OIG shifts gears to promote self-disclosure

IG’s open letter says feds will soften corporate integrity agreements for cooperative providers

In an apparent effort to entice more health care providers to self-disclose incidents of fraud and abuse, the Department of Health and Human Services’ Office of Inspector General (OIG) announced March 9 that it would soften the corporate integrity agreements (CIAs) it imposes on providers that volunteer incriminating information.

HHS Inspector General June Gibbs Brown revealed the policy shift in an open letter to providers last Thursday. The decision marks a significant move away from the increasing scope CIAs had started to assume. To date, more than 430 health care providers have entered into CIAs, whose increasingly onerous requirements have begun to raise the ire of providers.

The OIG says more than 70 providers have self-disclosed potentially abusive conduct. While that total does mark a notable uptick in the number of self-disclosures since Brown implemented the program two years ago, it remains a modest number.

When False Claims Act liability results from a disclosure, the OIG says it will now be "more flexible" in considering the terms of a CIA. "In general, we grant more deference to the existing compliance measures of a self-disclosing provider, even if those measures differ from what we might otherwise require in a CIA," Brown said.

In cases where the provider’s own audits detected the disclosed problem, the OIG may consider alternatives to the CIA’s auditing provisions and permit a self-disclosing provider to perform some or all of the billing audits itself, rather than require the retention of an independent review organization for each year of the CIA.

In addition, says OIG Associate Inspector for Legal Affairs Lew Morris, the OIG may narrow the scope and focus of the claims review to the areas found to be out of compliance. Alternatively, it may allow other audit methodologies in lieu of the statistical sampling methodology that is generally required.

Morris emphasizes that, to take advantage of the new policy, providers must have an effective compliance plan in place and self-disclose the potential problem.

"If the self-disclosing provider has demonstrated that its compliance program is effective and agrees to maintain its compliance program as part of the False Claims Act settlement, the OIG … may not even require a CIA," Brown asserted. "In those cases where, in our judgment, it is necessary to require the self-disclosing provider to enter into a CIA, the provider may need to make only limited changes to its existing policies and procedures to meet most of the requirements of the CIA."

Morris says the OIG wants effective CIAs that don’t "break the bank," and that appropriate compliance efforts on the part of suppliers should be considered credit "that turns into dollars."

Morris also defends the OIG’s current posture concerning self-disclosure in relation to whistle-blowers. He says whistle-blowers are free to come forward even when negotiations between providers and the government are under way, as long as there has been no public disclosure of the facts brought by the whistle-blower.

"At present, there is no inconsistency," he argues. But he also notes that there’s a growing body of case law over what constitutes "original source material" brought by whistle-blowers.

In addition to the audit provisions, Morris says many providers entering into CIAs express concern about the OIG’s exclusion authority when it determines the provider has materially breached the terms of the CIA.

In her letter, Brown defended this practice, but said the OIG will forego the exclusion remedy if the provider has made an "appropriate self-disclosure," and has demonstrated "sufficient trustworthiness."