Several new bills will become law on January 1, 2017 that will influence the management of workers’ compensation medical claims. The most important is SB 1160 which precludes the payment of medical bills when vendors have been accused or convicted of certain crimes such as workers’ compensation fraud, Medi-Cal fraud, or Medicare fraud.
AB 1244 provides that If a vendor is convicted of fraud, then they are automatically suspended from treating in the worker’s compensation system. The Administrative Director will create a list of all names on its website.
And other health care systems seem to be headed in the same direction.
It’s no secret that Medicare and Medicaid patients are crucial to the bottom line for many physicians. So being excluded from participating in the programs is a big deal and can sometimes mean the end of a medical practice.
Under the Social Security Act, the Office of the Inspector General is authorized to exclude individuals or entities that cause the submission of false or fraudulent claims to Federal health care programs. The exclusion law is applicable in nearly all conduct that forms the basis for a False Claims Act (FCA) action involving the Federal health care programs and serves to protect the integrity of these programs.
A recent 20-year exclusion issued by the HHS Office of Inspector General should serve as a cautionary tale for physicians and proof that the federal government is also keeping a close eye on physician conduct.
Labib Riachi, a New Jersey-based OB/GYN, was excluded for allegedly submitting thousands of fraudulent claims for pelvic floor therapy.
David Blank, a senior counsel with the OIG who represented the agency in the Riachi investigation, said the exclusion was one of the longest reached under the OIG’s permissive exclusion authority and the longest issued after an agency-initiated legal action.
Riachi reached a $5.25 million False Claims Act settlement in February over the false claims, but the OIG thought the settlement didn’t go far enough based on Riachi’s alleged actions.
The OIG set out to determine if Riachi required a corporate integrity agreement or exclusion, and Blank said it became readily apparent that exclusion was necessary.
In addition to the monetary loss Riachi caused to Medicare and Medicaid, the OIG determined his alleged actions carried a significant risk of patient harm. For example, Riachi allegedly provided electrical stimulus to patients with pacemakers and allowed unlicensed and unqualified staff to perform procedures.
An initial notice of proposed exclusion called for a 30-year exclusion for Riachi, but he ended up settling on a 20-year period rather than going before an administrative law judge, Blank said. While he agreed to the exclusion, Riachi denied any liability.
“Twenty years is a substantial period of exclusion and is a clear signal to physicians that they face significant consequences, beyond monetary penalties, for taking advantage of Federal health care programs and their beneficiaries,” said Gregory E. Demske, Chief Counsel to the HHS Inspector General. “In cases such as this, collecting money from a wrongdoer is not sufficient and OIG will pursue exclusion to protect our patients and programs.”