Enforcement Climate Likely to Get Tougher

Health care providers, including clinical and anatomic pathology laboratories, are likely to see increased enforcement efforts by Medicare and Medicaid program integrity contractors in 2014 and beyond. Over the past few years, the Centers for Medicare and Medicaid Services (CMS) has expanded the ranks of program integrity contractors. Recovery Audit Contractors (RACs), for example, began operating exclusively in the Medicare fee-for-service program but have since expanded into Medicare Part C, Medicare Part D, and Medicaid. Because of record fraud recoveries, the federal government has continued to devote more money to its anti-fraud efforts. But even as the government pours more resources into fraud fighting, some of the programs may be in for some changes. Karen Lovitch, an attorney with Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. (Washington, D.C.), says the RAC program will face increased scrutiny in 2014, in part due to a September 2013 report from the Department of Health and Human Services Office of Inspector General that was critical of CMS’s oversight of the RAC program. Lovitch also noted that a bill was introduced in Congress in 2013 designed to improve the RAC process. The Medicare Audit Improvement Act of 2013 was introduced in May 2013 in both the House (H.R. 1250) and Senate (S. 1012) with the intention of improving the accuracy of RAC audits and increasing contractor transparency. Another factor contributing to the overall turmoil within the RAC program is the expiration of all four RAC contracts. The contracts are due to expire in February, which means some RACs may be replaced, but CMS has said that as it continues the procurement process for the new RAC contracts, the current contracts will be extended several months. In particular, the active recovery auditing period will be extended through the awards and implementation phases of the new contracts. James Sheehan, chief integrity officer and executive deputy commissioner for the New York City Human Resources Administration, said he expects to see some RAC expansion. He said CMS is committed to some changes in the program and will spend the next two years reviewing proposals and litigating protests. RAC changes include moving from four RACs to five RACs and requiring RACs to support the appeals process through the level of administrative law judges. Side Box: Current RACs Region A    Performant Recovery Region B    CGI Federal Inc. Region C    Connolly Inc. Region D    HealthDataInsights Inc.