Literature Review

FTC sues big 3 Pharmacy Benefit Managers PlanSponsor; by Remy Samuels; 9/20/24 The Federal Trade Commission filed a lawsuit against the largest PBMs, following its July report exposing the ‘opaque’ business practices of the ‘powerful middlemen.’ ... The Federal Trade Commission filed an administrative lawsuit Friday against the three largest pharmacy benefit managers—Caremark Rx, Express Scripts and Optum Rx—and their affiliated group purchasing organizations. The regulator argued the firms are responsible for inflating the cost of prescription drugs, such as insulin, and preventing patients’ access to lower-cost products. The FTC’s complaint, filed under its administrative process, not a federal court, alleges that the big three PBMs, which the FTC stated administer about 80% of all prescriptions in the U.S., have “abused their economic power by rigging pharmaceutical supply chain competition in their favor, forcing patients to pay more for life-saving medication.” 

New revised Medicaid Fraud Control Unit performance standardsOIG press release on X; 9/19/24HHS-OIG published revised Medicaid Fraud Control Unit (MFCU) performance standards. The standards provide helpful guidance to MFCUs in their operations and assist HHS-OIG in overseeing MFCUs. Read the performance standards here: https://direc.to/fj2o. 

CVS' Oak Street Health pays $60M to settle kickback allegationsModern Healthcare; by Katherine Davis; 9/18/24Chicago-based healthcare firm Oak Street Health has agreed to pay $60 million to resolve allegations from the U.S. Department of Justice that it paid kickbacks to third-party insurance agents in exchange for recruiting seniors to Oak Street’s primary care clinics. The DOJ alleged in a statement today that Oak Street’s Client Awareness Program, designed to grow patient membership, had third-party insurance agents contacting seniors eligible for or enrolled in Medicare Advantage plans, seeking to recruit them to Oak Street locations.

New red flags emerge in hospice UPIC auditing Hospice News; by Holly Vossel; 9/20/24 Unified Program Integrity Contractor (UPIC) auditors are taking a sharper look at nursing home room-and-board for hospice patients. Hospices have increasingly faced more regulatory scrutiny in recent years amid rising program integrity concerns, including ramped up UPIC audits, among various others. These audits are designed to instill oversight measures aimed at safeguarding against bad actors in the hospice industry. Regulators have been zeroing in around hospices’ data when it comes to patient interviews and Medicaid skilled nursing room-and-board payments, among other aspects of care delivery. These data could give UPIC auditors clues as to potential malfeasance. However, auditors’ data extrapolation methodology is flawed and poses risks for quality hospice providers, according to Bryan Nowicki, partner at the law firm Husch Blackwell.

Most frequent CMS citations in 2024 Becker's Clinical Leadership; by Paige Twenter; 9/19/24 Similar to 2023, hospitals are most frequently cited for deficiencies in patient rights, according to CMS data obtained by Becker's.  So far this year, CMS accrediting agencies have conducted nearly 2,760 surveys at U.S. hospitals. Of those surveys, more than 6% have resulted in a citation over a patient's right to receive care in a safe setting. Here are the 25 most common citations as of Sept. 15, according to data from CMS' Quality and Certification Oversight Reports: 

CMS updates guidance for rural emergency hospitals: 16 things to know Becker's Hospital CFO Report; by Alan Condon; 9/17/24 CMS has updated guidance for hospitals interested in converting to a rural emergency hospital, a Medicare designation that was made available Jan. 1, 2023. REHs are a provider type established by the Consolidated Appropriations Act, 2021, to address concerns over rural hospital closures and provide rural facilities a potential alternative to closure.  Since 2005, 106 rural hospitals have shut down, with another 86 facilities no longer providing inpatient services, according to data compiled by the University of North Carolina's Cecil G. Sheps Center for Health Services Research. Of those, 37 closures have occurred since 2020. Here are 16 things to know about REHs, including designation requirements, qualifying facilities, conditions of participation and how many hospitals have converted to REHs.  

CMS submits 75,000 pages to federal court to justify nursing home staffing mandate McKnights Long-Term Care News; by Kimberly Marselas; 9/15/24 The Department of Health and Human Services filed more than 75,000 pages of rule-making records with a federal court Friday, beginning its formal defense of its controversial nursing home staffing mandate. The submission of the administrative record is the first significant advance in the case since the American Health Care Association brought its challenge to the minimum staffing standard in late May. The Texas Health Care Association, three Texas providers and LeadingAge are also part of the case. In another development, District Court for the Northern District of Texas Judge Matthew Kacsmaryk on Sept. 10 agreed to fold in a separate federal challenge against the staffing mandate filed by the state of Texas. He noted that the two cases “share common questions of law or fact, consist of similar parties, the same claims, and [have] the same relief sought.”

United States settles claims of durable medical equipment fraud against Wilmington physicianDOJ press release; 9/11/24WILMINGTON, Del. – U.S. Attorney David C. Weiss announced today that Dr. Vishal Patel, a Wilmington physician, has agreed to pay $1,080,000 to resolve allegations that he violated the False Claims Act by ordering medically unnecessary durable medical equipment for patients covered by Medicare and the Federal Employees Health Benefits Program (FEHBP). Between February 2018 and April 2019, Dr. Patel referred patients for more than 1750 orthotic devices, including wrist, shoulder, knee, ankle, and back braces. The United States alleges that Dr. Patel had no medical relationship with these patients and that the referrals were based on brief reviews of the patients’ medical charts, which failed to establish any legitimate medical justification for the devices. Medicare and FEHBP paid, on average, more than $400 for each device. Patient files were provided to Dr. Patel by RediDoc, LLC, a purported telemedicine company based in Phoenix, Arizona whose owners pleaded guilty to participation in a $64 million health care fraud conspiracy in May 2022.

Hospice Insights Podcast: What’s the latest on UPICs? Highlights from recent audit activity, part I JD Supra; podcast by Husch Blackwell, LLP; 9/11/24 [UPIC stands for Unified Program Integrity Contractor audits.] UPIC activity is picking up, and the UPICs are reviving some old tactics. In this episode, Husch Blackwell’s Meg Pekarske and Bryan Nowicki discuss these trends which include extrapolation, Medicaid nursing home room and board payments, patient interviews, and more. Meg and Bryan also describe some handouts they’ve developed to help hospices stay prepared for the inevitable audit. 

CMS to expand ‘enhanced oversight’ to combat hospice fraud in 4 states Hospice News; by Jim Parker; 9/10/24 The U.S. Centers for Medicare & Medicaid Services (CMS) is expanding its enhanced oversight for new hospices in fraud-ridden states, including California, Nevada, Arizona and Texas. The agency in July 2023 first announced a “provisional period of enhanced oversight” for new hospices in those states. A key component of the enhanced oversight includes a medical review of claims before a Medicare Administrative Contractor (MAC) will pay them. “To combat fraud, waste, and abuse under the hospice benefit, CMS will expand prepayment medical review this September in Arizona, California, Nevada and Texas,” the agency indicated in a statement. “To help reduce burden on compliant providers, initial review volumes will be low and adjusted based on results. If you’re noncompliant, we may implement extended review or take additional administrative actions.” 

Home health care company operators sentenced to prison in $5.5 million kickback scheme and tax evasionDOJ press release; 9/5/24A married Macomb County [MI] couple, Noli and Isabel Tcruz, both 68, were sentenced today to 6 years in prison and 38 months in prison, respectively, on health care fraud kickback conspiracy, tax evasion, and fraud charges, announced U.S. Attorney Dawn N. Ison. This follows the sentencings earlier this year of two doctors who had pled guilty to receiving kickbacks and bribes from the Tcruzes... The Tcruzes engaged in an approximately $5 million conspiracy to illegally pay kickbacks and bribes to acquire referrals for home health care for Medicare beneficiaries and refused to pay their income tax obligations for both -personal and business taxes. After their last home health company was shut down in February 2020, Noli Tcruz began engaging in Covid-19 program fraud, and used a family member’s identity and company to steal from and defraud the Small Business Administration and Health and Human Services out of more than $250,000 from pandemic assistance funds.

22 health systems dropping Medicare Advantage plans | 2024Becker's Hospital CFO Report; by Jakob Emerson; 9/4/24Medicare Advantage provides health coverage to more than half of the nation's older adults, but some hospitals and health systems are opting to end their contracts with MA plans over administrative challenges. Among the most commonly cited reasons are excessive prior authorization denial rates and slow payments from insurers. [See article for list of 22 health systems dropping Medicare Advantage plans - including KS, ME, SD, NE, NV, MI, MN, OH, NY, IN, OK, TX, PA, DE, NC, OR, MO, KY, and CA.]

$83M fraud case against nursing home group may proceed, with no defendants excusedMcKnight's Long-Term Care News; by Jessica R. Towhey; 8/27/24A New York Supreme Court judge threw out all arguments from lawyers for an embattled group of nursing homes that sought to have charges dismissed in a case accusing the owners and operators of $83 million in Medicare and Medicaid fraud. Judge Melissa Crane ruled that the owners of Centers Health Care, along with numerous other individuals, did not make sufficient arguments for dropping charges of fraud, “saddling” nursing homes with “excessive debts,” colluding to pay “sham vendors,” and paying themselves “inflated” salaries.