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1 7 M D N E W S . C O M /// M D N E W S C E N T R A L N Y ■ 2 018 L E G A L E A S E ❰❰❰❰❰ 1 7 SOME OF US might remember the phrase "finders keepers, losers weepers." In the healthcare provider world, this saying has no place. It has long been the position of the government that overpayments are to be returned regardless of the fact that the recipient played no part in the mistake. A recent case illustrates this fact very well for physician practices. First Coast Cardiovascular Institute (First Coast) recently settled with the Department of Justice (DOJ) to pay $448,821 for failing to address credit balances and repay overpayments to federal healthcare programs. The DOJ alleged that First Coast delayed repayment of approximately $175,000 in potentia l overpayments to federal healthcare programs beyond 60 days. The situation came to the attention of the DOJ through qui tam lawsuit allegations brought by a former employee of First Coast. Numerous commentators have indicated that this and one other similar recent settlement represent a warning to providers who intentionally drag their feet in the face of a potential overpay- ment and fail to diligently investigate and repay monies owed to federal health care programs. In this case, the qui tam lawsuit alleged that the employee made several documented attempts to get First Coast to address the credit balance, but the practice did not heed those attempts. Honest healthcare providers have always had the opportunity to return overpayments. Since the 1995 pilot program, there has been a formal voluntary disclosure mechanism through the O«ce of Inspector General (OIG) for certain providers, which was expanded in 1998 for all healthcare providers. Very few providers took advantage of the protocols. It was not until the Aƒordable Care Act (ACA) passed in 2010 that self-disclosure took on a more paramount importance. The key change from the ACA was a new requirement to report and return overpayments within 60 days. Essentially, an overpayment is defined broadly to mean: + Any funds that a person receives or retains from Medicare or Medicaid to which the person, after any applicable reconcili- ation, is not entitled. + An overpayment includes all monies received at least within the last six (6) years. Once identified, an overpayment must be reported and returned within the 60 day period. An overpayment is identified when a person: + Has or should have, through the exercise of reasonable dili- gence, determined that the person has received an overpayment and quantified the amount of the overpayment. Somewhat confusingly, therefore, because quantification is part of identification, the 60-day rule doesn't exactly mean a hard 60 days from the initial discovery of a potential overpay- ment. Further, reasonable diligence includes both: (1) proactive compliance activities and (2) reactive investigations conducted in a timely manner in response to credible information. Indeed, as long as a provider continues to act reasonably diligently, a provider may have up to six months to complete its investigation. Time frames may be further extended but only in truly extraordinary circumstances. Practices should never presume they exist. There are several channels to report and return an overpayment, and the pros and cons of each channel should be weighed carefully by the provider. Reporting mechanisms may also be diƒerent based on how the overpayment resulted. For example, an overpayment may result because a practice was referring certain designated health services (e.g. physical therapy, radiology, or inpatient or outpatient hospital services, to name just a few) to another practice from whom the referring practice rents space without a signed lease. Absent such signed lease, the referrals may not be made and the resulting designated health services are not billable, and the resulting payments are therefore considered overpayments. This overpayment is a result of a Stark law violation and there is a specific self-disclosure protocol that has been established by the Centers for Medicare and Medicaid Services (CMS) for violations of the Stark law. Other examples include the inadvertent use by a practice of an administrative employee on the federal or state excluded personnel list, or the termination of an ambulatory surgical center (ASC) partner by their refusal to refer a su«cient number of cases to the ASC. Each of these examples creates a complicated potential deemed kickback situation, and the OIG has a special protocol for overpayments that might implicate the anti-kickback statute. Moreover, each of the foregoing examples might also result in a potential false claim act case brought by a qui tam relator or by the DOJ on its own. There is no nationally established DOJ disclosure protocol. A DOJ disclosure is sometimes advisable to stave oƒ a potential false claims act case and to maintain a credible relationship with the local U.S. Attorney's o«ce. One should note, however, that even when self-disclosed, obtaining a false claims act release from DOJ often requires payment of a damages multiple (often 2x). The key point is that if an overpayment is not returned within the 60 day period (as might be extended to six months), the gov- ernment ceases to view the retention of those monies as a mere mistake and is now seeking to recoup those funds in context of its fraud armamentarium. Marc S. Beckman is a founding member of CCBLaw, a bou- tique law firm focused on providing counsel to physicians and healthcare professionals. He can be reached at 315-477-6244 or mbeckman@ccblaw.com. ■ Overpayments BY MARC S. BECKMAN, CCBLAW HOW TO GO FROM A SIMPLE MISTAKE TO ALLEGED FRAUD IN JUST 60 DAYS.