Feds in Pursuit of Medicare Data

Healthcare providers who ignore federal requests for documents as part of an annual Medicare claims audit are fueling perceptions that healthcare is rife with fraud and abuse, observers say. Concerned about the number of providers who failed to furnish requested documentation for last year's audit, the Health and Human Services Office of the Inspector General has stepped up efforts to collect the data.

Almost half of the estimated $23.2 billion in 1996 Medicare overpayments was attributable to insufficient documentation, said Janet Rankin, director of the financial statements audit conducted by the Inspector General's Office of the Health Care Financing Administration. For about 14%, or $3.2 billion, of the claims, "we did not get a single piece of paper" from providers, Rankin said.

Generally, hospitals, perhaps because the claims tend to be larger, responded promptly to last year's audit requests, she said. Hospitals should encourage doctors to comply with the documentation requests, because that is where most of the problems were last year.

In the past, documentation requests were sent on Medicare contractors' letterhead, Rankin said. Hoping to inspire compliance, requests this year are going out on the inspector general's letterhead. As a pilot project, letters were sent by certified mail in one contractor's region. Providers have 30 days from the date of the request to provide the documentation, usually medical records that support the basis for the claim, Rankin said. The inspector general's staff is making follow-up phone calls 15 days after the initial request and sending a certified letter if the information has not been received by the deadline.

New Medical Error Data

Medical errors in hospitals could be causing as many as 3 million patient injuries costing $200 billion a year, three times more than previously estimated, new research from the University of Chicago shows. The data were presented at a seminar in New York sponsored by the American Medical Association's National Patient Safety Foundation. A poll by Louis Harris & Associates shows 42% of Americans say they have experienced a medical mistake personally or through a friend or relative.

Compliance Officers Increasing

The Wall Street Journal (WSJ) reports that the hottest new job category in healthcare is currently a compliance officer. According to the WSJ article, hospitals and other providers are no longer relying on internal auditors to catch potential problems. Instead, they are increasingly depending on compliance officers not only to discover problems, but to inform their boards and the government when they are found. More importantly, the compliance chiefs are to train other employees how to follow the rules that apply. Consultants expect the total number of the nation's hospitals and medical schools having compliance officers to make sure they adhere to all federal rules and regulations involving healthcare fraud and abuse will double in the next year. Currently about 5% of the 5,400 U.S. facilities employ compliance officers.

Eileen Boyd, former deputy inspector general with the federal Department of Health and Human Services, who spoke during a recent Arkansas Hospital Association compliance program, said federal investigators welcomed the new emphasis on in-house compliance officers and programs among healthcare providers. Boyd acknowledged that federal sentencing guidelines treat the existence of a compliance program as a mitigating factor that can reduce civil or criminal penalties if fraudulent activities are detected.

Fraud Investigations Increase

Increased scrutiny is expected for hospitals, managed care, and physicians as federal law enforcement agencies add more troops to ferret out wrongdoing, according to the country's top fraud fighters. Michael Mangano, principal deputy of the Health and Human Services Office of the Inspector General, told members of the House Ways and Means Health Subcommittee that the recently passed balanced budget act "gives us even more weapons we can use in this fight."

Congress has responded to healthcare fraud by providing more than $5 billion through 2003 to beef up enforcement efforts through the 1996 Health Insurance Portability and Accountability Act, or HIPAA. That $5 billion investment, and changes in Medicare payment policies, should recoup nearly $58.6 billion in Medicare savings, Mangano said. Charles L. Owens, chief of the FBI's financial crimes section, testified that he believes healthcare fraud is the number one white-collar crime. The FBI's funding for healthcare fraud investigations will more than double from $47 million in 1997 to $114 million in 2003, he said.

Just as investigators are cranking up activities, the American Hospital Association is trying to persuade Congress that authorities have abused the civil False Claims Act. The AHA's efforts to challenge "heavy-handed" use of the False Claims Act include urging hospitals to adopt voluntary anti-fraud compliance plans and "pursuing legislative remedies to ensure the act is used to prosecute fraud and not honest errors in dealing with Medicare's massive billing system," said AHA senior vice president of communications Rick Wade.

OIG's Model Compliance Program Delayed

Release of the model regulatory compliance program for hospitals being prepared by the U.S. Department of Health and Human Services' Office of the Inspector General (OIG) has been delayed until mid-winter. The OIG had hoped to release the program in late October or November, but hit snags because of the retirement of Deputy Inspector General Eileen Boyd and because of the many comments some entities made about the July 10 draft, said OIG spokeswoman Judy Holtz. OIG has sought input from several government agencies and outside organizations including the American Hospital Association and the American Medical Association. Officials hope to release the plan by February, Holtz said.

Search Warrant Advice

Last summer, the national media focused its attention on Columbia/HCA Healthcare Corp. after officials from several federal agencies served warrants to seize property from 35 Columbia hospitals in six states. With the number of governmental anti-fraud initiatives growing each year, the possibility of a similar scene occurring at other hospitals across the country, even in Arkansas, can't be overlooked. According to a Medicare Compliance Alert issued last spring, if federal investigators show up at your hospital armed with search warrants, use the following guidelines:

-- Keep your cool and be cooperative. Offer a cup of coffee to the investigators and you have one, too.

-- Call the hospital's attorney as soon as the investigators appear, even if you "have nothing to hide." Have one person take charge of dealing with the investigation until your attorney comes. Then the attorney takes over.

-- Stay silent. Wait for your attorney to answer questions except to indicate where requested records are. You may not tell employees not to speak with investigators, but you can say that they don't have to, and that the hospital's attorney would like to be present. Be careful!

-- Send non-essential workers home. They're just in the way.

-- Ask for a copy of the search warrant and affidavit. If you don't get it, ask the investigator what the suspected crime is.

-- Object if agents try to search more than the warrant allows.

-- Get an inventory of seized items.

-- Copy what they take. Say please. If they want a computer, ask them to take just the computer files.

-- Keep track of the search. You can have someone politely videotape it. Or someone can write down observations and agents' statements as they search. Don't, however, get in the way.

-- Be accurate when you answer questions. It's appropriate to say that you don't know if you don't.

It would be a good idea for each administrator to talk with the hospital attorney before the need for this arises so that everyone acts together.

Arkansas Hospitals Quiz

(answers below)

1. Who is the new AHA chairman?

2. Terry Amstutz was elected to the AHA board to represent which district?

3. True or False: Arkansas Blue Cross Blue Shield will implement a new payment methodology for professional fee schedules patterned after the Health Care Quality Improvement Act (HCQIA).

4. Arkansas Medicaid's _________ program has won an award from the Ford Foundation.

5. Who received the 1997 A. Allen Weintraub Memorial Award?

6. True or False: While not putting more physical therapists into practice, the UCA doctoral program in physical therapy will supply needed faculty for PT programs in Conway and in Jonesboro.

7. Amy Rossi and Dick Trammel received the___________ Award at the AHA annual meeting.

8. The AHA's new Internet web site is ______________.

9. True or False: The Balanced Budget Act of 1997 contains a newly defined classification for Critical Access Hospitals which may help some rural hospitals.

10. According to the Wall Street Journal, the hottest new job category in healthcare is a ___________ officer.

Answers: 1. Patrick Flynn 2. North Central 3. False 4. ConnectCare 5. Charles Shuffield 6. True 7. Distinguished Service 8. www.arkhospitals.org 9. True 10. Compliance