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Top Ten 2021: Fraud and Abuse Trends to Watch

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Based on AHLA’s annual Health Law Connections article, this special series brings together thought leaders from across the health law field to discuss the top ten issues of 2021. In the second episode, Carol Carden, PYA, speaks to Joe Wolfe, Hall Render Killian Heath & Lyman PC, and Tony Maida, McDermott Will & Emery LLP, about the top fraud and abuse trends to watch in 2021. They discuss government enforcement in light of the ongoing COVID-19 pandemic and the recent changes to the Stark and AKS final rules, the use of blanket waivers, and increased scrutiny related to the expansion of telehealth. Sponsored by PYA.

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Speaker 1:

The American Health Law Association is pleased to present this special series highlighting the top 10 issues of 2021, where we bring together thought leaders from across the health law field to discuss the major trends and developments of the year. Support for A H L A in this series is provided by P Y A, which helps clients find value in the complex challenges related to mergers and acquisitions, clinical integrations, regulatory compliance, business valuations, and fair market value assessments, and tax and assurance. For more information, visit pya pc.com.

Speaker 2:

Hi, my name is Carol Carden. I'm a principal with p y a. Welcome to the A h l A podcast series on the top 10 issues and health law. Um, 2021. We're here today to discuss fraud and abuse trends to watch, and I'm joined on this podcast by the authors of this part of the article, Joe Wolf from Rinder, and Tony Maa from McDermott, will and Emory. Thanks Joe, and to Tony for joining me today to discuss your thoughts on fraud and abuse trends in this Covid era that we are living through. Um, there certainly has been a lot happening recently as changes to the Stark Law and the anti-kickback statute have been finalized, um, coupled with the stark blanket waivers that were issued earlier in the public health emergency. So I noticed in your article you were cautioning that changes, you know, the magnitude that we've been experiencing would likely drive some enforcement efforts on the part of the government. So I'm, I'm just curious where you anticipate the most interest to be. Um, are you thinking that the waivers are gonna cause a lot of the scrutiny or is it some of the other changes that are likely to be a catalyst? And Joe, maybe if you wanna kick us off on this, um, first topic, that'd be great.

Speaker 3:

Yeah, thanks, Carol. Um, in, you know, in thinking about the interest from the government enforcement, I think on the regulatory changes, there will be a little bit of wait and see. Um, we, we have the opportunity now with the new Stark and, and anti-kickback rules for more technical enforcement. I remember in the, in the commentary, in the, the final rule, the government talked about these changes, providing clarity that would both benefit the regulated industry and their law enforcement partners as well. So I think, you know, where we have more clarity in the regulations and bright line standards, we could see more enforcement, um, the new more objective volume and value standard, uh, perhaps the new directed referral language and the tests there. Um, now we actually have a definition of commercial reasonableness that we can look to. Those could be areas where, um, those new tests could drive some of the enforcement. I, I think around the value-based changes and that new value-based framework, that's gonna probably be a bit further down the road. But, you know, certainly as healthcare organizations roll out, uh, their value-based framework, there are gonna be some more technical requirements. You know, whether an organization or a value-based enterprise is at risk, uh, whether they have done the, the monitoring they they need to do, and the documentation of the financial relationship, those could drive, uh, enforcement. I think on the waiver side, um, as you mentioned around covid, that could be, you know, more immediate. Um, especially, you know, everyone's gonna have to get their arms around what they did during this public health emergency. Um, and, and they should have done some analysis around whether, uh, the changes they made to their arrangements, uh, were, uh, appropriate. And whether they had a good faith belief that they could rely on those waivers. And so they should have been, uh, healthcare organizations now should, should be pausing and thinking about, you know, did we have a Covid 19 purpose for what we did? Was there a waiver we we could look to? Have we taken our step, the steps to document our reliance on those waivers? And I just think that there will be activity, uh, in, in this area in enforcement after the public health emergency, because a lot has happened and a lot of arrangements have required adjustments. So, uh, understanding how organizations line up with the waivers will, will be important. So those are some thoughts on where we could see enforcement, um, from, from my vantage point

Speaker 2:

A And Tommy, before you jump in, I guess I'm curious from both of you all, did you see a lot of clients use the waivers extensively? I think for the most part, most of the clients I work with may have used it here and there. I can only think of one client who used it pretty extensively. Has that been consistent with your all's experience?

Speaker 3:

And I'll give co uh, Tony a chance to answer. I mean, I have seen clients rely on the waivers. Um, I think one piece of this is if, if you've relied on the waivers, have you taken the next step, uh, to document that that reliance, um, as, as CMS indicated in the waiver document? So, you know, the, the fact that you relied on the waivers, uh, will provide some protection if there's reasonable reliance. And the government said that right in a waiver document. But the question is, have you gone a another step further, uh, to document your, to create documentation supporting the use of the waivers? That's definitely a, a best practice. Um, the government has said that, um, those need to, you know, documentation would need to be available, um, down the road for, for potential audits. So that's, that's an area that, that healthcare organizations should be thinking about.

Speaker 2:

That's a good point. And Tony, what are your thoughts on areas of scrutiny as well as clients' use of the blanket waivers?

Speaker 4:

Right, thank you. Um, yeah, I, I think a lot of clients use the Stark and anti kickback r waivers, you know, fairly earl particularly fairly early on in the emergency, as we all remember back to the difficult days in March and April, you know, last year where there was a lot of, um, scrambling on some level to get providers to, to staff hospitals, uh, and, and, and dealing with the immediate impacts of a shutdown. So I, I do think that those, you know, and I think they've probably, the reliance on those waivers has dissipated over time as things have, you know, somewhat smoothed out in various parts of the country. Um, but I agree with Joe that the important part about, you know, now that we're sort of out of the, that difficult stage, um, is to assess, you know, what happened at that time. Do you have the documentation to support, you know, when they're inevitably will be some sort of inquiry? Um, you know, I think for a lot in a lot of places there will, the government or relators will, there will be inquiries in terms of how those, how those waivers were used and what relationships were created as in reliance on it. Um, and I would say two things. One is to, to have that sort of ready to go. Um, and two, to the extent that any of those relationships are ongoing, you know, eventually the pandemic emergency will end and those arrangements will need to be, you know, uh, adjusted. Um, and in some cases they might, it might make sense to adjust them now, if you know, or within a, before the official ending of the emergency if that organization, you know, thinks that it's, you know, appropriate to do so. Um, you know, and some of the stark Covid related purposes are more, you know, straightforward than others. I think the one around to the extent arrangements were related to maintaining healthcare capacity in our market, I think there's, you know, there's probably some ambiguity there or, or places where, uh, you know, the government may sort of Monday morning quarterback have a different view about a arrangements. And so just being prepared to, um, explain why that arrangement was necessary at the time, um, and, and, uh, be able to explain that, I think will be helpful. Um, in terms of the, of the final rules, I, I do think that the, I think that a lot of, uh, industry is, uh, trying to digest and process the value-based rules and to determine whether, uh, those are sort, those are relationships or arrangements that they're going to be able to use. Um, I think the anti kickback safe harbors are as other safe harbors fairly narrowly drawn. And, you know, uh, people are going to need to look to those stark exceptions as a first instance since that's, um, since those are mandatory from a start perspective and then work with what they think the anti kickback, uh, um, posture is going to be for particular arrangements. Um, but, and I, so I think enforcement, consequently, I think enforcement activity is fairly down the road there because enforcement activity generally follows, you know, some period of time after the organiz, you know, the industry starts doing things. And I'm not sure that the industry is gonna start doing value-based arrangements at any, at a significant level, you know, in the near term. Um, and I agree with Joe. I think part of the changes to this bird, the Stark regulations to reduce burden, were also to provide clarity so that, um, I think c m s was fairly clear that, uh, in their perspective anyways, that now that they've created more bright line rules, it would be, you know, easier for the industry to comply. And consequently, if the government believes industry is not complying, that there would be, you know, a more straightforward enforcement pathway. Um, on the flip side, I think there's a lot of, uh, areas where technical violation, where, you know, enforcement and activity, particularly as it relates to Stark, probably is going to decrease. Um, given the changes in the volume value rule, uh, around physician compensation by health systems or hospitals in particular. A lot of the, um, uncertainty around the Tomi related theory, I think has been addressed by the rule, uh, a lot in, in the indirect compensation definition. Change has now removed, I think, will remove a lot of arrangements from needing the definition. And so I actually anticipate more of the government's enforcement efforts to shift from Stark back to Kickback Land when looking at physician arrangements, because I think the, the stark now, the, the, it's going to be more difficult for the government to prove up a stark case. And so that enforcement activity may shift, um, back, um, to a kickback focus theory than it had, than it has in the most recent past.

Speaker 2:

Interesting. Well, in my opinion, one good thing that came out of the, the Covid environment was the expansion in the telehealth services area. I think that was long overdue in the article you guys commented on in increased scrutiny. That's honestly already started to occur where telehealth is concerned. So I was just curious to hear your all's thoughts about, you know, what is it about telehealth that you think's gonna drive this? Is it outright fraud where people are billing for telehealth services that didn't occur? Or is it medical necessity issues or maybe something else entirely, or a blend of, of a lot of different things? So maybe, Joe, you wanna start us off on this topic?

Speaker 3:

Yeah, Carol sings, it's, it's a, it's a very, very good question. You know, as we think about telehealth enforcement, uh, you know, I, I do think that big ticket, uh, fraud, um, you know, will obviously, we'll we will, will garner some attention. It, it definitely will, uh, lead to, uh, um, you know, more significant headlines as the government, uh, tackles this. So I do think big ticket fraud will be part of this. Um, I do think also that other areas around billing and coding and, and appropriate, um, e and m levels, um, associated with care will will get attention as well. We know that the government, the OIG included in their most recent work plan, um, a focus on telehealth services during the Covid 19 pandemic and, and issues with program integrity. Uh, so the government's gonna be analyzing provider billing patterns for telehealth services. Uh, they're going to be looking at areas that pose a program and integrity or risk. Um, and so, uh, they are going to be piecing this together. Uh, so I think that's one, one part of this. Another is just the use of, of telehealth technology. Um, will, you know, where, where has that technology come from during the pandemic? You know, how does it line up with the waivers that were relied upon? I mean, you know, connecting those dots, we could see an enforcement in that area. And I do think it, you know, if we fast forward a bit with the new regulatory changes, we know that, um, changes under Stark and kickback in the civil monetary penalty law that just went into, into effect do have a, a telehealth component. You know, there are opportunities for healthcare organizations to provide technologies under some of those rule changes that could be an area of, of focus going forward as well. So I think we have the dynamic of, of covid, um, and, and the activities that happen. Then we have the OIG saying they're gonna focus on, uh, telehealth services, and now we have the going forward piece as well from a telehealth enforcement to keep our eyes on.

Speaker 2:

Good point. How about you, Tony? Anything, any other thoughts on the telehealth expansion that might, um, result in some additional enforcement efforts?

Speaker 4:

Yes, I, I, uh, I think that we're, I think that telehealth is going to be, you know, probably the primary, if not in the top three of enforcement categories for, you know, in my mind the foreseeable future<laugh>, um, because of its now prevalence in how healthcare is delivered. And I think that that's going to be a relatively permanent feature of the healthcare marketplace. I think a lot of people like learned, learned during the pandemic that they liked telehealth, um, for certain things anyways, and that it was a convenient way to get healthcare. Um, and that, you know, I, I, I think, uh, previously systems and physician practices who hadn't ever really used telehealth before or now have jumped in with both feet. And I don't know that that's, um, I dunno that that's going to change either. But I do think, you know, we just saw the, uh, uh, principal Inspector General's statement on telehealth fraud last week. I think that OIG has also jumped in with both feet on looking at telehealth from a Medicare, uh, payment and fraud enforcement perspective. And I don't see that changing any time in the near future. Um, you know, I think that the operation take the, the take down over the fall was focused on telehealth and looked at whether there was not only if the services were provided, but in some cases they were provided, but whether, um, whether there really was a treatment relationship between the telehealth provider and the patient, or if they were, you know, or, or not. Um, so I think that telehealth companies or practices that are using telehealth, you know, need to be, you know, need to start incorporating telehealth into their compliance programs and looking at, you know, ensuring that they meet the state requirements for having a legitimate physician patient relationship. You know, that there've been some flexibilities in light of covid. Those flexibilities also have an expiration date once Covid ends. So there will be a need to pivot, um, and make sure that, that those practices or, or, um, activities adjust, uh, and also look at the marketing strategy for telehealth services and make sure that the marketing of telehealth is happening appropriately. Um, you know, they're generally are rules against cold calling patients, and I think that's one of the things that the take down, you know, found on, on the cases on the, in the cases that they had investigated there, um, as well as looking at the, you know, in, in, in some ways it's, it's an extension of what compliance programs have been doing for a long time, right? It's auditing claims to make sure that they meet government and commercial payer requirements and, and the compensation relationships between the different entities now and the telehealth delivery system. There's a lot of new players, um, and some of those players are more sophisticated than others, which I think, you know, which as a result carries some risk that there could be some compensation relationships that, you know, would merit, you know, a second look now that we've, you know, now that we've been doing this for a year, and, and there's, there, it's a good time, I think, to take, uh, to assess where an organization is in their telehealth platform and, you know, decide if they need to make adjustments going forward. Um, now that we're, you know, now that I, that, you know, telehealth, I think has become at least a, a facet of what a lot of, uh, of how providers and, uh, and organizations are gonna be delivering care into the future.

Speaker 2:

Yeah, I think you make some good points, Tony, about telehealth being, you know, this expansion, being here to stay. You know, we've heard a lot in the past few years about current shortages and impending shortages and different specialties, and it seems like that telehealth could be a possible, you know, at least a part of that solution. So I, I'm hopeful that a lot of the telehealth expansion does stay, of course, just assuming that providers are doing it compliant, but

Speaker 4:

Yeah, absolutely. And it increases access and can deal with a lot of the, you know, issues that some vulnerable populations have too in dealing with social determinants of health. And a lot of seniors and other people have trouble getting to tran to getting transportation to medical appointments. And that's been a longstanding, you know, problem in delivering care and managing the patient population that is, that has that feature. And telehealth, you know, you have to now make sure that those populations have internet access, but that's also a solvable, um, problem. Um, even under the new rules, there's a, there's a pathway to, to help, um, to help value-based enterprises deal with that. So there's a, um, you know, and, and so one exa and, and, uh, one example of a strategy, right, would be to assess, you know, the licensure, um, the, the provider's licensure that you have in your, in your portfolio. Um, perhaps that's not the right word to describe it, but whoever your telehealth providers are, you know, where, what states are they licensed? Where are your patients located? And, you know, do you need to, to, to find providers who are licensed in other states, or get your current providers to obtain licenses in other states in order to meet, you know, the, the business goal or the population that you're, that you're looking to treat, um, in light of covid. You have some flexibility there, um, which varies by state, but you know, that, again, that's sort of a short term solution to, um, if you're really in telehealth as from a long game perspective, you're gonna wanna understand and, and have a strategy for dealing with those licensure differences.

Speaker 2:

Good point. So I guess as our kind of final, uh, thing to that, I'd be curious about, at least in our time that we have left together here, and maybe Tony, since you've got the floor, uh, what would be your top three recommendations, um, to providers to best navigate this 2021 and beyond environment?

Speaker 4:

Yeah, it's a, it's a great question. I love a top three, um, or top 10 kind of question, um, fits well with our, with the, uh, top 10 series that ALA does every year. I think, you know, number one, it, it, it, and some of these are gonna be kind of going back to compliance basics on some level, but I think given all of the changes that have occurred in the last year and in the delivery system that we've talked about, and, um, with the rise of telemedicine and the changes and the, and I kickback and Stark rules, I think it is actually helpful to go back to the basics and sort of foundational aspects of an effective compliance program. Um, and have those, and have that, you know, compliance and number one, have that compliance committee be tasked with, you know, doing this work, figuring out how does, how do the, the revised rules affect how we should be, um, entering into relationships with physicians or other referral sources? How do we need to change our contract management system in order to deal with those changes? How do we need to audit arrangements differently? Um, uh, how do we need to adjust our work plan, uh, or risk assessment for the organization to address telehealth capacity that we've added in the last year? How do we make sure that we are meeting those requirements both now during the covid, uh, emergency, but planning for being able to, to continue delivering this service in a seamless way once that Covid emergency ends? Um, and number two, really to continue to, to, to have that infrastructure in place to provide the documentation that you're gonna need, um, in order to respond to any kind of government inquiry, uh, uh, um, you know, both related to during covid period of time, um, and then afterwards, right? It's, it's a matter of, you know, having the ability to explain, um, your story to, to a regulator, um, and, and have the information to, um, to deal with that sort of inquiry, um, in the, is really critical to minimizing the impact that an inquiry or an investigation can have. Um, and I think three is to, uh, is to, the, the third thing that I would recommend is really to, um, think about how the value-based, you know, how the organization wants to approach the value-based payments and the value-based enterprise concept. Because once, you know, once we kind of get back to normal, I do think that there's going to be an increased interest in commercial payers and in the government in changing the reimbursement system to, you know, shift risk, um, given budgetary constraints that are inevitably going to start, um, becoming part of the conversation. Um, the political conversation again, um, given all of the, uh, spending related to covid, I do think that there's going to be, you know, I think that the march towards value-based payment away from fee for service, uh, is going to continue. And so that's sort of the long term, you know, planning for, for organizations and providers to have. And I think the people who think about it early and who figure out a way to build a mouse trap to get that right are gonna be really well positioned into the future.

Speaker 2:

Thanks, Tony. How about you, Joe? What would be your top three?

Speaker 3:

It's interesting. Um, you know, my, uh, my top three, uh, coincide nicely with, with Tony is, I, I would say my, my first was also to get back to basics. There's been lots of disruption within, uh, um, healthcare organizations in their legal and compliance team. And so now is the time to, you know, take a step back and take a, a breath, get your your team in place, and look at your, your policies and process and how you're monitoring and auditing and, and, um, really lay out that work plan and what you're gonna focus on, uh, here in 2021, uh, to ensure compliance. So I first get back to basics, uh, two, I would prioritize taking stock of, uh, your covid 19 related actions. Now, while the public health emergencies in place, um, it, uh, at, by now you've operationalized some of those changes and, and have implemented, uh, changed arrangements into Tony's point. Um, you, you have to give some thought to whether these changes can stay in place. What happens when the waivers go away? Uh, does the arrangement need to be shut down? Uh, what, how have you documented reliance on those waivers? Uh, those should be, uh, an immediate, uh, priority, uh, now, um, rather than when you get to the end of the public health emergency. So I, I would take stock of those, um, efforts. Um, and then third, I, I would look forward here and think of how to operate, operationalize these new rules. Uh, there is a lot in these new rules and regulations, and I think one way to start to tackle it is to just get your team focused on just getting an understanding of these rule changes going forward and what the new exceptions and safe harbors might, might mean to you. Uh, think about updating your policies, um, doing training, allocating responsibility within your legal and compliance team to these new rules or lean on support from outside. I think you do need to let these sink in a bit a bit, you know, especially the value-based framework, uh, there is, is is a significant amount of, of, of regulatory, uh, uh, text there in, in and of itself. So, um, I, I, I do think you need to just give some thought to how that's gonna drive your strategy. Go f going forward. Um, focus on how those, the, the changes to the big three and fair market value and commercial reasonableness and volume and value are gonna impact your organization. Uh, think more granularly about the signature rules and, and, and now the more, uh, greater flexibility around reconciliations and, um, diminimous arrangements under 5,000 actually fit into your response to compliance issues more granularly. Um, and, and then also think about these rules are in effect already. They went into effect on January 19th, um, except for the group practice rules that go into effect next year. So your organization should already be implementing your arrangements under these new rules, and you also should be examining existing arrangements under these rules as well to make sure you are, you're in compliance. So those would be my big three. Uh, get back to basics, uh, prioritize your covid 19 actions. And then third, uh, make sure you're operationalizing these new rules.

Speaker 2:

Those are great insights from both of you. I, I really appreciate you both, uh, joining me on this podcast to discuss your article on fraud and abuse trends. And thank you to all the listeners who have dialed into the A H L A podcast series on top 10 issues in health law 2021. I trust you guys have found it as, um, enlightening and enjoyable as I have. So thanks again, Joe and Tony, appreciate your time today. Thank

Speaker 4:

You.