Corporate Compliance

1. Hospitals settle for transplant fraud
2. How to minimize FCA penalties
3. Pay-per-view article: Privacy Primer: Train staff to respond to patient requests
4. OIG reviews HHA billing
5. Tip: Questions directors should be asking

Compliance Monitor, July 28, 2003

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Tip of the Week

Compliance Hot Topics: Billing and Coding, EMTALA, Stark, HIPAA

Question of the Week

In This Week's Issue

  1. Hospitals settle for transplant fraud
  2. How to minimize FCA penalties
  3. Pay-per-view article: Privacy Primer: Train staff to respond to patient requests
  4. OIG reviews HHA billing
  5. Tip: Questions directors should be asking
This Week's Headlines

1. Hospitals settle for transplant fraud

Three medical centers in Chicago improperly diagnosed and hospitalized patients in the late 1990s to allow them to become eligible sooner for transplants, according to the U.S. Attorney for the Northern District of Illinois.

The University of Chicago Hospitals paid $115,000 and Northwestern Memorial Hospital paid $23,587 on July 28 to settle the following allegations:

  • Admitting liver transplant-eligible patients to the intensive care unit when it was not medically necessary
  • Admitting liver transplant-eligible patients to the hospital when it was not medically necessary
  • Billing for these medically unnecessary hospitalizations and services
  • Falsely diagnosing patients to justify their placement on the liver transplant eligibility list
  • Falsely identifying patients as "Status 1" or "Status 2A" in order to make them eligible for liver transplants before other patients also in need of transplants

    In addition, the state has teamed with the federal government to sue the University of Illinois for triple damages of more than $3 million. According to the government officials, the university allegedly engaged in transplant fraud in order to increase its number of liver transplant patients and ensure that it would receive Medicare and Medicaid reimbursement for the procedures.

    Back to top

    New ezine: Health Care Auditing Weekly

    Setting up and maintaining an auditing program is never an easy task, but HCPro now offers a free resource that delivers helpful news and advice each week! Introducing Health Care Auditing Weekly, the new e-mail newsletter designed for healthcare internal auditors and compliance professionals. Click here to sign up for your complimentary subscription.


    2. How to minimize FCA penalties

    The most efficient way to minimize a False Claims Act (FCA) penalty is to present mitigating circumstances. You can prove mitigating circumstances if your organization has a proactive and effective compliance plan. Having such a plan is the best way to stop a qui tam, or whistleblower action. An active compliance plan will also help you discover errors or negligence before the government or a relator has the opportunity to take action. The Office of Inspector General's self-disclosure protocol can also prevent a quit tam suit, since the provider and not the whistleblower becomes the original source of the information.

    FCA cases have decreased in the last eight years. In 1996, when the OIG began auditing the Centers for Medicare and Medicaid Services, there was $23 billion in claims inappropriately paid. The following year, the amount was $20 billion, and then $11 billion in 1998.

    Not all of the inappropriate payments were due to fraud. Providers began to undercode, rather than raise red flags with the government. Since the audits began, the underlying problem boils down to one thing: documentation-providers either have very little, or none at all. All electronic claims are automatically paid as long as the appropriate "boxes" are checked. The OIG and others go behind the claim and look for the supporting documentation. The documentation is a combination of the provider's notes and the actual service rendered. Therefore, documentation is key to beating any FCA charge.

    For more on protecting your organization from FCA lawsuits, order the book "Compliance Troubleshooter: Tackling the Top 10 Compliance Challenges." This book features information on outlier payments, quality of care, economic and traditional economic credentialing criteria, EMTALA, nonphysician practitioners, billing and documentation, outpatient prospective payment system, Stark, and inpatient compliance issues. Click here for more information or to order.

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    3. Pay-per-view article: Privacy Primer: Train staff to respond to patient requests

    Train your staff to respond appropriately to patient requests for restrictions and confidential communications. The HIPAA privacy regulations allow patients to request restrictions on certain uses and disclosure of their PHI.

    A covered entity is not required to agree to these requested restrictions, unless it is required to do so under state law, however . . .

    Go to "Privacy Primer: Train staff to respond appropriately to patient requests for restrictions and confidential communications" for the rest of this article. Subscribers to the online version of Briefings on HIPAA have free access to this article. Subscribers to the print edition can find it in their July issues.

    A $30 steal!
    You can read this article-and much more-in the July issue of Briefings on HIPAA. Your cost: Five stories for only $30! You'll learn how tips for auditing your facility's claims denials for medical necessity issues, and strategies for examining diagnostic testing in the emergency room. Choose between a PDF or HTML version for just $30. Online subscribers have free access to this issue. Print newsletter subscribers can find it in their mailboxes.

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    4. OIG reviews HHA billing

    One intermediary overpaid home health agencies (HHA) by an estimated $1.9 million during fiscal year 2001. The Office of Inspector General (OIG) conducted this review. It wanted to find out whether HHAs were in compliance when billing for Medicare services that were preceded by an inpatient hospital discharge. Its findings were part of a nationwide effort at four regional home health intermediaries.

    The OIG said that the overpayments occurred and recovery was not initiated due to the following:

  • HHAs incorrectly billed services due to the fact that their clinicians did not adequately complete the patient assessment instrument that requires the HHA to identify all facilities that discharged the beneficiary within 14 days prior to the HHA episode
  • The regional home health intermediary (RHHI) had not established post-payment controls to detect these types of HHA claims that were billed incorrectly.

    The OIG recommended that the RHHI do the following:

  • Initiate recovery of the $77,461 in the OIG's sample claims.
  • Use the OIG's file with the universe of claims with "probable billing errors in FY 2001" to identify additional overpayments (estimated at $1.8 million)
  • Direct HHAs to strengthen billing controls, including procedures to ensure that their clinicians adequately complete the patient assessment instrument
  • Conduct periodic post-payment data analysis to detect improperly billed HHA claims and use the results of that data analysis to recover overpayments and take additional corrective actions, as necessary

    Click here to read the audit report "Review of Payments Made by Associated Hospital Services for Home Health Services Preceded by a Hospital Discharge."

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    We have a new tool to improve outpatient documentation!

    Did you know that four types of encounters account for over 90% of the facility-based outpatient visits? If your facility is busy with emergency department, diagnostic testing, ambulatory surgery, and observation visits, that adds up to plenty of opportunities to miss appropriate reimbursement due to documentation errors.

    You need the new book, "Guide to Outpatient Clinical Documentation Improvement: The First Step in Revenue Cycle Management" by Ruthann Russo, JD, MPH, RHIT. For more information, CLICK HERE and save 10% when you order on line. You may also call our Customer Service Team at 800-650-6787. Please mention source code EB1068D when you call.


    5. Tip: Questions directors should be asking

    Corporate compliance officers can use a new resource from the Office of Inspector General (OIG) to improve their relationships with board members, and work more closely with them. The resource: "Corporate Responsibility and Corporate Compliance: A Resource for Health Care Boards of Directors."

    It's full of questions board members should ask to help them meet their duty of care responsibilities as directors in overseeing compliance systems. The compliance officer may also want to formulate responses to the suggested questions.

    Most compliance officers may already be providing the kind of information the OIG offers in its resource, but in a different format or under a broad heading. So, you may want to restructure the information for the board like this:

    One of the questions is: 'Does the organization have policies that address the appropriate protection of whistleblowers and those accused of misconduct?' The OIG resource says that the organization should determine that it has a process in place to encourage such constructive communications. The compliance officer should provide the board with a summary of the whistleblower protection process to specifically address this question.

    Click here to read "Corporate Responsibility and Corporate Compliance: A Resource for Health Care Boards of Directors."

    This column was written by Hank Vanderbeek, MPA, CIA, CFE. IRP, Inc.

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    Network with your audit colleagues

    "Audit Talk" is a new, moderated chat forum that members can use to post messages or questions for their peers 24-hours-a-day. "Audit Talk" offers a free forum to network, share ideas, and solve problems for those in the audit industry. Getting involved is easy. To subscribe, just send your request to this e-mail: owner-audit_talk@hcpro.com.

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    Send your comments and questions about Compliance Monitor to:

    Melissa Osborn
    Managing Editor
    mosborn@hcpro.com



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