$ Billionaires $

The US Attorney’s Office for the Southern District of Florida announced that they have finally reached the One Billion Dollar level in a single healthcare fraud scheme.  This dubious achievement is credited to three individuals including the owner of at least thirty Miami skilled nursing and assisting living facilities, a hospital administrator, and a PA.  Two of the three have also added to their achievements by being charged with obstruction of justice in connection with the investigation and arrest of others.  One of the individuals, Philip S. Formes, is reported to have previously paid $15.4 million in 2006 to resolve civil charges.

That’s Not What I Meant

Once again overpayment/repayment obligations create issues that perhaps were unexpected.  Recently, the OIG reported on its investigation of states paying Medicaid Meaningful Use Incentives to hospitals.  Two states, Texas and Arizona, according to OIG, were incorrectly paid more than $15 million each.

Arizona disputes OIG’s claim that Arizona wrongly received $15 million.  Arizona states that the information that hospitals provided to OIG is not the same data that the hospitals provided to Arizona. Arizona is refusing to pay the $15 million until the issue is resolved.

The problem? Given the 60-day overpayment/repayment requirement, will Arizona and OIG be able to reconcile their positions before the 60-days run and Arizona is required by federal law to repay the $15 million?  Remember that the 60-day period comes when the overpayment has been “discovered” and has been meaningfully quantified.  OIG believes that its audit results claiming the $15 million completes the meaningful quantification phase and that the time started running upon Arizona’s receipt of the audit results and the accompanying overpayment demand.

New Record

Illinois based Advocate Healthcare Network has agreed to settle HIIPA violations regarding electronic protected health information in a record setting $5.5 million amount along with adopting, what one assumes, is a rather significant compliance plan.

In 2013 Advocate filed 3 breach notification reports relating to ePHI affecting 4 million patients.  Advocate is a twelve hospital, 250 treatment locations system with a number of other facilities.  The violations were almost a laundry list of failure to safeguard encrypted laptops, failure to have written business associate contracts, failure to conduct assessments of potential risk and vulnerabilities to Advocates ePHI, failure to implement procedures and policies, limiting physical access to ePHI systems and so on.

Still Trying to get Doctor Lists Right

Federal and State governments continued to try to find a happy place where lists of participating providers shown potential enrollees or current enrollees in both private-based insurance and ACA-based insurance are accurate.  Why does this matter?  It matters because patients may choose a particular plan believing that one or more providers are participating providers when they are not.  The first negative effect is not being able to use their expected and preferred physician or hospital providers.

The second problem is financial, for many people who checked the provider list before enrolling in a particular insurance plan, and then sought treatment at a listed and preferred provider, only to find out later by receiving a surprise and surprisingly large bill based upon out-of-network status, that the provider list was wrong in the first place.

California now requires a minimum update each quarter of lists, and online lists at least weekly if any providers report changes.  Provider lists must be posted online and available to anyone, not just enrollees.  The lists must clearly display directions for reporting inaccuracies and the lists must be updated within 30 days of any justified consumer complaint.  Providers must inform the plan within 5 days if they are no longer accepting new patients or will start accepting them.  These are important provisions, but California has gone a step further, health plans not complying with these requirements must reimburse participants for any amount over the amount paid to see an in-network doctor.  Other states have passed such laws (Georgia, Maryland) and others are considering this.  Perhaps the most interesting part of the new California law is that it applies to Medicaid, private plans, managed care, and almost all employer sponsored insurance plans.  Will Indiana, Illinois, and Kentucky take action in this matter or will they wait for the federal government to impose new rules?

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, practices and hospitals in contract items, federal legal compliance, practice entity creation, 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.