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HHS Releases Proposed Rule Increasing OIG’s Authority to Combat Fraud under the ACA

On May 12, 2014, the U.S. Department of Health and Human Services (HHS) issued a Proposed Rule to increase the Office of Inspector General’s (OIG) authority to combat fraud and abuse under the Civil Monetary Penalty (CMP) Regulations. The Proposed Rule implements changes enacted by the Patient Protection and Affordable Care Act of 2010 (ACA), which expanded OIG’s ability to assess CMP fines against individuals or entities that defraud Federal healthcare programs. Under the proposed rule, OIG may assess CMPs against individuals or entities for:

  1. Failure to grant OIG timely access to documents, as determined on a case-by-case basis;
  2. Ordering or prescribing medicine or services that the person knows or should know may be paid for by a federal health care program while excluded;
  3. Making false statements, omissions, or misrepresentations in an enrollment application or similar bid to participate in a federal healthcare program;
  4. Failure to report and return a known overpayment; and
  5. Making or using a false record or statement that is material to a false or fraudulent claim

In addition, the Proposed Rule broadens the liability of misconducting entities to include contracted providers and suppliers. As a result, liability may extend as far as non-agent personnel working on behalf of the contracting organization. Furthermore, the Proposed Rule empowers the OIG to penalize entities for transferring an individual enrollee between plans without prior consent; transferring an enrollee solely to earn a commission; and failing to comply with marketing provisions regarding pre-approval of marketing materials and prohibited marketing activities.

The Proposed Rule also includes explicit delegation from HHS to OIG to exercise exclusionary authority over individuals or entities if they:

  • Are convicted of an offense in connection with obstruction or interference with an audit;
  • Fail to supply payment information for items or services for which payment may be made under Medicare or any State health care program; or
  • Make false statements, omissions, or misrepresentations of material facts in applications to participate as a provider or supplier under a Federal healthcare program.

Lastly, the Proposed Rule amends general definitions of the CMP authority, including “Separately Billable Item or Service” and “Non-separately Billable Item or Service.” Ultimately, these changes attempt to prevent disproportionate assessment.
Wachler & Associates healthcare attorneys regularly counsel providers in proactively addressing potential violations and defending providers against government allegations. If you have any questions regarding the OIG’s Proposed Rule, please contact an experienced health care attorney at Wachler & Associates at 248-544-0888.