Containing Medicaid Costs: State Strategies

Transcription

1 Containing Medicaid Costs: State Strategies to Fight Medicaid Fraud and Abuse March 19, 2012 Today s webinar will cover: Overview & Impact of the ACA New York State Example Texas State Example 1

2 Presenters Patricia MacTaggart Lead Research Scientist, The George Washington University Mark Hennessey Assistant Medicaid Inspector General for Legislative and Intergovernmental Affairs, New York State Office of the Medicaid Inspector General Jack Stick Deputy Inspector General of Enforcement, Texas Office of the Inspector General Containing Medicaid Costs: State Strategies to Fight Mdi Medicaid idf Fraud, dab Abuse and Payment Errors Patricia MacTaggart, Lead Research Scientist GWU NCSL Webinar 3/19/12 2

3 Medicaid Program Integrity: Fraud, Abuse & Payment Errors Additional Opportunities, Requirements and Resource Demands Challenges of Evolving Environment: New Entities: ACO Health Homes New Delivery & Payment Options: Self- Directed New Data &D Data Sources, Conversion of Data & Potential Loss of Old Data Approach: Preventing Not Just Recovering ACA: Provider Participation Termination of Individuals or Entities: Medicaid must if terminated under Medicare or any other state Medicaid Medicare may if terminated by Medicaid Regulation includes CHIP Termination: provider's billing privileges revoked, provider has exhausted all applicable appeal rights or the timeline for appeal has expired, and no expectation that the revocation is temporary. CMS Secure Web-based Portal : States download information regarding terminated providers and to upload information regarding own terminations effective 1/1/11 3

4 ACA: Provider Participation Type of Screening Limited Moderate High Verification of any provider/supplier-specific requirements established by Medicaid/CHIP x x x Conduct license verifications (may include x x x licensure checks across State lines) Database Checks (to verify SSN and NPI, the x x x NPDB, licensure, a HHS OIG exclusion, taxpayer identification, tax delinquency, death of individual practitioner, and persons with any ownership or control interest or who are agents or managing employees of fthe provider) Unscheduled or Unannounced Site Visits x x Criminal Background Check x Fingerprinting x ACA: Suspension of Payments Pending Investigations of Credible Allegations of Fraud State Failure to Suspend Payments: Medicaid FFP not available if a State has failed to suspend payments when there is pending an investigation of a credible allegation of fraud against the individual/entity, unless the State determines good cause (criteria set by CMS) (3/5/11) States Flexibility: to determine credible allegation of fraud Human Error Billing Errors: not typically rise to level of fraud MCOs: subject to payment suspensions based upon a pending investigation of a credible allegation of fraud Exception: emergency item or service, not including items or services furnished in an emergency room of a hospital 4

5 ACA: Preventing Inappropriate Claims Payment Application Fee: Institutional providers and suppliers Temporary Moratoria: Ability for state to impose temporary moratoria to prevent or combat fraud, waste, and abuse of new providers/provider types Home Health Provider Face-to-Face Encounter (telehealth allowed): Required with patient prior to ordering home health services, medical supplies, equipment or appliances. Conducted by physician, nurse practitioner /clinical nurse specialist working with the physician, certified nursemidwife, or physician assistant under physician supervision ACA: Preventing Inappropriate Claims Payment Recovery Audit Contractors (RACs): audit payments to identify/recover provider overpayments/underpayments. State Medicaid programs to have RAC programs by 12/31/10. Medicaid RACs Final Rule was published 9/16/11 CPI-CMCS Info Bulletin with FAQs was released 12/30/11 and available on Medicaid RAC Contingency Fee Federal Register Notice was published 2/24/12 National Correct Coding Initiative (10/1/10): Consists of edits, definitions of types of claims subject to the edits, claims adjudication rules for applying edits, and rules for addressing provider/supplier appeals of denied payments for services based on the edits 5

6 ACA: Preventing Inappropriate Claims Payment Recovery Audit Contractors (RACs): audit payments to identify/recover provider overpayments/underpayments. State Medicaid programs to have RAC programs by 12/31/10 Proposed Rule CMS-6034-P: funding, payment, appeals & coordination with other efforts cms.gov/cmcsbulletins/downloads/ recent-developments.pdf National Correct Coding Initiative (10/1/10): CMS program that consists of edits, definitions of types of claims subject to the edits, claims adjudication rules for applying edits, and rules for addressing provider/supplier appeals of denied payments for services based on the edits Medicaid Integrity Program Medicaid Integrity Contractors CMS Contracted Entities: Review provider claims Audit providers and others Identify overpayments Educate providers, MCOs, Enrollees and Others Three types of MICs: Audit, review, education 6

7 Resources Needed Human Resources: Skill Sets: Analytical & Clinical Information Technology: Statewide Enterprise Technology (look at MH/SA/Medicaid/State Employees/Managed Care/FFS) Standardization of Data Elements Interfaces with Medicare, Data Bases, Other States, Attorney General Office Applications to screen claims and review encounters and look at them differently Challenges of Evolving Environment New Entities: ACO Health Homes New Delivery & Payment Options: Self-Directed New Technologies & New Focus Areas of Concern: Children imaging New Data & Data Sources: Conversion of Data: encounter data- not just MCOs Potential Loss of Old Data: ICD-10 New Interfaces: federal and state death records & other data bases 7

8 Approaches using e-health for Preventing Not Just Recovering Identification: Looking for Trends: Prepare for prospectively looking differently rather than retro as there will be no previous trends for new coverage, new service types (health homes) and trends as a result of ICD-10 Conversion Identity Management (Individual, Entity & Patient) : Leverage Health Information Exchange (HIE) & Health Insurance Exchange (Exchange) Communication & Management: Privacy and Security: Identity Theft Leverage HIE and/or Exchanges: provider directories, record locator, hub, secure messaging, consumer friendly web portal, interfaces with multiple data bases Fraud and Abuse: A New York Perspective Mark Hennessey Assistant Medicaid Inspector General New York State Office of the Medicaid Inspector General 8

9 OMIG Mission OUR MISSION Our mission is to enhance the integrity of the New York State Medicaid program by preventing and detecting fraudulent, abusive and wasteful practices in the Medicaid program and recovering improperly expended Medicaid funds while promoting high quality patient care. Achieving the Mission Great leadership: Governor Andrew M. Cuomo Medicaid Inspector General Jim C. Cox Advanced Tools: Cutting edgedataanalysis data analysis and visualization tools Industry leading practices: Transparency Compliance Data mining Investigations Audits Cost saving saving activities Holistic Subject Matter Analysis Terrific staff Partnerships with the program integrity community in New York and beyond That includes you! Governor Cuomo 9

10 Independent MIG New York created a Medicaid Inspector General lby statute ttt in 2006 Independent office Close to 600 employees Offices from Long Island to Buffalo (and in between) 19 NY Medicaid Inspector General Medicaid Inspector General: James C. Cox Former Regional Inspector General for the HHS Office of the Inspector General Two decades of Medicaid auditing experience Auditor by training James C. Cox 10

11 Holistic Approach Consistent application of protocols and guidance Accurate citations A fair approach A better result 21 Who is Involved? OMIG regulating enrollees agencies, law enforcement providers, provider associations, managed care plans 22 11

12 How does New York find fraud and abuse? Identifying Cause and Effect Learn about provider s business processes Perform root cause analysis: Identify cause of concern Work to correct problems where they exist Reviewinformation information supporting a claim: Consider presented evidence of whether service was provided (e.g. medical records) 24 12

13 Looking at What Matters Focus on fraud: Look for providers who are committing fraud Change approach to improve integration of targeted data mining and risk analysis not just high billing Balance this approach with maintaining access to services: Key part of what we do 25 New Tools Example In late 2011, OMIG undertook a new type of review: Inventory Verification Reviews Pharmacist buys pharmaceuticals from wholesalers in order to dispense An inventory verification review compares what ht was claimed on the Medicaid program with what was purchased from a wholesaler 26 13

14 Analyzing Results A team led by a pharmacist investigator is in charge of analyzing results Data miners compare and calculate variances If a variance is significant, it can be for only two reasons: Phantom billing Drug diversion 27 In Progress Field work on seven reviews so far One final action concluded, one coming in the next two weeks Focus has been on fast action for bad actors first review was completed in four months 28 14

15 Success Brooklyn pharmacists scammed $393,000 from Medicaid: state KENNETH LOVETT, TINA MOORE Saturday, March 03, 2012 A Sunset Park drug store and three pharmacists have to pay the state back hundreds of thousands of dollars for bogus Medicaid bills, the Daily News has learned. RBS Group Inc. (Premium Pharmacy) pharmacists James Lau, Chris Chang and Johnny Jian Q. Luo, have to return more than $393,000, the Medicaid inspector general s office said Saturday. The three also face possible prosecution for Medicaid fraud, a statement from the office said. Submitting a false claim isn t just bad record keeping, it s fraud, Acting Medicaid Inspector General James Cox said. Three excluded pharmacists Almost a half million recovery from one fraudulent pharmacy Better program integrity 29 Fraud and Abuse: A New York Perspective Mark Hennessey Assistant Medicaid Inspector General New York State Office of the Medicaid Inspector General 15

16 Texas Approach to Medicaid Investigations Jack Stick Deputy Inspector General Office of the Inspector General Staffing Doubled investigative manpower Divided into regional teams Regional teams each have field experts; field experts all belong to provider specialty teams Allows for exchange of ideas and experience; allows rapid deployment of investigators into targeted initiatives 16

17 CAF Holds Now identified at Intake phase as well as full scale investigation Result: fewer non-recoupable dollars Model T Investigations Identify top 25 or top 50 utilizers in problem areas Assign teams of investigators to handle all cases in an initiative area Same investigators, same type of case Results: increasing speed and accuracy 17

18 Initial Results Increased investigation completion rate >25% (partial year) Increased productivity measured by dollars investigated/identified (approx. 1700%) Decreased time to complete investigation 42 months in July 2011 vs. 8 weeks today DME Statewide sweep of 5,800 DMEs Goal: Identify clearly fraudulent providers while complying early with ACA requirements 18

19 MCO State shift to managed care 80% of dollars spent through h MCO OIG still has obligations same as before, as well as underutilization by MCOs View SIUs as farm teams use their resources, train them, cooperate with them FTP site for rapid transmission of large quantities of data Regular alerts providers bad in FFS or one plan are bad across all plans Graph Pattern Analysis for Fraud Analysis Pattern Recognition in EBT Trafficking and Provider Integrity 19

20 Graph Pattern Analysis in Fraud Interdiction Benefits Increases identification of suspicious activity Increases successful interdictions of benefit fraud Increases recoupment potential from fraudulent transactions Easy to use Leverages multi- jurisdictional resources What is Graph Pattern Analysis? Effective when: There s more data than a human (or computer, at present) can handle Relationships among date points matter more than individuals Any single piece of evidence is innocuous, but certain combinations of evidence are very threatening Graph Pattern Analysis has been used in intelligence community for: Social network analysis Finding IEDs Finding terrorists Graph Pattern Analysis provides an easy method to manage massive data quantities across multiple databases to identify suspicious activity 20

21 Scenario 1) Subscriber receives a SNAP Card with value of $600 2) Runner goes to retail location where Subscriber is shopping and offers $150 in cash for Subscriber s Card 3) Runner delivers card to Buyer, Card is sold to Buyer for $300 4) Buyer purchases goods from Retailer 4a) Buyer bundles multiple cards and delivers to a secondary buyer or organization, which converts to cash 5) Subscriber subscribes for a new card and repeats the process The Data SNAP transactions A reference to a Card and who the card is issued to (a Subscriber) Subscriber s s mailing address Transaction info What s not in the data Info on Runners or Buyers Info on the transactions between Runners and Subscribers, or Runners and Buyers Card transactions look like they are performed by Subscriber 21

22 Using Graph Pattern Analysis to Find Suspicious Behavior Look for suspicious subscriber behavior Look for suspicious usage behavior Look for data behavior and understand how it all interrelates There is no way to see this using current systems and infrastructure Active Approach to Block Card Issuance to Suspicious Subscribers Graph pattern analysis helps us gain knowledge sooner Example: using pattern analysis we can catch instances of the same malicious subscriber being issued a new card 22

23 The First Step Start with a query for suspicious behavior Step Two The Pattern Begins Use visual graph analysis helps focus investigation Note the suspicious spending at the retail store card subscribers from Houston are purchasing items at the same store in Austin 23

24 Discovery of Suspicious Purchasing A deeper dive in the highlighted store s sales activity reveals an odd behavior in purchases (note amounts circled in red) Note that there are Note that there are several transactions several transactions at this store all for all for the same the same dollar dollar amount amount Strategic Analysis Graph pattern matching and strategic views of the data highlights other stores with similar suspicious card charging patterns 1. Original Store under investigation 3. New store exhibiting same suspicious pattern of behavior 2. Expanding the scope of the investigation reveals other stores with similar suspicious activity 24

25 Identify Recipients, Cards and Locations Suspicious activity readily traceable to individuals and transactions Questions To report waste, abuse, or fraud, visit online at or contact the Fraud Hotline at

26 Questions & Contact Information The webinar archive and power points will be online next week. Upcoming Webinar: Medicaid Managed Care April 20th Staff Contact: Megan Comlossy 26