Fraud and Abuse: Government Enforcement in Lab Testing

In this episode of our monthly series on fraud and abuse issues, Matthew Wetzel, Associate General Counsel, Compliance Officer, GRAIL, speaks with Giovanni Giarratana and Soma Nwokolo, Bradley Arant Boult Cummings, about recent government efforts to chase down fraud in the laboratory testing space, including DOJ’s recent Operation Double Helix takedown. The podcast also discusses evolving standards in telehealth fraud enforcement, and compliance strategies. From AHLA's Fraud and Abuse Practice Group. Sponsored by BRG.

To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.

Transcript

Speaker 1: 0:14

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Speaker 2: 0:34

Welcome to another edition of the American Health Law Associations Fraud Abuse Practice Group podcast, where we bring you the latest trends in developments and healthcare fraud enforcement. I'm Matt Wetzel, vice Chair of Educational Programming for the Practice Group. Today's topic is government enforcement in the laboratory testing space. Each month we see more and more stories about fraud schemes being forwarded or rings of conspirators using laboratory testing as a means of booking patients in the government. With me today are two health lawyers from Bradley a Bolt, Cummings, Soma voco, and GIO Jarana, both based in the Tampa, Florida office. Soma is an associate and Bradley's Government Enforcement and Investigations Practice Group. She's a former federal prosecutor and litigator and represents clients in civil investigations, white collar criminal investigations, and federal court litigation, including False Claims Act, keam and healthcare fraud matters. GIO is also an associate with Bradley, and his practice includes assisting clients with civil and criminal investigations, enforcement actions, and compliance issues across various industries. Soma and Geo recently wrote a terrific ar terrific article for A H L A on this topic, decoding DOJs crackdown on genetic testing, high profile indictments and practical takeaways for the Cancer and Pharma Genomics industries. The articles available on ALA's website. Soma, welcome. Thank you so much, ma. We're so to be here. Absolutely. Well, before we get started, you know, it might help to give a little bit of a foundation, uh, and background about genetic testing. So if you wanna share a little bit a, a high level overview of what do we mean when we talk about genetic testing? Yeah, absolutely. I'll, I'll, I'll start us off here. Um, so first of off, first off, as you had mentioned, seminar's practice is largely, um, assisting advising clients navigate government enforcement actions, um, both civil and criminal. And many of our clients are involved with the healthcare industry. And so when there's a large take down, like what happened in September in the genetic testing space, um, it perks, perks up our ears. And, um, we were just so glad to be able to write about this topic for a hla. Um, so thank you for that. Um, with the genetic testing, you know, genetic testing, Matt, you probably would be able to speak more, uh, broadly on the topic with your background. Uh, but someone and I have definitely become familiar with some aspects of the genetic testing, um, with the recent take down and with this article. And, um, gen genetics testing comes in various forms, um, and is administered in various ways, whether it be through blood sampling or tissue sampling. Um, but for our purposes here, um, there are two primary tests that were involved and for the focus of the, the crackdown and September id oj and that is, um, a test called CG X test testing, which is cancer genetic testing. Mm-hmm.<affirmative> and pgx pgx testing, which is P code genetic testing. Um, the cancer genetic testing is designed to, um, look at an individual susceptibility to deter, uh, developing certain types of cancers. Um, so with the pharmacogenetic testing that is designed to look at an individual's, um, genetic variations to determine how they're gonna metabolize certain medications and therefore determine whether or not they're gonna be effective. Um, and so again, those are the two main tests that were at the forefront of this particular, um, crackdown in September. Got it. Thank you. And that's a great background. And, you know, so it, it sounds to me as if what we're talking about here is testing, uh, for, uh, cancer detection and then, and then testing to, to determine whether specific drugs might treat a particular type of cancer based on a person's genetic markup. And so I would, uh, I, I, I suppose, you know, the big question that we have today, and especially for our practice group members is, you know, what is the, uh, government's interest in this area? What are some of the trends that you're seeing in this space as far as enforcement goes? Yeah, so, uh, uh, the there, the large takedown that I, I've referenced a couple times, I was in September. Um, and that was largely due to a federal investigation that was dubbed by the government called Operation Double Helix. And that was a coordinated effort with multiple agencies, US Attorney's Office, the fbi, dea, GS O oig. Um, and in that, um, that investigation was spurred by I think two main things. And that was, um, first there was Medicare beneficiaries approaching the government complaining about being approached, uh, for these genetic tests by marketers. And then also the government always follows the money, right? And there was, was a spike in 2017 and 2018 for these types of genetic tasks being billed. Um, and so that sparked the government's interest to go ahead and start looking at these complaints more closely. So, um, which ultimately resulted in this take down in September where 35 individuals were charged or indicted, um, for a loss amount, which is staggering. It's a 2.1 billion loss amount that the government is alleging with this, with this take down, um, a pretty significant, sorry to interrupt. It's sounds like a pretty sign. No, it's a significant, um, enforcement action, uh, and, uh, highly coordinated among multiple agencies, I would imagine. Um, you know, tell me a little bit about what, what, what the general allegations are here. You know, who were the main players, what are some of the tactics that were alleged, uh, to be at issue here and, uh, and, and, you know, to sort of zero in for us on, on, uh, what were the bad acts that were alleged, uh, in these cases? Sure, sure. Absolutely. So the, the main players are the marketers, um, telemedicine, uh, companies and physicians and positions, and then laboratories. And the government has alleged, uh, basically that the marketers are the driving force of these schemes. They, and I, I use the word alleged cuz so, and I come from the defense perspective of this<laugh>, so you'll hear me say allege a lot in that<laugh>. Um, the, the government has alleged that these marketing companies have driven, um, these schemes by first providing, approaching Medicare, Medicare beneficiaries, um, convincing them to agree to take these tests. And then once they have, um, the government has also alleged that there's been, that they've dub scare tactics to get them to agree to these tests. Um, then in turn, once they had that referral, the, the marketers utilized telemedicine companies to provide orders for these tests. Um, the government is alleging that these telemedicine physicians had limited interaction or no interaction with the beneficiaries before ordering these tests. Once the marketers have the orders, the government then has alleged that they're providing them to the laboratories or brokering'em off to the laboratories, um, where the laboratories are then submitting it for reimbursement after processing the test. Um, so that's just the general scheme alleged and, and the main players, uh, at, at play here. Um, and, and, and, and, and how is the government concluding that these, uh, actors are, uh, violating the law? You know, what are sort of the, the theories of legal liability and, and, and some of the schemes that you're seeing? Yeah, absolutely. So the, most of the charges and needs indictments are under the general healthcare fraud statute, section 1347, and then also, uh, violations oft kickback statute. Um, and so of course the, the government also tags on conspiracy charges for violating the, a, the AKs and also conspiracy to commit healthcare fraud. And it's just a given most of these cases. And so, um, to support those theories of liability, the, the government as a alleging that these genetic tests were lacking of medi medical necessity, um, primarily because they don't believe these tests were being used to diagnose or treat, um, in this case cancer. Um, instead that they were being used more as diagnostic tests, which is not reimbursable. And, um, the, the government is also alleging that the, the underlying medical, uh, telehealth visit was not reimbursable. Um, that, that's another theory that the government is putting forth. Um, I think someone's gonna discuss a little bit more about, um, the telehealth requirements and how those have loosened up a bit. Sure. Um, and then as far as the a K s and that, I think this is the main reason that the government has really taken a close look is the, the relationships between the, the marketers and the laboratories and the, the te telehealth entities all, um, according to the government re uh, um, anti kickback statute violations. Um, great. Well, I, I, I appreciate the, the insight and the download and, you know, for the benefit of our listeners, uh, do you have any of the citations or the complaints or, uh, the names of any of these cases that, that folks could research? Uh, or if there's a website for the DOJs operation double helix that, that our listeners could visit, that would be great. Sure. There is a, a, there's a great press release by, uh, the DOJ giving, um, a list of the, um, different indictments of that initial crackdown. I'm not sure the best way to communicate that, um, press release, and I'm happy to provide that afterwards. Um, that's great. We can, we, we can upload that with, uh, with the podcast, so, so that'd be great. And, you know, you mentioned, um, telehealth, and I wanna turn quickly, we had a, recently had a really good podcast on, um, the impact of covid 19 on telehealth. And I know Soma, we spoke, uh, previously about this issue, but do you wanna talk a little bit about, uh, telehealth and, and some of the changes that we are seeing in light of Covid-19? You had some interesting thoughts on this, right? Um, and I know that you could discuss some of these on your most recent podcast. Um, but just to recap, recap, yes. CMS has, uh, loosened some of the prior telehealth requirements, and it's mostly to allow healthcare providers more flexibility in providing services, especially, you know, during this time of, uh, pre social distancing. And we don't really want people, um, transmitting, transmitting, um, the disease or the virus, um, you know, by going into medical offices where that might not be prepared, um, uh, for, you know, transmission. So, um, sure, the, um, a lot of the changes have to do with the services that are eligible, the providers that can provide these, um, the telehealth visits and, um, um, the patients that, um, are not eligible. So one important change is the Geo Geographic restrictions. Um, so previously telehealth patients had to live in rural areas, and the rules have now been changed so that all Medicare beneficiaries are eligible for telehealth services were regardless of support they live. Um, so whether they're in urban areas, um, they can still get telehealth, um, appointments, and these are are reimbursable where they weren't before. Um, another important change is HHS is no longer auditing for an established or prior patient physician relationship. So whether you're a new or established patient, you can get, um, telehealth services. Um, other changes have been HIPAA requirements. So previously you had to use a platform that, um, was approved under hipaa, um, and now you can use, uh, you know, a wider range of platforms as long as you're not public facing. So you can't use Facebook Live for a telehealth appointment, but you can use Zoom or Google Hangouts, or even Facebook Messenger video. It's video chat. And then also, um, convenient things we use every day, like FaceTime, um, and V hhs. OIG is also providing flexibility for healthcare providers to reduce or waive cost, cost sharing or copays for telehealth visit visits, um, that are paid by federal healthcare programs. So one of the fears of liability the government has used in, um, these genetic testing cases is that, um, patients were being provided these prescriptions without paying copay, without um, having to, um, pay anything at all. And the government sometimes will see this as an inducement, um, which is, um, illegal under the anti-kickback statutes. But this flexibility is, it's certainly going to reduce some of the government's arguments, um, that they've previously used, um, in, in the fact that, you know, if it's, if it didn't qualify for reimbursement before and it now does, um, the government's not gonna be able to use those arguments. Um, and you know, Gio mentioned one of those important ones, which is, um, what constitutes an eligible telehealth visit? Um, you know, one of the, one of the government's main arguments in Operation Helix was that, um, the service wasn't reimbursable because the underlying visit wasn't reimbursable. So the orders didn't, um, meet the Medicare rules. But you know, now that they're, they're being a lot more flexible with what constitutes a reimbursable visit, um, these, um, these changes are going to erode, you know, these prior years of liability. And so I think that what we're left with is really the medical necessity arguments. Um, and practically speaking, um, given, um, all that's going on the COVID 19, um, there's been a lot of experimental testing and innovation that's been going on, um, in an effort to combat their healthcare crisis. So I think that outside, you know, blatant scams, there's going to be a huge gray area in, in kind of debating what constitutes medical necessity right now, because the, uh, the, the circumstances are are constantly evolving. Absolutely. Absolutely. So, but that's, um, that's really good insight and I think that, you know, you've added some additional layers of thought to what we've previously discussed on this podcast. And, you know, I, I appreciate your, um, commentary on the flexibility that OIG is providing right now. And I wonder if you might wanna share some additional thoughts about, uh, you know, the type of guidance that practitioners should look to in advising their clients or any practical compliance strategies, either in the lab enforcement space or, uh, the covid 19 impact to, uh, telehealth. So, uh, Soma Geo, any thoughts on, on those topics? Well, you know, I think the best way, um, to be proactive right now is to have an effective compliance program. You know, in recent years, DOJ has really focused on producing guidance documents that kind of outlined what they expect out of compliance programs. They released one in 2017 and most recently in April of 2019. And, um, at its core, you know, this, the, the 2019 guidance asked three basic questions. Um, first, you know, is the compliance, is the compliance program well designed? Um, are companies applying it in good faith and earnestly, and then does it work in practice? And, um, a lot of the focus falls under the first question about whether the compliance program is well designed. And so, um, companies are really gonna have to make sure that they, that they have, um, procedures and policies in place that are, you know, designed well to detect, um, misconduct, um, and correct misconduct. Um, that there's appropriate mechanisms in place for employees to report misconduct. Um, internal audits, internal investigations, um, will be important. Having compliance personnel that are qualified and have appropriate resources. And then I also think, um, making sure they're Rev, they're revising these compliance programs, especially with what's going on now. Um, and I think that, you know, in light of this discussion where there's testing with labs or, um, telehealth visits and you're seeing these fact patterns come up, um, in the government enforcement space, I think it'll be very wise for, um, healthcare practitioners to, um, kind of look at what the government's looking at and, um, assess, you know, do we have business arrangements that are likely going to, um, fall under government scrutiny? Um, and you know, there's a number of resources that, uh, practitioners can look to in structuring their business transactions to make sure that they're not falling inside these bounds. Um, the anti-kickback statute has several safe harbors and, um, you know, I mentioned the, um, the, the 2019 compliance guidance from the government. Um, and there's also several guidance pieces that have been published from HHS OIG that specifically deal with clinical labs. Um, most recently, um, there was a special fraud alert that was published by HHS oig, and, um, there's been advisory opinions in the past, um, limited, but there's at least one or two. And, um, um, OIG has even, um, developed compliance, um, expectations for clinical laboratories, um, which they published in 1998. Um, but you know, that is out there and it echoes a lot of the principles that have been, um, that have been, you know, um, emphasized by the government and their certainly and their recent compliance documents. Certainly. No, I think that's really great advice. And of course, pointing to OIGs special fraud alerts, advisory opinions and compliance program guidance is always a good measure for, uh, an A H L A lawyer, uh, looking to, uh, to provide guidance for their, uh, for their clients, especially on these issues. Uh, Soma, Gio, thank you again for your really insightful thoughts on laboratory enforcement in the genetic space, and of course the telehealth, uh, impacts from Covid 19. We really appreciate your insights, uh, and your thoughts. We'll continue to monitor this area and thanks again of course for listening to the, a podcast. And thank you to the GroupShip for update of the podcast on Thank you very much.