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CMS Initiatives to Combat Medicare Advantage and Part D Fraud

Tanette Downs

Director, Division of Plan Oversight and Accountability

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Medicare Fraud costs our country $60 Billion a year

(Attorney General Eric Holder)

If we do not step up our efforts, the Medicare Trust Funds could become insolvent by 2024

(Medicare Board of Trustees)

And our entire healthcare system would be compromised…

…for all Americans

But we are fighting back, and it’s working…

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Amazing results from an amazing group of dedicated people…

Including you and your organization

The fight continues…

We now have new tools to help us work together to win the war on fraud…

And help ensure healthcare for this generation and future generations to come.

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“Today, we are releasing a report, which shows that our work to take on the criminals who steal from Medicare and

Medicaid is paying off: we are regaining the upper hand in our fight against health

care fraud.

As this report shows, our anti-fraud efforts recovered $4.1 billion last year. That’s up 58 percent from 2009.”

Kathleen Sebelius, Secretary US Department of Health and Human Services

February 14, 2012

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Our Agenda for Today’s Discussion

1. Building on a Successful Anti-Fraud Effort

2. Introduction to the Center for Program Integrity (CPI) and its Role in Combating Fraud Waste & Abuse

3. Outreach & Education Initiatives

4. Prevalent Fraud Schemes

5. Resources & How to Report Fraud

6. Questions & Answers

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Building on a Successful Anti-Fraud Effort

Detection • Pre-payment detection

model vs. “pay & chase”• New technologies, e.g.

predictive modeling and innovative data sources

• Temporary “stop payments” for suspicious claims

• More rigorous provider enrollment screening

Deterrence • Expanded overpayment

recovery efforts, e.g. Recovery Audit Contractors (RACs)

• Stronger civil and monetary penalties

• Tougher new sentences for criminals

New Initiatives

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1. Center for Program Integrity (CPI)

2. Division of Plan Oversight and Accountability (DPOA)

Introduction to the Center for Program Integrity (CPI) and its Role in Combating Fraud Waste & Abuse

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Center for Program Integrity (CPI)

In 2010, CMS established CPI

and appointed Dr. Budetti as

Deputy Administrator

• Realigned all CMS fraud,

waste and abuse (FWA)

activities under one Center

• Heightened level of attention

to FWA

• Enhanced data sharing

across programs

• Stronger industry

partnerships for anti-fraud

collaboration

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Division of Plan Oversight and Accountability (DPOA)

• DPOA’s Vision: To be the organization at CMS that will safeguard the integrity of the Part C & Part D programs

• DPOA’s Mission: To manage all the facets of program integrity functions as they relate to the provision of Part C & Part D benefits

Leading the Fight Against Medicare Part C & D Fraud

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Part D Recovery Audit Contractor

Outreach & Education MEDICNational Benefit Integrity MEDIC• Complaints Intake• Proactive Data Analysis• Referrals from

Sponsoring Organizations (SOs)

• Investigations /Audits

• Collaboration with Law Enforcement

• Assistance to SOs

• Outreach Activities• MEDIC Website• Education and

Training• Quarterly Fraud

Workgroups• Fraud Tools

Medicare Parts C & D Anti-Fraud Team

NB

I ME

DIC

Part D RAC

O&

E MED

IC

• Audit of (PDE) Claims Paid to Excluded Providers

• Improper Payment Determinations• Fraud Referrals to NBI MEDIC

CPI DPOA

Working Together Against Fraud

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National Benefit Integrity MEDIC• Complaints Intake• Proactive Data Analysis• Referrals from

Sponsoring Organizations (SOs)

• Investigations / Audits

• Collaboration with Law Enforcement

• Assistance to SOs

Medicare Parts C & D Anti-Fraud Team

NB

I ME

DIC

Hea

lth In

tegr

ity

Part D RAC

O&

E MED

ICCPI

DPOA

Working Together Against Fraud

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Part D Recovery Audit Contractor

Medicare Parts C & D Anti-Fraud Team

NB

I ME

DIC

Part D RACACLR Strategic

Business Solutions

O&

E MED

IC

• Audit of (PDE) Claims Paid to Excluded Providers

• Improper Payment Determinations• Fraud Referrals to NBI MEDIC

CPI DPOA

Working Together Against Fraud

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Outreach & Education MEDIC• Outreach Activities• MEDIC Website• Education and

Training• Quarterly Fraud

Workgroups• Fraud Tools

Medicare Parts C & D Anti-Fraud Team

NB

I ME

DIC

Part D RAC

O&

E MED

IC

Rainm

akersCPI

DPOA

Working Together Against Fraud

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Outreach & Education Initiatives

1. Fraud Work Groups: Working Together to Create Cutting Edge Tactics

2. O&E MEDIC Website: Keeping Updated on the Latest Information

3. Fraud Tools: Making it Easier to Detect & Report Fraud

4. Education & Training: Shortening the Learning Curve for Faster Results

2012 Fraud Work Groups

VALUE PROPOSITION: Coming together to create cutting edge tactics for fighting fraud

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Keeping

Upda

ted on the

Latest

Inform

ation –

Every D

ay

http://medic-outreach.rainmakerssolutions.com

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O&E MEDIC Website

Provides a HIPAA-compliantsecure site for:

• CMS

• SOs

• Law Enforcement

• Other Professionals

• Consumers

Content includes:

• Fraud news updates

• Training

• Fraud tools

• Fraud Work Group meeting

registration

• e-Resource Library containing

basic references and contact

listings

• FAQs

VALUE PROPOSITION: Providing you with a complete online guide for combating fraud

Resources and Information to Aid Anti-Fraud Efforts

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Fraud Tools

Examples of 2012 Deliverables

VALUE PROPOSITION: Making it easier for you to detect and report fraud

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Education and Training

VALUE PROPOSITION:Helping you get up to speed quickly

Shortening the Learning Curve for Faster Results

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Prevalent Fraud Schemes

1. Services Not Rendered/Not Medically Necessary

2. Top Prescribers/Top Providers

3. Drug Diversion

4. False Front Providers

5. Upcoding

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Recently Reported High Risk Areas: CA, FL, IL, NC, NJ,

NY, MI, PR, TN, TX

SERVICES NOT RENDERED or NOT MEDICALLY NECESSARY

Ways to Identify:

• Pharmacy audits reveal shortages: invoices for medications

do not support the claims processed by the plan,

falsified invoices for drug manufacturers or distributors

• Forged physician or patient signatures on documents

• Physician prescribes outside his/her practice

• Patient/member complaints of not receiving items received

on EOB or items being delivered that were not requested

• High claim volume of abused drugs such as controlled

substance medications, pain medications, muscle relaxers, etc.

• Diagnosis on file does not match the services or items being billed

• Home Healthcare or other services billed while patient was in the hospital

Description: Claims submitted for services that never were received/ delivered, or were not medically necessary for the patient.

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Recently Reported High Risk Areas: MI, MO, NC, NY,

OK, PA, TX

TOP PRESCRIBERS/TOP PROVIDERS

Ways to Identify:

• Proactive data analysis can reveal top

prescribers and providers of highly abused

drugs and/or services in paid claim files

• Multiple plans have identified possible

overprescribing physicians

• Prepay review departments reveal no patient

history for services billed

Description: Top prescribers and providers are identified as prescribing or providing more services or items than others in the same professional peer group within their respective area or region.

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Recently Reported High Risk Areas: AZ, CA, FL, IN, MI,

NJ, NY, OH, PA, WA

DRUG DIVERSION

Ways to Identify:

• Diversion of drugs for medical purposes to the illegal

market occurs in several ways, including doctor

shopping, drug theft, prescription forgery, and illicit

prescribing by a physician, beneficiaries bribed to

sell their drugs or family members stealing drugs

• Drugs usually abused in this "pill mill" environment

are: Abilify, Zyprexa, Cymbalta, Zetia, Lorazepam,

Hydrocodone, Vicodin, Oxycodone, Oxycontin or

allergy/cough syrups

Description: Drug diversion is a criminal act involving the unlawful distribution of prescription drugs.

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Recently Reported High Risk Areas:

South FL, NY

FALSE FRONT PROVIDERS

Ways to Identify:

• New provider with sudden increase in billing

pattern

• UPS or FedEx® address

• High number of claims being submitted by a

new provider

Description: These are fictitious clinics, laboratories or other fake providers that bill for services or items not delivered. Many are identified as empty “shell” offices generating false claims.

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Recently Reported High Risk Areas:

CA, FL, UT

UPCODING

Ways to Identify:

• Data analysis can quantify:

• spikes in specific codes such as durable

medical equipment, prosthetics, and orthotics

( i.e., billing for customized orthotic, but

delivering an off-the-shelf product)

• spikes in brand name drugs versus generics

• Beneficiary Complaints

Description: Billing healthcare plans for more costly services or items versus what was delivered or received by the patient. This is done by billing a different level code to obtain a higher reimbursement.

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Resources and How To Report Fraud

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More Resources

• NBI MEDIC http://www.healthintegrity.org/

• O&E MEDIC Website/Part C & Part D Fraud Work Grouphttp://medic-outreach.rainmakerssolutions.com/

• Compromised Number Contractorhttp://www.tpgsi.com/

• Senior Medicare Patrol (SMP)http://www.smpresource.org/

• Corrective Action Plans (CAPs) http://www.cms.gov/MCRAdvPartDEnrolData/CAP/list.asp

• OIG Work Plans http://oig.hhs.gov/publications/workplan/2011

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How You Can Report Fraud

Contact National Benefit Integrity MEDIC at:

1-877-7SAFERX (1-877-772-3379) or http://www.healthintegrity.org/html/contracts/medic/case_referral.html

Questions?29