ANTHEM SUED OVER NARROW NETWORK

News reports indicate that at least the second lawsuit has now been filed against Anthem/WellPoint/Anthem over its narrow network health plans.  In the latest report, over 30 Anthem customers filed suit in California over misrepresentation.  The suit accuses Anthem of inducing the Anthem customers to cancel better PPO or EPO coverage by offering them less expensive narrow network plans, but, apparently, misrepresenting just how narrow the new plans were.  The plaintiffs accuse Anthem of giving misleading or incorrect information both in 2013 and 2014, about which medical providers participated in the plan.

Expect more and more lawsuits as consumers find out that their narrow networks and EPO coverage does not pay for out of network costs.  Also, expect more lawsuits as individual consumers try to make appointments with providers who were listed as being providers in these narrow networks or EPO policies, and the customers find out the physicians either aren’t participating, or are not accepting new patients.

In an earlier issue of the Newsletter (Volume 31), I wrote about an acquaintance who joined a narrow network plan in Southwestern Indiana, and who tried for six months to get an initial appointment with a primary care physician, but was told in each case that the physician was not participating or was not accepting new patients, and only after many, many, many, many phone calls, did the insurer point the insured to a primary care physicians some two hours away in Louisville, Kentucky.  However, when the insured called the physician in Louisville, Kentucky, still no service was available.

Obviously, there is a shortage of primary care physicians, but it is unlikely that consumers will tolerate paying insurance premiums for plans that are unable to deliver basic healthcare.  Look for not only the courts, but also for the politicians to begin considering these matters.

MEDICARE FRAUD LIVES

Currently, our government spends about $600M per year trying to prevent, detect and prosecute Medicare fraud.  Despite these expenditures, the government recovers only about $4B of fraud or systemic overcharging to Medicare.  RAC auditors have also recovered several billion dollars since 2009, but their approach and their inherit conflicts of interest by receiving a portion of the charges they dispute have created numerous problems and resulted in limited RAC audits currently, and a suspension of due process by limiting appeals.

Reviewing various reports, it appears that the vast majority of Medicare fraud or overbilling recoveries are the result of False Claims Act suits, with many, if not most, of those the result of whistleblower inquiries and claims.  It appears that the government’s anti-fraud attempts outside of the False Claims Act, simply doesn’t work very well, are poorly managed and appear to bend with the winds of the moment as opposed to spending money to create a robust system that already contains all of the information needed for audits so that the government would not have to rely on RAC, ZIPIC or UPIC auditors.  HHS simply does not manage outsourced audits very well.  Hopefully we can remove this concern from politics and develop a payment system that provides for audits internally.  Imagine if just half the $60B Dollars a year could be spent on real, beneficial healthcare instead of fraud where the healthcare is normally even delivered.

WANT TO BE A WHISTLEBLOWER?

I am often asked who can be a whistleblower under the False Claims Act (FCA).  The correct question probably should be who can’t be a whistleblower under the FCA?  Whistleblowers have included doctors, nurses, clerical staff, compliance officers and even executive officers of healthcare providers.

Stories and cases regarding whistleblowers show circumstances where whistleblowers have simply copied company records, taped meetings and done other acts while employed by healthcare providers, and then turned around and handed the government such documents, tapes or information while benefiting significantly themselves from the whistle blowing activity.  Remember that after the whistleblower files suit and turns the information over to the government for further investigation, the whistleblowers often still receives paychecks from the provider.

Other whistleblowers have included auditors, contractors and subcontractors for healthcare providers.

No amount of paranoia or surveillance will allow you to identify whistleblowers in advance.  While unusual activities such as large copies of documents or downloads, and asking questions outside their normal work area may be indicators, the fact is that only proper compliance programs and management that sets forth proper standards and procedures for operating your business, and internal monitoring and audits, followed by enforcement of your standards, rules and procedures can limit or eliminate the risk of FCA/whistleblower lawsuits.

If you suspect that a whistleblower situation has arisen, discuss it with your compliance officer and outside counsel at the very first opportunity.  While I have criticized existing self disclosure protocols as being duplicative and confusing, you still may be able to utilize self disclosure protocols to manage the message and minimize the damage.

This newsletter is edited by Paul Wallace of Jones ∙ Wallace, LLC, a member of the American Bar Association Healthcare Law Section and the American Health Lawyers Association who has been representing physicians and healthcare practices for over 25 years.  Mr. Wallace assists physicians in health practices in contract items, federal legal compliance, creation of practice entities, estate and wealth planning and similar issues.  Please feel free to call if you have any questions on this newsletter or legal matters at (812) 402-1600 or pwallace@joneswallace.com.