Program Integrity

1. Program Integrity

2. The Cost of Fraud, Waste, and Abuse • Between July 2012 and January 2013, the North Carolina Division of Medical Assistance collected over $80 million in recoupments related to Program Integrity and Third Party overpayment notices. • Of that amount, behavioral health services accounted for more than $45 million. • This represents only a portion of identified overpayments due to fraud, waste, and abuse.

3. What this means for you • Money lost due to fraud, waste, and abuse results in decreased funds available for actual services and increased scrutiny of all providers • In addition, consumers who need these services suffer due to inappropriate and ineffective treatment

4. Definitions • Fraud is defined as an intentional deception or misrepresentation made by a person with the knowledge that the deception could result in some unauthorized benefit to himself, some other person, or organization. It includes any act that constitutes fraud under applicable Federal or State law (42 CFR 455.2; N.C.G.S. 108A-63).

5. Definitions • Waste is defined as the over-utilization of services, or other practices, that results in unnecessary costs generally not considered caused by criminally negligent actions but rather the misuse of resources.

6. Definitions • Abuse is defined as provider practices that are inconsistent with sound and accepted fiscal, business or medical practices and result in unnecessary costs or financial loss to Sandhills Center, the Medicaid Program, the State or Federal government, or another organization. It could also result in reimbursement for services that are not medically necessary, or that fail to meet professionally recognized standards for health care. It also includes recipient practices that result in unnecessary cost to the Medicaid program (42 CFR 455.2 and 10 NCAC 22F.0301).

7. Examples • Billing for services not provided • Upcoding (billing for a more expensive service than what was provided) • Double billing (billing for two services that are mutually exclusive or cannot be provided during the same time period) • Overutilization (providing more frequent or intensive services than are medically necessary) • Billing for services staff is not licensed or qualified to provide • Failure to adhere to requirements in service definitions • Providing compensation (money, goods, or services) in exchange for referrals or enrollment in services

8. What is Program Integrity? • In the past, Program Integrity was a function of the North Carolina Division of Medical Assistance [DMA] • With the implementation of the 1915(b)(c) waiver, each MCO is required to conduct their own program integrity activities • The MCO’s will continue to receive guidance and oversight from DMA

9. Program Integrity • The Program Integrity team is responsible for “cases involving fraud, abuse, error, overutilization, or the use of medically unnecessary or medically inappropriate services” • In other words: Program Integrity investigates cases involving Fraud, Waste, and Abuse

10. Who We Are • Sandhills Center LME/MCO has a Program Integrity team consisting of a Director, Investigator, Clinical Analyst, and Data Analyst • The multidisciplinary team works together to review cases using various approaches, including clinical and administrative records review, data mining and analysis, and on-site investigations

11. How We Operate • Program Integrity accepts referrals from any source – remember that any Sandhills Center employee can take your complaint and refer it to the appropriate department • We screen all referrals to determine if they fall within our jurisdiction • Preliminary investigation may include data analysis, consumer, family member or staff interviews, and initial evidence collection

12. Investigations • If a full investigation is necessary, Program Integrity staff will usually conduct an on-site review • Providers are notified of the investigation at the time of this on-site review • Program Integrity staff will also submit a request for consumer records, based on a random sample of paid claims

13. Investigations – Documentation Requests • Providers shall cooperate with all announced and unannounced site visits, audits, investigations, post-payment reviews, or other program integrity activities conducted by the Department. Providers who fail to grant prompt and reasonable access or who fail to timely provide specifically designated documentation to the Department may be terminated from the North Carolina Medicaid or North Carolina Health Choice programs. (N.C.G.S. 108C-11)

14. Investigation Results • Investigations and all associated materials are considered confidential (10A NCAC 22F.0106) and will not be released to the provider unless sanctions are issued as a result of investigation findings • Investigation findings may be referred for sanctions by the MCO or for additional investigation by other authorities • Providers will receive written notification of any sanctions (for example: notice of overpayments or contract termination) • Until this written notice is provided, no information about the investigation will be released

15. Suspension of Payments • In accordance with 42 CFR 455.23, if the Division of Medical Assistance receives a credible allegation of fraud, they have the authority to suspend all payments while the investigation is ongoing. • Only DMA has the authority to suspend payments due to an allegation of fraud.

16. References • 42 CFR 438 (Managed Care) • 42 CFR 455 & 456 (PI & Utilization Control) • 31 USC 3729-2733 (False Claims Act) • 42 USC 1320 (Anti-Kickback Statute) • N.C.G.S. 108A-63 (Medical Assistance Provider Fraud) • N.C.G.S 108C (Medicaid and Health Choice Provider Requirements) • 10A NCAC 22F (Program Integrity)