Health Care Provider Focus on Medicare Advantage Reimbursement

Over the previous yr, the federal governing administration has taken concrete steps to satisfy its assure of a heightened determination to investigating and enforcing wellbeing care fraud within the Medicare Benefit method (Medicare Portion C).  Well being treatment suppliers that contract with Medicare Benefit Organizations (“MAOs”) and present treatment to Medicare Advantage beneficiaries need to just take take note, as they are not immune to the government’s enforcement endeavours.  Throughout two speeches in 2020, the Office of Justice (“DOJ”) discovered Medicare Part C as a application of raising emphasis and an important priority for Untrue Claims Act (“FCA”) investigations and litigation.  There are a escalating quantity of current decisions by DOJ to intervene in FCA scenarios alleging Medicare Benefit fraud, and a expanding variety of scenarios pulling health treatment vendors into the fray.  Seeking to these settled or intervened FCA conditions, some typical themes occur of which suppliers ought to be aware to mitigate likely FCA legal responsibility.  

Combatting Medicare Advantage Fraud Is An “Important Priority”

In 2020, the Medicare Gain method offered overall health care protection for 25 million People (accounting for 40% of all Medicare beneficiaries) resulting in a total annual price tag of $314 billion, in accordance to a recent report issued by the Workplace of Inspector Basic for the Department of Overall health and Human Providers (“OIG”).  The important and developing price tag of the Medicare Gain application has led the DOJ to determine it as an “important precedence,” as reflected in Deputy Assistant Legal professional Normal Michael Granston’s responses in December 2020. 

Medicare Benefit Theories of Legal responsibility

The Centers for Medicare & Medicaid Companies (“CMS”) pays MAOs capitated per-member payments that are modified for possibility elements noted by way of service provider-equipped diagnoses codes.  Diagnoses with increased severity and treatment method expenses consequence in greater long term capitated payments to MAOs and maximize the general charges to the Medicare Plan.  This danger-adjustment reimbursement course of action is integral to FCA instances asserting Medicare Advantage fraud.  

In those people FCA issues involving wellness treatment suppliers, the governing administration alleges that the provider knowingly submitted false, inaccurate, or unsupported diagnoses codes to an MAO and induced the MAO to post these information and facts to CMS, thus raising its danger-adjusted capitation payments.  If a provider receives inflated capitated payments from the MAO as a result of the provider’s inaccurate submission of diagnoses codes, the authorities could seek out to establish FCA legal responsibility for knowingly retaining overpayments.  Much more recently, the authorities is pursuing FCA legal responsibility versus a team of suppliers primarily based on the theory that care rendered in violation of Medicare necessities prompted difficulties for Medicare Benefit people that resulted in supplemental analysis codes, enhanced risk scores, and inflated capitation payments.

Current Medicare Gain Scenario Developments

The latest situation developments illustrate these widespread theories of legal responsibility asserted in FCA instances alleging Medicare Portion C fraud. 

On July 29, 2021, the United States intervened in and consolidated six FCA actions submitted towards Kaiser Foundation Well being Prepare, Inc. and many of its affiliated providers for purportedly upcoding diagnoses and distributing inflated possibility adjustment info to CMS for Medicare Edge beneficiaries.  Allegations concentration on pressuring medical professionals to build healthcare history addenda immediately after affected individual encounters, purportedly months to a year later, to insert diagnoses relevant to possibility-adjustment.  The diagnoses allegedly had been unsupported by the patient’s healthcare ailment or were being not tackled during the patient’s encounter.  The circumstances continue to be pending in the Northern District of California.  See United States ex rel. Osinek v. Kaiser Permanente, No. 3:13-cv-03891 (N.D. Cal.).

On August 30, 2021, Sutter Wellness and many of its supplier affiliate marketers agreed to pay back $90 million to settle an intervened FCA scenario alleging the being aware of submission of possibility adjustment details primarily based on diagnosis codes that ended up not supported by patient clinical documents to MAOs for beneficiaries underneath Sutter Health’s care.  The diagnosis codes submitted allegedly resulted in bigger payments created from CMS to the MAOs and, in change, to Sutter Wellbeing, provided the capitation and gainsharing agreements between Sutter Wellbeing and MAOs.  Allegations concentrated on numerous campaigns by Sutter Health and fitness built to increase Medicare Gain patients’ threat scores, this sort of as monitoring chance adjustment knowledge, educating and education physicians on diagnosis coding, scheduling once-a-year affected person wellness exams to seize analysis codes, and jogging electronic clinical report queries concerning analysis codes.  Sutter Health also purportedly overlooked audits reflecting unsupported prognosis codes and failed to repay determined overpayments.  Sutter Well being entered into a Corporate Integrity Settlement as section of the settlement.  See United States ex rel. Ormsby v. Sutter Overall health et al., No. 15-CV-01062-JD (N.D. Cal.). 

On September 3, 2021, the United States intervened in a FCA action brought in opposition to the University of Pittsburgh Health care Center (“UPMC”), its multi-specialty physician observe team, and an employed surgeon alleging the submission of phony claims for (i) overlapping/concurrent surgeries carried out in violation of prerequisites that training physicians be quickly accessible all through, and current throughout important parts, of the procedure and (ii) medically unnecessary anesthesia billings as a consequence of unwanted delays in surgical procedures that artificially lengthened surgical time.  The federal government alleges that the non-compliant surgical techniques brought on difficulties, lengthy clinic stays, or sophisticated stick to-up treatments.  For Medicare Edge sufferers, the governing administration further more asserts this sort of outcomes resulted in further diagnoses codes, which greater risk scores and, therefore, capitation payments made to MAOs and the UPMC.  In essence, the authorities appears to be attempting to establish FCA liability by threading jointly allegedly-weak Medicare Gain patient outcomes connected with noncompliant surgical procedures and defendants’ purported knowledge of the elevated possibility of affected person damage resulting from the surgical procedures with the receipt of inflated capitation payments.  This scenario remains pending in the Western District of Pennsylvania.  See United States ex rel. D’Cunha v. Luketich et al., No. 2:19-cv-00495-CB (W.D. Pa.). 

On September 14, 2021, the United States intervened in an FCA motion brought versus Impartial Overall health Affiliation (an MAO), and its subsidiary that supplies chart overview expert services, alleging inaccurate submission of diagnosis codes to CMS that amplified prepare reimbursement. Although no health treatment providers are named as defendants, the government’s allegations are however instructive.  The govt focuses on alleged retrospective chart critiques made to capture affected individual problems skipped by treating providers or coders that remained unsupported by health care documents as very well as procedures for vendors to retroactively insert unsupported diagnoses to clinical report addenda, in buy to submit new possibility adjustment data to CMS.  The circumstance continues to be pending in the Western District of New York.  See United States ex rel. Ross v. Unbiased Wellbeing Affiliation et al., No. 12-CV-0299(S) (W.D.N.Y.). 

Even though unrelated to pending FCA litigation, on September 21, 2021, OIG introduced a examine identifying problems that 20 distinctive MAOs may well have inappropriately utilised chart assessments and well being risk assessments to generate a disproportionate share of payments (amounting to $5 billion) from diagnoses described by these assessments and not connected to other service information.  Although the analyze addresses the function of MAOs in distributing inaccurate info to CMS, the government’s aim on possibility-adjustment info currently being supported by underlying health care data is instructive to providers as properly. 

Critical Takeaways for Health and fitness Care Suppliers

• As is the situation with other federal overall health treatment plans, diligent documentation tactics are critical when offering care for Medicare Edge beneficiaries.  Have processes in location to be certain that clinical documents aid statements and danger-adjustment details, like diagnoses codes, that are submitted to MAOs. 

• Interior and external audits that flag probable inconsistencies with submitted statements and diagnoses codes really should not be ignored.  This sort of audit findings may signal the potential receipt of overpayments if MAOs go possibility-adjusted payments together to companies.  Inaction can guide to the alleged retention of overpayments in violation of the FCA.

• Offered the government’s mentioned, and demonstrated, focus on investigating and implementing Medicare Benefit fraud, it is prudent to incorporate this method into program compliance activities, this sort of as instruction, professional medical report opinions, and statements audits.  Instruction, nonetheless, should aim on compliant documentation and coding procedures and be carefully crafted to assure that companies and coders are not swayed to up-code diagnoses codes, for illustration.