The Office of Inspector General for the Department of Health and Human Services (OIG) has released its 2012 Spring Semiannual Report (Report) on the legal review, monitoring, and prosecution-related activities undertaken by the agency between October 1, 2011 and March 31, 2012.

The Report highlights the ramp-up of data analytics capabilities, including the “data warehouse” that “integrates data from Medicare Parts A, B, and D so [the OIG] can develop a more comprehensive picture of beneficiaries’ histories of medical care and providers’ billing patterns.”  One area where the OIG is applying more comprehensive reviews is in its hospital compliance initiative (mentioned on page 11 in this segment of the OIG 2012 Work Plan).  Rather than focusing on one or two risk areas during a review of a hospital’s billing and coding activities, the OIG can now review a hospital’s data related to all codes billed to assess compliance risk areas.

In addition to detecting more fraudulent activities in real-time, the OIG’s increasingly sophisticated data analysis activities are uncovering more deficiencies that lead to waste in federal health care programs.  For instance, the Report describes that the states have often received Medicaid overpayments based on faulty drug reimbursement methodologies and  non-compliance with other certain federal requirements.

In the Report, the OIG announced the following significant investigative results for the first half of FY 2012:

  • expected recoveries of $1.2 billion ($483.1 million in audit receivables and $748 million in investigative receivables, including $136.6 million in non-HHS investigative receivables from sources such as the States’ shares of Medicaid recoveries).
  • exclusions of 1,264 individuals and entities from participation in the federal health care programs;
  • 388 criminal actions against individuals or entities that engaged in crimes against HHS programs;
  • 164 civil actions, which included false claims and unjust-enrichment lawsuits filed in federal district court, civil monetary penalty (CMP) settlements, and administrative recoveries related to provider self-disclosure matters.

Tom Crane, a member of Mintz Levin’s Health Care Enforcement Defense Practice, found it notable that the OIG continues to “pay a significant amount of attention to fraud and abuse monitoring in the Medicare Advantage (MA or Part C) and Prescription Drug Benefit (Part D) Programs.”   Specifically, the Report noted that significant variations exist in the capabilities of MA plans to identify and combat health care fraud, that only 3 MA and Prescription Drug Plans reported 95% of the fraud and abuse incidents, and that over $15.1 million in gross drug costs for prescriptions were associated with claims submitted by excluded providers.