The Office of the Inspector General (OIG) reported it conducted audits and investigations resulting in anticipated recoveries of $2.2 billion; exclusions of 1,291 individuals and entities for fraud and abuse involving federal health care programs; 293 criminal prosecutions for crimes against HHS programs, and 142 civil actions including False Claims Act cases, unjust enrichment suits, civil money penalties law (CMPL) settlements, and administrative recoveries related to provider self disclosure matters during the time period from October 1, 2007 to March 31, 2008. Also, long standing issues under review included Medicaid payment integrity; appropriateness of Medicaid and State Children's Health Insurance (SCHIP) payments; as well as recent focus on oversight of Medicare Part D; public health emergency preparedness and response; oversight of food, drug and medical device safety; integrity of information technology and systems; and ethics program oversight and enforcement.
Medicare Part D and B
CMS analysis of Part D data estimates revealed that Part D sponsors owe Medicare a net total of $4.4 billion for the 2006 program year. Eighty percent of the sponsors owed CMS money and 20 percent were due money. CMS also noted that there was no mechanism to collect funds or adjust prospective payments prior to reconciliation after close of the plan year. A review of Part D payments to local, community pharmacies, disclosed almost 97 percent of the time, drugs were acquired for less than the reimbursement amounts. OIG estimates that, Medicare Part D payments to local, community pharmacies exceeds the pharmacies' drug acquisition costs by 18.1 percent.
OIG estimates that Medicare Part B made a total of $106.9 million in potential overpayments to suppliers of outpatient services on behalf of beneficiaries in Part A covered skilled nursing facilities (SNF) during calendar year (CY) 2001 and 2002, due to no systems edits being in place. In CY 2003 edits were implemented and overpayments were reduced to $22.7 million
Enforcement actions
Major enforcement actions for the period were reported by OIG against an artificial joint makers that agreed to pay approximately $310 million to resolve allegations of anti-kick back statute and False Claims Act (FCA) violations. A pharmaceutical company settled a civil suit and agreed to pay $499 million plus interest to resolve allegations related to illegal drug marketing and pricing. A Michigan dermatologist was sentenced to 10 years and 6 months in prison and ordered to pay $1.3 million in restitution for upcoding surgical procedures, billing for medically unnecessary procedures and improperly billing for follow-up office visits.
Medicaid fraud control units
Grants totaling $92 million were distributed to 49 states and the District of Columbia for this period to combat and punish fraud against Medicaid. Two chiropractors were sentenced to prison for 5 years, and 42 months, respectively, and ordered to pay $1.8 million in restitution for conspiracy to bill over $5 million in fraudulent physical therapy claims to Medicare and Georgia Medicaid. A Texas psychologist was sentenced to 4 years in Federal prison and ordered to pay $530,000 in restitution for fraudulently billing Medicare and Medicaid for psychological interviews and tests as if he performed the services, but in fact the services were performed by his unlicensed staff. The owner of a prenatal and child coordination services company was sentenced to 5 years in prison and ordered to pay $320,603 in restitution for billing Medicaid programs for services never rendered and for services not covered. It was discovered she attempted to hide the fraudulent billings by paying employees to fabricate records to support the claims submitted.
Source: OIG Report, June 12, 2008.
For more information on this and related topics, consult the CCH® Medicare and Medicaid Guide.
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