Health Care Reform: New Fraud and Abuse Provisions Kim C. Stanger Hawley Troxell LLP (5/10)

Health Care Health Care Reform: New Reform: New

Fraud and Fraud and Abuse Abuse

ProvisionsProvisions

Kim C. StangerKim C. Stanger

Hawley Troxell LLPHawley Troxell LLP

(5/10)(5/10)

The small print…The small print… This is overview of selected provisions in law.This is overview of selected provisions in law. The law and general requirements are subject to The law and general requirements are subject to

change as new regulations issue or the law is change as new regulations issue or the law is amended.amended.

Participants should review the law and Participants should review the law and corresponding regulations when seeking to comply.corresponding regulations when seeking to comply.

This presentation is given for educational purposes This presentation is given for educational purposes only; it does not constitute legal advice.only; it does not constitute legal advice.

This presentation does not establish an attorney-This presentation does not establish an attorney-client relationship.client relationship.

The opinions expressed are those of the speaker; The opinions expressed are those of the speaker; they do not necessarily represent the position of the they do not necessarily represent the position of the Hospital Cooperative or Hawley Troxell LLP.Hospital Cooperative or Hawley Troxell LLP.

Patient Protection and Patient Protection and Affordable Care Act Affordable Care Act

(“PPACA”)(“PPACA”)

PPACA:PPACA:OverviewOverview

Cost of health care reform estimated Cost of health care reform estimated at $940 billion over 10 years.at $940 billion over 10 years.

““[M]ost of [health care reform] can be [M]ost of [health care reform] can be paid for by finding savings within the paid for by finding savings within the existing health care system, a system existing health care system, a system that is currently full of waste and that is currently full of waste and abuse.” abuse.”

– Pres. ObamaPres. Obama

PPACA Fraud and PPACA Fraud and Abuse ProvisionsAbuse Provisions

Shorten time for submitting claims.Shorten time for submitting claims. Require report and repayment of Require report and repayment of

overpayments.overpayments. Impose additional requirements for Impose additional requirements for

enrollment.enrollment. Strengthen and expand current fraud and Strengthen and expand current fraud and

abuse laws.abuse laws. Expand government and RAC authority for Expand government and RAC authority for

investigations.investigations. Create new rules for certain providers.Create new rules for certain providers. Require states to implement similar measures.Require states to implement similar measures.

PPACA Fraud and PPACA Fraud and Abuse ProvisionsAbuse Provisions

Reduced Time Reduced Time for Submitting Claimsfor Submitting Claims

For services furnished on or after 1/1/10, For services furnished on or after 1/1/10, must submit claims to Medicare parts A and must submit claims to Medicare parts A and B within one calendar year from date of B within one calendar year from date of service.service.

For services furnished before 1/1/10, must For services furnished before 1/1/10, must submit claims by 12/31/10.submit claims by 12/31/10.

HHS may issue regulatory exceptions to HHS may issue regulatory exceptions to one-year limit.one-year limit.

(PPACA 6404)(PPACA 6404)

Include NPIInclude NPI

By January 1, 2011, providers and By January 1, 2011, providers and suppliers must include National Provider suppliers must include National Provider Identifier (“NPI”) onIdentifier (“NPI”) on– Application for enrollment, andApplication for enrollment, and– All claims for payment.All claims for payment.

HHS to issue regulations.HHS to issue regulations.(PPACA 6402)(PPACA 6402)

Report and Repay Report and Repay OverpaymentsOverpayments

““Overpayment” = funds a person receives or retains Overpayment” = funds a person receives or retains to which person is not entitled after reconciliation.to which person is not entitled after reconciliation.

Providers and suppliers must:Providers and suppliers must:– Report and return overpayments to HHS, the Report and return overpayments to HHS, the

state, or contractor by the later of:state, or contractor by the later of: 60 days after the date the overpayment was 60 days after the date the overpayment was

identified, oridentified, or The date the corresponding cost report is due.The date the corresponding cost report is due.

– Provide written explanation of reason for Provide written explanation of reason for overpayment.overpayment.


Report and Repay Report and Repay OverpaymentsOverpayments

Retaining overpayment after Retaining overpayment after deadline for reporting and returning deadline for reporting and returning overpayment is an “obligation” overpayment is an “obligation” under False Claims Act.under False Claims Act.

““Knowing” failure to report and Knowing” failure to report and return overpayments by the date return overpayments by the date due may result in penalties under:due may result in penalties under:– False Claims ActFalse Claims Act– Civil Monetary Penalties Law.Civil Monetary Penalties Law.

False Claims ActFalse Claims Act

Prohibits Prohibits – knowingly submitting false claim for knowingly submitting false claim for

payment to federal government, orpayment to federal government, or– Concealing, avoiding, or decreasing an Concealing, avoiding, or decreasing an

obligation to pay to the federal obligation to pay to the federal government.government.

(31 USC 3729 et seq.)(31 USC 3729 et seq.)

False Claims ActFalse Claims Act

PenaltiesPenalties– $5,500 to $11,000 penalty per false claim$5,500 to $11,000 penalty per false claim– 3x amount claimed3x amount claimed

Private whistleblowers may assert qui tam Private whistleblowers may assert qui tam lawsuits.lawsuits.– Receive percentage of recoveryReceive percentage of recovery– Prevailing party may recover costs and Prevailing party may recover costs and

feesfees

(31 USC 3729 et seq.)(31 USC 3729 et seq.)

False Claims ActFalse Claims ActChangesChanges

Prior “public disclosure” not a bar to qui tam action.Prior “public disclosure” not a bar to qui tam action.– No dismissal required if government opposes dismissal.No dismissal required if government opposes dismissal.– Public disclosure is limited to federal actions, e.g.,Public disclosure is limited to federal actions, e.g.,

Federal criminal, civil and administrative actions.Federal criminal, civil and administrative actions. Federal reports, hearings, audits or investigations.Federal reports, hearings, audits or investigations. News media and perhaps social media.News media and perhaps social media. NotNot state proceedings and private litigation. state proceedings and private litigation.

To be “original source,” qui tam relatorTo be “original source,” qui tam relator– Must provide info to govt prior to public disclosure, andMust provide info to govt prior to public disclosure, and– Info must be independent of and materially add to Info must be independent of and materially add to

publicly disclosed allegations.publicly disclosed allegations.– NotNot required to have direct and independent knowledge. required to have direct and independent knowledge.


Civil Monetary Civil Monetary Penalties LawPenalties Law

Prohibits specified conduct, e.g.,Prohibits specified conduct, e.g.,– Submitting false or fraudulent claims, or claims for Submitting false or fraudulent claims, or claims for

unnecessary servicesunnecessary services– Offering inducements to program beneficiariesOffering inducements to program beneficiaries– Contract with excluded providerContract with excluded provider– Etc.Etc.

Penalties generally includePenalties generally include– $10,000 to $50,000 penalty, depending on violation$10,000 to $50,000 penalty, depending on violation– 3x amount claimed3x amount claimed– Exclusion from govt programsExclusion from govt programs

(42 USC 1320a-7a)(42 USC 1320a-7a)

Civil Monetary Penalties Law Civil Monetary Penalties Law ChangesChanges

Expanded to prohibit:Expanded to prohibit:– Failing to report and return known Failing to report and return known

overpayment.overpayment. Penalties up to $10,000 per violationPenalties up to $10,000 per violation 3x damages3x damages Exclusion from govt programsExclusion from govt programs

– Knowingly making false statement in Knowingly making false statement in application, bid, or contract to participate or application, bid, or contract to participate or enroll in a federal health care program.enroll in a federal health care program. Penalties up to $50,000 per violationPenalties up to $50,000 per violation Exclusion from govt programs.Exclusion from govt programs.

(PPACA 6402, 6408)(PPACA 6402, 6408)

Civil Monetary Penalties LawCivil Monetary Penalties Law

Expanded to prohibit:Expanded to prohibit:– Ordering or prescribing items or services Ordering or prescribing items or services

when person ordering or prescribing is when person ordering or prescribing is excluded from federal health care excluded from federal health care program.program.

– Failing to grant OIG timely access for Failing to grant OIG timely access for audits, investigations, evaluations upon audits, investigations, evaluations upon reasonable request.reasonable request. Penalties up to $15,000 per day.Penalties up to $15,000 per day.

(PPACA 6402(d), 6408)(PPACA 6402(d), 6408)

Civil Monetary Penalties LawCivil Monetary Penalties Law

New exceptions:New exceptions:– Programs that promote access to care and pose a Programs that promote access to care and pose a

low risk of harm to patients and health care low risk of harm to patients and health care programs.programs.

– Coupons, rebates and other rewards from a retailer Coupons, rebates and other rewards from a retailer that are offered to general public not tied to items that are offered to general public not tied to items reimbursed under Medicare/Medicaid.reimbursed under Medicare/Medicaid.

– Unadvertised items or services for free or less than Unadvertised items or services for free or less than fair market value based on financial need.fair market value based on financial need.

– Part D plan waiver for first fill copayment for a Part D plan waiver for first fill copayment for a generic Part D drug.generic Part D drug.


Stark Self-Referral Stark Self-Referral LawLaw

If a physician (or their family member) has a If a physician (or their family member) has a financial relationship with an entity:financial relationship with an entity:– The physician may not refer patients to The physician may not refer patients to

that entity for designated health services, that entity for designated health services, andand

– The entity may not bill Medicare for such The entity may not bill Medicare for such designated health servicesdesignated health services

unless the referral or financial relationship is unless the referral or financial relationship is structured to fit within a regulatory exception.structured to fit within a regulatory exception.

(42 USC 1395nn; 42 CFR 411.350)(42 USC 1395nn; 42 CFR 411.350)

Stark Self-Referral LawStark Self-Referral Law

PenaltiesPenalties– No payment for services provided per No payment for services provided per

improper referralimproper referral– Repayment of payments improperly Repayment of payments improperly

receivedreceived– Civil penaltiesCivil penalties

$15,000 per improper referral/claim$15,000 per improper referral/claim $100,000 per scheme$100,000 per scheme

(42 USC 1395nn; 42 CFR 411.350)(42 USC 1395nn; 42 CFR 411.350)

Stark Changes:Stark Changes:In-Office Ancillary ServicesIn-Office Ancillary Services

To qualify for in-office ancillary services To qualify for in-office ancillary services exception, if provider refers patient for exception, if provider refers patient for MRI, CT, or PET scan performed in MRI, CT, or PET scan performed in physician’s office, physician must:physician’s office, physician must:– Notify patient that patient may obtain Notify patient that patient may obtain

the services from other suppliers, andthe services from other suppliers, and– List of other suppliers where patient List of other suppliers where patient

resides that can provide the service.resides that can provide the service. HHS may expand list of affected services.HHS may expand list of affected services. Applies to referrals after 1/1/10.Applies to referrals after 1/1/10.(PPACA 6003)(PPACA 6003)

Stark Changes: Stark Changes: Physician-Owned HospitalsPhysician-Owned Hospitals

To qualify for “whole hospital” and “rural To qualify for “whole hospital” and “rural provider” exceptions, physician-owned provider” exceptions, physician-owned hospitals:hospitals:– Must have physician ownership and provider Must have physician ownership and provider

number by 12/31/10.number by 12/31/10.– Cannot convert from ASC or increase Cannot convert from ASC or increase

percentage of total value of physician percentage of total value of physician ownership or investment after 3/23/10.ownership or investment after 3/23/10.

– Cannot expand number of operating rooms, Cannot expand number of operating rooms, procedure rooms, and beds after 3/23/10.procedure rooms, and beds after 3/23/10.

Exception for certain high Medicaid hospitals.Exception for certain high Medicaid hospitals. Regulations due 1/1/12.Regulations due 1/1/12.(PPACA 6001, 10601; Reconciliation Act 1106)(PPACA 6001, 10601; Reconciliation Act 1106)


Must comply with additional reporting duties, e.g., Must comply with additional reporting duties, e.g., – Submit annual report to HHS identifying physician Submit annual report to HHS identifying physician

owners and investors.owners and investors.– Referring physician owners must notify patients of:Referring physician owners must notify patients of:

Referring physician’s ownership interestReferring physician’s ownership interest Treating physician’s ownership interest.Treating physician’s ownership interest.

– Disclose that hospital is owned by physicians inDisclose that hospital is owned by physicians in Hospital websiteHospital website Public advertising.Public advertising.

– If hospital does not have physician on site 24/7, If hospital does not have physician on site 24/7, Notify patient of such fact prior to admissionNotify patient of such fact prior to admission Obtain patient’s written acknowledgement of Obtain patient’s written acknowledgement of

fact.fact.(PPACA 6001, 10601; Reconciliation Act 1106)(PPACA 6001, 10601; Reconciliation Act 1106)


Cannot condition physician’s Cannot condition physician’s ownership/investment on referrals.ownership/investment on referrals.

Cannot offer physician owner/investor more Cannot offer physician owner/investor more favorable ownership opportunities than a favorable ownership opportunities than a person who is not a physician owner/investor.person who is not a physician owner/investor.

Hospital cannot guarantee, make payment, or Hospital cannot guarantee, make payment, or subsidize loan to physician or group to subsidize loan to physician or group to acquire ownership/investment interest.acquire ownership/investment interest.

Returns distributed based on Returns distributed based on ownership/investment interests.ownership/investment interests.

Other requirements.Other requirements.(PPACA 6001, 10601; Reconciliation Act 1106)(PPACA 6001, 10601; Reconciliation Act 1106)

Stark Changes:Stark Changes:Self-Disclosure ProtocolSelf-Disclosure Protocol

HHS must establish a self-disclosure HHS must establish a self-disclosure protocol by 9/23/10 for reporting Stark protocol by 9/23/10 for reporting Stark violations, including:violations, including:– Agency to whom disclosures may be Agency to whom disclosures may be

reported, andreported, and– Process for corporate integrity and Process for corporate integrity and

compliance agreements.compliance agreements. Separate from advisory opinion process.Separate from advisory opinion process.


Stark Changes:Stark Changes:Compromise re PenaltiesCompromise re Penalties

HHS is authorized to settle Stark violations HHS is authorized to settle Stark violations for less than full statutory penalties if for less than full statutory penalties if participate in self-disclosure protocol.participate in self-disclosure protocol.

Factors to consider include:Factors to consider include:– Nature and extent of illegal or improper Nature and extent of illegal or improper

practicepractice– Timeliness of self-disclosureTimeliness of self-disclosure– Cooperation in providing informationCooperation in providing information– Other factors HHS deems relevant.Other factors HHS deems relevant.


Anti-Kickback StatuteAnti-Kickback Statute

Prohibits individuals or entities Prohibits individuals or entities from knowingly and willfully from knowingly and willfully offering, paying, soliciting or offering, paying, soliciting or receiving remuneration to induce receiving remuneration to induce referrals of items or services referrals of items or services covered by Medicare, Medicaid or covered by Medicare, Medicaid or any other federally funded any other federally funded program unless fit within program unless fit within regulatory exception.regulatory exception.

(42 USC 1320a-7b; 42 CFR (42 USC 1320a-7b; 42 CFR 1001.952)1001.952)

Anti-Kickback StatuteAnti-Kickback Statute

PenaltiesPenalties– FelonyFelony– 5 years in prison5 years in prison– $25,000 fine$25,000 fine– $50,000 civil administrative $50,000 civil administrative

penaltypenalty– Exclusion from Medicare/MedicaidExclusion from Medicare/Medicaid

Anti-Kickback Statute Anti-Kickback Statute ChangesChanges

May violate statute even if:May violate statute even if:– You did not know of AKSYou did not know of AKS– You did not intend to violate AKSYou did not intend to violate AKS– Rejects Rejects Hanlester v. Shalala Hanlester v. Shalala (9(9thth

Cir. 1995)Cir. 1995)

** Ignorance of the law is no longer a Ignorance of the law is no longer a defense.defense.

Anti-Kickback Statute Changes:Anti-Kickback Statute Changes:AKS Violation = FCA ViolationAKS Violation = FCA Violation

Anti-Kickback StatuteAnti-Kickback Statute Criminal statuteCriminal statute Beyond reasonable Beyond reasonable

doubt standarddoubt standard 5 years in prison5 years in prison $25,000 fine$25,000 fine Exclusion from Exclusion from

Medicare/MedicaidMedicare/Medicaid

False Claims ActFalse Claims Act Civil statuteCivil statute Preponderance of Preponderance of

evidence standardevidence standard Civil penaltiesCivil penalties

– $5,500 to $11,000 $5,500 to $11,000 per claimper claim

– 3x amount claimed3x amount claimed Qui tam lawsuitQui tam lawsuit

Increased Funding for Increased Funding for EnforcementEnforcement

$100 million in 2011$100 million in 2011 $250 million through 2016.$250 million through 2016.

OIG Investigative OIG Investigative AuthorityAuthority

Providers who fail to grant timely access to Providers who fail to grant timely access to records may be fined $15,000 for each day that records may be fined $15,000 for each day that access is denied.access is denied.

OIG may obtain information from providers and OIG may obtain information from providers and beneficiaries.beneficiaries.

OIG may subpoena witnesses to testify in OIG may subpoena witnesses to testify in exclusion cases.exclusion cases.

OIG may access databases.OIG may access databases.– Government databases integrated to facilitate Government databases integrated to facilitate

data matching, mining and sharing.data matching, mining and sharing.(PPACA 6402, 6408)(PPACA 6402, 6408)

RAC AuditsRAC Audits

States must implement RAC audits States must implement RAC audits for Medicaid by 12/31/2010.for Medicaid by 12/31/2010.– RACs paid according to amount RACs paid according to amount

recovered.recovered. Medicare Parts C and D will be Medicare Parts C and D will be

subject to RAC audits.subject to RAC audits.


Suspension of Suspension of Payments Pending Payments Pending

InvestigationInvestigation HHS may suspend payments to a HHS may suspend payments to a

provider pending an investigation of a provider pending an investigation of a credible allegation of fraud against the credible allegation of fraud against the provider.provider.

HHS shall withhold FPP from state if state HHS shall withhold FPP from state if state Medicaid does not suspend payment.Medicaid does not suspend payment.

CMS must consult with OIG to determine CMS must consult with OIG to determine whether there is a credible allegation of whether there is a credible allegation of fraud.fraud.


Recovery from Recovery from Related ProvidersRelated Providers

HHS may recover payments from HHS may recover payments from providers and suppliers that share providers and suppliers that share same tax identification number as same tax identification number as entity with past-due obligation to entity with past-due obligation to Medicare.Medicare.

Applies even if they have different Applies even if they have different billing number or NPI.billing number or NPI.


Mandatory Mandatory Compliance PlansCompliance Plans

Providers will be required to have Providers will be required to have compliance plans as condition to compliance plans as condition to enrollment and re-enrollment.enrollment and re-enrollment.

HHS will determineHHS will determine– Timing re industry sectorsTiming re industry sectors– Applicable standards for Applicable standards for

compliance plans.compliance plans.


Enrollment ProcessEnrollment Process

HHS must implement screening process for HHS must implement screening process for enrollees in Medicare, Medicaid, and CHIP by enrollees in Medicare, Medicaid, and CHIP by 9/23/10.9/23/10.– Licensure checksLicensure checks– Maybe background checks, fingerprints, Maybe background checks, fingerprints,

unannounced site visits, database inquiries, etc.unannounced site visits, database inquiries, etc. Screening applies to:Screening applies to:

– New enrollees: by 3/23/11New enrollees: by 3/23/11– Current enrollees: by 3/23/12Current enrollees: by 3/23/12– Revalidation: by 9/23/10Revalidation: by 9/23/10


Enrollment ProcessEnrollment Process

Institutional providers will be charged Institutional providers will be charged a $500 enrollment fee beginning a $500 enrollment fee beginning 2010.2010.– Subject to CPI adjustmentSubject to CPI adjustment– Hardship exemptions may be Hardship exemptions may be

available.available.


Enrollment ProcessEnrollment Process Enrollees must disclose info about affiliates Enrollees must disclose info about affiliates

with uncollected debt, that have been with uncollected debt, that have been excluded from govt programs, or had billing excluded from govt programs, or had billing privileges denied.privileges denied.– HHS may deny enrollment based on HHS may deny enrollment based on

affiliation.affiliation.

RememberRemember HHS may impose penalties for HHS may impose penalties for false statements in enrollment process, false statements in enrollment process, including:including:– $50,000 civil monetary penalty per false $50,000 civil monetary penalty per false

statement, orstatement, or– Exclusion from govt program.Exclusion from govt program.

(PPACA 6401, 6402)(PPACA 6401, 6402)

Enrollment ProcessEnrollment Process HHS may subject certain enrollees to HHS may subject certain enrollees to

oversight during provisional period lasting oversight during provisional period lasting 30 days to one year.30 days to one year.– Prepayment reviewsPrepayment reviews– Payment capsPayment caps– Others as HHS deems appropriate.Others as HHS deems appropriate.

HHS may place moratorium on enrollment HHS may place moratorium on enrollment of certain providers or categories if of certain providers or categories if necessary to prevent waste, fraud or necessary to prevent waste, fraud or abuse.abuse.– Not subject to judicial review.Not subject to judicial review.


501(c)(3) Tax-Exempt 501(c)(3) Tax-Exempt HospitalsHospitals


Must conduct community needs Must conduct community needs assessment at least every 3 years and assessment at least every 3 years and implement strategy.implement strategy.

Effective for tax year beginning 3/23/12.Effective for tax year beginning 3/23/12. HHS to review community needs HHS to review community needs

assessment at least once every 3 years.assessment at least once every 3 years. Violations may result in:Violations may result in:

– $50,000 excise tax$50,000 excise tax– Loss of tax exempt status?Loss of tax exempt status?



Must establish financial assistance policy.Must establish financial assistance policy.– Amount billed to qualified patients Amount billed to qualified patients

cannot exceed amount billed to patients cannot exceed amount billed to patients with insurance.with insurance.

– Cannot take extraordinary collection Cannot take extraordinary collection actions until determine whether patient actions until determine whether patient qualifies under policy.qualifies under policy.

– Must provide emergency care without Must provide emergency care without regard to ability to pay.regard to ability to pay.


DME and Home DME and Home Health ServicesHealth Services

Physicians who order DME or certify home Physicians who order DME or certify home health services must be enrolled in Medicare health services must be enrolled in Medicare to receive payment.to receive payment.

Physicians or midlevels must have face-to-Physicians or midlevels must have face-to-face encounter with a patient prior to ordering face encounter with a patient prior to ordering DME or certifying home health services.DME or certifying home health services.– May conduct encounter by telemedicine.May conduct encounter by telemedicine.– Must document encounter as condition of Must document encounter as condition of

payment.payment.

(PPACA 6407, 10605)(PPACA 6407, 10605)

DME and Home Health DME and Home Health ServicesServices

HHS may revoke enrollment for HHS may revoke enrollment for physicians and suppliers who fail to physicians and suppliers who fail to maintain and, upon request, provide maintain and, upon request, provide access to documentation related to:access to documentation related to:– Written orders or claims for DMEWritten orders or claims for DME– Certifications for home health Certifications for home health

servicesservices– Other high risk items designated by Other high risk items designated by

HHS.HHS.(PPACA 6406)(PPACA 6406)

Long Term Care ProvidersLong Term Care Providers

Additional reporting and notification Additional reporting and notification requirementsrequirements

Mandatory compliance, quality assurance, Mandatory compliance, quality assurance, and performance improvement programsand performance improvement programs

Website informationWebsite information Background checks and fingerprintingBackground checks and fingerprinting Staff trainingStaff training Complaint processesComplaint processes New demonstration projectsNew demonstration projects(PPACA 6101-6105, 6111, 6121, 6201)(PPACA 6101-6105, 6111, 6121, 6201)

Transparency Reports:Transparency Reports:Drug Samples to PhysiciansDrug Samples to Physicians

Drug manufacturers and distributors Drug manufacturers and distributors must report samples distributed to must report samples distributed to physicians beginning 4/1/12.physicians beginning 4/1/12.


Transparency Reports:Transparency Reports:Physician Payments or Physician Payments or

OwnershipOwnership Drug and device manufacturers must report beginning Drug and device manufacturers must report beginning

3/31/13:3/31/13: Payments or transfers of value to physicians or Payments or transfers of value to physicians or

teaching hospitalteaching hospital Physician or family members’ ownership or Physician or family members’ ownership or

investmentinvestment Subject to certain exceptions.Subject to certain exceptions. PenaltiesPenalties

– If not “knowing”: $1,000 to $10,000 per payment; up If not “knowing”: $1,000 to $10,000 per payment; up to $150,000 total annually.to $150,000 total annually.

– If “knowing”: $10,000 to $100,000 per payment; up If “knowing”: $10,000 to $100,000 per payment; up to $1,000,000 total annually.to $1,000,000 total annually.


Medical Medical Malpractice LimitsMalpractice Limits

Appropriates $50 million in grants to Appropriates $50 million in grants to states to develop, implement, and states to develop, implement, and evaluate alternatives to current tort evaluate alternatives to current tort litigation.litigation.

(PPACA 10607)(PPACA 10607)

Responding to PPACAResponding to PPACA

Responding to PPACAResponding to PPACA Take action to timely submit claims.Take action to timely submit claims.

– Pre-1/1/10 claims by 12/31/10.Pre-1/1/10 claims by 12/31/10.– Post-1/1/10 claims within 1 yearPost-1/1/10 claims within 1 year

Revitalize compliance efforts.Revitalize compliance efforts.– Compliance planCompliance plan– Auditing and monitoringAuditing and monitoring– Responding to suspected violationsResponding to suspected violations– Document actionsDocument actions

Report and repay within 60 days.Report and repay within 60 days.– Put in place process of evaluationPut in place process of evaluation– Document actionsDocument actions

Responding to PPACAResponding to PPACA Review physician transactions to ensure Review physician transactions to ensure

compliance with Stark and AKS.compliance with Stark and AKS.– Written contractsWritten contracts– Current contractsCurrent contracts– Fair market value for legitimate servicesFair market value for legitimate services– Compensation set in advanceCompensation set in advance– Not based on referralsNot based on referrals

If transactions are non-compliant, considerIf transactions are non-compliant, consider– Repayment obligationsRepayment obligations– Self-disclosure protocol.Self-disclosure protocol.


Monitor physician’s compliance.Monitor physician’s compliance.– General compliance activities for employed General compliance activities for employed

physicians.physicians.– Orders or certifications for DME and home Orders or certifications for DME and home

health services.health services.– Notice re in-office ancillary services.Notice re in-office ancillary services.– Ownership or investment in specialty Ownership or investment in specialty

hospitals, including:hospitals, including: ExpansionsExpansions Required noticesRequired notices


Consider capitalizing on new Consider capitalizing on new compliance exceptions.compliance exceptions.– Programs that increase access to Programs that increase access to

care but do not create waste, care but do not create waste, fraud, or abuse, e.g., transportation fraud, or abuse, e.g., transportation programs.programs.

– Others?Others?


Consider corporate structures and Consider corporate structures and affiliations.affiliations.– May be liable for affiliated entities’ May be liable for affiliated entities’

obligations.obligations.– May be subject to penalties for May be subject to penalties for

violations of owned entities.violations of owned entities. If contemplating enrollment of new If contemplating enrollment of new

entity, may want to do so before new entity, may want to do so before new enrollment processes take effect.enrollment processes take effect.


Tax exempt hospitals, begin working Tax exempt hospitals, begin working onon– Community needs assessmentCommunity needs assessment– Financial assistance policyFinancial assistance policy– Charges for emergency medical Charges for emergency medical

care.care.


If offer DME or home health services, If offer DME or home health services, ensure compliance with new ensure compliance with new requirements.requirements.– Written orders from qualified Written orders from qualified

providerprovider– Maintain documentationMaintain documentation


Watch for new regulations as they Watch for new regulations as they come out.come out.

Consider coordination with Consider coordination with association and getting involved in association and getting involved in policy or rulemaking.policy or rulemaking.– State Medicaid changesState Medicaid changes– Malpractice reformMalpractice reform– Other?Other?

ResourcesResources

AHA Summary of Health Care ReformAHA Summary of Health Care Reform OIG Supplemental Compliance OIG Supplemental Compliance

Program Guidance for Hospitals Program Guidance for Hospitals IHA Sample Compliance PlanIHA Sample Compliance Plan Hawley Troxell Client UpdatesHawley Troxell Client Updates

– [email protected]@hawleytroxell.com– 208-388-4843208-388-4843

Tons of stuff on internetTons of stuff on internet

Questions?Questions?

Kim C. StangerKim C. Stanger

(208) 388-4843(208) 388-4843

[email protected]@hawleytroxell.comm

Health Care Reform: New Fraud and Abuse Provisions Kim C. Stanger Hawley Troxell LLP (5/10)

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