This course is designed to provide Part B providers with an overview of the Medicare Fraud and Abuse program including:

• Medicare Trust Fund• Defining Fraud & Abuse• Examples of Fraud & Abuse• Fraud & Abuse Laws• Office of Inspector General (OIG)• Special Prevention Partnerships• Reporting Fraud & Abuse

The primary goal of the Medicare Integrity Program (MIP) is to pay claims correctly by

ensuring that they pay the right amount for covered and correctly coded services

rendered to eligible beneficiaries by legitimate providers.

Therefore, the Medicare Fraud Program will seek to identify cases of suspected fraud,

develop them and take immediate action to ensure that the Medicare Trust Fund monies

are not inappropriately paid out and that any mistaken payments are recouped. All cases

of potential fraud are referred to the Office of Inspector General (OIG).

Fraud and Abuse Overview

• In 1965, Medicare was signed into law. Medicare was designed to assist qualified elderly and disabled individuals an affordable solution for their medical needs.

• The Medicare program consists of two components, Hospital Insurance (HI) or better known as Medicare Part A, that helps pay for hospital, home health, skilled Nursing facilities, and hospice care. Supplementary Medical Insurance (SMI) consists of Medicare Part B and Medicare Part D.

• Medicare Part B helps pay for physician services, outpatient hospital, home health, and other services for those beneficiaries who have voluntarily enrolled. Part D coverage provides subsidized access to drug insurance coverage.

• During Medicare's early years, there was little oversight on claims and payments to Medicare providers. This resulted in inflated claims and a rise in healthcare costs, which put a severe strain on the Medicare Trust Fund. As a result, in 1983 Medicare went to a fixed rate payment plan, known as the Medicare Physician Fee Schedule.

Medicare Trust Fund History

• The Centers for Medicare and Medicaid Services (CMS), under the Department of Health and Human Services, is responsible for administration of Medicare.

• The Social Security Act established the Medicare Board of Trustees to oversee the financial operations of the Medicare Trust Fund.

• The Board of Trustees reports annually to Congress on the financial operations and actuarial status of the Medicare program.

• The Trustees Report is a detailed document containing information on the past and estimated future financial operations of the Medicare Part A and Part B Trust Funds.

You can view the Annual Trustees Report at https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/ReportsTrustFunds/index.html

Trust Fund Administrator

• Most improper payments and/or overpayments are due to unintentional errors, but there is a minority of individuals who are intent on abusing the system which can cost taxpayers billions of dollars and put beneficiaries health and welfare at risk.

• In 2012, the Department of Justice (DOJ) opened 1,131 new criminal health care fraud investigations, in addition to the 2,032 criminal healthcare fraud investigation cases pending for Federal prosecutors.

• 452 new criminal cases were filed involving 892 defendants in 2012.

• 826 defendants were actually convicted of health care fraud related crimes in 2012.

• $4.2 Billion was recovered from fraud related convictions in 2012.

2012 Trust Fund Enforcement Actions

Fraud is defined as:• The intentional deception or misrepresentation that an individual knows to be false or

does not believe to be true and makes, knowingly that deception could result in some unauthorized benefit.

Fraud schemes range from those perpetrated by individuals acting alone to broad-based activities by institutions or groups of individuals.

Examples of Fraud:• Altering claim forms to obtain a higher reimbursement• Billing for services or supplies that were not provided• Billing both Medicare and the beneficiary for the same service/item• Completing Certificates of Medical Necessity (CMN) for patients not personally or professionally

known by the provider• False representation of the identity of the person receiving or rendering the services• Soliciting, offering, or receiving a kickback, bribe, or rebate• Supplier completing CMN for provider

Fraud

Abuse is defined as:• Acting with gross negligence or reckless disregard for the truth in a manner that result in

any unnecessary cost or any unnecessary consumption of a healthcare resource. Incidents that is inconsistent with accepted medical or business practices, improper and excessive.

Fraud differs from abuse because fraud is committed knowingly, willfully, and intentionally.

Abusive billing practices may not result from intent, however abusive practices may, under certain circumstances, develop in to fraud if there is evidence the subject was knowing and willfully conducting an abusive practice.

Examples of Abuse:• Unbundling Charges• Claims for services that are not medically necessary• Violation of the Medicare participation or assignment agreements• Waiving coinsurance and deductibles• Improper billing practices

Abuse

Fraud committed against Medicare may be prosecuted under various provisions of the United States Code.

42 U.S.C. § (section) 1320a-7b (a) states:If an individual or entity is determined to have engaged in any of the following activities, he or she shall be guilty of a felony and upon conviction shall be fined a maximum of $50,000 per violation or imprisoned up to 5 years per violation or both.

The following laws are enforced by the Department of Justice (DOJ), the Office of the Inspector General (OIG), and CMS:

• False Claims Act (FCA)• Anti-Kickback Statute• Physician Self Referral Law (Stark Law)• Criminal Health Care Fraud Statue• Exclusion Statute & Civil Monetary Penalties (CMP) Law

Federal Fraud & Abuse Laws

• FCA protests the Federal Government from being overcharged or sold substandard goods or services.

• Imposes civil liability on any person, who knowingly submits, or causes to be submitted,

a false or fraudulent claim to the Federal Government.

• Civil Penalty fines range from $5,000 to $11,000 per claim, plus 3 times the amount of damage.

• Qui Tam or "Whistleblower" protection is afforded under this Act.

• In accordance with the False Claims Act, individuals who come forward as

"whistleblowers" are given certain rights, and may not be retaliated against.

False Claims Act (FCA)

• Makes it a criminal offense to knowingly and willfully offer, pay, solicit, or receive any remuneration to induce or reward referrals of items or services reimbursable by the Federal health care program.

• Also in compliance with the Anti-Kickback Statute, pharmacies cannot direct, urge or attempt to persuade a Medicare beneficiary to enroll in a particular plan or to insure with a particular company based on any interest of the pharmacy, financial or otherwise. This includes that pharmacies cannot inappropriately offer, pay, solicit, or receive unlawful compensation to switch patients to different drugs or influence prescribe different drugs.

• For more information visit:https://oig.hhs.gov/compliance/safe-harbor-regulations/index.asp

Anti Kickback Statute

Prohibits a physician from making a referral for certain designated health services to an entity in which the physician (or an immediate member of his/her family) has an ownership/investment interest or with which he or she has a compensation arrangement unless an exception applies.

Designated Health Services/Self Referral Prohibitions include:• Clinical Lab Services• PT-OT-ST Services• Radiology and certain imaging service such as MRI & Ultrasound• Radiation Therapy Services & Supplies• DME & Supplies• Parenteral & Enternal Nutrients, equipment, & Supplies• Prosthetics, Orthotics, Prosthetic Devices, & Supplies• Home Health Services & Supplies• Outpatient Prescription Drugs• Inpatient & Outpatient Hospital Services

For more information on Designated Health Services and Stark Law Exceptions, visit:https://www.cms.gov/medicare/fraud-and-abuse/physicianselfreferral/index.html

Physician Self Referral (“Stark”) Statue

The Criminal Healthcare Fraud Statue establishes "health care fraud" as a federal offense.

Prohibits knowingly and willfully executing, or attempting to execute, a scheme or artifice:• To defraud any health care benefit program; or• To obtain (by means of false or fraudulent pretenses, representations, or promises) any of

the money or property owned by, or under the custody or control of, any health care benefit program.

Under this statute, proof of actual knowledge or specific intent to violate the law is not required.

Penalties for violating this Criminal Health Care Fraud Statutes may include fines, imprisonment, or both.

Criminal Health Care Fraud Statue

The Office of the Inspector General (OIG) has the authority to exclude (sanction) providers or suppliers from the Medicare Program.

Exclusion to participate in all Federal Health Care programs if convicted of:• Medicare Fraud• Patient Abuse or Neglect• Felony convictions for other Healthcare related fraud or other financial misconduct• Felony convictions for unlawful manufacture, distribution, prescription, or dispensing of

controlled substances

CMPs may be imposed for multiple conduct, and different amounts of penalties and assessment may be authorized based on the type of violation where an individual or entity knowingly submits claims that are false or fraudulent, including violating the Anti-Kickback Statute.

Exclusion Statue & Civil Montary Pemalites (CMP) Law

The Office of the Inspector General has been at the forefront of the Nation's efforts to fight fraud and abuse in the Medicare Program.

A majority of the OIG's resources goes toward the oversight of Medicare and Medicaid, programs that represent a significant part of the Federal Budget and affect our most vulnerable citizens.

Facts about the OIG:• Established in 1976• 1,700 Fraud, Waste, & Abuse employees• Medicare and Medicaid Oversight• Audits, Investigates, and Evaluates health care information• Develops and Distributes resources to assist the health care industry comply with the Nation's Fraud &

Abuse Laws• Assist with the development of cases for criminal, civil, and administrative enforcement

For more information, visit: https://oig.hhs.gov/

Office of the Inspector General (OIG)

• The Health Care Fraud Prevention and Enforcement Action Team (HEAT), a joint project of the Department of Justice (DOJ) and the Department of Health and Human Service (HHS), was developed in 2009 to assist in the prevention of waste, fraud, and Abuse in the Medicare and Medicaid programs.

• HEAT's goal is to reduce health care costs and improve the quality of care by preventing fraudsters from victimizing people with Medicare and Medicaid.

• Heat helps tracks down the people and organizations who abuse the system and cost Americans billions of dollars each year.

https://www.stopmedicarefraud.gov/index.html

HEAT Task Force

Multiple government agencies work together to fight Medicare fraud and abuse.

CMS partners with the following entities and law enforcement agencies to prevent and detect fraud & abuse:

• Medicare Beneficiaries & Caregivers• Physicians, Suppliers, & Other Providers• Comprehensive Rate Testing (CERT) Contractors• Recovery Audit Program• Program Safeguard Contractors (PSCs)/Zone Program Integrity Contractors (ZPICs)• Medicare Drug Integrity Contractor (MEDICs)• Senior Medicare Patrol (SMP) Program• Accreditation Organizations (AOs)• State and Federal law enforcement agencies, such as the OIG, Federal Bureau of Investigation

(FBI), Department of Justice (DOJ), and State Medicaid Fraud Control Units (MFCUs)

Special Prevention Partnerships

Do current Provider Revalidations efforts help prevent Medicare fraud and abuse?The answer to that question is "YES".

The revalidation project is an effort by CMS, mandated by Section 6401(a) of the Affordable Care Act, to verify all information on file for existing Medicare Providers, and to ensure they meet all standards associated with the new screening criteria.

Approximately 1.5 Million Providers & Suppliers must be revalidated by March 25, 2015.

Provider Validation

All contractors, employees, and providers have a responsibility to assist in preventing fraud, waste, and abuse in all Medicare programs. As such, you are encouraged to report matters involving fraud, waste, and mismanagement in any departmental program(s) to the Hotline.

OIG Hotline Information:• Phone: 1-800-HHS-TIPS

(1-800-447-8477)• TTY: 1-800-377-4950• Fraud Form: https://www.stopmedicarefraud.gov/index.html• Mail:

US Department of Health and Human ServicesOffice of Inspector GeneralATTN: OIG HOTLINE OPERATIONSPO Box 23489Washington, DC 20026

Report Fraud & Abuse

Sources used to develop this contentCahaba Education Material:https://www.cahabagba.com/cahaba-u/part_b/fraud_abuse/html/index.htm

Click the link below and complete the Fraud & Abuse Training Post-test:

http://w3.mccg.org/iota/test-fraud-abuse.asp

When the test is successfully completed, you will be prompted to enter information to record

your results.