Legal and Criminal Investigation of Health Care Fraud in the Long-Term Care Setting

**sub**Investigation of Health Care Fraud Among Long-Term Care Practitioners **endsub** Stuart Silver, a Supervisory Special Agent of the FBI, Atlanta, GA, who heads a squad of agents investigating health care fraud in Atlanta and monitors all health care fraud activity in the state of Georgia, began his presentation by quoting a startling figure of $100 billion as an estimate of the sum that is lost to health care fraud each year. He explained that this figure is obtained by calculating 10% of annual health expenditure in the country. While health expenditure is now at approximately $1.35 billion, it is expected to rise to over $2 billion in just five years. This explains why in 1992, Janet Reno, who then held the position of Attorney General, made the investigation of health care fraud the top priority in FBI investigations. How are these investigations financed? Forty-five percent comes from government-sponsored programs and 55% comes from private payers, who would be considered victims of health care fraud. “But really,” noted Mr. Silver, “the victims are everyone in the United States because either you pay in added taxes, or in extra insurance premiums, or you suffer in terms of benefits that are reduced due to money that had been lost to fraud.” The FBI has approximately 12,000 agents in 56 field offices throughout the world, and 4% of these professionals are dedicated to the investigation of health care fraud, “which is really a lot” according to Mr. Silver. He mentioned that, in spite of the organization’s newly increased emphasis on countermeasures against terrorism post 9/11, prosecuting health care fraud remains an important program. According to Mr. Silver, the agency’s success at these investigations can be measured by the number of resulting indictments, which was at about 750 in the year 2000. “That means that on every given federal work day, there are three people being indicted for health care fraud,” said Mr. Silver.   To explain the prevalence of fraud, the presenter observed that individuals who were previously involved with various criminal enterprises, such as drug trafficking, often move into health care fraud. The speaker outlined four reasons for the transition: there is more money to be gained in health care fraud; there is a smaller likelihood of getting caught and prosecuted by the authorities; in the event of being convicted, the sentences are more benign; and the operations themselves involve a smaller degree of risk. According to Mr. Silver, there is a small and select number of individuals who are committing fraud within each provider community. These communities are: physicians’ practices, hospitals, ambulance services, home health care, clinics, pharmacies, durable medical equipment (DME), laboratories, and mental health care. Mr. Silver focused his presentation on the first three. Physician Fraud Among the different types of physician fraud, such as the classic billing for services not rendered, false upcoding, billing for medically unnecessary procedures, and kickbacks for referrals, the speaker focused on the former. “Our concern,” stated Mr. Silver, “is that room rental payments may be disguised kickbacks to the physician landlord to induce referrals.” He made it clear that federal law prohibits knowingly and willfully soliciting, receiving, or paying anything of value to induce referrals of items or services payable by a federal health care program. In addition, both parties in a kickback are held legally accountable. The speaker recommended the following website, https://oig.hhs.gov/ fraud/docs/alertsandbulletins/ office%20space.htm, for additional information on kickbacks that includes a list of rental arrangements that would be classified as “suspect” by the FBI. In summary, there should not be any link between the number of patients one refers and the amount of rent that this individual collects. Hospital Fraud The most common types of hospital fraud are billing for services not rendered, false upcoding of Diagnosis Related Groups (DRG), automatic billing charges, kickbacks for admissions, billing for a less qualified person, and cost report fraud. The upcoding of DRG, on which certain specialties are higher paying than others, is widely practiced in hospitals and may appear to present an optimal opportunity to generate extra revenue for the institution.  “What usually happens,” explained Mr. Silver, “is a hospital is approached by a consultant who says, ‘You are missing out on some really good revenue potential, and we are going to teach your coders how to code in a special way that is going to bring in increased revenue.’” The “special” coding may continue for a while until it gets noticed, which, in fact, is not difficult since it merely involves comparing the rates of utilization of expensive DRG codes at one hospital to those of others in the same geographic area. If the rate seems higher, the hospital’s previous rates of coding can be reviewed. If there is a sudden leap for expensive codes in the absence of an epidemic or any other reasonable explanation, the likelihood of fraud is quite high to the eye of an FBI investigator. Mr. Silver mentioned a recent case of a hospital in Atlanta that was confronted by the FBI with allegations of false DRG coding. An independent consultant was hired by the hospital under the instructions of the FBI to carefully review all patient records to verify billing. It turned out that over 50% of the DRGs were false. The overpayment amounted to about $1 million, and under the False Claims Act, the institution’s penalty was double that sum.  “And what kills me about this is that it was a local hospital that certainly did not have a lot of money to throw away on a civil penalty like this,” shared Mr. Silver. “They should have known.” Medicare Ambulance Fraud “Medicare covers ambulance services only if they are furnished to a beneficiary whose medical condition is such that other means of transportation are contraindicated,” stressed Mr. Silver. Among common allegations in Medicare ambulance fraud are: falsehood in a beneficiary’s ambulatory status, false origination/destination codes, inappropriate means of transport, and absence of transport altogether.   Mr. Silver clarified “inappropriate means of transport” by citing an example of a case involving an ambulance company in Atlanta that, as it turned out, did not actually own any ambulances. In the investigation that was unveiled, the FBI interviewed several people who were allegedly transported in the ambulances. The levels of satisfaction were high. Their response to questions about the quality of service was: “It was great. They were great. They were very helpful. In fact, sometimes the owner himself would come to my house to pick me up, and I got to ride in the front seat of his Porsche.” Mr. Silver stated, “An ambulance has to actually be an ambulance.” Next, Mr. Silver talked about a case that brought up a range of issues. A bill was filed for a patient’s transportation from the airport to her residence. The patient’s reservation, found by the FBI, said: “Will have her own wheelchair, no gurney to be at gate.” Clearly the patient did not have the required stretcher-bound status for being transported in an ambulance. The Health Care Financing Administration (HCFA) form 1500, however, indicated that the patient was confined due to medical conditions and could not be transported by any means other than a stretcher. In this case, it was the patient who made the phone call requesting transport by ambulance. It was therefore her responsibility, and not that of Medicare, to cover the cost of the service. However, certifying the HCFA-1500 remains the responsibility of the ambulance staff, and they should have told the patient in this case that the cost of her transport would not and should not be covered by Medicare. The frequently used argument of ambulance companies —“I relied on the doctor’s assessment of the patient’s status”—does not relieve the staff of that responsibility. Although there has not yet been a case when a physician was prosecuted for signing a form requesting ambulatory services without need, Mr. Silver called for honesty and a sense of responsibility among physicians. A problem may arise due to the timing of the actual transport of the patient and the physician’s assessment of his or her status, restricting eligibility for ambulatory services. However, this again stresses the importance of an honest assessment of the patient by the ambulance staff at the time of transport. Finally, while it is perfectly clear why a patient would prefer a ride in an ambulance that costs $300 to paying $15 out of pocket for a taxi, there is no justification for this expense on the part of Medicare, which raised a valid question: Should Medicare cover the $15 taxi ride? “Contact your local congressman,” advised Mr. Silver. “But the answer is not to saddle everyone with $300 round-trip buses,” he asserted. Conclusion Mr. Silver concluded his presentation by advising the audience of what every health care professional can do to combat fraud in the field: “Stay current with your bulletins, document both your questions to the CMS and their answers, do self-audits, and report billing errors and overpayment to your contract.” It is a good idea to fund and support a compliance officer in each organization—one whose role is not confused by other unrelated duties within his or her organization. This individual has to identify high-risk areas, open the lines of communication, establish an employee hotline, screen employees, and provide training in billing. It is difficult for the FBI to show criminal intent in a company that has undertaken efforts to eliminate fraud. **sub**Communication and Care Coordination: Defending Your Medical Decisions Before a Defense Is Needed **endsub** John Parisi, JD, MA, who practices in general tort law, medical malpractice, produce liability, environmental law, and False Claims Act cases in the state of Kansas, stated that he was presenting with the intent of informing his audience how they can minimize the risk of litigation by patients or their families, and how they can defend themselves and their medical decisions with properly generated and maintained medical records. A big determinant in whether or not a lawsuit is going to be filed is the relationship between the physician and the patient. The importance of communication cannot be overstated. First, geriatricians are, in most cases, able to foresee adverse outcomes—whether a result of medication or a health condition—when the patient is nearing the end of his or her life. Warning and preparing the patient in such a case can potentially ward off a lawsuit down the road. “It is critically important that you educate your patient and you educate the patient’s family as to what to expect,” stressed Dr. Parisi. The physician’s style of communication is instrumental as it sets the groundwork for his or her relationship with the patient. Surveys have shown that caregiver–patient interactions are the largest determining factor in patient satisfaction. People want to be treated a certain way. Most want an attentive listener in their physician, one who finds time to answer questions and converse with the goal of really understanding the patient’s standpoint. Physicians are presently being encouraged and taught, in training and at seminars, to relate to their patients, to scale their practices back in order to personalize them, and to communicate with patients in a way that creates bonds, and most importantly, builds loyalty. “Courtesy, smile, smile, smile!” urged Dr. Parisi. “Nothing says ‘I don’t care’ like ‘I don’t know,’” continued the speaker. And it is as much in the hands of the staff as it is in the physician’s own hands to keep the lines of communication open within the medical practice. Dr. Parisi brought up a recent case to emphasize his point. A 65-year-old woman who was extremely dehydrated and suffered from diarrhea, was brought into a family physician by her daughter. The doctor did blood work, and ordered a complete chemistry panel and an electrocardiogram, after which he sent her home, promising to call with the lab results. When the daughter called the office the next day, the office manager knew nothing of the case. She then called back the following day, only to find that the office manager was still uninformed. She called once again the day after that, and nothing had changed, but that afternoon she received a call from the office informing her that her mother should be taken to an emergency room immediately. A cardiologist had detected the presence of ischemia; the patient’s calcium and potassium levels were found to be critically low. These findings had come back from the lab three days before the urgent phone call was made from the physician’s office. The patient died in the hospital two days later. “Communication! And this did not happen 10 years ago, this happened last year,” said the speaker. “So people still aren’t getting the message that communication is very important.” Dr. Parisi noted that in the case of ancillary caregivers, “the key is to use a chain of command.” If a nurse practitioner or a nurse is aware of a problem with a patient that is being neglected, this caregiver must “go above people’s heads” in the institution. While Dr. Parisi admitted that this may be hard for some people to do, the court will consider failure to stop a malpractice as negligence if a lawsuit is filed. In the case that the caregiver gets a sense of imminent litigation, according to Dr. Parisi, it may not yet be too late to avoid a lawsuit. He suggested organizing a meeting with the patient’s attorney—in the presence of the caregiver’s attorney if he or she feels it necessary—and discussing the issues at stake. Dr. Parisi said that in his experience open and direct dialogue has often prevented litigation. Finally, if a case reaches a courtroom, “documentation is the key to a defense,” said Dr. Parisi. “Destruction of evidence equals evidence of negligence.”  All information regarding patients should be documented objectively and factually, keeping in mind that the time of events is extremely important. When adverse incidents occur, the question is whether to document them in an incident report. The peer review privilege is usually used to protect information in incident reports. However, “putting on his defense hat,” Dr. Parisi gave the following advice to the audience: “If you want to protect information, go through an attorney. The attorney-client privilege will protect you where the work product privilege will not.” In addition, “Due process of law is that with fundamental fairness of a due process of law, both sides to a litigation have a right to the underlying facts.” This overwrites the peer-review privilege. Concluding, Dr. Parisi emphasized the importance of properly documenting patients’ cases by giving some humorous examples of existing charts kept by physicians. “The patient is tearful and crying constantly, she also appears to be depressed,” he said. “The patient has been depressed since she began seeing me. The patient has no previous history of suicide.”