Health Care Client Alert - January 2016

2016 Enforcement Trends that May Affect Your Practice


HHS’s Office of the Inspector General (OIG) announced its New Year’s resolutions for 2016 in the form of a Work Plan, which it unveiled in November. As you may know, the OIG was created to protect the integrity of HHS programs by detecting and preventing fraud, waste, and abuse and by holding accountable those who do not meet program requirements. In 2015, they reported exclusions of 4,112 individuals and entities from participation in Federal health care programs, 925 criminal actions against individuals and entities, and 682 civil actions, including false claims and unjust-enrichment lawsuits. Through the creation of its annual Work Plan, the OIG identifies the areas it believes are most in need of attention and, accordingly, sets its priorities for the sequence and proportion of resources to be allocated.

The following are the areas the OIG has identified as needing more attention in 2016 that may impact your practice:

  • Anesthesia Services: Physicians report the appropriate anesthesia modifier code to denote whether the service was personally performed by an anesthesiologist, or medically directed and delegated to some other health care professional, such as a nurse anesthetist. Incorrectly coding the service as having been provided personally by an anesthesiologist will result in an overpayment, for which the OIG will seek reimbursement.
  • Chiropractic Services: Medicare Part B only pays for a chiropractor’s manual manipulation of the spine to correct a subluxation if there is a neuromusculoskeletal condition for which such manipulation is considered to be medically reasonable or necessary. Chiropractic maintenance therapy is not considered to be medically reasonable or necessary and is therefore not payable.
  • Clinical Laboratory Services: The OIG will be analyzing Medicare payments for clinical diagnostic laboratory tests, including the top 25 clinical diagnostic laboratory tests, since it found that it pays more than other insurers for certain high-volume and high-expenditure tests. Medicare payment rates for these tests beginning in 2017 will be based on private payer rates.
  • Physicians-referring/ordering Medicare Services and Supplies: The OIG will review select Medicare services, supplies and durable medical equipment (DME) referred or ordered by physicians and non-physician practitioners to determine whether the referring providers were Medicare-enrolled practitioners, as required.
  • Anesthesia Services/Non-covered Services: The OIG will review Part B claims to determine whether the beneficiary had a related Medicare service. Medicare will not pay for anesthesia related to items or services that are not reasonable and necessary.
  • Physician Home-visits: The OIG will determine whether Medicare payments to physicians for evaluation and management home visits were reasonable and made in accordance with Medicare requirements. Physicians are required to document the medical necessity of a home visit in lieu of an office or outpatient visit.
  • Prolonged-services: Prolonged services are for additional care provided to a beneficiary after an evaluation and management service has been performed. Physicians submit claims for prolonged services when they spend additional time beyond the time spent with a beneficiary for a usual companion evaluation and management service. The necessity of prolonged services are considered to be rare and unusual.
  • Enhanced Enrollment Screening for Medicare Providers: As part of an effort to prevent fraud, waste, and abuse resulting from vulnerabilities in the Medicare enrollment process, CMS is implementing new authorities that include site visits, fingerprinting, and background checks, as well as an automated provider screening process.
  • Opioid Misuse and Abuse: The OIG’s future planned work includes a holistic examination of HHS’s efforts to reduce opioid misuse and abuse.
  • Health IT Adoption: The OIG’s planning efforts will consider the significant challenges that exist with respect to Health IT adoption. It will review Medicare incentive payments to eligible health care professionals for adopting EHRs and CMS safeguards to prevent erroneous incentive payments, such as those not meeting selected meaningful use criteria.
  • HIPAA/HITECH: The OIG will determine the adequacy of the Office for Civil Rights (OCR) oversight over the security of electronic protected health information (ePHI). Prior OIG audits reported that OCR had not assessed the risks, established priorities, or implemented controls for its HITECH Act requirement to provide for periodic audits of covered entities and business associates to ensure compliance with the HITECH Act and HIPAA Rule requirements.

In addition to the OIG Work Plan, Decision Health, which publishes the Medical Practice Compliance Alert, also issued predictions for compliance trends likely to affect physicians’ practices in 2016. Many of Decision Health’s 2015 predictions turned out to be accurate. Its 2016 predictions include:

  • Increased reliance by government and private payers on data to judge physicians’ performance, thereby affecting value- and quality-based payments as dictated by the Affordable Care Act.
  • Additional HIPAA enforcement by agencies besides OCR, such as the Department of Homeland Security, the Securities and Exchange Commission, and the Federal Communications Commission.
  • Continued focus on False Claims Act, Stark and Anti-Kickback law compliance.
  • Increased OCR focus on Business Associate relationships as part of the new HIPAA audit program, such as attention on the selection of Business Associates and the due diligence associated with such selection, as well as the content of Business Associate Agreements.
  • Increased state enforcement activity in areas such as HIPAA/HITECH and consumer fraud laws.

The Health Care Team at Kaufman & Canoles is ready and happy to assist you in complying with any of these enforcement areas and beyond, and we wish you a very happy and prosperous New Year!


The contents of this publication are intended for general information only and should not be construed as legal advice or a legal opinion on specific facts and circumstances. Copyright 2017.

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