Retired OIG Special Agent and Advize’s Director of Litigation & FWA Support will be stepping in each week to examine current fraud trends from the lens of an investigator. Stay tuned for weekly insights, updates, and information on healthcare’s most expensive crimes.

I am surprised sometimes at the number of people in the healthcare field that are not familiar with the OIG’s Self-Disclosure Protocol (SDP), which can be found on the OIG website.  The protocol was established in 1998 and is designed to give providers an opportunity to disclose to the OIG instances where there may have been fraudulent claims submitted to the Medicare program.  The incentive for those who apply for, and are accepted in the SDP, is typically a reduced damages calculation and no corporate integrity agreement (CIA); however, as with everything, it is a case by case basis.  The SDP can be very advantageous to a provider, as a civil case brought by the US Attorney’s Office often does not have with it the potential reduction in damages and avoidance of a CIA.

The protocol is fairly straightforward, but the main point is that providers have taken steps to alert the OIG of the fraudulent behavior, clearly taken steps to mitigate the behavior in the future, identified the loss to the Medicare program as a result of the behavior, and are prepared to pay back the overpayment plus the damage calculation (which can be as little as .5 over the overpayment amount for a total of 1.5 times the identified fraud amount).

The SDP outlines 11 criteria needed for submission.  The OIG makes it very simple to submit the request for inclusion into the program and provides a link for an electronic submission.  The only part that is a bit tricky, is to ensure that your estimation of loss is accurate.  That can be done in one of two ways: a claim by claim analysis of the identified codes that are the nature of the fraudulent claims, or via a statistically valid random sample (SVRS).  I always suggest doing the SVRS because you can limit your review to 100 claims, which will give you a high level of confidence that your loss amounts are correct, will avoid additional OIG scrutiny (since using an SVRS is a standard practice), and the universe can be more easily articulated.

In my career at OIG, I was involved with several SDP matters.  Typically, they involved some billing issue, where the provider had some default system to bill a certain way, which triggered an additional payment for a service that was not rendered.  These cases are worked directly with the providers’ attorneys and the Office of Counsel to the Inspector General (OCIG).  OCIG lawyers are extremely well versed in this area, and the cases tend to move rather quickly with very little bumps in the road.  My role in these matters was to corroborate the information submitted for inclusion.  The process is not adversarial, as most matters involving healthcare fraud are, specifically because all of the parties are working together to resolve the matter in a harmonious fashion.

At Advize Health, we use RAT-STATS for identifying the universe of 100 claims for the SVRS sample.  RAT-STATS is the program developed by the OIG for statistical sampling.  It is an old program, and the interface is not all that attractive, but it really does get the job done.  More importantly, it is the standard used by the OIG, and has stood the test of time in criminal and civil cases and has been proven to be an accurate tool for statistical sampling.  We have worked with clients to obtain such samples, conduct the review and the subsequent extrapolation for the overpayment calculation.  We have also used RAT-STATS for providers who have found themselves in need of such sampling for CIA compliance as part of yearly reporting to the OIG for compliance monitoring.  We also use RAT-STATS for investment groups seeking to make purchases of provider assets to identify any potential billing issues that may exist (I discussed such due diligence in a prior blog, where a provider did not take conduct proper due diligence and purchased a falsely profitable practice that was profitable merely because the selling provider was heavily involved in upcoding).

It is always prudent to make a self-disclosure sooner rather than later, as by the time you are ready to make the disclosure, the OIG may have already opened an investigation.  If that happens, there is no way to obtain admission into the SDP.

Advize Health LLC is a healthcare advisory and consulting company that provides a breadth of healthcare industry services in the payer, provider, and legal communities. Contact Eric Rubenstein for more information on our Fraud Spotlight series.