Presentation - Health Care Compliance Association

3/17/2015
Ilah Naudasher – Kettering Health Network
Chris Bennington - INCompliance Consulting
Shannon DeBra – Bricker & Eckler LLP
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How we Got Here
Culture Clash
Onboarding
Risk Assessment
Billing Issues
Legal Issues
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Hospitals/Health Systems rapidly buying physician
practices
◦ Expand referral networks
◦ Reimbursement declines for some physician specialties –
looking for income stability
◦ Physician quality of life
◦ Cost of malpractice and adopting new technologies (EHRs)
◦ Improve quality of care
◦ Prepare for population health management
◦ Launching own managed care plans
◦ Drive/Capture hospital admissions, especially in
specialties
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Culture
◦ From small, independent to corporate with formal
policies/procedures
◦ Comprehensive compliance program
◦ Stark Law becomes more relevant
◦ Integration into existing systems – resistance to
change
◦ Human Resources issues – benefits, retirement,
seniority
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Notices of Change of Ownership
CLIA
Contracts – assignment/assumption?
Incident to rule
Going Provider-based?
State-specific issues to consider
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Staff – recruitment, retention, training
Exclusion checking – Ensure your new
employees are not excluded (OIG’s LEIE and GSA
SAM List) before adding to payroll system
Medical staff privileges
IS/Billing system/EHR integration/roll-out
Policies/Procedures/Training
Notification to Payors, State agencies, etc.
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Conduct proactive claims audits specifically for
practices in which a full acquisition is desired
◦ To identify any potential improper payments due to
incorrect coding/billing
◦ Identify coding knowledge/needs prior to start date
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Obtain and verify proper licensure, etc. (change of
address, change of ownership and discontinuing
business forms are applicable in some States):
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Prescriptive Authority for midlevel providers
State specific Board of Pharmacy for ‘dangerous drugs’
Controlled Substance reporting-State specific
CLIA
Radiology
OIG and State Medicaid exclusions
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Physician and office staff orientation.
◦ Use this time to orient yourself and your compliance
program to the new physicians and their staff. Topics
in your orientation should be informative and
educational such as:
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How to report a compliance concern
New patient E/M coding
1:1 coding education
Audit plans
Licensure requirements
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All providers should be audited within 90-120 days
of onboarding to your network.
All audit results should be shared with the provider
Re-audits should be conducted if high error rate or
trends are identified
Every audit should include a training/education
element
◦ 1:1 E/M coding education by a certified coder to
the physician
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Patient Name, Record Number, Dates of Service
CPT Codes Billed
Global Surgical Period
E/M Level Correct?
E/M level suggested based on documentation
E/M comments
Procedure codes correct?
Modifiers correct?
Place of Service correct?
Billed? Paid or denied?
Compliant? Comments?
Practice Agrees? Practice Comments?
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Key to identifying risks and issues internally
Provides an outlet for leadership and
employees to provide, in confidence
compliance risks affecting the organization
Findings should used to determine audit
plans, education, etc. for upcoming year
Risk assessments should be conducted
routinely, this shouldn’t be a ‘one and done’
type of project
Ensure all newly acquired practices are added
to your risk assessment
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Risk assessments can be used to help identify
changes needed to the entire compliance
program or portions of the program
Trend and score responses by determining
factors such as likeliness to occur,
consequence if occurred, etc.
◦ Can be done via 1:1 interviews
◦ Electronically (and anonymously, such as using survey
monkey)
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Are you familiar with the policies, federal and state
regulations that specifically affect your department or area?
If not, why not?
Do you feel that there are adequate controls to ensure your
department’s compliance with those policies and federal
regulations that affect you?
In your opinion, what are the 3 greatest risks to the entire
organization?
Can you recommend controls that would alleviate those
risks?
Are there mechanisms in place to evaluate the quality of each
contracted service and to ensure it is provided safely and as
expected?
Are there processes in place to properly screen medical staff
members and to assure services are provided appropriately?
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Are there adequate processes in place to identify
improper payments?
When overpayments are identified, are overpayments
promptly reported and repaid?
Do you have any concerns regarding auditing and/or
reporting of financial information, such as the cost
report?
What information security and privacy (HIPAA)
challenges do you think the facility has now or will
have in the future?
Do employees receive adequate and timely
compliance education and/or training?
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Are employees, including physicians, aware of the
conflict of interest policy?
Do you have any concerns regarding the governance
and/or leadership at the facility?
Do you have any concerns about ethical issues or
compliance related practices?
Do you have any risks/concerns with the EMR?
Do you feel employees are challenged to always do
the right thing?
Do you feel that there might be retaliation by
supervisors or managers for reporting suspected
wrongdoing internally?
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Provider-Based
◦ If the newly acquired practice will now be treated as
provider (hospital) based - Must meet all requirements of
42 CFR 413.65, including:
 Physicians working in the hospital-based space must have
privileges at main hospital
 Medical records must be integrated with main provider
 Financial integration – costs appear on hospital cost report
 Public awareness – must be held out as part of hospital, not a
physician office – patients must know
 Additional requirements if off-campus (see 42 CFR 413.65(e)
 Must treat all Medicare patients as hospital outpatients for
billing purposes even if they have another insurer that doesn’t
treat clinic visits as a hospital service
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Site of Service – Make sure the physicians are billing
the correct site of service
◦ If hospital-based, physicians must bill site of service code 22
(outpatient hospital), not 11 (office)
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Coding – Make sure physician coding is compliant
with payor guidelines (audit?)
Any pending audits by government or commercial
payors?
Examine physician documentation to ensure
documentation matches codes billed
Teaching Physicians? Make sure they know how to
document and what is required to bill
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Incident-to Billing
◦ Allows for non-physician practitioner to be reimbursed at
100% of physician fee schedule instead of 85%
◦ Must be integral part of physician’s services
◦ Physician must have initially provided health care services
to the patient to initiate an ongoing course of treatment
◦ Direct supervision – require that physician be immediately
available (in same office suite)
◦ Change in chief complaint or problem requires physician to
see the patient again or NPP cannot bill incident-to
 NO INCIDENT-TO BILLING IN HOSPITAL SETTING
(INCLUDES PROVIDER-BASED CLINICS)
 Split/shared care may be used if criteria is met in a hospital
department
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Billing for services incident to can only be
used when the following criteria are met:
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Direct Supervision
Office setting (POS 11)-cannot be used
in a hospital outpatient department
No new patient, no new
conditions or symptoms
Established patients, with established
plans of care from the physician ONLY
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Physician supervision if hospital-based clinic now
Diagnostic Services
• Check the required level of supervision for the test
• Medicare Physician Fee Schedule (PFS) Relative Value File
• Direct Supervision: Physician must be present on the same
campus and immediately available to furnish assistance and
direction throughout the performance of the procedure
• The supervisory physician must have, within State scope of
practice and hospital-granted privileges, the knowledge, skills,
ability, and privileges to perform the service or procedure (more
than just emergency response).
• Supervising physician should know on duty
• Can be in a physician office or other nonhospital space that is not
officially part of the hospital campus where the services are being
furnished as long as he or she remains immediately available
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Physician supervision if hospital-based clinic now
Therapeutic Services
Services and supplies (including the use of hospital facilities and
drugs and biologicals that cannot be self-administered) which
are not diagnostic services, are furnished to outpatients incident
to the services of physicians and practitioners and which aid
them in the treatment of patients. These services include clinic
services, emergency room services, and observation services.
Unless indicated otherwise, CMS requires direct supervision by
an appropriate physician or NPP
Direct Supervision: Physician must be present on the same
campus and immediately available to furnish assistance and
direction throughout the performance of the procedure
◦ Can be in a physician office or other nonhospital space that is not
officially part of the hospital campus where the services are being
furnished as long as he or she remains immediately available
◦ Supervising physician should know he/she is on duty as supervisor
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Supervision Requirements
◦ Is supervision of non-physician staff required,
and if so, what level of supervision is necessary?
◦ Medicare Claims Processing Manual
 Vaccines – Pneumonia/flu (no supervision
requirement; Secs. 10.1.1 and 10.1.2) vs. Hepatitis
(supervision required; Sec. 10.2.5)
 Injections – Payment for Codes for Chemotherapy
Administration and Non-Chemotherapy Injections
and Infusions – Supervision required (Sec. 30.5)
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Coding new vs. established patient E/M codes
◦ If in the same specialty/sub-specialty and same Tax
ID# and patient has been seen within the past 3
years, you cannot code a new patient E/M code
◦ Create edits to assure these are caught, in large
networks, it is hard to identify who has been seen
by other physicians, and could create an
overpayment
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Incident to and State-specific physician
supervision requirements are not
synonymous-be careful not to interchange
these requirements
Be sure to understand State requirements
regarding prescriptive authority before billing
services provided by mid-levels
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It is important to determine while onboarding if
the physician intends to be a teaching physicianadditional education regarding teaching
physician requirements would then be necessary
◦ Training for the residents is necessary as well
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Some State regulations are more strict than CMS
in terms of teaching physician requirements-e.g.,
Ohio requires for billing the teaching physician to
be physically present for the medical decision
making
Due to recent settlements across the country,
auditing teaching physician documentation is
imperative
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If there is no documentation of the
teaching physician’s physical
presence, the only documentation
that can count towards the E/M
code is from the teaching
physician
Train/educate the residents as
well as the teaching physicians on
the documentation/coding/billing
requirements
Use EMR templates to help guide
providers to document physical
presence
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Patient Name/Acct Number, DOS, Payer, CPT
Code Billed
Resident Name
GC Modifier Present on Claim?
◦ GC = Service has been performed in part by a Resident
under the direction of a teaching physician
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Is Resident listed as servicing provider?
Approved signature of resident?
Documentation to prove teaching physician was
present during critical portions of visit?
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Did resident document which portions of visit
teaching physician was present?
Did teaching physician document which
portions of resident’s visit she was present for?
Approved signature of physician?
Does documentation support billing under
teaching physician?
Is E/M level correct based solely on physician’s
documentation?
Is the place of service correct?
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HIPAA – Privacy and Security
Records – Retention / EMR Issues
Prescription Drugs – ensuring practices comply
with state and federal laws
Teaching Physicians – Supervision compliance
Stark Law/Anti-Kickback - Fair market value –
purchase price, employment compensation
Exclusion – physicians and staff
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Organized Health Care Arrangement
Essential Documents
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Notice of Privacy Practices
Policies and Procedures
Business Associate Agreements
Authorizations and Other Forms
Implementation of Policies and Procedures
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Individual Rights Documentation
Notice of Privacy Practices
Breach Log
Business Associate Agreements
Training
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Walkthroughs
Training
Mobile Device
Review
EMR Review (Same
name, high profile)
Document Review
“Secret Shoppers”
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Looking Forward: Compliance with System’s
retention policy and applicable laws
Looking Back: Dealing with records created
pre-acquisition
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Where maintained?
How long maintained?
Archive or move to “live” EHR?
Need access to records for
malpractice cases
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Make sure provider is appropriately trained
on EMR before they open/start their practice
More documentation does not equal better
documentation
Often times templates are not set up as the
provider thought or wanted-which may lead
to documentation issues
Educate on appropriate use of
copy/paste/cloning functionality within the
EMR
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It is imperative to understand your State
specific regulations of prescription drugs
◦ Some States require increased licensure and
regulatory requirements once a practice is no
longer considered a ‘solo practitioner’
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Provide proactive auditing of prescription
drugs in practices, including samples, drugs
administered, etc.
Audits are conducted to assure proper
security, access to drugs by licensed
professionals, inventory and recordkeeping of
prescription drugs.
340B compliance if the newly acquired
practices will be hospital-based and your
hospital participates in 340B program
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If the practice has samples or administers
medications, do they have their State license (OhioTDDD) signed and readily retrievable?
Does the practice have the proper category of license?
Is the practice conducting a controlled substance
inventory as required by State law (even if zero)?
Are physicians registered with the State’s prescription
drug reporting system to prevent drug-seeking
behavior?
Are physicians reporting personally furnished
controlled substances as required by law??
Are physicians personally furnishing controlled
substances?
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Are prescription pads stored in a secure location?
Is EMR prescription paper stored in a secure
location?
Are hypodermics, needles, and syringes, etc.
stored in a secure location?
Are sharps containers and used sharps secure?
Is the medication storage area secure except
when there is a licensed professional present
(including Oxygen)?
Is the medication refrigerator in a secure location?
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Does the medication refrigerator have a
thermometer?
Is there a temperature log kept for the medication
refrigerator and freezer?
Is there a process for verifying temperature of the
medication refrigerator and freezer at night, on the
weekends, and on holidays?
Samples: Is there a separate sheet in the inventory
log for each medication and dosage (for meds being
audited)?
Samples: Are there inventory logs on file for 7 years?
Samples: Does the actual medication inventory match
the log (for meds being audited)?
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Samples: Are the inventory logs and patient records
Positive ID compliant (prescriber signature along with
explanation of samples given)?
Other Meds: Is there a separate sheet in the
inventory log for each medication and dosage (for
meds being audited, including Oxygen)?
Other Meds: Are there inventory logs on file for 7
years?
Other Meds: Does the actual medication inventory
match the log (for meds being audited)?
Other Meds: Are the inventory logs and patient
records Positive ID compliant (prescriber signature
along with explanation of medications given)?
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Does the practice have a process that they are following
for tracking the Beyond Use Date (BUD) when multi dose
vials (MDVs) are opened?
Is the current inventory of all opened MDVs within the 28day timeframe?
Is the current inventory of all opened immunizations
within their expiration date or manufacturer
recommended date?
Samples: Are expired medications segregated from other
medications?
Other Meds: Are expired medications segregated from
other medications?
Does the practice have a process to dispose of waste or
expired meds that includes rendering the drug useless or
disposing to an approved wholesaler or charity?
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The Stark Law
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Stark Law – Regulates hospital relationships with
referring physicians
a. Purpose – to ensure that physician decisionmaking isn’t skewed by the financial
relationships the physicians have
b. Requires every financial relationship (interpreted
VERY broadly) to fit within an exception or else
the physician cannot refer patients to the
hospital, and the hospital may not bill Medicare
for the services provided to patients referred by
the physician.
1. Purchase of practice
2. Employment of physician
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The Stark Law
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Stark Law – Regulates hospital relationships with
referring physicians (cont’d)
c. Strict liability law – meaning no intent required.
This law requires perfection.
d. There are several possible relevant exceptions.
1. Isolated Transactions
2. Bona Fide Employment Arrangement
3. Group Practice
4. Fair Market Value
e. Penalty – Hospital must refund all Medicare
payments; also subject to fines, exclusion, treble
damages if included as basis for False Claims Act
liability
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The Anti-Kickback Statute
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Anti-Kickback Statute – Regulates relationships
with referral sources (any referral source, not just
physicians)
a. Purpose: To protect patients from medical decisionmaking skewed by financial considerations
b. Applies to relationships with all referral sources and to all
individuals and entities you make referrals to
c. Criminal and Civil Penalties
d. Requires intent to induce or reward referrals of federal
health care business
e. If one purpose of an arrangement is to induce or
reward referrals, the arrangement is tainted.
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Purchase of Physician Practice
◦ Concern: Remuneration paid for physician practice
is intended to induce referrals to the hospital
acquiring the practice
◦ Important to establish FMV of consideration paid
for the practice stock/assets.
◦ Important to document the intent behind the
acquisition of the practice.
◦ Repurchase provisions
◦ OIG cautions against paying for anything more
than hard assets – could be viewed as payment for
referral stream
 Goodwill, noncompetes, value of ongoing business unit,
patient lists, patient records
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Concern: FMV of purchase price of practice
Stark Exception: Isolated Transaction
◦ Must be in writing (signed by parties)
◦ No other transaction for 6 months (unless fit in
another exception, and except certain post closing
adjustments)
◦ FMV; Not related to volume or value of referrals
◦ Must be commercially reasonable
◦ Installment Payments
 Aggregate payment must be set before first
payment is made (some post-closing
adjustments OK); not take into account volume or
value of referrals
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Concern: FMV of purchase price of practice
AKS Safe Harbor: Sale of Practice
◦ Most acquisitions won’t fit
◦ Date from agreement to closing is not more than 3
years
◦ Seller will not be in a professional position to make
referrals post-closing
◦ Practice must be in a HPSA for that specialty
◦ Purchaser must engage in recruitment activities that:
(i) may reasonably be expected to result in recruitment
of new practitioner to take over the acquired practice
within one year; and (ii) will satisfy the conditions of
the practitioner recruitment safe harbor
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Concern: FMV of Employment
Compensation
Concern: Payments With No Contract – Look
for payments from DHS entities and identify
written agreements
Concern: Real Estate Leases – Space owned
by now-employed physician  Lease must fit
into Rental of Office Space exception if
hospital now considered tenant and
physician is landlord – must be FMV rent
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FMV – Get a valuation from independent
appraiser for purchase of practice
FMV – Get appraisal or use survey data to set
employment compensation post-acquisition
◦ Have a provision to adjust income if postacquisition productivity not same as what was
represented – ensure your compensation
methodology really is FMV as applied
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Due Diligence
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OIG and State specific Medicaid exclusion
checking should be conducted during the
new provider onboarding process and
monthly thereafter
Develop an internal policy on exclusions and
communicate the policy and regulatory
requirements to physicians and office staff
◦ All employees and physicians should be educated
and informed on exclusions
◦ Medical staff credentialing should also be validating
exclusions during credentialing and recredentialing
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Communicate upfront with the new provider what
to expect, i.e. audits, exclusions, etc.
Collaborate with physician leadership to keep up
to date with issues, audit findings, trends, etc.
Always obtain the provider’s insight on audit
findings
◦ Be empathetic-but firm!
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Change takes time, often times compliance is
‘new’ to providers, especially those coming from
a solo/small practice
Communicate to the providers and staff that you
are here to help, it is better if you find errors vs.
the government!
Create a culture of compliance first!
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