The Zone 7 ZPIC Has Recommended Revocation of 82% of CORFS and 79% of CMHCs in South Florida – Is Your ZPIC Next?

October 9, 2010 by  
Filed under Featured, Medicare Audits

(October 9, 2010):  In late 2008, SafeGuard Services LLC (SafeGuard) was awarded one of the first two contracts to serve as a Zone Program Integrity Contractor (ZPIC) for Zone 7, an area which includes Florida, Puerto Rico and the U.S. Virgin Islands.  The contract covered a base year plus four additional years.  SafeGuard’s appointment was one of the first actions taken to consolidate the work previously performed by Program SafeGuard Contractors (PSCs) and Medicare Drug Integrity Contractors (MEDICs). Among its consolidated duties, SafeGuard is responsible for handling medical reviews and benefit integrity functions for Medicare claims under both Part A and Part B (hospital, CMHCs, skilled nursing, home health, provider and durable medical equipment).  These claims are the focus of this article.  SafeGuard became fully operational in Zone 7 on February 1, 2009.

Working together to promote the integrity of the Medicare and Medicaid programs, in recent years Safeguard has developed close working relationships with CMS, HHS-OIG, U.S. Attorney’s Offices, the FBI and other Medicare contractors.  .

As with other ZPICs, SafeGuard employs a number of techniques, both proactive and reactive, to address fraud.  In recent years, SafeGuard appears to have been one of the leading ZPICs in terms of “data-mining.”  The primary source for Medicare claims data is CMS’ National Claims History system.  Many of the audit and investigative processes developed by SafeGuard appear to now be employed by other ZPICs

CMS’ Proposed Rule issued September 23, 2010, provides an overview of how CMS and HHS-OIG intend to implement a number of new enforcement tools authorized under the Health Care Reform bill passed last March.  In reviewing the Proposed Rule, we unexpectedly learned about several audit initiatives that the “Zone 7 ZPIC” has been pursuing.  As the Proposed Rule states:

In addition to GAO and HHS OIG studies and reports, a number of Zone Program Integrity Contractors (ZPIC) and Program Safeguard Contractors (PSC), organizations used by CMS in helping to fight fraud in Medicare, have taken a number of administrative actions including payment suspensions and increased medical review, for the provider and supplier types shown above. For example, the Zone 7 ZPIC contractor in South Florida has conducted onsite reviews at 62 CORFs since January 2010 and recommended revocation for 51 CORFs, or 82 percent of the CORFS in the area. The same contractor has conducted an onsite reviews at 38 CMHCs located in Dade, Broward and Palm Beach County since January 2010, and recommended that 30 CMHCs be revoked for noncompliance (79 percent of the CMHCs in the area). In each instance where the ZPIC requested a revocation, the CMHC was also placed on prepay review. We have also conducted an analysis of IDTF licensure requirements and have found several circumstances that indicate irregularity and potential risk of fraud.” (emphasis added).

 Notably, there was no discussion of how the ZPIC expects patients with rehabilitative needs or acute psychiatric treatment needs will be cared for if SafeGuard succeeds in shutting down a vast majority of the CORFs or CMHCs in South Florida.   Is your ZPIC next to go down this path?

 Liles Parker attorneys represent providers in ZPIC related actions.  For a free consultation, please call 1 (800) 475-1906.

HHS-OIG has Identified “Partial Hospitalization Program Services” as a New Audit Area of Interest in its 2011 Work Plan

October 1, 2010 by  
Filed under Medicare Audits

(October 1, 2010):  This afternoon, HHS-OIG issued its 2011 Work Plan setting out new and continuing areas of interest where the investigative agency plans to initiate new audit reviews or continue their assessment of other areas of interest.  Depending on the ultimate findings made by HHS-OIG’s Office of Audit Services, there may very well be increased scrutiny in the future by ZPICs and RACs of partial hospitalization billings to the Medicare program.  Specific areas of interest for HHS-OIG’s Office of Audit Services include:

(1) Patient plans of Care, (2) Physician supervision and (3) Certification requirements.

 As the 2011 Work Plan sets out:

“We will review the appropriateness of Medicare payments for partial hospitalization program (PHP) psychiatric services. The Social Security Act, § 1832(a)(2)(J), provides for coverage of PHP services, and conditions for payment are in CMS’s Medicare Claims Processing Manual, Pub. No. 10004, ch. 4, § 260, and at 42 CFR §§ 410.43 and 424.24(e). A PHP is an intensive outpatient program of psychiatric services that hospitals may provide to individuals in lieu of inpatient psychiatric care. The program is to provide individuals who have mental health conditions with an individualized, coordinated, comprehensive, and multidisciplinary treatment involving nurses, psychiatrists, psychologists, and social workers. Medicare spending for PHP services has increased over the years. We will determine whether Medicare payments for PHP psychiatric services in hospital outpatient departments and freestanding community mental health centers met Medicare requirements based on documentation supporting psychiatric services, including patient plans of care, and physician supervision and certification requirements. (OAS; W001135453; various reviews; expected issue date: FY 2011; new start).”

 Once again, it is highly recommended that CMHCs review their documentation and billing practices to better ensure full compliance with applicable regulations. 

Liles Parker attorneys have extensive experience representing Medicare providers in administrative appeals.   Should you have any questions regarding these issues, contact Liles Parker for a free consultation at: 1 (800) 475-1906.