A biweekly publication from the Healthcare Group at Feeley & Driscoll, P.C.
Please visit us at OIG’s website: www.fdcpa.com/healthcare.htm.
This OIG Update is also accessible from the F&D website, by visiting www.fdcpa.com/oig.updates.htm.
In This Issue:
1. Review of State Children’s Health Insurance Program Eligibility in California (A-09-06-00022)
2. Review of Selected Physician Practices’ Procedures for Tracking Drug Administration Costs and Ability To Purchase Cancer Drugs at or Below Medicare Reimbursement Rates (A-09-05-00066)
3. Review of Pharmacy Claims Billed as Family Planning Under New Jersey’s Medicaid Program (A-02-05-01019)
4. Review of Pharmacy Claims Billed as Family Planning Under the New York State Medicaid Program (A-02-05-01018)
5. State Medicaid Agencies’ Initiatives on Health Information Technology and Health Information Exchange (OEI-02-06-00270)
6. Review of Florida Physical Therapist's Medicare Claims for Therapy Services Provided During 2003 (A-06-06-00078)
7. Review of Vendor Rebates Paid to Hospitals, Option Care, Inc., Buffalo Grove, Illinois (A-05-07-00045)
1. Review of State Children’s Health Insurance Program Eligibility in California (A-09-06-00022)
The California Department of Health Services and the Managed Risk Medical Insurance Board (referred to collectively as the State agencies) (1) made some State Children’s Health Insurance Program (SCHIP) payments on behalf of beneficiaries who did not meet Federal and State eligibility requirements and (2) did not always adequately document eligibility determinations. Of the 191 payments in the statistical sample, 7 payments totaling $259 (Federal share) were unallowable because the beneficiaries were ineligible for SCHIP. In addition, for 12 sampled payments totaling $410 (Federal share), the case files were missing or did not contain adequate documentation supporting eligibility determinations.
As a result, for the 6-month audit period, the OIG estimated that the State agency made between 104,162 and 407,226 payments totaling between $2,081,901 and $14,248,148 (Federal share) on behalf of ineligible beneficiaries. The OIG also estimated that case file documentation did not adequately support eligibility determinations for an additional 220,344 to 600,063 payments totaling between $4,996,337 and $20,829,931 (Federal share).
The OIG recommended that the State agencies use the results of this review to help ensure compliance with Federal and State SCHIP eligibility requirements by (1) reemphasizing to beneficiaries the need to provide accurate and timely information and (2) requiring employees of MAXIMUS, Inc., and the California county government offices to verify eligibility information and maintain appropriate documentation in all case files. The State agencies agreed with the recommendation.
To view the full report, click here: http://www.oig.hhs.gov/oas/reports/region9/90600022.pdf
2. Review of Selected Physician Practices’ Procedures for Tracking Drug Administration Costs and Ability To Purchase Cancer Drugs at or Below Medicare Reimbursement Rates (A-09-05-00066)
The report summarizes the results of the OIG’s reviews of 12 selected physician practices in the specialties of hematology, hematology/oncology, and medical oncology.
Eleven of the twelve practices reviewed did not have procedures to track, by procedure code, the costs associated with administering drugs to cancer patients. Without procedures for tracking these costs by procedure code, the 11 practices could not determine whether Medicare reimbursement for each code was sufficient to cover the costs of providing the services. Nine of the twelve practices could generally purchase drugs related to 15 selected payment codes for the treatment of cancer patients at or below the reimbursement rates established by the Medicare Prescription Drug, Improvement, and Modernization Act. The remaining three practices paid prices above the reimbursement rates for at least half of the payment codes related to the drugs purchased.
The OIG recommended that CMS consider the results of the review in any future evaluations of Medicare Part B reimbursement of costs associated with the administration and purchase of drugs for the treatment of cancer patients. CMS agreed with the recommendation.
To view the full report, click here: http://www.oig.hhs.gov/oas/reports/region9/90500066.pdf
3. Review of Pharmacy Claims Billed as Family Planning Under New Jersey’s Medicaid Program (A-02-05-01019)
The OIG’s objective was to determine whether the prescription drug claims for which New Jersey received Federal reimbursement at the enhanced 90-percent rate of Federal financial participation (FFP) qualified as family planning services.
New Jersey improperly received Federal reimbursement at the enhanced 90-percent rate of FFP for 160,995 prescription drug claims that did not qualify as family planning services. As a result, the State improperly received $2,219,746 in Federal Medicaid funds. This amount represents the difference between the enhanced 90-percent rate and the applicable 50-percent or 52.95-percent Federal medical assistance percentage.
The OIG recommended that the State (1) refund $2,219,746 to the Federal Government; (2) review all National Drug Codes (NDC) presently coded as family planning in the Medicaid Management Information System (MMIS) to verify that they are related to family planning; (3) periodically review all NDCs to ensure that they are appropriately coded in the MMIS; and (4) determine the amount of Federal Medicaid funds improperly reimbursed at the 90-percent rate for non-family-planning NDCs, both prior and subsequent to the OIG’s audit period, and refund that amount to the Federal Government. New Jersey concurred with the OIG’s findings and recommendations.
To view the full report, click here: http://www.oig.hhs.gov/oas/reports/region2/20501019.pdf
4. Review of Pharmacy Claims Billed as Family Planning Under the New York State Medicaid Program (A-02-05-01018)
The OIG’s objective was to determine whether the prescription drug claims for which New York State received Federal reimbursement at the enhanced 90-percent rate of Federal financial participation (FFP) qualified as family planning services.
New York State improperly received Federal reimbursement at the enhanced 90-percent rate of FFP for 592,165 prescription drug claims that did not qualify as family planning services. As a result, the State improperly received $6,132,366 in Federal Medicaid funds. This amount represents the difference between the enhanced 90-percent rate and the applicable 50-percent or 52.95-percent Federal medical assistance percentage.
The OIG recommended that the State (1) refund $6,132,366 to the Federal Government; (2) review all National Drug Codes (NDC) presently coded as family planning in the Medicaid Management Information System (MMIS) to verify that they are related to family planning; (3) periodically review all NDCs to ensure that they are appropriately coded in the MMIS; and (4) determine the amount of Federal Medicaid funds improperly reimbursed at the 90-percent rate for non-family-planning NDCs, both prior and subsequent to the OIG’s audit period, and refund that amount to the Federal Government. New York State generally concurred with the OIG’s recommendations.
To view the full report, click here: http://www.oig.hhs.gov/oas/reports/region2/20501018.pdf
5. State Medicaid Agencies’ Initiatives on Health Information Technology and Health Information Exchange (OEI-02-06-00270)
In recent years, both the President and the Secretary of the Department of Health and Human Services have promoted the goal of developing health information technology (HIT) and health information exchange (HIE) initiatives. This report is based on interviews with State Medicaid Directors and relevant CMS staff.
The OIG found that 12 State Medicaid agencies have implemented a total of 16 HIT initiatives for Medicaid beneficiaries and participating providers. These include claims-based electronic health records initiatives, electronic prescribing initiatives, remote disease monitoring initiatives, and personal health records initiatives. The OIG also found that 25 State Medicaid agencies are currently involved in planning and developing statewide HIE networks. Lastly, the OIG found that 13 State Medicaid agencies are incorporating the Medicaid Information Technology Architecture (MITA) into their HIT and HIE planning. MITA is a framework developed by CMS to help States modernize their Medicaid information systems.
The OIG recommends that CMS continue to support the goals of MITA to help facilitate future State Medicaid HIT and HIE initiatives, collaborate with other Federal agencies and offices to assist State Medicaid agencies with developing privacy and security policies regarding the use of Medicaid health care information in HIT and HIE initiatives, and continue to work with the Office of the National Coordinator for HIT to ensure that State Medicaid initiatives are consistent with national goals. CMS concurred with all of the OIG’s recommendations.
To view the full report, click here: http://www.oig.hhs.gov/oei/reports/oei-02-06-00270.pdf
6. Review of Florida Physical Therapist's Medicare Claims for Therapy Services Provided During 2003 (A-06-06-00078)
The objective of this review was to determine whether therapy services provided by a Florida physical therapist during calendar year 2003 met Medicare reimbursement requirements. Of the 100 sampled claims, 96 did not meet Medicare's reimbursement requirements. In total, 494 of the 702 physical therapy services contained in the 100 sampled claims did not meet one or more of the Medicare reimbursement requirements because (1) the physical therapist inappropriately used his provider identification number to bill for services performed or supervised by someone else, (2) the documentation for some therapy services did not meet Medicare requirements, (3) some therapy services were miscoded, and (4) a plan of care did not meet Medicare requirements.
The physical therapist did not have a thorough understanding of Medicare requirements and did not have effective policies and procedures in place to ensure that he billed Medicare only for services that met Medicare reimbursement requirements. As a result, the physical therapist improperly billed Medicare and received $10,781 for the 494 services.
The OIG recommend that the physical therapist (1) refund to the Medicare program $411,781 in unallowable payments for therapy services provided in 2003 and (2) develop quality control procedures to ensure that therapy services are provided and documented in accordance with Medicare reimbursement requirements. The physical therapist stated that he will address any issues concerning the audit through the Medicare appeals process.
To view the full report, click here: http://www.oig.hhs.gov/oas/reports/region6/60600078.pdf
7. Review of Vendor Rebates Paid to Hospitals, Option Care, Inc., Buffalo Grove, Illinois (A-05-07-00045)
The objective of the OIG’s review was to determine whether Option Care, Inc. (the provider) reduced costs reported on its fiscal year 2003 Medicare cost report by the $173,805 vendor rebate it received. For the $173,805 rebate reviewed, the provider did not reduce costs reported on its 2004 Medicare cost report by $43,451, contrary to Federal regulations and CMS guidance.
The OIG recommended that the provider (1) revise and resubmit its 2003 Medicare cost report, if not already settled, to properly reflect the $43,451 portion of the rebate as a credit reducing its health care costs and (2) consider performing a self-assessment of its internal controls to ensure that future vendor rebates are properly credited in its Medicare cost reports. The provider disagreed with the OIG’s finding and recommendations.
To view the full report, click here: http://www.oig.hhs.gov/oas/reports/region5/50700045.pdf
For the List of Excluded Individuals/Entities (LEIE), follow this link:
http://oig.hhs.gov/fraud/exclusions/listofexcluded.html
For the index of recent they Advisory Opinions, follow this link: http://oig.hhs.gov/fraud/advisoryopinions/opinions.html
To see "Frequently Asked Questions" (FAQs) on the OIG Advisory Opinion process, go here: http://oig.hhs.gov/fraud/advisoryopinions/aofaq.html
If you have any questions or would like to discuss any of these issues with one of Feeley & Driscoll’s healthcare specialists, please contact us at (617) 742-7788 or via e-mail at info@fdcpa.com.
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