The U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) annual release of a new Work Plan both summarizes the results achieved last year and highlights new areas for examination in the next. This year’s Work Plan reported rising audit results but declining investigative results, in contrast to previous years.
In examining the new topics added to the Work Plan, two themes emerge. First, many of the new payment audits reflect OIG’s use of data mining to identify providers or suppliers who could potentially be considered “outliers” from the average use of a particular code or procedure. Data mining will also play a significant role in connection with the second theme—a notable increase in OIG’s review of significant, and some controversial, policy issues concerning changes in the country’s health care delivery system, operation of HHS programs and the effectiveness of HHS agency oversight of those changes and programs.
Based on how OIG identified new study topics, the main takeaway from the Work Plan is “know your data.” Whether the issue is Medicare claims or data reporting obligations, the OIG increasingly turns to data analytics to both generate audit or investigative leads or to study HHS program effectiveness.
The fiscal year 2016 Work Plan, released November 3, 2015, stated that OIG expected recoveries of nearly $1.3 billion in audit receivables for its 2015 work, an increase from the $834.7 million reported in 2014. OIG reported a significant drop in the investigative receivables amount, however, from $4.1 billion in 2014 to $2.22 billion in 2015. The number of civil actions, defined as false claims and unjust enrichment lawsuits filed in federal courts, civil monetary penalty settlements and self-disclosure recoveries, increased from 533 in 2014 to 682 in 2015. These statistics may foreshadow a corresponding decrease in the total recoveries under the False Claims Act, but potentially an increase in the number of filed cases, in the upcoming Health Care Fraud and Abuse Control Program Report issued by the U.S. Department of Justice and HHS. However, the almost 30 percent increase in the number of civil actions demonstrates the government’s, and whistleblowers, sustained attention to the health care industry.
2016 Planned Work
Federal Health Care Program Payment Audits
OIG added a number of new reviews that expand OIG’s work in areas previously identified as priorities, such as hospital-based services, post-acute care, lab testing and Part D. Many of these topics lend themselves to selecting audit targets through data mining to find providers or suppliers who are “outliers” from their peers or who otherwise appear to exhibit aberrant billing patterns.
Health Care System Reviews
OIG announced a number of potentially high-profile and high-impact review topics spanning many aspects of CMS’ oversight of the Medicare and Medicaid programs and health reform as well as other HHS agencies.
Proper Payment Levels
Other HHS Agency Oversight
Revised Investigative Priorities
The Work Plan not only summarizes audit and study topics but also provides an overview of investigative activities and priority risk areas. OIG made some changes to this section that specifically lists areas OIG views as having higher risk of abuse, including:
Also, while OIG discusses more traditional investigative areas, such as billing for services not rendered, medically unnecessary and misrepresented services, the Work Plan removed specific references to “failure of care” or “worthless services.” This step away from the “worthless services” theory may be related to the lack of a victory pursuing this theory in False Claims Act litigation, stemming from the U.S. Court of Appeals for the Seventh Circuit’s 2014 decision in United States ex rel. Absher v. Momence Meadows Nursing Ctd., Inc stating, “Services that are ‘worth less’ are not ‘worthless.’” The Work Plan mentions the solicitation and receipt of kickbacks, which focuses attention on either the physician or a patient for their involvement in the fraud scheme, instead of the more traditional enforcement target—the party offering or paying the kickback. This reminder of OIG’s interest in physicians is consistent with the uptick in Special Fraud Alerts and other guidance published and civil money penalty actions taken in recent years that focus on physician compliance with the anti-kickback statute.