Compliance _ Corrective Action - NIATx

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					Compliance & Corrective

     Prepared by Mae Regalado
     Presented by Linda Hagen
Compliance Slide Deck
“This brief presentation will review operational
alignment with billing procedures and is strictly
informational in nature. While we refer to health law
and regulations, we are not providing legal advice
and nothing in this presentation or in what is said
should be construed as legal advice. If you need help
answering legal questions or have concerns about
your organization’s compliance, you should contact
your legal counsel. She/he may be able to provide
you with guidance or may make a referral to a
         Presentation Outline
1.   Overview: Why are we talking about Compliance?
2.   Context: Federal and State Laws related to
3.   Compliance: What does it mean for providers to
     be compliant?
4.   Effective Compliance Program
5.   What is Non-Compliance?
6.   Audits & Corrective Action
7.   Question and Answer Period
     Why are we talking about
A few startling reasons to talk compliance:
• The federal Department of Justice, Office of
  Inspector General (OIG), state Medicaid fraud
  control units, and other enforcement agencies have
  brought multiple enforcement actions against
  various health-care practices, including small
• The personal risks of noncompliance have changed
  too from money return to exclusion from government
  programs and loss of practice license.
• Administrators can be barred from working in the
  healthcare industry and clinicians, and managers,
  can be jailed for healthcare fraud and abuse.
Overview- Health Care Fraud Prevention
 & Enforcement Action Team (HEAT)
  In May 2009, Attorney General Eric Holder and Health
  and Human Services (HHS) Secretary Kathleen
  Sebelius announced the creation of the Health Care
  Fraud Prevention and Enforcement Action Team
  (HEAT) and renewed their commitment to fighting
  health care fraud as a Cabinet-level priority at both
                  Mission of HEAT
• To marshal significant resources across government to prevent
  fraud, waste and abuse (FWA) in the Medicare and Medicaid
• To crack down on the fraud perpetrators who are abusing the
  system and costing us all billions of dollars.
• To reduce skyrocketing health care costs and improve quality of
  care by eliminating the system of perpetrators who are preying on
  Medicare and Medicaid beneficiaries.
• To highlight best practices by providers and public sector
  employees who are dedicated to ending FWA .
• To build upon existing partnerships that already exist between the
  two agencies, including our Medicare Fraud Strike Forces to
  reduce fraud and recover taxpayer dollars
     Context – Federal Law
Health and Healthcare    • Patient Protection and Affordable Care Act (Health Care Reform)
                         • Mental Health Parity and Addiction Equity Act (MHPAEA)
Financing Laws
                         • Deficit Reduction Act (DRA)
                         • Consolidated Omnibus Budget Reconciliation Act (COBRA)
                         • Emergency Medical Treatment and Active Labor Act (EMTALA)
                         • Children’s Health Insurance Program (CHIP)

Health Information       • Health Insurance Portability and Accountability Act (HIPAA)
                         • Code of Federal Regulations (CFR) Title 42, Public Health

Information Technology   • Health Information Technology for Economic and Clinical Health
                         (HITECH) Act
                         • Electronic Data Interchange (EDI) Standard Transaction Code Sets
                         (ANSI, X12, HL7)
                         • HIPAA 5010 (X12 revisions)
• The laws in the previous slides (and all of the
  accompanying amendments, rules and regulations)
  create the context for the manner in which health care
  is reimbursed
• Laws are concerned with access to coverage and
  services, access to information, “fraud, waste and
  abuse”, right to privacy and security, interoperable
  infrastructure, and standardized coding that simplifies
  the administration of health care and reimbursement
• These laws and the agencies responsible for their
  implementation determine use of such billing-related
  tools as the ICD-9 (ICD-10 in 2013), National Provider
  Identifier (NPI), EDI standards, and forms like the
  UB04 and CMS 1500
  Context – Federal Oversight
• Health and Human Services (HHS)
• Centers for Medicare and Medicaid
  Services (CMS)
• Office of Inspector General (OIG)
• Substance Abuse and Mental Health
  Services Administration (SAMHSA)
• Office of the National Coordinator for
  Health Information Technology (ONC)
     Context – State Law
• State health insurance laws vary from
  one state to another
• State Medicaid programs and rules vary
  from state to state as well
• State Department of Insurance or
  Insurance Commissioner provides
  regulatory oversight of health care
  coverage in each state and enforces
  state rules specific to his/her state
Context – Local health Plans
• Traditional indemnity health plans (fully
  insured) and the wide range of
  managed care plans have to comply
  with federal and state law
• Self-insured plans (large employers)
  and their third-party administrators
  have to comply with federal laws only
What do we mean by Compliance?
1. Becoming and remaining basically fluent in the laws, rules,
   regulations and policies that govern your business
2. Avoiding practices that are wasteful or abusive or otherwise
   disadvantage or deceive the payer (including the patient)
3. Avoiding outright fraud and clear violations of the law (seeking
   reimbursement for services you didn’t provide, for instance)
4. Using correct codes, providing accurate information and
   following procedures in a timely manner
5. Using appropriate technology and means to submit billing in
   order to produce greater efficiencies while protecting health and
   financial information
6. Abiding by contract terms and conditions
7. Conforming to generally-recognized accounting principles and
   demonstrating transparency
     Compliance is Evident in…
1.  Your policies and procedures
2.  Your information systems and hardware
3.  Your physical environment
4.  Your data and reporting
5.  Your billing practices
6.  Your employee training
7.  Your applicable certification and licensure and
    standards for professionalism
8. Your workflow and business processes, controls,
    checks and balances
9. Your contracts and agreements
10. Your internal audit of all the above
Areas where Compliance Matters
• Data and system interface and
  interchange (including batch file transfers)
• System security, ID, and password
  management (protocols concerning
  access, authentication, authority, intrusion,
  and vulnerability protection)
• Disaster recovery, back-up and business
• Training
Areas where Compliance Matters
• Eligibility verification
• Clinical documentation including dates
  and signatures
• Information/data management and
• Service capture, coding and billing
• Cash management and banking
       Internal Audit and Review
Things you can do now:
  1. Review billing policies and procedures
  2. Review contracts and provider billing manuals
  3. Observe workflow in light of standards
  4. Assess staff knowledge
  5. Assess training materials
  6. Make improvements to workflow and business
  7. Sample billing data and validate accuracy
  8. Work with billing system vendor to identify
     enhancements including system functionality,
     configuration, interface, security, and back-up
      Internal Audit and Review
• Commonly review for:
  –   Fee schedule and claim pricing
  –   Unique contract requirements
  –   Accuracy
  –   Timeliness
  –   Coding and other data (provider ID, patient ID, diagnosis,
      service, place of service, date of service, etc.)
  –   Cash collections
  –   Duplicate claims
  –   Over-billing
  –   Fidelity with privacy and security procedures
  –   Clinical documentation
  –   Validating system transactions and any interfaces
Effective Compliance Program
     An effective compliance program to prevent and
     detect violations of law should include some of
     the elements listed below:
1.      Written polices and standards of
2.      Designating a compliance officer
3.      Conducting training
4.      Developing effective lines of
5.      Enforcing standards using discipline
Effective Compliance Program
6. Internal monitoring and auditing.
   Some examples for specific items for monitoring
       Billing for items or services not rendered
       Submitting claims for supplies and services that are not
        reasonable and necessary
       Double billing
       Billing for non-covered services
       Failure to properly use coding modifiers
       Up-coding
       Improper billing for incident-to services

7. Prompt response to offenses and developing
   corrective action
 Compliance Line-of-Sight
                                                                           Law, Rules and

                                                Policies and
                  Business Process

Claim File
   What is Non-Compliance?
• Medical Billing non-compliance also
  known as fraud and abuse is
  widespread and very costly to America's
  health-care system.
• No precise dollar amount can be
  determined, some authorities say that
  insurance fraud constitutes a $100-
  billion-a-year problem.
Examples of Non-Compliance
Double Billing:
1.   Double billing for services and then falsifying records to support them.
     For instance, a patient receives a psychiatric evaluation to rule-out
     dual-diagnosis and the provider falsifies the dates of service in order to
     have it appear as though the patient was seen on more than one
     occasion by the psychiatrist.

2.   Double billing often occurs when the provider obtains payment from
     two sources. Two insurers or public programs, or both, may be billed
     for the same service. If a State-funded (Block Grant-funded) patient is
     found to be insured by his/her parents or employer and the provider
     bills both the State and the insurer without disclosing knowledge of
     both forms of benefit coverage, collecting monies from both payers,
     that would constitute double-billing.
         More Examples of Non-
Services not rendered/add-on services:

1. Billing for services that were never delivered to patients. For example,
   some providers bill Medicare or Medicaid for services they never
   provided and residential providers might bill for supplies that were never
   actually used.

2. Billing for unnecessary procedures or services that have been added to a
   bill for legitimate charges is another type of fraudulent claim.

3. There is often some falsification of records to support improper billings.
    More on Examples of Non-

• Charging for a more complex service than was actually
  provided. This usually involves billing for longer or more
  complex services such as a full 3-hour assessment when
  what was actually provided was a brief screening.
    Audits & Corrective Action
• State and/or federal agencies can periodically conduct onsite
  audits therefore one of the most important audit strategies is
  preparation. You must understand how to handle an
  unannounced onsite audit and how to respond to a chart

• Internal audit and self-initiated corrective actions are always in
  your best interest. They demonstrate a willingness to identify
  and correct mistakes, maintain fidelity and compliance, improve
  business practices and evidence of transparency.
  Audits & Corrective Action
• Comprehending the OIG Work Plan is also key to designing
  coding and reimbursement processes that keep your practice
  compliant and profitable.

• It is important to understand audit findings and to promptly
  respond to offenses by developing corrective action(s).

• Common problems reported during audits include a lack of
  testing, out-of-date policies and procedures that do not reflect
  current guidelines and incomplete training.
       Corrective Action Plan
  What should be included in a
  corrective action plan (CAP)
• Commit to rectifying the underlying causes of the
• The CAP should demonstrate what issues led to the
  deficiencies and institute safeguards to prevent a
• Upon notice, a sound internal plan of correction
  should be developed that includes established
  measurement benchmarks and documentation
  describing how the deficiency will be rectified.
        Corrective Action Plan
    Most successful CAPs require/include the
    following remedial actions:
•   Training or re-training
•   Policy and procedure and documentation
    development and revision
•   Process improvement
•   Systems modification
•   Documentation of the entire CAP process
       Compliance Related Links
Comprehensive Medicaid Integrity Plan (CMIP)

Report to Congress

How to Report Fraud

Provider Audits
      Compliance Related Links
State Program Integrity Support & Assistance

Deficit Reduction Act (DRA) of 2005

State Contacts

Medicare Fraud - How to Report
       Compliance Training Sessions
    OIG Announces Free Provider Compliance Training Sessions
    Around the Country
•   The Office of the Inspector General (OIG) at the Department of Health and
    Human Services has announced it will conduct six free compliance training
    programs for health care providers in 2011.
•   These training sessions will focus on helping attendees understand recent
    legislation to fight fraud and abuse.
•   Sessions will also offer information about how to create effective
    compliance plans and handle compliance violations.
•   The half-day programs will feature speakers from OIG, the Centers for
    Medicare and Medicaid Services, the U.S. attorneys’ offices, and state
    Medicaid fraud control units.
•   Sessions will be held in Houston, TX (Feb. 16); Tampa, FL (March 2);
    Kansas City, MO (March 23); Baton Rouge,LA (April 12); Denver, CO (May
    3); and Washington, D.C. (May 18). Additional details are available online at
Thank You! Questions?


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