In 2010 alone, more than 3,000 health care professionals and organizations were excluded from participating in government-funded health care programs, primarily Medicare and [...]]]> As most health care professionals are now aware, government investigation and prosecution of fraud among participants in federal health care programs has risen substantially in recent years and shows no signs of abating.

In 2010 alone, more than 3,000 health care professionals and organizations were excluded from participating in government-funded health care programs, primarily Medicare and Medicaid.  The number of exclusions has increased nearly 30 percent since 2009.

In addition, in the six months ending in March 2011, the federal government brought nearly 300 criminal actions and 200 civil suits against health care providers.

Why the increase?

According to the federal Office of Inspector General (OIG), much can be attributed to aggressive prosecutorial efforts on the part of the Medicare Fraud Strike Force – a component of the recently established federal Health Care Fraud Prevention and Enforcement Action Team – together with greater federal funding for these enforcement initiatives. As a result, the billing practices of physicians, hospitals and other health care providers have come under greater scrutiny by the OIG, the Justice Department and other federal agencies. It appears the question is no longer if a provider will be investigated, but when.

An external audit, subpoena or, worse, an unexpected visit from any one of these governmental agencies could trigger alarm and panic, especially among individuals who are targeted for investigation. Below are suggestions for managing the inevitable chaos that comes with such an event, and for minimizing the chances of being found in violation.

Preparation is paramount

Even before receiving a government subpoena or the like, a health care provider can minimize the likelihood of becoming the target of a Medicare/Medicaid billing investigation.

Here are some tips on how to avoid becoming a government target:

• Lead from the top.

To be effective, a commitment to compliance must be embraced from the top of the organization down. Senior-level personnel must adopt and reinforce a company-wide “culture of compliance” through open communication and continuing education.

• Inform.

Inform those within the organization about the risks of non-compliance with Medicare and Medicaid rules, ranging from program exclusion to criminal sanctions to civil penalties under the federal False Claims Act.

• Educate.

Make sure all employees understand the rules governing medical coding, billing and recordkeeping, and how those rules apply to them.

• Keep up with paperwork.

Timely provide complete, accurate responses to audits or other inquiries from the Centers for Medicare & Medicaid Services (CMS) or regional Medicare Administrative Contractors. Failing to do so may trigger further scrutiny.

• Implement a compliance program.

Although effective compliance programs must be tailored to the organization, the goal of every program is to ensure that the organization conducts itself in accordance with applicable rules and regulations. Compliance programs can include protocols for responding to an investigation. If violations are found, the existence of a compliance program can result in reduced fines, lower penalties and fewer criminal sanctions. In fact, the existence of a compliance program will influence the decision whether to exclude a provider from further participation in the Medicare and Medicaid programs.

Coordinating a response to a government investigation

When a health care provider receives a visit from an investigator or other government agent, a careful response is crucial, regardless of whether a provider has an organized compliance or risk management plan.

An organized response should include at least the following components:

• Establish a communication plan.

A communication plan should include a protocol for immediately notifying designated individuals within the organization, together with clear guidelines for communicating with government investigators.

The organization should also consider how much information to communicate to employees regarding an investigation. At a minimum, employees who are aware of an investigation should be asked not to discuss it outside of the organization.

• Do not retaliate.

Employers cannot retaliate against employees for cooperating with a government investigation by, for example, speaking with a government agent, even when doing so violates company policy.

• Seek representation by counsel.

The health care provider should contact counsel and, in the case of an organization, determine whether any actual or potential conflicts of interest require individual providers or other personnel to retain separate counsel.

Responding to government subpoenas – time is of the essence

To ferret out fraud, federal agencies rely heavily on the subpoena as their primary fact-gathering tool. Subpoenas may require either testimony or the production of documents or other materials. They are commonly issued to explore billing and/or coding irregularities along with questions concerning medical necessity.

Above all, a subpoena is a signal that a civil or criminal investigation is underway.

When a health care provider is served with a subpoena, it often has no insight into what triggered the investigation. The reasons might include a whistleblower-related investigation, a pattern of suspicious billing discrepancies, or complaints by a patient or competitor. The basis for inquiries may be civil, criminal or both.

After receiving a subpoena, a health care provider should:

• Immediately notify counsel and avoid the temptation to respond before doing so;

• Remind employees that they should not discuss the matter outside the organization, and ask that they refer any inquiries – from government agents or elsewhere – to a designated person;

• With help from counsel, prepare and distribute an organization-wide “litigation hold” to suspend any document destruction policies and ensure that any and all potentially relevant information is preserved;

• Help outside counsel formulate a strategy for comprehensive document preservation, collection, review and production. The strategy must include safeguards against the inadvertent production of confidential materials (i.e., proprietary information and trade secrets) and privileged information;

• Work with counsel to assess the scope and volume of the information sought by the government;

• Identify early on significant hurdles to making a timely and complete production, such as cost, timing, limitations on retrieval of historical documents and documents stored off-site;

• When appropriate, negotiate with the agency that issued the subpoena for a phased or rolling production to narrow or clarify the scope of information sought;

• Consider engaging an expert consultant to review records before they are produced in response to a subpoena, and to evaluate whether, and to what extent, the organization may have violated any applicable rules and regulations.

Now more than ever, health care professionals from all sectors must demonstrate a visible commitment to compliance with federal laws and program rules. Counsel and consultants are valuable resources for providers seeking to implement a compliance program or to test the rigor of an existing one.

Margaret H. Paget is a partner in the Litigation Department and co-chair of the Employment Law Group at Boston-based Sherin and Lodgen. Margaret can be contacted at 617.646.2167 or mhpaget@sherin.com. Jason L. Drori is an associate at K&L Gates in Boston, commercial litigation, regulatory compliance, and government enforcement issues. Jason can be contacted at 617.951.9143 or jason.drori@klgates.com.

Merck will pay a total of $950 million to resolve criminal charges and civil claims in connection with its promotion of the drug, which is no longer on the market.

According [...]]]> Massachusetts will receive $10 million as part of a multi-state settlement with Merck, Sharp & Dohme over the alleged illegal marketing of the painkiller drug Vioxx.

Merck will pay a total of $950 million to resolve criminal charges and civil claims in connection with its promotion of the drug, which is no longer on the market.

According to the Justice Department, Merck pleaded guilty to a single violation of the Food Drug and Cosmetic Act and will pay a $321 million fine. Under a civil agreement, it will pay $628 million to the U.S. and state Medicaid agencies to resolve allegations regarding off-label marketing of Vioxx and false statements about the drug’s cardiovascular safety.

Merck is accused of making false statements to state Medicaid agencies about Vioxx’s safety, and causing those agencies to rely on false claims in making payment decisions about the drug, the Justice Department said. An aide to Attorney General Martha Coakley said that Coakley’s office was the “principal negotiator” on the multi-state settlement team.

In July 2006, he underwent a bilateral knee replacement without complications. Following surgery, he was treated for pain with patient-controlled epidural analgesia and rescue doses of Dilaudid and Nubain. He was later [...]]]> A 60-year-old father of three adult daughters had a history of sleep apnea, which he treated with a Continuous Positive Airway Pressure (CPAP) machine.

In July 2006, he underwent a bilateral knee replacement without complications. Following surgery, he was treated for pain with patient-controlled epidural analgesia and rescue doses of Dilaudid and Nubain. He was later seen by a pain service and treated with rescue doses of Dilaudid, Oxycontin, Bupivicaine and Neurontin.

The next day, he still was not ambulatory and had a continuous positive motion machine applied to one of his legs at all times. A nurse noted that he was sleeping without his CPAP machine on. Thirty minutes later, he was not breathing. Resuscitation efforts were unsuccessful and the patient was pronounced dead.

A suit was brought against the decedent’s surgeon, two physicians on the pain service, an attending physician and the nurse who noted that the patient was sleeping without his CPAP machine. The theory of negligence was that the medication suppressed his heart rate, blood pressure and respiratory drive, increasing his risk of respiratory depression and pharyngeal collapse and, in light of his sleep apnea, requiring that he be continuously monitored (e.g., with a pulse oximeter) and that his  CPAP machine be applied or available when he was sleeping or at risk of sleeping.

The plaintiffs alleged that if the defendants had complied with the accepted standards of care, the patient would not have suffered a respiratory/cardiac arrest, and even if he did, it would have been detected immediately, and the patient would have been resuscitated successfully.

The defendants disputed that the standard of care required CPAP orders or continuous monitoring. They further disputed the cause of death and stated that even with a CPAP machine applied and monitoring, the patient still would have died.

The parties settled for$1.2 million.

Action: Medical malpractice
Injuries alleged: Wrongful death
Date: Aug. 23, 2011
Submitted by: Philip J. Crowe, Crowe & Mulvey, Boston (for the patient’s family)

The ambulance personnel allegedly made an inaccurate report to two nurses that the plaintiff had a history of migraines. The emergency room physician sent her home without a [...]]]> In the early morning hours of May 28, 2005, a 29-year-old woman presented to a community hospital emergency department by ambulance with a headache, vomiting and diminished consciousness.

The ambulance personnel allegedly made an inaccurate report to two nurses that the plaintiff had a history of migraines. The emergency room physician sent her home without a CT scan. She fell into a coma and was found unresponsive several hours later and rushed to a major hospital, where she was diagnosed with a subarachnoid hemorrhage.

The neurosurgical team observed and stabilized the patient, but at 7 p.m. she suffered a major re-bleed. The following day, the team clipped the aneurysm. The patient subsequently suffered several strokes that led to catastrophic injury, affecting most of her higher functioning.

An expert was prepared to testify that had she had been transferred to the major hospital with an accurate diagnosis directly from the community hospital, the medical team likely would have stabilized her condition and operated on her that day, before the major re-bleed. Also, had she deteriorated in the hospital instead of at home, the team would have observed it and performed emergency surgery. In either case, she likely would have had surgery the same day, avoiding the re-bleed, and likely would have had a good medical outcome.

The defendants’ experts, including a leading neurointensivist, were designated to testify that had the patient been transferred to a tertiary hospital for neurosurgery services in the most expeditious manner possible, she still would have suffered the injury. They claimed that immediate neurosurgery is not advocated on a patient who has only recently experienced an intracerebral hemorrhage due to the swelling, and that the timing of the plaintiff’s surgery likely would have been the same even if she had been transported to the hospital sooner. They claimed that once her hemorrhage began, she became at significant risk for vasospasm and stroke, and that the strokes she suffered were primarily due to the amount of hemorrhage from the initial bleed. Statistical data backed the defendants’ claims in that substantially more than 50 percent of subarachnoid hemorrhage patients die or suffer catastrophic injury.

The case settled at mediation for $3 million.

Action: Medical malpractice
Injuries alleged: Failure to accurately diagnose subarachnoid hemorrhage resulting in delayed surgery and significant neurological injuries
Date: Nov. 29, 2011
Submitted by: Jeffrey S. Raphaelson, Raphaelson & Raphaelson, Boston (for the patient)

The employee’s claim for workers’ compensation benefits was initially denied by the insurer; a conference later took place before an administrative [...]]]> A union ironworker injured his back after lifting heavy railings at Fenway Park. He was diagnosed with disc herniations at the L3-L4 levels and eventually underwent microdiscectomies performed by a Norwood doctor in May 2009.

The employee’s claim for workers’ compensation benefits was initially denied by the insurer; a conference later took place before an administrative judge, who awarded ongoing total disability benefits to the employee.

Following an appeal by the insurer, the employee was examined by an impartial physician, Joseph D. Ferrone Jr. of Newton, who insisted that the employee remained totally disabled and that his disability was causally related to his work injury. As a result, the insurer withdrew its appeal, but later filed a request to discontinue benefits.

A second conference in June 2010 resulted in an order denying the insurer’s request. The insurer once again appealed, and the employee’s lawyers again turned to Ferrone, who reiterated his opinion that the employee remained disabled. The doctor’s unyielding stance forced the insurer to withdraw its second appeal.

Ultimately, the parties settled on a $450,000 lump-sum agreement, which was approved by the administrative judge as being in the employee’s best interests.

Action: Workers’ compensation
Injuries alleged: Back injuries
Date: Oct. 5, 2011
Submitted by: Steven I. Bergel, Law Offices of Howard M. Kahalas, Boston (for the worker)

Rand researchers found that the use of [...]]]> A new study by Rand Corp. has revealed that the use of retail medical clinics is rising swiftly, and users tend to be younger, wealthier and in better health overall than their peers who went to a physician’s office or an emergency room for care, according to Modern Physician.

Rand researchers found that the use of retail clinics rose 10-fold between 2007 and 2009, based on a review of data for 13.3 million commercially insured patients younger than 65. During the period studied, 3.8 million members of that population made at least one clinic visit.

The researchers’ findings are published in the latest issue of the American Journal of Managed Care.

The researchers from Rand – which has examined retail clinics in several studies and reports – also found that the clinics can be used to manage some common health problems such as upper respiratory infection, bronchitis, ear infection, flu and conjunctivitis. Clinic users were more likely to be female, younger than 44, and living in ZIP codes with median incomes of more than $59,000, the study found.

Visiting a clinic tended to be at least 30 percent cheaper than going to a doctor’s office and a whopping 80 percent less than visiting an ER; however, the overall cost implications for clinic use are still unclear, as researchers couldn’t tell whether patients’ use of clinics represented new utilization or the shifting of care to cheaper providers.

Researchers compared how primary care providers responded to [...]]]> Pediatricians and other primary care providers are good at identifying physical injuries in children that might be the result of abuse, but they are not as good at judging when to report those cases to authorities, according to a study led by a doctor at Boston Medical Center.

Researchers compared how primary care providers responded to evaluations by child abuse experts in 92 child injury cases.

They found reporting was warranted in 13 of the 63 cases doctors chose not to report. Most of those cases involved leg fractures or facial bruises.

The study indicated that most primary care providers are trained on how to identify child abuse injuries, but they need to be told why they need to report and what information they need to provide.

The app, which is available for 99 cents through iTunes, allows users to store data about their current medications, drug allergies and immunizations. Also, the app’s functionality lets patients e-mail [...]]]> The American Medical Association has released “My Medications,” a new smartphone application created to help patients store and share their health information, according to Modern Physician.

The app, which is available for 99 cents through iTunes, allows users to store data about their current medications, drug allergies and immunizations. Also, the app’s functionality lets patients e-mail medical information and store health care providers’ contact information.

AMA Chair-Elect Dr. Steven Stack noted that the increased ease of physician access to patients’ current medications, allergies and immunizations decreases the risk of medication errors and adverse reactions to medications.

This is the second app the AMA has released. In March, the association launched an app for physicians to use in determining correct CPT Evaluation and Management billing codes.

Modern Physician reported that the rule, which was proposed on Feb. 17, will exempt [...]]]> Doctors will no longer be notified if someone is checking their record in the Health Resources and Services Administration’s National Practitioner Data Bank, according to a final rule from the federal Department of Health and Human Services posted in the Federal Register.

Modern Physician reported that the rule, which was proposed on Feb. 17, will exempt the use of information from the data bank from certain provisions of the Privacy Act.

The exemptions include provisions in the Act that would otherwise mandate notifying physicians if their information has been requested as part of a criminal, civil or regulatory investigation; allow individuals who are the subject of an investigation to correct or amend their information; and inform individuals – upon their request – if the data bank contains information on them.

If individuals were being notified of an investigation, it “could reveal the nature and scope of the investigation and could lead to the destruction or alteration of evidence, tampering with witnesses and other evasive actions that could impede or compromise an investigation,” according to the final rule.

Also, the rule says, physicians should already be receiving a copy of any disciplinary reports that a hospital or other entity is filing about them and procedures are in place to correct or amend these reports.