Federal Work Plan to Impact Hospitals, Health Care Providers

By HunterMaclean Attorneys

For Business in Savannah

In October, the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) released its Work Plan for Fiscal Year 2013 (2013 Work Plan), which summarizes new and ongoing reviews and activities that OIG plans to pursue with respect to HHS programs and operations during the next fiscal year and beyond.

The Work Plan outlines the office’s target areas and primary objectives, which are designed to reduce healthcare fraud and increase fiscal accountability in the medical field.  The 148-page Work Plan delineates various projects to be addressed during the upcoming fiscal year by the Office of Audit Services, Office of Evaluation and Inspections, Office of Investigations and Office of Counsel to the Inspector General.

Although some areas of the OIG’s focus remain unchanged from year to year, the 2013 Work Plan details a number of new areas of interest affecting hospitals and other health care providers. One new area of focus will be on cost-saving measures for hospital claims. The OIG will determine how much the Centers for Medicare and Medicaid Services (CMS) can save by bundling outpatient services delivered up to 14 days prior to an inpatient hospital admission into a diagnosis-related group (DRG) payment. Medicare currently bundles outpatient services delivered three days prior to inpatient hospital admission. The OIG will also review trends in coding patient discharges and transfers to determine whether such claims were processed and paid appropriately.

Billing by provider-based physician practices will also be reviewed more closely in 2013. Community mental health centers and rural health clinics will be scrutinized for possible lack of compliance in billing for services. Physician office and hospitals experiencing drug shortages will be investigated. Billing for physician services that were, in fact, delivered by a non-physician provider will also come under scrutiny.

Investigators will review Medicare and Medicaid incentives from last year to identify payments for establishing electronic health records to providers who should not have received them. They will also assess CMS plans to oversee incentive payments and the agency’s actions to remedy incorrect payments.

Another area of interest to many providers is a provider’s obligation to disclose potential violations of federal laws to the OIG.  The intent of the OIG’s Self-Disclosure Protocol is to providers the opportunity to minimize the potential costs and disruption that a full-scale OIG investigation might entail if fraud is uncovered.  Many questions remain for providers regarding when to disclose and the scope of disclosure.  The OIG published a Solicitation for Information and Recommendations in the Federal Register earlier this year and plans to release a revised Protocol in 2013.  Hopefully, this revised Protocol will provide additional guidance to providers navigating the path of self-disclosure.

The 2013 Work Plan is deliberately broad and likely includes more projects than can be completed in one year. Equally impressive, however, are the recoveries and cost savings that OIG credits from its initiatives.

For Fiscal Year 2011, the OIG reported expected recoveries of about $5.2 billion from audit and investigative receivables and created $419.8 billion in savings as a result of legislative, regulatory or administrative actions supported by OIG’s recommendations. There were exclusions of 2,662 individuals and entities from participation in federal health care programs, 723 criminal actions against individuals or entities that engaged in crimes against HHS programs and 382 civil actions ranging from false claims to civil monetary penalty settlements.

Providers should pay close attention to the 2013 Work Plan to avoid areas of OIG scrutiny.  Be sure to consult with an experienced health care attorney to determine whether your company is in full compliance with the latest federal regulations.