Compliance Mentor - March 2016

Hospital Access Management - Hospital Case Management - Hospital Employee Health
Hospital Infection Control - Hospital Peer Review - Healthcare Risk Management
Case Management Advisor - IRB Advisor - Medical Ethics Advisor - Same-Day Surgery

The Supreme Court Could Determine the Future of Fraud and Abuse Cases

There are more than a dozen major healthcare organizations that have filed amicus briefs in the case of Universal Health Services v. United States ex rel. Escobar, including the American Hospital Association and the American Medical Association, which could greatly affect future fraud claims brought against healthcare organizations.

At issue is the validity of the current legal theory used to bring fraud and abuse cases against hospitals and other healthcare facilities and providers. Plaintiffs are asking the court to overturn a False Claims Act (FCA) decision that relies on a broad interpretation of “implied certification.”

The issue is whether the “implied certification” theory of legal falsity under the FCA is viable. It focuses on situations in which whistleblowers or others allege that a healthcare provider has submitted a false claim by failing to follow certain regulations. This is sometimes true even if it was never stated that following the regulations was a condition of payment.

In Universal Health Services, parents filed a lawsuit after their child died at a Massachusetts mental health clinic. Plaintiffs allege the clinic did not adequately supervise their child. The plaintiffs also claimed the clinic did not employ a licensed psychologist or a board-certified or eligible psychiatrist in violation of state Medicaid regulations. State prosecutors say the claim submitted by the mental health clinic is an FCA violation because the clinic employed unlicensed counselors in violation of the law.

To read more about the case, please visit: http://bit.ly/1TBeF19.

To read the AHA amicus brief, please visit: http://bit.ly/1Uc9yVj.

To read the AMA amicus brief, please visit: http://bit.ly/1WvVFjk.

---

Hackers Hijack Medical Records, Hospital Pays Ransom

In a very alarming case, Hollywood Presbyterian Medical Center in Los Angeles said hackers used malware to infect their computers, preventing staff from accessing electronic medical records.

The hackers said they would release the records if the hospital paid 40 bitcoins, or about $17,000. The hospital paid the ransom.

Hackers use malware to lock systems by encrypting files and then demand ransom in exchange for the decryption key. The FBI is investigating. The hospital says neither patient care nor medical records were compromised.

Be sure to check out the April issue of ED Legal Letter for more about this.

---

---

CMS Issues Long-awaited 60-Day Overpayment Final Rule

CMS finally published the long-awaited final rule for reporting and returning overpayments, four years after CMS published the proposed rule, which requires hospitals and other providers to report and return any overpayments within 60 days of the date that the overpayment is identified or on the due date of any corresponding cost report, whichever is later.

The Affordable Care Act requires any person who received an overpayment to report it and return it to the state, intermediary, or carrier within 60 days. Failure to return overpayments within 60 days can result in treble damages, which are three times the amount of the overpayment. The federal False Claims Act also imposes penalties of a minimum of $5,500 and a maximum of $11,000 for each Medicaid claim.

The 60-day clock starts “when the person has, or should have through the exercise of reasonable diligence, determined that the person has received an overpayment and quantified the amount of the overpayment. A person should have determined that the person received an overpayment and quantified the amount of the overpayment if the person fails to exercise reasonable diligence and the person in fact received an overpayment.” The key provision is that the person exercises reasonable diligence and is quantifying the amount of the overpayments.

The final rule negates the concerns of the Kane case, which found the 60-day clock starts to run as soon as the provider is put on notice of a potential overpayment. (United States ex rel. Kane v. Healthfirst, Inc.) The clock is not ticking while the provider is conducting its reasonable diligence into whether there is an overpayment.

The requirements protect the Medicare Trust Fund against fraud and improper payments. It also ensures compliance with the current requirements.

To see a copy of the rule, please visit: http://bit.ly/20OxZxp.

---

TJC Proposes Standards for Pediatric Head Injury

The Joint Commission (TJC) released a proposal to require hospitals that treat pediatric patients with minor head trauma to determine whether to perform a CT scan.

Children are more susceptible than adults to the effects of ionizing radiation. CT scans save lives, but the radiation exposure is responsible for 15,000 new cancers every year. TJC is not the only organization that has expressed concerns about preventing unnecessary radiation exposure: CMS recently rewrote all its radiology and nuclear medicine conditions of participation, noting the same concerns.

TJC has expressed that the use of guidelines can determine when the CT scan is necessary for minor pediatric trauma and when dual phase CT exams of the head and chest are appropriate for pediatric patients. Hospitals and other providers are expected to use the Pediatric Emergency Care Applied Research Network’s (PECARN) Childhood Head Trauma: A Neuroimaging Decision rule.

For more information on PECARN, please visit: https://www.pecarn.org/.

The main prediction rule manuscript is available at: http://bit.ly/1SWj9jS.

To view the proposed TJC National Patient Safety Goal (NPSG.17.01.01), please visit: http://bit.ly/212WTJE.

---

---

UPCOMING COMPLIANCE WEBINARS