2019 2019 Com Complian ance S Sym ymposium Regulatory - - PowerPoint PPT Presentation

“Regulatory Enforcement Actions: Compliance Issues Impacting Orthopedics”

Robert W. Liles, JD, MBA, MS, CPC Liles Parker, Attorneys & Counselors at Law

AAOE 2019 Compliance Symposium

Amer erican A Alliance o ce of Or Orthopaed edic E c Exec ecuti tives es

2019 2019 Com Complian ance S Sym ymposium

AAOE 2019 Compliance Symposium

Current Enforcement Environment "Men must turn square corners when they deal with the government," stated the Supreme Court in Rock Island Arkansas & Louisiana R. Co v. United States, 254 U.S. 141, 143 (1920). Justice Felix Frankfurter later commented that this view “does not reflect a callous outlook. It merely expresses the duty… to

• bserve

the conditions defined by Congress for charging the public treasury.” Fed. Crop Ins Corp. v. Merrill, 323 U.S. 380 (1947) 54.

AAOE 2019 Compliance Symposium

Current Enforcement Environment The Yates Memo On September 9, 2015, Deputy Attorney General Sally Yates issued a Memorandum entitled: “Individual Accountability for Corporate Wrongdoing” This important document instructs DOJ prosecutors to stop resolving corporate cases that release individuals from personal liability, absent extraordinary circumstances.

AAOE 2019 Compliance Symposium

• Notably, health care enforcement efforts are not limited to only Strike Force territories.

Each of the 94 U.S. Attorneys Offices around the country have dedicated civil and criminal prosecutors investigating health care fraud and abuse matters.

• During FY 2018, the federal government won or negotiated over $2.8 billion in

judgments and settlements under the False Claims Act. Of the $2.8 billion in settlements and judgments recovered by the Department of Justice this past fiscal year, $2.5 billion involved the health care industry. Although the gross recoveries were almost $600 less than what was collected in FY 2017, it is worth noting that an additional $329 million was collected in health care related cases than last year.

• During FY 2018, 645 qui tam (whistleblower) cases were filed. About 87% percent of all

new FCA matters pursued against entities involved in the healthcare industry were brought by relators.

• During FY 2018, DOJ opened 1,139 new criminal health care fraud investigations.
• Last fiscal year, HHS-OIG excluded 2,712 individuals and entities from participation in

Federal and health care programs.

Current Enforcement Environment

FY 2018 Civil, Criminal and Administrative Statistics

AAOE 2019 Compliance Symposium

Current Enforcement Environment False Claims Act Actions

• What is the False Claims Act? Simply put, the federal civil False Claims Act (FCA) is the

primary civil enforcement tool used to combat fraud against the United States. The False Claims Act imposes civil monetary penalties and damages on any person who knowingly submits, or causes to be submitted, a false claim to the government for payment.

• What is meant by “knowingly”? The term “knowingly” does not merely mean “actual

knowledge,” the term also includes reckless disregard and deliberate ignorance. 31 U.S.C. § 3729-3733.

• Statute of limitations, damages and penalties under the False Claims Act. Generally, the

False Claims Act has a six-year statute of limitations that can be tolled (under certain circumstances) up to a maximum of ten years from when the government knew, or reasonably should have known, that the violation occurred. 31 U.S.C. § 3731(b).

• The penalties for violations of the False Claims Act are currently:

Treble damages, plus $11,463 and $22,927 per false claim or statement. (These 2019 estimated amounts

reflect the anticipated increase that has not yet been announced by DOJ).

AAOE 2019 Compliance Symposium

• Recent changes to the False Claims Act:

 Changes to the False Claims Act were passed under the Fraud Enforcement and Recovery Act

(FERA) which made it clear that any person who knowingly concealed or knowingly and improperly avoided an “obligation to pay” would be liable under the False Claims Act’s reverse false claims provisions.

 Changes to the False Claims Act were also subsequently covered in the Health Care Reform

• Act. Importantly, the Health Care Reform Act defined “overpayments” as “any funds that a

person receives or retains” under Medicare or Medicaid, to which they are not entitled.

 The Health Care Reform Act further provides that all overpayments must be reported and

refunded within 60 days of being identified. What does “identified” mean?

 Moreover, the legislation made it clear that a repayment retained by a person after the deadline

for reporting and returning the “overpayment” is an “obligation” for purposes of the False Claims Act. The bottom line is clear – should you identify an overpayment, it must be repaid within 60 days or the provider may be liable under the False Claims Act

Current Enforcement Environment False Claims Act Actions

AAOE 2019 Compliance Symposium

• 2018: DOJ Granston Inter-office DOJ Memo from the Director of the Commercial Litigation

Branch to the Fraud Section not intended for public release discussing factors for Evaluating dismissals of False Claims Act Cases without the consent of the relator.

• 2018: Issuance of DOJ Memo Limiting the Use of Agency Guidance in Affirmative

Enforcement Cases. Memo from the Associate Attorney General to DOJ Components regarding the limitation of the use of Agency Guidance in False Claims Act and other affirmative matters brought by DOJ.

• 2019: Guidelines for Taking Disclosure, Cooperation and Remediation into Account in

False Claims Act Matters. The DOJ issued guidelines setting out the factors that Federal prosecutors would take into consideration when entities and individuals voluntarily self- disclose conduct that may constitute liability under the False Claims Act. These guidelines are set out under Section 4-4.112 of the Justice Manual.

Current Enforcement Environment

Recent Guidance Issued on the False Claims Act

AAOE 2019 Compliance Symposium

• Charges Outlined in Recent Criminal Indictments Have Included:

Submission of false and fraudulent claims. Overbilling. Identity theft. False patient information. Solicitation of referrals. Provider kickbacks and bribes. Medical identity theft. Forgery of physician’s signature. Billing for services by unlicensed individuals. Unsupervised staff. Employment of excluded individuals and falsification of records. Filing claims with names and identifiers for dead people.

Current Enforcement Environment Criminal Enforcement Actions

AAOE 2019 Compliance Symposium

• Federal Anti-Kickback Statute (42 U.S.C. § 1320a–7b(b)). The federal Anti-Kickback

Statute makes it a crime to knowingly and willfully

• ffer, pay, solicit, or receive

remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to purposefully induce or reward referrals of items or services payable by a federal health care program. Simply put, it is against the law to pay or provide anything of value in an effort to induce referrals or business related to a federal health care program.

• Increased penalties and imprisonment for kickback violations. Under the Bipartisan

Budget Act of 2018 (effective February 9, 2018):

Criminal penalties for acts involving Federal health care programs under 42 U.S.C.

§ 1320a–7b, including but not limited to the Anti-Kickback Statute, were increased from $25,000 to $100,000.

Additionally, the maximum sentences for felonies involving Federal health care

program fraud and abuse under 42 U.S.C. § 1320a–7b, including but not limited to the Anti-Kickback Statute, were increased from Five to Ten years.

Current Enforcement Environment Criminal Enforcement Actions

AAOE 2019 Compliance Symposium

Current Enforcement Environment Criminal Enforcement Actions

• The federal Anti-Kickback Statute and the False Claims Act were long viewed as separate

and distinct enforcement tools, with the False Claims Act used in civil enforcement matters and the anti-kickback statute applied in criminal kickback cases.

• Over the past 20 years, the enforcement landscape has slowly changed. Starting in the early

1990’s, whistleblowers began asserting violations of the False Claims Act in cases that would typically be pursued as a criminal anti-kickback violation.

• These cases often involved fact patterns where a party was alleged to have violated the anti-

kickback statute and, in the process, billed for services that were allegedly worthless and made a false express and / or implied certification to the Medicare or Medicaid program.

• The 2010 passage of the Affordable Care Act obviated the need to bootstrap a violation of

the anti-kickback statute into a violation of the False Claims Act. Under the ACA, a claim submitted in violation of the federal anti-kickback statute now automatically constitutes a false claim for purposes of the False Claims Act.

AAOE 2019 Compliance Symposium

Current Enforcement Environment Criminal Enforcement Actions

• Safe harbors. As the Anti-Kickback Statute reflects, the scope of potential coverage under

the law is extraordinarily broad. In recognition of this fact, in 1987 Congress authorized HHS-OIG to issue “safe harbors” for certain business arrangements and practices that while potentially a violation of law, would be permitted as long as certain safeguards are put in place to prevent fraud and abuse. The most likely safe harbors to arise in a physician compensation arrangement with a hospital affiliated physician group or other entity would be:

Personal services and management contracts safe harbor, Employee safe harbor, and Practitioner recruitment safe harbor.

• Safe harbors are voluntary not mandatory.
• While a given arrangement is not necessarily a violation of the anti-kickback statute if one
• r more of the elements in a safe harbor have not been met, a provider is effectively

precluded from relying on a safe harbor as an absolute defense.

• The number of safe harbors to the federal Anti-Kickback Statute is subject to change.

There are currently more than 20.

AAOE 2019 Compliance Symposium

Current Enforcement Environment Criminal Enforcement Actions -- EKRA

• “Substance Use-Disorder Prevention that Promotes Opioid Recovery and

Treatment (SUPPORT) for Patients and Communities Act.”

• This bipartisan legislation was intended to address a number of the fraudulent

and abusive business practices currently employed by unscrupulous substance abuse treatment providers in this segment of the market.

• This legislation effectively amplifies existing anti-kickback measures to better

cover schemes involving private insurance. While the aim of widespread expansion of enforcement is to combat opioid and other substance abuse, the implications of many provisions are far reaching. One particular provision with far reaching consequences is Subtitle J, also known as the “Eliminating Kickbacks in Recovery Act (EKRA).”

AAOE 2019 Compliance Symposium

Current Enforcement Environment Criminal Enforcement Actions -- EKRA

• EKRA was intended to address patient brokering and other kickback schemes by expanding liability

and raising the maximum penalties for kickbacks. An offense under this provision is described as: Offense — Except as provided in subsection (b), whoever, with respect to services covered by a health care benefit program, in or affecting interstate or foreign commerce, knowingly and willfully— (1)solicits or receives any remuneration (including any kickback, bribe, or rebate) directly or indirectly,

• vertly or covertly, in cash or in kind, in return for referring a patient or patronage to a recovery

home, clinical treatment facility, or laboratory; or (2)pays or offers any remuneration (including any kickback, bribe, or rebate) directly or indirectly,

• vertly or covertly, in cash or in kind—

(A) to induce a referral of an individual to a recovery home, clinical treatment facility, or laboratory; or (B) in exchange for an individual using the services of that recovery home, clinical treatment facility, or laboratory…”

• Under EKRA, the maximum penalties for illegal remunerations paid by recovery homes, clinical

treatment facilities, or laboratories in an effort to induce referrals can result in penalties of $200,000 and 20 years of imprisonment per occurrence.

AAOE 2019 Compliance Symposium

Current Enforcement Environment Criminal Enforcement Actions – State Kickback Statutes

• Examples of “all-payor” state anti-kickback statutes:

Massachusetts. Under M.G.L.c. 175H, §3, it is a felony to solicit or receive any remuneration, directly or indirectly, "for purchasing, leasing, ordering, or arranging for or recommending purchasing, leasing, or

• rdering of any good, facility, service or item for which payment is or may be made in whole or

in part by a health care insurer." Texas. Under Tex. Occ. Code 102.001(a): “A person commits an offense if the person knowingly offers to pay or agrees to accept, directly

• r indirectly, overtly or covertly any remuneration in cash or in kind to or from another for

securing or soliciting a patient or patronage for or from a person licensed, certified, or registered by a state health care regulatory agency.”

AAOE 2019 Compliance Symposium

Current Enforcement Environment Criminal Enforcement Actions

• Other risks areas to keep in mind:

Failure to properly document opioid medical necessity. Several of the recent

criminal prosecutions pursued by the government were based on: “Prescriptions of oxycodone that were outside of usual medical practice and without a legitimate medical purpose”

Improperly using a patient’s identity. More and more prosecutors are including a

charge of “aggravated identity theft (18 U.S.C. § 1028A) in health care fraud cases brought by the government. Under this statute, whoever during and in relation to any felony enumerated in subsection (c) [predicate offense], . . . knowingly transfers, possesses, or uses without lawful authority a means of identification of another person, shall, in addition to the punishment provided for such [predicate

• ffense], be sentenced to a term of imprisonment of 2 years.

Examples of the 60 predicate offenses include: 18 U.S.C. 1001 (relating to false statements or entries generally), 18 U.S.C. 1035 (relating to false statements relating to health care matters), 18 U.S.C. 1347 (relating to health care fraud) 18 U.S.C. 1343 (relating to wire fraud) 18 U.S.C. 1341 (relating to mail fraud)

AAOE 2019 Compliance Symposium

Current Enforcement Environment Criminal Enforcement Actions

• Kickbacks / Disguised Kickbacks and Bribes

Be especially careful before your practice or clinics enters into a business arrangement with a

compounding pharmacy.

A continuing concern of the government involves lease arrangements with actual and / or potential

referral sources.

Serving as a medical director to a hospice, home health agency, or nursing home to whom you make

patient referrals.

Serving as a consultant to a pharmaceutical manufacturer, compounding pharmacy or durable medical

equipment supplier whose products you prescribe.

While old school “dine and dash” approaches may be gone, bringing lunch and other goodies to a practice

• r office is still commonplace.

Participating in a sham loan arrangement with an entity to whom you make referrals or whose products

you prescribe, order or recommend.

Acquiring or having a financial interest in an entity to whom you send referrals (especially if the referral is

for DHS services).

Accepting cash, gifts or other Items of value from a patient or other individual in exchange for a

prescription for opioids or other controlled substances.

Accepting or soliciting any type of remuneration (something of value), such as a gift card, sporting event

tickets or liquor, from a pharmaceutical representative, compounding pharmacy or DME supplier whose products you order or prescribe (or could order or prescribe).

AAOE 2019 Compliance Symposium

Current Enforcement Environment Recent Orthopaedic Cases

• Oklahoma. In this case out of the Western District of Oklahoma, multiple physician

defendants, along with their associated orthopaedic practice, agreed to pay $670,000 under the False Claims Act. The defendants allegedly submitted false claims to Medicare, Medicaid, and Tricare related to unnecessary medical procedures involving ultrasonic guidance for needle placement imaging supervision and interpretation. The government also alleged that the practice and one of the defendant physicians caused false claims to be submitted to Medicare, Medicaid, and Tricare for a surgery assistant who did not perform the services billed.

• Pennsylvania. In this False Claims Act case out of the Eastern District of Pennsylvania, the

government alleged that an orthopedic surgical practice and one its attorneys engaged in a scheme to improperly unbundle claims for reimbursement for orthopedic surgeries in order to artificially inflate reimbursements from federal healthcare payers. More specifically, the government alleged that the practice routinely exploited Modifier 59 to improperly unbundle

• rthopedic surgery claims, including for many total joint replacement and arthroscopic
• surgeries. The practice paid $11.25 million and the physician personally paid $1.25 million to

resolve the False Claims Act allegations.

AAOE 2019 Compliance Symposium

Current Enforcement Environment Recent Orthopaedic Cases

• Delaware. In this case, an orthopaedic practice was assessed $16.2 million for submitting false

claims for Medicare reimbursement under the civil False Claims Act. The government alleged that the practice and its owner knowingly submitted false claims to Medicare by administering contrast dye during magnetic resonance imaging (MRI) scans on patients without proper supervision by a physician.

• Oklahoma. In this case out of the Western District of Oklahoma, multiple physician defendants, along

with their associated orthopaedic practice, agreed to pay $670,000 under the False Claims Act. The defendants allegedly submitted false claims to Medicare, Medicaid, and Tricare related to unnecessary medical procedures involving ultrasonic guidance for needle placement imaging supervision and interpretation. The government also alleged that the practice and one of the defendant physicians caused false claims to be submitted to Medicare, Medicaid, and Tricare for a surgery assistant who did not perform the services billed.

• Pennsylvania. In this False Claims Act case out of the Eastern District of Pennsylvania, the

government alleged that an orthopedic surgical practice and one its attorneys engaged in a scheme to improperly unbundle claims for reimbursement for orthopedic surgeries in order to artificially inflate reimbursements from federal healthcare payers. More specifically, the government alleged that the practice routinely exploited Modifier 59 to improperly unbundle orthopedic surgery claims, including for many total joint replacement and arthroscopic surgeries. The practice paid $11.25 million and the physician personally paid $1.25 million to resolve the False Claims Act allegations.

AAOE 2019 Compliance Symposium

Common Errors Identified in a Gap Analysis

• Recommendation Continued: Identify your weaknesses – then correct them. It is essential

that you conduct a “gap” analysis early in the process of creating an effective Compliance Plan.



As a first step, providers should review each of the regulatory and statutory provisions related to the specific services being billed to Medicare.



Next, providers should compare their actual documentation, coding and billing practices with Medicare’s rules. Any gaps between the applicable requirements and a provider’s actual practices must immediately be remedied.



Additionally, should these gaps represent an overpayment, the Medicare provider must repay the overpayment to the government within 60 days of identification.



Prior to conducting a gap analysis, you should contact your legal counsel for advice and assistance.

AAOE 2019 Compliance Symposium

Common Errors Identified in a Gap Analysis

• Health care providers have routinely failed to screen their applicants, clinical staff, administrative staff,

contractors, vendors and agents on a monthly basis. At this time, there are a total of 43 different databases that need to be checked. These 43 databases include: (1) List of Excluded Individuals and Entities (LEIE). Maintained by HHS-OIG. (2) System for Award Management (SAM). Maintained by the General Services Administration. (3) 38 State Medicaid Exclusion Registries. Maintained by either the State Attorney General’s Office

• r the State Medicaid Fraud Control Unit (MFCU).
• Failure to Screen, Continued: Companies like “Paladin Deception Services” can be found online and

perform an amazing job of creating a credible (but fake) employment history, references, verification

• f specific skills, etc. Do you really know the members of your staff?
• A good resource in this regard is Exclusion Screening. Call 1 (800) 294-0952
• r visit their website www.exclusionscreening.com

AAOE 2019 Compliance Symposium

Common Errors Identified in a Gap Analysis

• Billing for services not rendered.

Recent private payor audits conducted have alleged multiple instances of improper billing because the provider failed to provide the services rendered.

• Misrepresentation of a non-covered service. In some respects, this improper practice is nothing more than another

form of “billing for services not rendered.” Simply put, in the cases we have seen where this has occurred, a medical practice has either purposely or erroneously characterized a non-covered service as a covered service. Keep in mind, the definition of a non-covered service varies from policy to policy. Additionally, the list of non-covered services under a specific policy may change from year-to-year. In any event, it is important that health care providers regularly check to ensure that the services being provided qualify for coverage and payment.

• Misrepresentation of the provider of the medical service. This type of billing error is still commonly found in

medical practices around the country. In the cases we have seen, “fraud” wasn’t the reason for the underlying misrepresentation on the CMS 1500 Claims form. In most instances, it was merely a matter of a credentialing delay. Although we have not seen a misrepresentation case of this type referred for criminal prosecution, it is important to remember that the CMS 1500 Claims form is being electronically submitted to the health plan for

• payment. Depending on the facts, an aggressive prosecutor could argue that such conduct constitutes wire fraud.

18 U.S.C. §1343.

AAOE 2019 Compliance Symposium

Common Errors Identified in a Gap Analysis

• Unlicensed individuals found to have performed medical procedures. Generally speaking, we have seen two

categories of cases where this has occurred, one which is truly egregious and one that was the result of an administrative error.

 Allowing unlicensed staff to provide care. Perhaps the quickest way to get into trouble with both law

enforcement and your State Medical Board is to allow non-licensed individuals provide medical care that may only be administered by qualified, licensed personnel. Earlier this year, the New York Attorney General’s Office announced the indictment, arrest and arraignment of a health care provider and four unlicensed individuals that the provider was permitting to perform medical related procedures on 110 Medicaid recipients. Unfortunately, this is a common occurrence, despite the fact that virtually every state Medical Practice Act / Nursing Practice Act, etc. has strict requirements governing both the level of supervision that must be exercised over subordinate staff and which tasks may not be delegated to unlicensed personnel.

 Unlicensed personnel providing care as a result of an administrative error. This typically occurs when a

licensee fails to pay their annual licensing fees in a timely fashion or fails to complete mandatory Continuing Medical Education (CME) required by their State Medical Board. If you are performing medical procedures and your license has been administratively suspended, a reviewer will still deny each of the claims where you are listed as the treating physician.

AAOE 2019 Compliance Symposium

Common Errors Identified in a Gap Analysis

• Failure to properly document support for medical necessity. Progress notes for each visit

must comply with documentation requirements under the State Medical Practice Act and any requirements set out in an applicable LCD, NCD, etc.

• Failure to sign EHR treatment notes.

Rendering health are providers have often failed to sign or initial each entry on the patient’s record pertaining to the treatment he or she

• rendered. Treating physicians, NPs and PAs should electronically sign AND CLOSE OUT

each entry on the patient’s record that pertains to a treatment he or she rendered. This is

• ften a state regulatory requirement and is typically required by both governmental and

private payor agreements.

• Missing medical treatment plans / consent forms. Completed medical treatment plans and

consent forms have frequently been found to be missing from patient records. Treatment plans reviewed have often not been signed by the patient or were not dated. Signatures should be dated. Many of the dates of authorization for the “signatures on file” on the claim form were after the date of service, which is an error cited in recent audits.

AAOE 2019 Compliance Symposium

HIPAA / IT Risks HIPAA Criminal Prosecutions

• California. In this case, a California Surgeon was dismissed from his job at the hospital. Later than day, he accessed the

medical records of his immediate supervisor and those of several co-workers. Over the next three weeks, he improperly accessed the records of 232 patients, many of whom were celebrities, without a valid business reason. After he was formally terminated, he accessed patient records on four different occasions. There was no evidence that he improperly used or tried to sell the information. In 2008, he was charged by Information for violations of HIPAA. He plead guilty and was sentenced to four months in prison.

• New York. An Assistant Clerk at a New York hospital and seven other individuals were indicted by the Manhattan District

Attorney’s Office. The hospital Assistant Clerk was alleged to have stolen patient identifying information and sold the information to one of the defendants (not employed by the hospital) for $3.00 per record. The buyer of the patient information then provided it to the other defendants who used the information to make thousands of dollars in purchases at Barneys, Macy’s and other stores. The stolen patient information had also been used to obtain forged driver’s licenses. Overall, this fraud scheme is estimated to have cost more than $50,000 in damages.

• Florida. A Customer Service Representative working at a Tampa hospital was convicted of illegally accessing the PHI of

more than 600 hospital patients. The defendants and her accomplices then used that information to file 29 false tax returns seeking refunds totaling $226,000. She was prosecuted for violations of HIPAA and wire fraud. She plead guilty in 2016 and was sentenced to 37 months in prison.

• Oregon. A Respiratory Therapist at an Oregon hospital was convicted by a federal jury of wrongfully accessing

individually identifiable health information. At trial, federal prosecutors suggested to the jury that Ms. Knapp was attempting to find out what type of medication patients were being prescribed so that she could steal the drugs either for herself or someone else. She was not charged with theft of drugs or identity theft. She faced up to one year in prison and was ultimately placed on probation for two years.

AAOE 2019 Compliance Symposium

HIPAA / IT Risks Reducing Your Level of Risk

• Administrative Safeguards.

Conduct an inventory of all the mobile devices (laptops, pads, cell phones, USB flash drives, CDs, DVDs) in

use by your organization and its staff to access and / or store ePHI. Update your inventory, as needed.

Ensure that written policies and practices covering the use of mobile devices is in place and that all staff

have been trained on the requirements.

• Technical Safeguards.

Are all mobile devices that access or store ePHI encrypted? If not, why not? Ensure that the encryption keys are NOT kept on the device. Are you changing your passwords at least every 90 days? Are backups of the ePHI on mobile devices maintained and encrypted?

• Physical Safeguards.

Are all mobile devices that access or store ePHI encrypted kept locked up and secure when not in use? Are any unencrypted breaches promptly reported to the OCR? If a mobile device is encrypted and then is subsequently lost or stolen, does it have to be reported to the

OCR? Depends. . . check your state privacy laws!

AAOE 2019 Compliance Symposium

HIPAA / IT Risks Reducing Your Level of Risk

• Ensure that you have completed and documented a HIPAA Security Risk

Assessment for your organization.

• Back-up your data.
• Encrypt all PHI, even if only maintained on your local servers.
• Pay an IT specialist to ensure that your anti-virus software is properly

installed and up-to-date.

• If you are going to use the cloud, make sure your account is properly

configured.

• Train your staff to watch out for phishing attacks.
• Require two-part authentication before you can access PHI on an outside
• server. Also, make sure that the data is encrypted.
• Should a scammer attempt to extort money from you, say NO and don’t pay a

ransom.

AAOE 2019 Compliance Symposium

Responding to an Investigation Half-Truths, Lies and Audiotapes

• When approached by a federal agent, the agent may indicate that he / she is merely getting some

background information. Based on this assertion, you may feel comfortable answering what you initial believe will only be “basic” questions. Let’s be clear, when that agent shows up, there is a VERY GOOD CHANCE that the agents already knows the answers to any question that is being asked. The government may have already been investigating your case for months or even years.

• Federal agents are counting on the fact that health care providers (especially physicians) have a tendency

to think that if they can only explain the facts, the case will go away. These agents have received extensive interrogation training at Quantico, FLETC, and the National Advocacy Center. They will use a provider’s misplaced believe that he / she can explain away any concerns to build a case against the provider.

• Do you really know the “facts”?

Although you may think that you remember a case or procedure administered to a patient, your mind isn’t a steel trap. You really need to carefully refresh your recollection before going down memory lane with the government.

AAOE 2019 Compliance Symposium

Responding to an Investigation Half-Truths, Lies and Audiotapes

• The world of law enforcement may have advanced. . . in at

least one way, the FBI hasn’t. In recent years, we have seen a significant increase in the use of “body cams” by law enforcement in recent years. In some instances, these cameras have been used to exonerate defendants. In other cases, body cams have solidified the government’s case against an individual. While street level law enforcement

• fficers have generally accepted body cameras, the FBI has

remained steadfast in its commitment to avoid tape recording an interview unless certain requirements are met.

• Why don’t FBI agents tape record an interview? If you are

interviewed by the FBI, in most instances, the agents will not tape record the interview. It is common for FBI agents to work in pairs when they interview a non-custodial suspect or witness. Instead, the FBI agents will take notes of the interview on an FBI Form 302.

• At trial, juries will give weight to the version of the events

documented on the FBI Form 302. Since FBI agents typically work in pairs (and will readily support each other at trial), it can be difficult to overcome the version of the facts documented in the FBI Form 302.

With these points in mind, what should you do if you are approached by an FBI agent or another federal auditor?

AAOE 2019 Compliance Symposium

Responding to an Investigation Half-Truths, Lies and Audiotapes

• An FBI agent can pose as a member of the news media or a documentary film crew. You may not even know when

the government is gathering evidence and / or documenting any statements against interest that you or someone on your staff may make.

AAOE 2019 Compliance Symposium

Responding to an Investigation Half-Truths, Lies and Audiotapes

• You CANNOT lie to government agents, investigators, etc. Can they lie to you? Absolutely. If the Police, the FBI or an OIG Agent lie to you during

questioning, it DOES NOT render any statements against interests that you may make, involuntary and inadmissible.

• The U.S. Supreme Court has addressed this issue. In the landmark U.S. Supreme Court case Frazier v. Cupp, 394 U.S. 731, 1969, a homicide

suspect was interrogated by the police and falsely told that an accomplice had already implicated him in the murder. Based on this lie, the suspect confessed to the murder. The U.S. Supreme Court ruled that such use of trickery and deceit can be permissible (depending on the totality of circumstances) provided that it does not shock the conscience of the court or community. Additional Supreme Court cases addressing this point: "Criminal activity is such that stealth and strategy are necessary weapons in the arsenal of the police officer." (Sorrells v. U.S.) "Nor will the mere fact of deceit defeat a prosecution, for there are circumstances when the use of deceit is the only practicable law enforcement technique available." (U.S. v. Russell)

• Examples of conduct that does, in fact, “shock the conscience” of the community.

 An investigator lying about his identity and introducing himself as the defendant’s court appointed attorney.  An investigator who poses as a clergyman in an effort to obtain a confession under that guise would constitute behavior that shocks the

conscience of the court or community.

 Over the years courts have upheld countless confessions even though the investigator lied to the defendant during an interview. These

cases have typically involved situations where the investigator made false statements about certain evidence, eye-witness testimony that the government will be depending on, the presence of fingerprints, etc.

AAOE 2019 Compliance Symposium

Responding to an Investigation Half-Truths, Lies and Audiotapes

• How should you respond when contacted by an FBI agent? The FBI shows up at your door. Can they come in without

a warrant?  Can they come into your home without a warrant? Ask for a copy of the agent’s business card. Absent an emergency or a search incident to an arrest, the FBI generally cannot come into and search your home unless you invite them in.  What if the FBI agent forces his way into my home? Don’t resist. Reiterate the point that you have not given them permission to enter your home. Don’t answer any questions.  Can the FBI agent require you to answer questions? No. You don’t have to answer any questions. Should you choose to answer questions, step outside, shut your door and then respond (limiting your responses to your personal identification). Tell the FBI agent that you want to exercise your rights under the 6th Amendment and want to speak with your attorney before making a statement. “I want to speak with my attorney before making a statement.”  How do you respond if the FBI agent says “You shouldn’t need an attorney if you haven’t done anything wrong.” Most individuals will be very differential to FBI agents and will want to address any questions that they have. You need to fight this instinct! Exercise your rights under the 5th Amendment to the Constitution: “At this time, I am choosing to exercise my rights to remain silent.”

AAOE 2019 Compliance Symposium

“Passive” Criminality

• When is the last time that you actually read your Medicare, Medicaid and private payor

participation agreements? What assertions are you agreeing to?

Do you really have an effective Compliance Program in place? Are you meeting your obligations to conduct exclusion screening of employees, contractors

and vendors?

Have you properly credentialed all of your providers? Have you properly screened your employees, agents, contractors, vendors and referring

providers?

• You need to carefully review your Medicaid participation requirements. A number of states,

including Texas, have completely reworked these agreements and have imposed a number of new Medicaid provider obligations.

AAOE 2019 Compliance Symposium

What if Management Refuses to Comply with the Law?

• If the government pursues you for individual liability, do you have indemnification coverage? Many

companies provide indemnification coverage for members of their Board and for high level

• fficers. This coverage is intended to indemnify these individuals if they are named in a lawsuit

related the services that they provided or the role they play in the organization.

• Ultimately, you may have only a limited number of options.

What are the implications of the following?

 Continue to work for the company, despite the fact that wrongdoing is taking place.  Lodge your disagreement with management and continue working.  Resign from your position.  Resign from your position and file a complaint with the affected payors.

• If you are aware that your organization has engagement in wrongdoing do you have an affirmative
• bligation to turn them in?

18 U.S. Code § 4 - Misprision of a Felony. “Whoever, having knowledge of the actual commission of a felony cognizable by a court of the United States, conceals and does not as soon as possible make known the same to some judge

• r other person in civil or military authority under the United States, shall be fined under this title
• r imprisoned not more than three years, or both.”

AAOE 2019 Compliance Symposium

Breaking News!

• On September 5, 2019, CMS issued the Final Rule “Program Integrity Enhancements to the Provider

Enrollment Process.” This Final Rule creates several new revocation and denial authorities to bolster CMS’ efforts to stop waste, fraud and abuse. “For too many years, we have played an expensive and inefficient game of ‘whack-a-mole’ with criminals – going after them one at a time -- as they steal from our programs. These fraudsters temporarily disappear into complex, hard-to-track webs of criminal entities, and then re-emerge under different corporate names.”

• CMS can now revoke or deny Medicare enrollment if:

 A provider or supplier circumvents program rules by coming back into the program, or attempting to come back in, under a different name (e.g. the provider attempts to “reinvent” itself);  A provider or supplier bills for services/items from non-compliant locations;  A provider or supplier exhibits a pattern or practice of abusive ordering or certifying of Medicare Part A or Part B items, services or drugs; or  A provider or supplier has an outstanding debt to CMS from an overpayment that was referred to the Treasury Department.

• CMS can now block providers and suppliers who are revoked from re-entering the Medicare program

for up to 10 years.

AAOE 2019 Compliance Symposium

Moving Forward

• The government expects health care providers and suppliers to have an effective Compliance Program

in place. Research has shown that a SINGLE course in clinical documentation, coding and billing can significantly improve the compliance of orthopaedic residents. Journal of Surgical Education 2017, 74 (5): 794-798.

• Self-audits are not just encouraged, they are required if a company wants to be viewed as a good

corporate citizen.

• Potential overpayments must be promptly investigated and returned to the appropriate payor.
• Educate your Owners, Executives, and other Management Officials regarding the “Responsible

Corporate Officer Doctrine,” the “Yates Memo” and DOJ’s interest in individual accountability.

• Your Compliance Program must be more than a paper tiger. Is it effective? What role do you play in

its oversight and implementation?

• Document your efforts to fully comply with applicable statutory and regulatory requirements.
• Review your position.

Are you saddled with accountability but have no authority (or ability) to properly monitor, evaluate and direct remedial changes in programs in your areas of responsibility?

AAOE 2019 Compliance Symposium

Questions

Presenter Information: Robert W. Liles Robert can be contacted at (202) 298-8750 or by e-mail at rliles@lilesparker.com www.lilesparker.com

• The CEU code will be read aloud

at end of the session – write it down!

• You must complete a session

evaluation in the app in order to get CEU credit

• Honest feedback helps

create better events! CEU Information: