Med­i­caid fraud cases more of­ten re­sult in set­tle­ments than crim­i­nal pros­e­cu­tions, a health of­fi­cial says.

Dis­cov­ered scam­mers few, far be­tween

Las Vegas Review-Journal (Sunday) - - FRONT PAGE - By Jessie Bekker

This story is the lat­est in­stall­ment in the Las Ve­gas Re­view-Jour­nal’s oc­ca­sional se­ries ti­tled Hard Medicine. Launched last year, the se­ries strives to cover how the state’s Med­i­caid sys­tem works and where it doesn’t, show some of the Ne­vadans it has helped and takes a close look at the costs and whether they are sus­tain­able over the long haul.

The ex­pan­sion of Med­i­caid in Ne­vada in 2014 made men­tal health care much more widely avail­able in a state ranked last in the na­tion for ac­cess to such ser­vices. It also pro­vided a great op­por­tu­nity for bad ac­tors.

Take Jean­ice Rae Moore of Reno, for ex­am­ple. She billed the state of Ne­vada for be­hav­ioral health ser­vices that she never pro­vided through her com­pany, JayLaray Care­giv­ing Place, be­fore be­ing con­victed of de­fraud­ing Med­i­caid, ac­cord­ing to a March news re­lease from the state at­tor­ney gen­eral’s of­fice.

Or Ken­neth Hollingsworth and Tonya Martin-Lowe, who were sen­tenced in 2017 for fail­ing to main­tain ac­cu­rate doc­u­men­ta­tion for be­hav­ioral treat­ment at the Be­cause We Care clinic in Las Ve­gas. The busi­ness it­self also was found guilty of Med­i­caid fraud less than a year later.

The in­di­vid­u­als were sen­tenced to prison terms, all of which were sus­pended. They were in­stead placed

on pro­ba­tion and or­dered to pay resti­tu­tion rang­ing from about $1,200 to more than $56,000.

Hollingsworth said he was framed and called the charge em­bar­rass­ing. He later called back and said an ill­ness caused him to make mis­takes on pa­tient’s records, adding that he has now left the med­i­cal busi­ness and is a pas­tor. He wouldn’t say where.

Moore and Martin-Lowe could not be reached for com­ment.

Be­cause We Care, LLC, which em­ployed Hollingsworth and Martin-Lowe, was placed on three years of pro­ba­tion. Kevin Quick, listed as man­ager of the busi­ness, told a Re­view-Jour­nal re­porter to call back later, then did not re­spond.

Suc­cesses touted

These cases are just a few of the suc­cess­ful pros­e­cu­tions touted by the of­fice of Ne­vada At­tor­ney Gen­eral Adam Lax­alt in a steady pa­rade of news re­leases in re­cent years. But an in­ves­ti­ga­tion by the Re­view-Jour­nal shows that catch­ing those who abuse the Med­i­caid sys­tem is a tor­tu­ous process that can ei­ther come too late or re­sult in rel­a­tively mi­nor penal­ties.

And while those in­ves­ti­ga­tions drag on, other fraud­sters are un­doubt­edly adding to the $56 mil­lion deficit Ne­vada Med­i­caid pre­dicts it will face in the 2019 fis­cal year, up from last year’s $30 mil­lion fore­cast at this time.

The Med­i­caid ex­pan­sion has cer­tainly “ex­ac­er­bated” the prob­lem of fraud­u­lent or im­proper claims in the field of be­hav­ioral health, said Cody Phin­ney, deputy ad­min­is­tra­tor of the state Di­vi­sion of Health Care Fi­nanc­ing and Pol­icy.

Sus­pi­cious claims from men­tal health providers led Ne­vada Med­i­caid to in­ves­ti­gate $73 mil­lion paid out in the 2018 fis­cal year, ac­cord­ing to the Depart­ment of Health and Hu­man Ser­vices. So far, about $10 mil­lion — or 13 per­cent — has been re­cov­ered by the di­vi­sion that Phin­ney helps over­see.

The state’s Med­i­caid of­fice also flagged 85 men­tal health providers for in­ves­ti­ga­tion last fis­cal year and has ter­mi­nated con­tracts with 33 of them, state data show.

Those 33 were passed to the state at­tor­ney gen­eral’s Med­i­caid Fraud Con­trol Unit, Med­i­caid of­fi­cials said. It’s not clear if those in­ves­ti­ga­tions have yielded civil or crim­i­nal cases yet, as the in­ves­ti­ga­tions of such cases are la­bor in­ten­sive and can drag on for months or years.

But just nine providers were con­victed of Med­i­caid fraud re­lated to be­hav­ioral health care in fis­cal 2018, which ended June 30.

Cases un­sub­stan­ti­ated by ev­i­dence or those in which wit­nesses are un­avail­able are sent back to Ne­vada Med­i­caid for ad­min­is­tra­tive re­coup­ment, a sort of “civil set­tle­ment,” ac­cord­ing to the at­tor­ney gen­eral’s of­fice spokes­woman, Mon­ica Moazez.

Phin­ney said cases more of­ten re­sult in set­tle­ments than crim­i­nal pros­e­cu­tions, though she didn’t have the pre­cise break­down on hand. The at­tor­ney gen­eral’s of­fice in­structed a re­porter to make a pub­lic records re­quest, which would pro­duce a re­sponse in late Oc­to­ber.

When an in­ves­ti­ga­tion fails to pro­duce ev­i­dence point­ing to crim­i­nal in­tent, providers are of­ten able to con­tinue work­ing.

The state Board of Med­i­cal Ex­am­in­ers will in­ves­ti­gate any claim that sug­gests a li­censee vi­o­lated the stan­dard of prac­tice. But if the Med­i­caid Fraud Con­trol Unit in­ves­ti­ga­tion leads to a set­tle­ment with­out ad­mis­sion of wrong­do­ing, it’s un­likely the board, with lim­ited re­sources, will de­ter­mine oth­er­wise, Ex­ec­u­tive Di­rec­tor Ed Cousineau said.

“I don’t think we’ve had too many cases of Med­i­caid fraud con­vic­tion cases come across the board’s radar,” Cousineau said. “What we do see at the board, what does come to us, we ob­vi­ously in­ves­ti­gate and pros­e­cute as ap­pro­pri­ate.”

“Ap­pro­pri­ate” varies on a case-by­case ba­sis. “There’s no ab­so­lutes,” he said.

‘Pay-and-chase’

Med­i­caid op­er­ates on a “pay-and­chase” model that in some ways re­sem­bles the old ar­cade game “Whack-A-Mole.” The state re­ceives claims, pays and some­times even over­pays providers.

Then, when it de­tects a sus­pi­cious climb in claims us­ing spe­cific billing codes over the course of a year, it goes hunt­ing for fraud.

Chuck Duarte, for­mer ad­min­is­tra­tor for the state pro­gram and now CEO for Com­mu­nity Health Al­liance, a health care provider in the Reno-Sparks area, de­scribes the process this way: “Find a prob­lem, stop the bleed­ing, and then con­duct a re­view.”

In those re­views, Med­i­caid staff an­a­lyze claims, then look at med­i­cal records and other provider doc­u­men­ta­tion to de­ter­mine whether a case is merely a case of mis­taken data en­try or meets the bar to be for­warded to the at­tor­ney gen­eral’s of­fice for a fraud in­ves­ti­ga­tion.

Not all in­ves­ti­ga­tions lead to find­ings of fraud. Many providers said they were con­fused by fre­quent changes to the Med­i­caid Ser­vices Man­ual poli­cies. In those cases, staff of­ten ed­u­cate the provider on proper billing and move on.

But if the ev­i­dence in­di­cates the bo­gus billing was in­ten­tional, Med­i­caid can ter­mi­nate that per­son’s con­tract and so­licit re­pay­ment.

But that some­times doesn’t lead to re­cov­ery of the ill-got­ten gains.

If a per­son closes up shop be­fore Med­i­caid has made con­tact, for ex­am­ple, the state may not be able to re­cover those dol­lars, Phin­ney said.

“I may not have re­course,” she said. “I may not be able to re­coup the money that’s gone out the door be­cause un­less there’s a crim­i­nal ac­tion that can be taken by an­other group, we don’t have the author­ity.”

Ul­ti­mately the state Med­i­caid of­fice swal­lows such debt and re­pays the fed­eral govern­ment 65 per­cent of the im­proper pay­ments, re­flect­ing the level of fund­ing it pro­vides to the pro­gram.

Prov­ing fraud can be dif­fi­cult, es­pe­cially if there’s lim­ited doc­u­men­ta­tion, said An­drew Schulke, se­nior deputy at­tor­ney gen­eral for the Med­i­caid Fraud Con­trol Unit.

In­ves­ti­ga­tors of­ten use doc­u­ments show­ing where and when a provider de­liv­ered a ser­vice and cross check those an­swers with pa­tient rec­ol­lec­tion or records, he said.

Re­gard­less, Schulke has to prove spe­cific in­tent. In other words, in­ves­ti­ga­tors have to show that a rea­son­able per­son would know their ac­tions were wrong.

Most of­ten, he said, providers claim con­fu­sion in an ef­fort to ex­plain the wrong­ful bills. “Providers love to use mis­take and con­fu­sion” as ex­cuses, he said. “It’s one of the big­gest hur­dles we face.”

Med­i­caid Ad­min­is­tra­tor Marta Jensen said im­proper pay­ment is only par­tially to blame for the ex­pected deficit the pro­gram faces next year.

“Our caseload is re­main­ing rel­a­tively flat. Our (pa­tients) are ac­tu­ally

re­ceiv­ing more ser­vices,” she said, ex­plain­ing why the deficit pro­jec­tion in­creased. Even so, she said she ex­pects the red ink to de­cline dur­ing the year ahead.

Con­vic­tion isn’t loss of li­cen­sure

Even when providers are con­victed of fraud or forced to make re­pay­ments through a civil set­tle­ment, that doesn’t nec­es­sar­ily trans­late to a loss of med­i­cal li­censes.

Pro­fes­sional li­cens­ing boards, like the state’s Board of Med­i­cal Ex­am­in­ers, say they mon­i­tor news re­leases from the at­tor­ney gen­eral’s of­fice flag­ging con­vic­tions and ini­ti­ate ad­min­is­tra­tive ac­tions in re­sponse to strip those providers of their abil­ity to prac­tice.

But some are try­ing to strengthen the re­view process. The Board of Ex­am­in­ers for Mar­riage and Fam­ily Ther­a­pists and Clin­i­cal Pro­fes­sional Coun­selors, for ex­am­ple, doesn’t re­ceive no­tice of con­victed li­censees or those be­ing in­ves­ti­gated and only re­cently es­tab­lished a re­la­tion­ship with Med­i­caid staff in hopes of keep­ing bet­ter track of their li­censees’ ac­tiv­i­ties, said Jake Wiskerchen, the board’s pres­i­dent.

“As a board, we re­ally want to do our best to pro­tect the pub­lic, and in or­der to do that, we need as much in­for­ma­tion as pos­si­ble,” he said.

Be­fore, he said, of­fice staff would have to man­u­ally check Med­i­caid’s ex­clu­sion list for their li­censees.

In the mean­time, the board is work­ing on a back­log of 40 un­in­ves­ti­gated com­plaints, he said, which could in­clude cases of fraud.

To put a stop to over­pay­ment and fraud, Med­i­caid cre­ates sweep­ing pol­icy changes that af­fect all providers. Prior autho­riza­tion is one of them.

The mech­a­nism, which re­quires providers to sub­mit pa­per­work for ap­proval of re­quested ser­vices

be­fore they are pro­vided, has been a topic of de­bate be­tween Ne­vada Med­i­caid and men­tal health prac­ti­tion­ers, who ar­gue the re­quests of­ten de­lay or deny care for vul­ner­a­ble pa­tients.

Med­i­caid also in­sti­tutes ser­vice lim­its, like cap­ping psy­chother­apy and neu­rother­apy treat­ment at 18to-26 ses­sions per pa­tient, de­pend­ing on age. But with a 40-year-old soft­ware sys­tem that won’t be up­graded un­til next year, au­to­mated ser­vice lim­its can prove dif­fi­cult to en­force, Phin­ney said.

Un­til July 5, the sys­tem wouldn’t deny claims for ser­vices that ex­ceeded the lim­its for psy­chother­apy and neu­rother­apy ses­sions, so providers got paid. Now, Med­i­caid is ask­ing providers for the money back, some­times in the thou­sands of dol­lars.

Phin­ney ar­gues those are nec­es­sary tools for pro­tect­ing clients.

“It’s not the goal to neg­a­tively im­pact the peo­ple who need ther­apy, and it’s not the goal to neg­a­tively im­pact le­git­i­mate providers,” she said. “But it’s im­por­tant that we fo­cus on peo­ple get­ting what they need that helps them re­cover.”

Getty Images/iS­tock­photo

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