OIG Files: Vignettes of the Week

August 12, 2022

If you missed Eric opining on LinkedIn this week, here are some quick pieces of information including: an infectious disease doctor, a case in NJ, and a Bill that was signed into law.

Another great case from my former OIG coworkers in NJ. This one should concern readers for a few reasons, but the least of which is that the third party distributors were concerned and the overall wholesale system allowed it to continue. The part of the puzzle here is we know Insys was the tip of the spear in many of the cases involving these drugs. As such, it is no surprise that the pharmacies engaged in illicit behavior were able to continue on their way. The money in these cases is so huge it’s easy to turn a blind eye.

I posted about this bill a week ago and now it’s been signed into law. Those who engage in fraud relative to the Paycheck Protection Program will have to deal with being caught for 10 years. A normal criminal statute of limitations is 5 years so this gives investigators and prosecutors a cushion of time. I speculate that the estimates of fraud are substantial and the extra time will be needed to work through the prosecutions.

As an infectious disease doctor, the scripts written here should have raised a red flag. The PDMP should have triggered a red flag. Regardless of the method of payment, the PDMP should have reflected these scripts-unless they were filled by a pharmacy that wasn’t logging this, which then would lead to inventory management issues. Cash for the service can keep a provider off the radar but writing the scrip puts them back on when the script is filled.

This did not get a lot of press. Regardless of your political beliefs, threatening to kill a government official is never a good idea. The OIG is charged with providing physical protection of those high ranking officials under HHS. When I was an agent, not only did I receive training on dignitary protection, but I got to go to and see some very cool things in NY. My favorite Secretary was Donna E. Shalala. She was, at the time, the longest serving HHS Secretary, and was appointed by President Clinton. She was always engaging, and as a New Yorker, traveled to NY frequently.

While the dollar amount is relatively low, comparatively speaking, the disclosure was part of an existing CIA with the provider. What is more notable, outside of the facts regarding the issues with telemedicine, is that it is clear that the OIG is taking overpayments of any amount very seriously. In years past, an error rate of 5% or lower was typically not considered a reportable event in a CIA. In today’s climate, any overpayment identified is considered a reportable event. This makes for a very different landscape for providers under a CIA, as even a single claim identified as an overpayment can cause a multiple to be paid. It is becoming ever more important for providers to recognize the importance of self-audits to be proactive and vigilant on their claims submissions.

I do not think I can stress the importance of basic data analytics in FWA prevention and detection. In this release, the provider ordered DME for over 3,000 beneficiaries, including an amputee who purportedly needed a knee brace for the amputated limb, and deceased patients. Prior data would have identified the CPT and DRG for the hospital stay for the amputation, and unfortunately, death reporting is reliant upon (typically) funeral homes for state reporting. The reporting of deceased beneficiaries is a huge gap, and it relies upon quick and accurate reporting to a state, which then reports to the feds. This can take some time, which leads to the ability for these types of frauds, as well as identity theft. Of course, the local newspapers report it in near real time in some instances. From my perspective, the 3,000 orders alone from one provider should have raised a huge flag.

Jeanmarie Loria & Eric Rubenstein

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