OIG Details Anti-fraud Efforts, Recoveries in Report to Congress

The U.S. Department of Health and Human Services Office of Inspector General (HHS OIG) recently reported that its investigative work is expected to lead to the recovery of $1.51 billion and 443 criminal actions for the period between October 1, 2019 and March 31, 2020. That is down from $2.3 billion during the same period last year.

The watchdog agency outlined its efforts to reduce fraud, waste and abuse in the healthcare system in its semiannual report to Congress.

The report noted that during this six-month period, OIG issued 81 audit reports and 14 evaluation reports and identified $605.2 million in expected recoveries, as well as $288.4 million in questioned costs. The audit also identified $911.3 million in potential savings for HHS (i.e. funds that could be saved if HHS implemented all of OIG’s audit recommendations).

In addition to the 443 criminal actions taken during the six-month period, OIG also took civil actions, such as assessing monetary penalties against 370 individuals and entities, and excluded 903 individuals and entities from federal healthcare programs.

The report highlighted the inclusion of a dedicated system to report fraud schemes for COVID-19.

“OIG is investigating and holding accountable those who would exploit the emergency to defraud the public and HHS programs, including through fraudulent marketing schemes for COVID-19 tests, identity theft, and submission of false claims for payment,†the report noted.

Other areas highlighted in the report include results from selected audits, evaluations and enforcement activities:

• The conviction of a doctor on 861 counts of illegal drug distribution, including distribution that resulted in death, for operating a pill mill in Virginia. Opioid prescriptions written by this provider resulted in the payment of hundreds of thousands of dollars in suspected fraudulent claims by Medicaid and Medicare Part D.  The provider was sentenced to 40 years in prison.

• OIG investigated a $21 million sober home fraud scheme in which three former co-owners and clinical directors of a group of purported substance abuse treatment centers and sober homes were sentenced to prison and ordered to pay a combined $4.2 million in restitution.

• A pharmaceutical company agreed to pay almost $12 million and enter into a corporate integrity agreement with the OIG to resolve allegations that it paid the copayments of Medicare patients taking a certain drug to induce the patients to purchase, or their physicians to prescribe, the drug.

• OIG determined that Medicare improperly paid suppliers $92.5 million for inhalation drugs that were unallowable for reimbursement.

• OIG also reviewed how states were operating their Medicaid programs. For example, it found that nearly 1,000 terminated providers (or 11 percent of all terminated providers) were inappropriately enrolled in state Medicaid programs. They were associated with some $50 million in Medicaid payments. Some of these providers were terminated for criminal convictions, licensure issues, and provider misconduct.

• OIG also found 23 states allowed unenrolled providers to serve Medicaid patients.

• OIG also found that Medicare improperly paid acute-care hospitals $54.4 million for 18,647 claims subject to Medicare’s post-acute-care transfer policy. These hospitals improperly billed the claims by using incorrect patient discharge status codes. Specifically, they coded these claims as discharges to home or to certain types of healthcare institutions, rather than as transfers to post-acute care.

In March, OIG released its strategic plan for 2020-2025 in which it set three goals: To fight fraud, waste and abuse; to promote quality, safety and value in HHS programs and for HHS beneficiaries; and to advance excellence and innovation.

The Health Law Offices of Anthony C. Vitale has more than 25 years of representing clients under investigation. We also can help you set up a compliance program so that you don’t find yourself the target of an investigation. Contact us for additional information at 305-358-4500 or send us an email to info@vitalehealthlaw.com and let’s discuss how we might be able to assist you.