Safeguarding Your Practice from Medicare Fraud

Fraud in the Medicare system is, unfortunately, an ongoing problem. No wonder — Medicare regulations are always changing, often leaving physician practices in a quandary as to what the most current policies are and what they need to do in light of them. So how can you ensure your practice stays on the right side of the law? Read on.

Your fraud risk abatement effort starts with an audit of the practice’s current operating policies and procedures. In particular, keep an eye out for improper coding and billing, delivered services that aren’t medically necessary, and inadequate documentation and backup procedures. And, last but not least, make sure no one at your practice is accepting inducements, kickbacks or self-referrals.

Once you’ve determined the key risk areas in your practice, develop guidelines specifying the actions staff members are expected to take when suspected incidents of fraud arise. The OIG recommends including these guidelines in a practice compliance manual along with relevant Medicare directives and carrier bulletins, as well as summaries of OIG Special Fraud Alerts and advisory opinions.

Also appoint one or more staff members as “compliance officers” to monitor compliance activity and execute corrective action plans when necessary. The OIG will accept outsourcing of the compliance officer responsibilities.

The next step is to implement a training program to familiarize the staff with regulations governing the practice’s business along with the above risk areas to avoid and monitor. At a minimum, make sure you provide compliance training for all staff members, including the operation and importance of the compliance program, consequences of violating standards and procedures, and the role of each employee.

Also provide coding and billing training for anyone involved in claims procedures. This training should cover coding requirements, claim development and submission processes, signing of physician forms, billing and documentation of services, ramifications of altering medical records, and legal sanctions for fraudulent billing.

Because communication is key to thwarting fraud, make sure you provide staff with easy methods for reporting potential problems or violations. This will help the practice address and eliminate compliance issues before they escalate.

Examples of how some practices have opened up such communication include telephone hotlines, e-mail forums, bulletin boards and drop boxes that allow anonymous reporting. Couple these methods with a culture that encourages staffers to keep their eyes and ears open to the slightest concern or complaint about possible fraud issues.

Staff members must fully understand the consequences of acting in a noncompliant manner. To get the message across, develop procedures for dealing with individuals who violate the practice’s policies and compliance standards, and then communicate the consequences to your staff.

In addition, make sure all employees are aware of the OIG’s Self-Disclosure Protocol (63 Federal Register 58399). It guides providers in cases of fraudulent overpayments, billing/coding violations, breach of Anti-Kickback Act or Stark law, or hiring of Medicare-excluded personnel.

The components of this rule include defining the scope of the problem and conducting a preliminary examination of related documents. With the help of an attorney, practices should conduct an investigation of the circumstances surrounding the allegation. The rule also discusses how to take steps to preserve relevant documentation as soon as a federal investigation seems imminent and how to prepare a remediation plan. Finally, the rule requires practices to conduct a self-audit to demonstrate to the OIG the positive effects of the remediation.

Carefully managed self-disclosure will reduce the likelihood of ongoing OIG oversight and possibly result in smaller financial settlements.

Medicare fraud will likely never go away, which makes it essential for physician practices to abide by the law and report any suspicious activity to Medicare. If your practice is lacking a system for reporting fraudulent activity, now is the time to set it up. And be sure to work with a qualified lawyer who knows the ins and outs of Medicare. •