Preparing for the Office of the Inspector General’s 2013 Work Plan

Oftentimes providers finding themselves under review comment that they wish they had known oversight was potentially heading in their direction, and that they wish they had insight into areas of potential areas of exposure. Such lamenting is, of course, wasted energy, because potential exposure is potential exposure, and having “not known” of potential exposure is not a defense to that exposure. In an effort to encourage provider compliance, and in its efforts to combat healthcare fraud, the US Department of Health and Human Services (HHS) Office of the Inspector General (OIG) is attempting to offer total transparency by telling all providers what main areas it will be reviewing in the coming year.

It is recommended that providers pay attention, because the OIG has the ability to cripple a provider in its review or with penalties and sanctions. For those who are unfamiliar, the OIG is tasked with protecting the integrity of the HHS programs and operations and the well being of beneficiaries by “detecting and preventing fraud, waste, and abuse; identifying opportunities to improve program economy, efficiency, and effectiveness; and holding accountable those who do not meet program requirements or who violate federal laws,” and it has taken a leading role in such investigations and audits ( WP00-Intro+Contents.pdf).

The OIG maintains a staff of more than 1700 individuals throughout the country to “conduct audits, evaluations, and investigations; provide guidance to industry; and, when appropriate, impose civil monetary penalties, assessments, and administrative sanctions” ( reports-and-publications/archives/ workplan/2013/WP00-Intro+Con tents.pdf). The OIG investigates a wide variety of conduct (42 CFR § 1003.102), and may seek civil monetary penalties against any person who, for example, (1) presents or causes to be presented claims to a federal health program that the person knows or should have known is for an item or service that was not provided as claimed or is false or fraudulent (42 USC § 1320a-7a[a][1][A] and [B]); (2) violates the antikickback statute by knowingly or willfully paying or receiving remuneration for referrals of federal healthcare program beneficiaries (42 USC § 1320a-7b[b]); 42 USC § 1320a-7a[a][7]); or (3) pre­sents or causes to be presented a claim that a person knows or should know is for a service that may not be made under the physician self-referral or the Stark law (42 USC § 1395nn[g][3]).

One need only glance at the OIG’s website to glean that enforcement actions are merely ramping up. The OIG has seen incredible success targeting healthcare providers; available statistics evidence that, as a result of the OIG’s efforts during fiscal year (FY) 2010, $3.8 billion in investigation receivables that were court ordered or agreed to be paid through civil settlements had been recovered, and $1.1 billion in audit receivables are to be pursued as a result of OIG audit disallowance recommendations ( reports-and-publications/archives/ workplan/2012/WP00-Intro.pdf). The numbers available for 2011 show significant increases as the OIG continues to incorporate more sophisticated reviews and to expand the scope of its investigations. The available statistics for FY 2011 evidence that the OIG reported expected recoveries of approximately $5.2 billion, consisting of $627.8 million in audit receivables and $4.6 billion in investigative receivables (which includes $952 million in non-HHS investigative receivables resulting from our work in areas such as the states’ share of Medicaid restitution).

In addition to projected recoveries, the OIG reported exclusions of 2662 individuals and entities from participation in federal healthcare programs; 723 criminal actions against individuals or entities that engaged in crimes against HHS programs; and 382 civil actions, which included false claims and unjust enrichment lawsuits that were filed in federal district court, civil monetary penalty settlements, and administrative recoveries related to provider self-disclosure matters (http://oig. archives/workplan/2012/WP00-Intro.pdf).

In its FY 2013 work plan, the OIG sets forth with specificity areas of review, allowing practitioners the opportunity to address those areas and to take corrective action now, as opposed to during or after a review process ( asp). Examples of a few identified areas of potential review include:

  • Payments for multiuse vials of trastuzumab (Herceptin): the OIG states it will review claims to Medicare for trastuzumab, which is used to treat breast cancer, to determine whether claims were billed and paid properly. Trastuzumab is a multiuse-vial drug, and providers are required to bill the complete services provided with specificity (ie, the amounts expended; Centers for Medicare & Medicaid Services [CMS]. Medicare Claims Pro­cessing Manual. Pub 100-04, ch 1, §§ and Medicare’s single-use vial rule does not apply for trastuzumab (CMS. Medicare Claims Processing Manual. Pub 100-04, ch 17, § 40). For certain drug claims, those involving a single-use vial or a package where a provider must discard the remainder of a single-use vial or package after administering a dose or quantity of the drug or biologic, Medicare provides payment for the amount discarded along with the amount administered, up to the amount of the drug or biologic as indicated on the vial or package label ( plan/2013/Work-Plan-2013.pdf)
  • Payments for outpatient drugs and for the administration of the drugs: the OIG states that it will review Medicare outpatient payments to providers for certain drugs and for the administration of the drugs (ie, chemotherapy drugs) to determine whether Medi­care overpaid providers because of incorrect coding or overbilling of units. The OIG has previously identified chemotherapy drugs as particularly vulnerable to incorrect coding. The OIG will review whether providers are billing accurately and completely for the services that were provided (CMS. Medicare Claims Pro­cessing Manual. Pub 100-04, ch 1, §§ and, as well as whether providers are reporting units of service as the number of times that a service or procedure was performed (CMS. Medi­care Claims Processing Man­­ual. Pub 100-04, ch 5, § 20.2 and ch 26, § 10.4;
  • Payments for prostate cancer drugs under the current policy: the OIG states that this year it will begin to scrutinize the financial impact of rescinding the least costly alternative (LCA) policies, which were in effect from 1995 through 2010 and provided a Medicare reimbursement amount for a group of clinically comparable products that was based on that of the least costly product. In April 2010, LCA policies for Medicare Part B drugs were discontinued in response to a court ruling that found that the use of an LCA policy for certain prescription drugs was not authorized under Medicare (https://oig.

The severity of a review by the OIG cannot be overstated, which is why it is imperative for all healthcare providers who are rendering services to federal healthcare programs to understand areas of potential exposure and to take proactive measures to ensure compliance.

Before discussing identified areas of focus for the OIG during FY 2013, it is important to note that the first step to maintaining compliance is to have a policy governing your practice’s compliance (ie, a compliance plan).

The OIG has specified—although it is not mandatory—that it recommends each and every practitioner implement a specific compliance plan that includes certain areas of compliance to protect a practice (www.kirsc In fact, on review, the OIG will inquire initially whether the target of any such review has implemented a compliance program. We recommend each and every provider work with his or her healthcare counsel to implement the same and to operate according to its standards.

This article is for education and discussion purposes only and does not constitute legal advice.

Jennifer Kirschenbaum, Esq, manages Kirschenbaum & Kirschenbaum, PC’s healthcare department, which specializes in healthcare practitioner compliance, audit defense, licensure and transactional matters. Erica Youngerman, Esq, is an associate of the firm. For additional information regarding this topic and for assistance with compliance program creation and implementation, contact Jennifer at Jennifer@Kirschenbaum, or at (516) 747-6700 ext 302. To learn more about compliance options, visit

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