New OIG Audits Coming

The Office of the Inspector General (OIG) of the U.S. Department of Health & Human Services (HHS) just released summary data for 2015. It was a busy year. There were 4,112 exclusions, 925 criminal actions, and 682 civil actions for matters such as false claims and civil monetary penalties.

Of particular interest to healthcare providers is the growth in the number of exclusions. RACmonitor took a look back at the historical record. Between 1977 to around 1982, there were only a handful of exclusions. But they have grown rapidly since. By 1991, OIG was excluding 1,000 providers per year. By 2001, that number had risen to around 2,800 per year. By the end of 2015, the OIG was running at an exclusion rate of around 3,800 per year, a little more than 15 providers per day.

One would assume that eventually this growth in exclusions will taper off, but for the time being, there seems to be nothing standing in the way of the trend continuing.

The OIG currently is branching out in several new directions. One important new effort is aimed at combating the growing heroin and prescription opioid crisis sweeping across the United States. Data from the Centers for Disease Control and Prevention (CDC) indicates that fatal overdoses from heroin have risen by more than 325 percent, and the addiction rate now is more than 2 per 1,000 persons. That adds up to 640,000 addicts across the country for heroin alone. There also is a severe problem with prescription opioids. From 1999 to 2010, they caused more than five times the number of deaths than cocaine and heroin overdoses combined. More than 82 percent of prescription opioid overdose deaths were unintentional. As a result, HHS has declared that prescription opioid overdose deaths constitute an epidemic.

To crack down on the overuse of opioid prescriptions, the OIG is joining a coalition including the FBI, DEA, and various state agencies. A pilot project is being launched in Massachusetts. The focus is going to be on prescriptions for hydrocodone, oxycodone, morphine, and codeine. The OIG already has prosecuted a number of cases in which providers take cash and blindly write prescriptions. It is going to increase audits in this area.

Although originally tasked with combating fraud and abuse in federal healthcare programs, we now will see the OIG assisting more actively in criminal prosecutions and coordinating more closely with state authorities. In other words, inspection and auditing powers are being used for social engineering. That’s a new role for the OIG.

The OIG also is sharpening its focus in other areas.

For example, in response to chronic problems in long-term care, the agency is pushing to set up a system of national background checks for all facility employees. This is based on section 6201 of the Patient Protection and Affordable Care Act. Long-term care facilities and providers in participating states must conduct state and national background checks on prospective employees, including a check of state abuse and neglect registries, state criminal history records, and national fingerprint-based criminal history records. For the time being, interested states can apply for participation and get matching federal funds for the work. The long-term goal is to have a nationwide program put into place.

Based on Section 502 of the Medicare Access and CHIP (Child Health Insurance Program) Reauthorization Act (MACRA) of 2015, the OIG has been directed “to establish procedures to ensure that Medicare payments are not furnished to … individuals not lawfully present in the United States.” It is foreseeable that providers eventually may be required to verify the immigration or nationality status of some individuals. It is unclear how this is going to be implemented, as are the penalties that will be assessed if the provider makes a mistake. What will happen in so-called sanctuary cities?  This part of the Act also applies to incarcerated or deceased individuals. Since every law has its genesis in the real world, we can assume that there is a major problem of Medicare payments being made to dead people.

The OIG also is planning on getting much more involved in how states finance and run their healthcare programs. Many states finance some of their Medicaid spending by imposing taxes on healthcare providers. But there are federal rules (42 CFR §§ 433.55 & 433.68) that control the extent of state power in this area, and the rules must be followed for a state to continue taking advantage of medical assistance programs. These taxes must be broad-based and uniformly imposed. Another federal-state issue is how to run state Medicaid fraud control units. OIG is auditing these state units for compliance with federal regulations and policy. So this means that the OIG is auditing the states themselves and enforcing compliance with federal law. Look for some fireworks in these areas.

On another front, OIG’s Office of the National Coordinator for Health Information Technology will be taking a crack at the problem of inter-operability of health-related information systems. Auditing is focusing on whether provider information systems meet the standards for electronic health records. So apart from a provider getting its claims audited, now the specific format of computer-stored meta data concerning claims will be a new target.

My guess is that much of this auditing work eventually will be done by artificial intelligence that endlessly searches for problems throughout your information systems.

This post originally appeared in RACmonitor on February 15, 2016