 13.

[6] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 7.

[7] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 7.

[8] Not all providers are assigned NPIs. Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 4, 9.

[9] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 2.

[10] Thirty-three percent of MCSIS records did not contain information about the provider type. Furthermore, some states identified 95 percent of providers as “other” when 25 different specific provider types were provided in a drop-down menu. See Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 11.

[11] The seventeen states were: Colorado, Hawaii, Kentucky, Minnesota, Montana, New Hampshire, New Mexico, North Carolina, North Dakota, Oklahoma, Oregon, South Carolina, South Dakota, Texas, Utah, West Virginia, and Wyoming. See Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 16.

[12] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 7.

[13] California, New York, Pennsylvania, and Illinois. See Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 7.

[14] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 7.

[15] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 16.

[16] Massachusetts Health and Human Services, Suspended/Excluded MassHealth Providers as of 5/31/2014, 2, http://www.mass.gov/eohhs/docs/masshealth/provlibrary/suspended-excluded-masshealth-providers.pdf (last accessed June 6, 2014).

[17] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 13.

[18] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 13.

[19] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 14.

[20] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 22.

[21] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 22.

[22] Dep’t of Health and Human Servs. Office of the Inspector Gen., supra note 1, at 22–23.