The Centers for Medicare and Medicaid Services (CMS) recently announced that it intends to resume both prepayment and postpayment medical reviews conducted by the Medicare Administrative Contractors, Supplemental Medical Review Contractors, and Recovery Audit Contractors, including those under the Targeted Probe and Educate program, on August 3, 2020:
In this LawFlash, our white collar litigation and government investigations team unpacks the fiscal year 2019 False Claims Act (FCA) recovery statistics recently announced by the US Department of Justice. At $2.6 billion in recoveries, 2019 marked the 10th consecutive year that healthcare industry recoveries exceeded $2 billion. To that end, the team addresses the largest recoveries involving healthcare and notes that “enforcement, mostly driven by qui tam filings, remains robust.”
The US Department of Health and Human Services (HHS) Office of General Counsel (OGC) offered the healthcare industry the benefit of its legal analysis of the recent US Supreme Court opinion in Azar v. Allina Health Services (Allina) with respect to its impact on Medicare payment rules, sharing its Memorandum to the Principal Deputy Administrator & Director of the Center for Medicare dated October 31, 2019 (OGC Memo) with the public. The OGC recognized at the outset the primary directive of the decision –“The Supreme Court made clear that Congress has imposed more stringent procedural requirements for certain Medicare rules than the framework that otherwise would apply under the Administrative Procedure Act (APA).”
The OGC then offered its advice as to the legal implications associated with that directive. If HHS or CMS “issued guidance that, under Allina, should have been promulgated through notice-and-comment rulemaking, the Department's ability to bring enforcement actions predicated on violations of those payment policies is restricted.” This concept works in concert with elements of the Department of Justice's Brand memorandum, which was also referenced in the OGC Memo. The OGC Memo then attempted to draw a distinction between guidance documents that do not require notice-and-comment rulemaking versus those that do. According to the OGC Memo, the principal inquiry in distinguishing between the two is the closeness of the guidance to the relative statutory or regulatory terms.
In recent remarks, Assistant US Attorney General Brian A. Benczkowski emphasized that the US Department of Justice remains serious about fighting corporate fraud and corruption, and noted that transparency in its criteria for prosecution is a key tool for both DOJ and private sector companies. Stressing the importance of effective compliance programs, he noted that companies are more likely to implement such programs when it is clear what conduct DOJ will credit or penalize.