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Sep 17 2018

The Dilemma of Joint Defense Agreements in Internal Investigations After the Yates Memo

Copyright 2018, American Health Lawyers Association, Washington, DC. Reprint permission granted. Previously published in the August 2018 issue of the American Health Lawyers Association Fraud & Abuse Newsletter.

The release of "Memorandum on Individual Accountability for Corporate Wrongdoing" – the so-called Yates Memo1 – by the Department of Justice (DOJ) in September 2015 caused much alarm about the prospect of DOJ's pursuit of individuals for corporate misconduct. Now, more than two years later, the public can start to assess the real effect of the implementation of that policy. In fact, significant fines have been levied against senior corporate officials. The Chief Executive Officer of Tuomey Healthcare System paid $1 million to resolve his role in the allegations pursued by the DOJ that Tuomey violated the Stark law through its financial relationship with a group of specialists.2 In reaching the agreement, the CEO also agreed to waive any right to indemnification from the company, ensuring that the settlement was paid out of personal funds.3 Indeed, in FY 2017, the DOJ touted for the first time that it "obtained more than $60 million in settlements and judgments with individuals under the False Claims Act that did not involve joint and several liability with the corporate entity."4 Taking individual liability one step further, the DOJ also seems to be willing to consider the liability of lower level employees. In the recent eClinicalWorks settlement, not only were senior executives jointly responsible for the $155 million settlement, but a software developer and three project managers also entered into settlements with DOJ for $50,000 and $15,000 each, respectively.5

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Aug 15 2018

OIG Report Updates

OIG Report: Outpatient Physical Therapy Services

Outpatient physical therapy has been under considerable scrutiny by Medicare for many years. Demonstrating its continued focus on therapy services, the Office of the Inspector General for the Department of Health and Human Services (OIG) released a report of an audit which found that 61% of sampled Medicare claims between July and December 2013 did not comply with rules requiring that services be medically reasonable and necessary, be submitted with proper coding, or submitted with sufficient documentation.1 Providers of outpatient physical therapy services should closely review the report and consider using its metrics for reviewing services billed to federal health care programs.

 

OIG Report: Cardiac Device Credits

The Office of Inspector General for the Department of Health and Human Services (OIG) recently issued a report that identified significant overpayments related to cardiac device warranty credits. Cardiac devices generally have lifetime warranties which provide hospitals with a full or partial credit for the cost of the failed or recalled device or with a replacement device at no cost. When a hospital receives one of these credits, federal rules typically require a reduction in any in-patient or out-patient payment by Medicare. An OIG report released earlier this year1 reviewed 296 hospital claims involving warranty credits for cardiac devices and none of the claims were properly adjusted to reflect those credits, resulting in a $4.4 million overpayment to the subject hospitals. Hospitals that perform cardiac procedures should consider incorporating this OIG report into their compliance risk assessment process.

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Aug 15 2018

Blog Post: OIG Report Updates

OIG Report: Outpatient Physical Therapy Services

Outpatient physical therapy has been under considerable scrutiny by Medicare for many years. Demonstrating its continued focus on therapy services, the Office of the Inspector General for the Department of Health and Human Services (OIG) released a report of an audit which found that 61% of sampled Medicare claims between July and December 2013 did not comply with rules requiring that services be medically reasonable and necessary, be submitted with proper coding, or submitted with sufficient documentation.1 Providers of outpatient physical therapy services should closely review the report and consider using its metrics for reviewing services billed to federal health care programs.

 

OIG Report: Cardiac Device Credits

The Office of Inspector General for the Department of Health and Human Services (OIG) recently issued a report that identified significant overpayments related to cardiac device warranty credits. Cardiac devices generally have lifetime warranties which provide hospitals with a full or partial credit for the cost of the failed or recalled device or with a replacement device at no cost. When a hospital receives one of these credits, federal rules typically require a reduction in any in-patient or out-patient payment by Medicare. An OIG report released earlier this year1 reviewed 296 hospital claims involving warranty credits for cardiac devices and none of the claims were properly adjusted to reflect those credits, resulting in a $4.4 million overpayment to the subject hospitals. Hospitals that perform cardiac procedures should consider incorporating this OIG report into their compliance risk assessment process.

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