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Government Audit of Chronic Care Management Services Raises Serious Questions About Proposed Anti-Kickback Statute Safe Harbors

Posted  November 22, 2019

The U.S. Department of Health and Human Services is engaged in what it calls a “Regulatory Sprint to Coordinated Care,” in order to, in the words of HHS Deputy Secretary Eric Hargan, “update, reform, and cut back our regulations to allow innovation toward a more affordable, higher quality, value-based healthcare system.”  On October 9, 2019, as part of this effort to “cut back” on regulations to advance these goals, HHS released documents totaling over 800 pages announcing numerous proposed changes and additions to the list of regulatory safe-harbors and exceptions to both the Physician Self-Referral Law (the “Stark Law”) and the Federal Anti-Kickback Statute.  If enacted, the proposed rules threaten to make the current protections against the payment of remuneration to physicians to induce patient referrals, and physician self-referrals, positively Ptolemaic in complexity.

It is still unclear whether HHS’s proposed regulatory changes will truly shift the American healthcare system toward genuine “value-based” arrangements that foster better coordinated and managed patient care, or simply create new loopholes for unscrupulous healthcare providers to manipulate.

One warning signal, however, has arisen in an HHS Office of Inspector General (“OIG”) audit report issued earlier this month on chronic care management (“CCM”).  The OIG report encompasses all Medicare Part B claims for CCM services from calendar years 2015 and 2016.  OIG concludes that, during this two-year period, physicians submitted 20,165 improper claims for CCM services, resulting in $640,452 in over-payments.  OIG also flags an additional 37,124 claims as potentially improper, worth an additional $1,162,562.  OIG determined that CMS did not have adequate controls in place to identify and prevent these overpayments.

CMS rightfully regards CCM services, which consist of efforts by healthcare providers to coordinate the care of patients, particularly those with illnesses or disease conditions that require constant vigilance, like diabetes, as a “critical component of primary care” that contributes to “better outcomes and higher satisfaction for patients.”  They are a important component of any value-based healthcare system.

Surprisingly, despite their obvious importance, CMS only began providing reimbursement for CCM services to Medicare Part B beneficiaries starting in 2015.  For purposes of reimbursement, CMS has defined an extensive list of CCM services that may be provided to a beneficiary.  The list of CCM services includes:

  • Recording of patient health information;
  • Maintaining a comprehensive electronic care plan;
  • Managing transitions of care and other care management services; and,
  • Coordinating and sharing patient health information.

In practice, these CCM services are carried out through non-face-to-face medical consultations that often occur through telephonic communications or through electronic messaging.

CMS limits patient eligibility for CCM services.  A Medicare beneficiary is eligible for enrollment in CCM services if the individual:

  1. Has two or more chronic conditions expected to last at least 12 months or until the beneficiary’s death;
  2. Is at risk of death, acute exacerbation or decompensation, or functional decline due to the chronic conditions; and
  3. Had an established, implemented, and monitored comprehensive care plan.

In addition, a beneficiary must consent to participation in CCM services and, for those that have not been seen within one year prior to commencement of CCM services, must first have a “face-to-face” visit with a billing practitioner.

Likewise, CMS limits practitioner eligibility to bill for CCM services.  In a healthcare practice, either a physician, certified nurse midwife, clinical nurse specialist, nurse practitioner, or physician assistant may bill for CCM services.  Only one practitioner may be paid for the CCM services for a given calendar month.  By contrast, in a situation in which the billing practitioner does not personally provide the CCM services, the practitioner must insure that the clinical staff member is acting under his or her direction “on an ‘incident to’ basis (as an integral part of services provided by the billing practitioner), subject to applicable state law, licensure, and scope of practice.”  Moreover, CMS notes that the clinical staff must be “either employees or working under contracting to the billing practitioner whom Medicare directly pays for CCM.”

OIG’s discovery in its recent audit report of significant improper billing by physicians for CCM services is alarming.  The overpayments were determined to be the result of physicians submitting duplicate claims for CCM services, multiple physicians billing for the CCM services to the same patient, and other types of overlapping claims.  In addition, OIG found many additional suspect claims for CCM services from non-physicians without any corresponding physician claims.

These problems reflect the challenges inherent in moving toward a value-based healthcare system.  Unscrupulous physicians and other healthcare providers will find ways to improperly bill for Medicare services no matter how the services are defined.  Simply creating new safe-harbors to the Anti-Kickback Statute and Stark Law will not make the problem go away.

If you know of fraud, including kickbacks, involving chronic care management services, or other Medicare or Medicaid services , please contact a Constantine Cannon whistleblower attorney to discuss the possibility of filing a qui tam complaint under the Federal False Claims Act and/or the equivalent state false claim act statutes.

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Tagged in: Anti-Kickback and Stark, FCA Federal, FCA State, Healthcare Fraud, Managed Care, Medicaid, Medical Billing Fraud, Medicare,