OIG Releases 2016 Work Plan
Nov 13 2015
The United States Department of Health and Human Services ("HHS") Office of Inspector General ("OIG") recently released its Fiscal Year 2016 Work Plan. OIG releases a work plan annually to identify the new and ongoing investigative, enforcement, and compliance activities that it will undertake during that fiscal year ("FY").
Takeaways From OIG's Work Plan
When analyzed and applied effectively, the 2016 Plan can be a valuable resource for health care organizations because the Plan indicates where OIG will focus its investigative resources. New initiatives indicate OIG's new priorities, audit and compliance continuing initiatives emphasize OIG's continued – and potentially heightened – interest in certain areas.
Organizations should consider updating or developing internal audit and compliance plans based on OIG's initiatives. Although OIG's Work Plan should not be the sole compliance focus an organization uses for its internal initiatives, OIG's stated priorities (including the degree of specificity of OIG's focus) can help an organization shape its compliance program for the coming year.
The remainder of this Update will provide a summary of OIG's initiatives as outlined in the 2016 Plan.
Report on FY 2015
In FY 2015, OIG reported expected recoveries of over $3 billion, including nearly $1.13 billion in audit receivables and approximately $2.2 billion in investigative receivables. OIG also reported FY 2015 exclusions of 4,112 individuals and entities from participation in federal health care programs; 925 criminal actions against individuals or entities that engaged in crimes against HHS programs; and 682 civil actions, including false claims and unjust enrichment lawsuits, civil monetary penalty settlements, and administrative recoveries related to provider self-disclosure matters.
Initiatives for FY 2016
The 2016 Plan includes many initiatives continued from previous years, as well as new initiatives including review of validation of provider data reporting, MS-DRG payment window compliance, review of physician home visits, and use of prolonged evaluation and management services. The 2016 Plan also contains reviews of prescription drug and pharmacy oversight and compliance, electronic health records, information security, and exclusion database compliance. This Update summarizes new initiatives, as well as highlights of the 2016 Plan.
Medicare Parts A and B
Hospitals and Institutional Providers
The 2016 Plan contains several new initiatives for hospitals and institutional providers as well as continuing initiatives:
- Medical Device Credits for Replaced Medical Devices. New this year, OIG will determine whether payment for medical device replacements due to defects, recalls, and other reasons comply with Medicare requirements.
- Oversight of Provider-Based Status. OIG revised its review of provider-based status. Along with a general review of hospital use of the status, OIG will study whether provider-based facilities comply with the requirements for provided-based status.
- Medicare Costs for Defective Medical Devices. OIG will continue to study the impact of defective medical devices on Medicare costs. OIG cited a concern by the Centers for Medicare and Medicaid Services ("CMS") about the cost of replacement devices.
- Medicare Payments During MS-DRG Payment Window. Also new for FY 2016, OIG will determine whether Part B outpatient claims for services provided during inpatient stays are allowable.
- Indirect Medical Education ("IME") Payments. OIG will continue to study payments for IME, whether providers receive duplicate or excessive IME payments, and whether payments are made in accordance with regulations and guidelines.
- Hospital Controls Over Wage Data Used to Calculate Medicare Wage Indices. OIG will continue its review of hospital controls over reporting wage data.
- Adverse Events Occurring in Long-Term-Care Hospitals ("LTCHs"). OIG will continue to estimate the incidence of harm to patients receiving care in LTCHs and determine factors that contribute to patient harm. OIG notes that LTCHs account for almost 11% of post-acute Medicare costs, behind skilled nursing facilities and independent rehabilitation facilities.
- Validation of Hospital-Submitted Quality Reporting Data. OIG will study CMS's actions to validate hospital quality data.
Medical Equipment and Supplies
OIG will continue to study competitive bidding, payments, and compliance for specific items, including power mobility devices, nebulizers, and diabetes testing supplies. OIG will add review of other items, including orthotic braces, osteogenesis stimulators, and ventilators.
Other Providers and Suppliers
The 2016 Plan outlines enforcement priorities for various other types of providers and suppliers that bill Medicare, including:
- SNF, Hospice, and Home Health Payment Compliance. New for FY 2016, OIG will review compliance with the SNF payment system. OIG will continue to review home health and hospice payment compliance.
- Ambulatory Surgery Centers ("ASC"). OIG will continue its review of the ASC payment system but, new for FY 2016, will also review Medicare's quality oversight of ASCs.
- Selected Independent Clinical Laboratory Billing Requirements. Continuing from last year, OIG will review billing practices by independent clinical laboratories to identify laboratories that routinely use improper billing practices in order to seek recovery of overpayments.
- Inappropriate Billing. OIG plans to continue examining claims for ambulance, chiropractic, and ophthalmology services to determine the extent of questionable and inappropriate billing.
- Portable X-ray Equipment. OIG will continue its assessment of qualifications of technologists that performed portable x-ray services and will continue its review of documentation used to seek Medicare reimbursement.
- Sleep Disorder Clinics. Again for FY 2016, OIG plans to analyze whether provision of high-use sleep-testing procedures is appropriate and consistent with applicable regulations.
- Physician Eligibility to Order. New this year, OIG will review physician and non-physician practitioner eligibility to refer or order.
- Other Physician Reviews. Also new this year, OIG will review the reasonableness of physician home visits and prolonged evaluation and management services.
Although the 2016 Plan contains no new prescription drug initiatives, OIG will continue a number of initiatives, including the following:
- 340B Program Savings. OIG will continue its study of payments for drugs under the 340B Program. This study includes analysis of the financial impact on covered entities, Medicare, and beneficiaries of three shared savings arrangements that would permit Medicare and beneficiaries to share in cost savings.
- Clinical Uses of Part B Drugs. OIG will review the actions of CMS and its contractors to determine if these organizations are ensuring that their Part B drug payments meet coverage criteria.
Medicare Parts C and D
The 2016 Plan contains new and revised initiatives for FY 2016:
- Medicare Advantage Organization Practices in Puerto Rico. New for FY 2016, the OIG will determine whether: (1) Medicare Advantage organization provider networks in Puerto Rico were established in accordance with federal requirements; (2) beneficiaries have access to appropriate medical care; and (3) providers in the network comply with federal, state, and local credentialing requirements.
- Part D Beneficiaries' Exposure to Inappropriate Drug Pairs. Also new, OIG will determine whether Part D beneficiaries are being prescribed drugs that should not be prescribed in combination with other drugs (e.g., drugs that have a severe interaction when used in combination with other drugs and drugs that should not be co-prescribed with component drugs).
- Part D Eligibility Verification Transactions. As a new focus, OIG will review transactions submitted by pharmacies to assess the validity of data and determine beneficiary eligibility for Part D.
- Pharmacy Enrollment. New this year, OIG will review CMS's ability to oversee Part D pharmacies and the extent to which pharmacies that bill for Part D drugs are enrolled in Medicare. This initiative is in response to numerous reports raising concerns about Part D oversight and pharmacy-related fraud.
- Increase in Prices for Brand-Name Drugs Under Part D. Also new for FY 2016, OIG will evaluate the extent to which pharmacy reimbursement for brand-name drugs under Part D changed between 2010 and 2014 and compare the rate of change to the rate of inflation.
OIG also plans to continue its audits and reviews of Part C and Part D compliance, including the following initiatives:
- Encounter Data: CMS Oversight of Data Integrity. Revised for FY 2016, OIG will review CMS's oversight of Medicare Advantage encounter data validation and assess the extent to which CMS's Integrated Data Repository contains timely, valid, and complete MA encounter data.
- Pharmacy Prescription Drug Event Data. OIG plans to conduct additional reviews of select retail pharmacies identified as having questionable Part D billing to determine whether records submitted by these pharmacies adequately supported and complied with federal requirements.
In addition, OIG will review financial interests reported under the Open Payments Program and sponsor compliance with Part D requirements (e.g., reconciliation of payments, dual eligibles' access to drugs, oversight of conflicts of interest in prescription drug decisions, and quality of sponsor data used in calculating coverage-gap discounts). OIG will also assess risk adjustment data in FY 2016, including sufficiency of documentation supporting diagnoses by Medicare Advantage organizations and cost savings potential of adjusting risk corridors.
OIG's focus on the Medicaid program for FY 2016 expands OIG's interest in fraud, waste, and abuse and continues OIG's previous initiatives addressing prescription drugs, billing and payment, quality and safety, community-based care, information system controls and security, and Medicaid managed care.
- Medicaid Prescription Drug Reviews. OIG will continue to monitor manufacturer compliance with average manufacturer price reporting and state rebate collection and reporting, including a new initiative that studies state collections of prescription drug rebates from Medicaid managed care organizations.
- Billing and Payment, State Claims for Federal Reimbursement and Quality of Care and Safety of Beneficiaries. New this year, OIG will review payments for adult day care services to assess compliance with state and federal requirements, including the requirement for services to be furnished in accordance with a plan of care. OIG will also assess whether states may have claimed federal reimbursement for unallowable room and board costs under the Home and Community Based Services waiver program.
- Billing and Payment. OIG will continue to study Medicaid payments and compliance issues for certain services, including transportation, health-care-acquired conditions, dental services for children, and family planning services.
- State Claims for Federal Reimbursement. OIG will continue two initiatives on state claims for federal funding. The first will study the Community First Choice State plan option, a program under the Affordable Care Act ("ACA") that permits states to provide attendant services and other support to individuals who qualify for institutional care. The second will review state claims under the Balancing Incentive Program, another ACA program that provides states enhanced funding for Medicaid long-term services and support.
- Quality of Care and Safety of Beneficiaries. OIG will continue two quality and safety studies for Medicaid beneficiaries. It will continue to review access to pediatric dental care and use of preventive screening services for children. OIG will also start a new review of Medicaid beneficiary transfers between group homes or nursing facilities to hospital emergency departments. According to OIG, these transfers raise quality of care concerns and are of "congressional interest." In addition, OIG will begin to focus on whether state survey agencies verified correction plans for deficiencies identified during nursing home recertification surveys.
- Medicaid Eligibility Determinations. OIG will determine the extent to which states made inaccurate eligibility determinations, including states that expanded their Medicaid programs under the ACA, as well as states that did not expand their Medicaid programs. OIG will calculate the Medicaid eligibility error rate and determine the amount of payments associated with beneficiaries who received incorrect eligibility determinations.
- Program Integrity Actions and Oversight of Fraud Control Units. OIG will compare required ownership information for select provider entities enrolled in Medicare and Medicaid provided to CMS and individual states, review payments to providers during pending investigations of credible fraud allegations, and conduct in-depth onsite reviews of state Medicaid Fraud Control Units and identify areas for improvement.
- Medicaid Information System Controls and Security. OIG's focus on information system controls and security will also include Medicaid-related reviews in FY 2016, including: assessment of the adequacy of CMS oversight of state security controls for information system networks, databases, web-facing applications, logical access and wireless access, as well as disaster recovery plan and physical security.
- Medicaid Managed Care. OIG will identify trends in Medicaid managed care claims with dates of service after beneficiaries' dates of death and assess Medicaid managed care payments made on behalf of beneficiaries not eligible for Medicaid. OIG will assess whether Medicaid managed care organizations identified and addressed potential fraud and abuse incidents, and will review beneficiary protections (e.g., provider networks and access to services, grievances and appeals processes, and marketing practices).
CMS-Related Legal and Investigative Activities
The 2016 Plan notes that OIG will continue to leverage its authority under the False Claims Act, Civil Monetary Penalties statute, and the Anti-Kickback and Stark rules, among other statutes and regulations, to combat fraud against federal health care programs. The Plan specifically indicates a focus on health care fraud schemes related to:
- Controlled and non-controlled prescription drugs;
- Home health agencies, personal care, and home and community based services;
- Ambulance transportation;
- Durable medical equipment; and
- Diagnostic radiology and laboratory testing.
Public Health Reviews
OIG reports that it will continue to work with public health agencies within HHS, such as the Centers for Disease Control and Prevention, to ensure such agencies are effectively managed and receiving proper resources to address key risk areas, including preparedness to respond to public health emergencies.
Affordable Care Act Reviews
OIG's planned reviews for FY 2016 will assess implementation and operation of ACA programs as well as progress toward achieving program goals. OIG reports that it will prioritize three main areas: (1) the health insurance marketplaces; (2) Medicare and Medicaid reforms; and (3) grant expenditures for public health programs. Initiatives will include:
- Marketplaces, Financial Assistance Payments, and Market Stabilization Payments. OIG will focus on proper expenditure of taxpayer funds and the efficient and effective operation of the marketplaces. This review includes assessment of: (1) accuracy of financial assistance for individual enrollees; and (2) review of certain states' compliance with ACA requirements related to state-based marketplaces; among others.
- Eligibility. OIG will assess effectiveness and efficiency of marketplace eligibility and enrollment, including enrollment safeguards and inconsistencies in the federally facilitated marketplace data.
- Security. OIG will review whether information security controls for state-based marketplaces have been implemented in accordance with federal requirements and recognized industry best practices. These state-based reviews will also include vulnerability scans of web-based systems.
Recovery Act Reviews
Under the American Recovery and Reinvestment Act of 2009, OIG received funding for discretionary oversight of certain HHS programs and operations. The 2016 Plan includes OIG's continuing initiatives to monitor oversight of HHS agencies' use of Recovery Act funds, including:
- Adoption of Electronic Health Records. OIG will review Medicare incentive payments to eligible health care professionals and hospitals adopting electronic health records to identify providers that should not have received incentive payments (e.g., providers that did not meet selected meaningful use criteria). OIG will also review Medicaid incentive payments to Medicaid providers for adopting EHRs and CMS safeguards to prevent erroneous incentive payments. OIG will review whether such incentive payments were claimed in accordance with Medicaid requirements and assess CMS actions to recover erroneous incentive payments.
- Systems and Information Security. In FY 2016, OIG will perform audits of various covered entities receiving EHR incentive payments to determine whether they adequately protect electronic health information created or maintained by certified EHR technology, including implementation of appropriate technical capabilities.
- Fraud and Whistleblower Reprisals. OIG will continue to evaluate credible allegations of improper expenditures of Recovery Act funds and credible allegations of reprisals against whistleblowers to identify cases in which criminal investigations should be opened and enforcement actions pursued.
The 2016 Plan is effective October 2015.
von Briesen & Roper Legal Update is a periodic publication of von Briesen & Roper, s.c. It is intended for general information purposes for the community and highlights recent changes and developments in the legal area. This publication does not constitute legal advice, and the reader should consult legal counsel to determine how this information applies to any specific situation.