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CMS Proposed Rules will Lead to an Increase of Investigations for Medicare and Medicaid Fraud

Posted by Ronald W. Chapman, II

On January 6, 2014 The Department of Health and Human Services, Centers for Medicare and Medicaid Services (CMS) released a Proposed Rule for public comment containing proposed rules which would make significant changes to Doctors’ ability to prescribe medications including painkillers and other controlled substances under Medicare’s Part D Drug Benefit Program. The proposed changes would take effect January 1, 2015.

In response to scathing Office of Inspector General (OIG) studies showing that Medicare reimbursed $26.2 million for drugs prescribed by non-physicians as well as the high frequency of physicians that prescribe inordinate amounts of medication to Part D beneficiaries, CMS has proposed rules which will have the effect of ensuring that only physicians in good-standing with state licensing boards, and the DEA as applicable, are writing prescriptions for covered Part D medications.

In these proposed rules CMS seeks the authority to refuse and revoke a physician’s or eligible medical professional’s Medicare enrollment, and thus their ability to prescribe drugs to Medicare patients if:

  1. his/her DEA certificate is currently suspend or revoked; or
  2. a state licensing body has suspend or revoked the professional’s ability to prescribe drugs.

Additionally, the 678 page proposal contains sweeping changes to the way that CMS is allowed to handle doctors suspected of drug diversion or prescribing painkillers without medical necessity. In a separate proposed rule, CMS seeks the ability to suspend a professional’s ability to prescribe medications under part D if CMS determines that the physician or eligible professional has a pattern or practice of prescribing Part D drugs that fall into one of the following categories:

  1. the practice is abusive and represents a threat to the health and safety of Medicare beneficiaries, or
  2. the pattern or practice fails to meet Medicare requirements.

To implement these proposed rule changes CMS wants greater latitude to register and investigate doctors and health professionals suspected of violations. Doctors and other providers who formally enroll with Medicare to write prescriptions to any of the 36 million people with Part D coverage would be required to verify their credentials and disclose professional discipline and criminal history. CMS investigation would include direct access to patient medical charts in order to assess whether the patient actually saw the doctor or had a condition warranting the prescribed medication. Investigations of doctors, which are already done by the DEA, would increase significantly if another federal agency, CMS, is granted authority to independently assess “medical necessity” and prescribing patterns.

With the proposed rules, CMS intends to increase its ability to identify, investigate and suspend doctors suspected of fraudulent and abusive prescription writing and drug diversion. CMS is consistently seeking ways to analyze Medicare/Medicaid prescription data to spot doctors who prescribed medications in a way that deviated from peers which will lead to an increased number of doctors under investigation facing criminal and administrative action.

If CMS privileges are suspended, doctors have the ability to challenge the decision through state and federal administrative courts with the assistance of an attorney. If you receive a letter of investigation from the Department of Justice, CMS, DEA, State Authorities, the Florida Department of Health, or the Michigan Department of Licensing and Regulatory Affairs (LARA) you should consider seeking the assistance and advice of an attorney knowledgeable in Professional Licensing and Criminal Law matters specifically as they pertain to health professionals.

Before making any statement to investigators contact an attorney immediately. Chapman Law Group is a health law firm devoted to representing Doctors, Nurses, and other health professionals in Criminal and Professional Licensing issues. Our team includes not only attorneys skilled in health law and criminal practice but licensed as health care professionals ready to assist you with an intimate knowledge of the law and medicine to protect your freedom, your license and your livelihood.

Additionally, if you are seeking advice about how these new proposed rules could impact your practice, please contact Chapman Law Group for a consultation.