Healthcare Fraud Prevention Under the Trump Administration

On Feb. 5, 2017 President Trump’s contested nominee to be secretary of Health and Human Services (HHS), Representative Tom Price (R-GA), was narrowly confirmed by the Senate in a 52-47 vote. Dr. Price, a retired orthopedic surgeon, has been critical of the Affordable Care Act (ACA) and has advocated its repeal. What will his appointment mean in the government’s battle to thwart healthcare fraud and abuse? We do not expect the federal government’s scrutiny of healthcare reimbursement to diminish under the Trump administration and Secretary Price, but the focus on how to accomplish that scrutiny may shift.

Increased Focus on Data to Root Out Fraud

When asked by Senator Orrin Hatch (R-UT) what he believed HHS [which includes the Centers for Medicare and Medicaid Services (CMS)] should be doing in the fight against fraud and abuse, Price said he felt that the focus should be more on going after the truly “bad actors” and that it should be done “in real time.” This was direct reference to CMS’ data analytics approach and data mining that is now beginning to be used to identify outliers and those providers who stick out among their peers as potentially billing particular payment codes improperly or excessively. This effectively moves away from the “pay and chase” model that has been the hallmark of Medicare audits–pay the claims and then do a post-payment audit. The more recent data-driven approach to identify improper billing makes good sense when comparing similar health providers with similar lines of service.

But for EMS, it is hard to compare apples to apples due to the wide range in the types of service providers (9-1-1 only ambulance, non-emergency only ambulance, and those that do both). EMS agencies have been the subject of audits based on comparative billing reports that may show that the agency was billing a much higher volume of a particular service than its peer group. We have seen EMS agencies subject to extensive audits–often unnecessarily–because the data analytics showed them to be problematic outliers when they really were not. A higher priority on the data-analytics approach to detect fraud and abuse may not reduce the risk of an audit or investigation at all, especially in light of the inherent difficulty in making appropriate data comparisons in our industry.

Less Potential Focus on Medical Necessity

Price then went on to say this data analytics approach should be used “instead of trying to determine if every single instance of care was necessary,”–a direct reference to the current practice of CMS contractors that finds fault in claims for failure to meet medical necessity requirements. Since the statute and regulations do not clearly define what is and what is not a “medically necessary” ambulance transport, these determinations become very subjective. Medicare contractors who review claims in an audit tend to find reasons to deny a claim on that basis, rather than approve it.

That is why, in great part, there is such a backlog of Medicare appeals stuck at the administrative law judge level–improper medical necessity determinations made at the lower levels of appeal by the very Medicare contractors that pay the claims. So perhaps Price will encourage that medical necessity reviews be completed more carefully, or perhaps that more weight will be given to other evidence of medical necessity beyond the PCR, such as the physician certification statement (PCS) required for non-emergency ambulance transports, and other clinical and hospital records. That would be a welcome change.

The Fraud and Abuse Fight has Broad Appeal

At the end of the day, despite the contentious political climate, fighting fraud and abuse is an area where both Democrats and Republicans can agree. Even with the potential that the ACA may be repealed and replaced, we do not expect that the fight against fraud and abuse –which brings with it improper audits and investigations as a side effect for EMS providers–will be relaxed very much.

Going after potential fraud and abuse is a popular cause, and EMS providers, like other healthcare providers, have seen a huge uptick in the number of federal investigations and lawsuits under the federal False Claims Act (FCA). EMS has also seen an increase in post-payment audits, pre-payment reviews and, in some cases, even suspension from the Medicare program–initiated by CMS and the government contractors that administer the program. And that is a big part of the problem–the federal agencies and government contractors that act under the authority of the government (or, as JEMS founder James O. Page liked to refer to them, the “fourth branch of government”). They are a massive bureaucracy, and that entrenched bureaucracy is hard to change even with a new administration.

In the last several decades, there has been a huge shift in government authority to these entities thanks in great part to a 1984 U.S. Supreme Court decision, Chevron v. Natural Resources Defense Council. That decision makes it difficult to challenge the determinations of administrative agencies and their contractors, including their audit findings. And it is those very agencies, rather than the courts, that have become the final arbiter of their own decisions. We are left with a flawed administrative appeal process, often with court action as a limited last step to seek redress from improper agency or contractor decisions.

President Trump has also signaled that he is concerned about improper billing and will likely continue with aggressive fraud and abuse enforcement. His campaign platform vowed to “attack our debt and deficit by eliminating waste, fraud and abuse in the federal government.” Trump has recently railed against high drug prices and other waste in government (including criticizing Boeing for the costs of a new Air Force One). These comments seem to indicate that President Trump may not be so willing to lower the scrutiny of healthcare providers and others who bill the federal government for their products and services.

Importance of Ongoing Compliance Efforts

The take-home message is this: Even with the drastic change that November brought to our Executive Branch of government, EMS and the medical transportation industry can expect a continued high degree of scrutiny of claims for payment that are submitted to federal health programs. Put simply, we do not expect to see the frequency of audits and investigations to decrease. To the contrary, given the huge success that these efforts have had in bringing money back into the Medicare trust fund, we could see even greater scrutiny.

A Focus on Compliance is the Key

EMS agencies need to be diligent and proactive to avoid the risk of a potential high overpayment demand, or worse–a full-blown federal false claims act lawsuit. A comprehensive and active compliance program is the key. It starts with a strong, top-down commitment to compliance, effective policies and procedures with general compliance training and compliance training specific to the various job functions in your agency.

Documentation training for EMS field providers, and billing and coding training for those who review and submit the claims for payment are a must. This is one of the best ways to reduce the risk associated with the greater scrutiny that we believe all healthcare providers will face in the next four years. 

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