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“THE PROBLEM IS OIG DOESN’T SEEM TO BE ABLE TO DISCERN BETWEEN GOOD PRACTICES AND BAD PRACTICES. THEY JUST LOOK AT THE NUMBERS AND GO AFTER GROUPS THAT SEE A LARGE VOLUME OF MEDICAID PATIENTS.”


Last fall, the Texas Health and Human Services Commission(HHSC) Office of Inspector General (OIG) asked Carousel Pediatrics for pa- tient records and documentation spanning from 2007 to 2011. Dr. Wood says OIG then told him in March that its review of the records revealed he’d committed Medicaid fraud and abuse and owed the state $18 million for billing at codes higher than documentation justified, plus $4 million in penalties. “OIG does have an important job. Sadly, some people take advantage of the system and overcharge intentionally. I have a clear conscience, and I know our clinics’ billing mistakes were unintentional. The problem is OIG doesn’t seem to be able to discern between good practices and bad practices. They just look at the numbers and go after groups that see a large vol- ume of Medicaid patients,” said Dr. Wood, whose clinics serve a 90-percent Medicaid patient volume. OIG monitors Medicaid to prevent and reduce waste, abuse, and fraud. And more physicians who participate in Medicaid may find themselves the target of OIG scrutiny, thanks to new “program integrity” rules HHSC adopted in October. The Texas Medical Association adamantly opposed the rules and submit- ted 35 pages of written comments to OIG that outlined the association’s concerns. To read the rules and HHSC’s responses to TMA’s comments, visit www.texmed.org/fraud_rules. TMA argued the rules, which took effect Oct. 14, cast every Medicaid billing error as a possible target for fraud-and-abuse prosecution. Dr. Wood says OIG “already has too much power and not enough oversight as it is.” He worries the rules give the agency broader discretion and prosecution powers, which “only make a bad situation worse.” HHSC’s decision to adopt the rules as proposed is “disheart-


ening,” says John Holcomb, MD, who signed TMA’s comment letter. Dr. Holcomb is chair of TMA’s Select Committee on Medicaid, CHIP, and the Uninsured. He objected to the rules repealing language that said not all actions resulting in over- payment to a physician are necessarily fraudulent. He asked HHSC officials to retain that language and reiterate in the new


18 TEXAS MEDICINE December 2012


rules that some overpayments are the result of mistakes, not fraud. But that didn’t happen. “These new rules allow OIG to proceed with payment holds


and essentially impound money from doctors without provid- ing appropriate due process,” Dr. Holcomb said. HHSC spokesperson Stephanie Goodman says the agency had to adopt the new rules “to comply with new program in- tegrity requirements in the Affordable Care Act.” She said federal law “now requires states to put a payment hold in place when there is a credible allegation of fraud. That means that the inspector general’s office has seen enough in its investigation to know that there’s a high likelihood of over- payments and evidence that the overpayments are the result of fraud, not a coding error or simple mistake, but the willful intention to deceive the state. That’s the kind of behavior these rules target.”


OIG has put a hold on payments to three physicians as a re- sult of its investigations and suspended payments to six others this year based on instructions from the Centers for Medicare & Medicaid Services (CMS) or the Texas attorney general’s office.


Ms. Goodman says the changes in rules are “long overdue,” adding that most doctors who treat Medicaid patients are “act- ing in the best interests of their patients and the public.” “Good doctors don’t get rich off of Medicaid, and they have


no reason to be concerned about these changes in the rules or a stronger, more vigilant Office of Inspector General,” she said. In its comment letter to HHSC, TMA acknowledges that


the Patient Protection and Affordable Care Act requires hold- ing payments based on a credible fraud allegation. But it says OIG’s interpretation of the provision is inconsistent with even the federal government’s guidance, which requires states to establish mechanisms to verify the allegations. The letter urged OIG to implement a meaningful verifica- tion system. As the rules stand, TMA argues, OIG can withhold payments based on incorrect or even malicious information,


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