Tag Archives: Audit

The Trouble with RACs

It seems the United States House of Representatives has taken aim at Medicare Recovery Audit Contractors (“RACs”). The RACs are private, non-governmental entities that are authorized by the Medicare program to conduct audits of Medicare providers and suppliers.

In December, 2013, the Office of Medicaid Hearings and Appeals (“OMHA”) sent a letter to providers with “a significant number of Medicare appeals currently pending” informing them that OMHA had temporarily suspended all Medicare claim and entitlement appeals “due to the rapid and overwhelming increase in claim appeals.” At the end of 2013, the number of appeal requests had grown to approximately 15,000 per week. The goal of the suspension was to “allow OMHA to adjudicate appeals involving almost 357,000 claims for Medicare services and entitlements already assigned to its 65 Administrative Law Judges.” The current wait time for a hearing to review the results of a RAC audit with an Administrative Law Judge is over two years. Continue reading

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Attention OPWDD Providers: OMIG Releases Compliance Guidance for Corporate Compliance Programs

The New York State Office of the Medicaid Inspector General (OMIG) has released Compliance Guidance for use by providers regulated by the New York State Office of Persons for Developmental Disabilities (OPWDD).

The routine identification of compliance risk areas, relating to the particular type of services being offered by Medicaid providers, is required for certain providers in accordance with the New York State Social Services Law Section 363-d and implementing regulations at 18 NYCRR Part 521. The purpose of the OMIG’s Compliance Guidance is to give examples of compliance risk areas that may be of particular concern to those providing Day Habilitation, Day Treatment, Residential Habilitation, and Medicaid Service Coordination services. Many of these are taken from OMIG Audit Protocols for Office for People with Developmental Disabilities (OPWDD) programs and services which can be found on OMIG’s Web site at www.omig.ny.gov.

The OMIG Compliance Guidance for OPWDD providers is viewable here.

For more information, please contact the author, David R. Ross, who served as Acting New York State Medicaid Inspector General under governors Pataki and Spitzer, as well as General Counsel, Deputy Medicaid Inspector General, and Director of Audits and Investigations for the Office of the Medicaid Inspector General (OMIG). He can be reached at (518) 462-5601 or via e-mail at dross@oalaw.com.

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False Claims Act: Payment vs. Participation Regulations

In U.S. ex rel. Williams v. Renal Care Group, Inc. (Case No. 11-5779) (October 5, 2012), the Sixth Circuit Court of Appeals reversed a grant of summary judgment in favor of the United States on two main False Claims Act (FCA) claims relating to Medicare reimbursement of dialysis supplies. In doing so, the Court issued an important decision distinguishing the applicability of the FCA between noncompliance with payment and participation regulations.

The United States alleged, inter alia, that defendants violated the FCA by submitting claims which they knew were not in compliance with DME supplier standards set forth by statute and regulation relating to conditions of participation (i.e. to honor warranties, fill orders, and maintain an appropriate place of business), which impose independent sanctions and potential exclusion.

The Sixth Circuit reasoned that “[t]he False Claims Act is not a vehicle to police technical compliance with complex federal regulations.” As such, the Court agreed with the defendants that noncompliance with participation regulations does not render a claim materially false, irrespective of the whether the regulation is violated, because payment is not expressly or impliedly conditioned upon compliance with participation conditions.

This decision could have a further relevance in the context of Medicare and Medicaid provider audits for improper payments. In opposing audit tactics, our firm has always maintained that disallowances based on noncompliance with conditions of participation are unwarranted and inconsistent with the structure and purposes of the Medicare and Medicaid program. This decision adds support and justification to the validity of this argument in suggesting that payment is not expressly or impliedly conditioned upon compliance with participation conditions.

This post is contributed by Charles Dunham

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