Reportedly, CMS summarily suspended these hundreds of providers based in part upon the task force’s AI-assisted reviews of billing data to identify potential fraud.
The Centers for Medicare and Medicaid Services (CMS) has reportedly issued notices of suspension of Medicare payments to hundreds of hospice facilities and a number of home health agencies in the Los Angeles area, citing potential fraud.
The suspensions are the latest imposed in connection with the federal government’s Task Force to Eliminate Fraud, established by executive order, that focuses federal resources on fraud prevention and “disrupt and dismantle fraud networks and facilitators.” Reportedly, CMS summarily suspended these hundreds of providers based in part upon the task force’s AI-assisted reviews of billing data to identify potential fraud.
Providers notified of such a suspension have a very short period in which to submit rebuttal statements seeking termination of the suspension under 42 C.F.R. § 405.374. While the relevant regulation allows for “at least 15 days” post-receipt of notification to file a rebuttal statement, Medicare contractors may impose shorter periods to submit rebuttal statements.
Background on CMS Payment Suspensions
Medicare payment suspensions may not be accompanied by prior notice or pursuant to a complete investigation. CMS has authority to suspend providers and suppliers in cases of “suspected fraud” if CMS or the relevant Medicare administrative contractor has consulted with the Office of Inspector General and “determined that a credible allegation of fraud exists” absent good cause not to suspend a provider (42 C.F.R. § 405.371(a)(2)). CMS could find good cause not to suspend payments if, for example, beneficiaries’ access to items or services would be so jeopardized as to cause a danger to life or health. Alternatively, CMS could find a credible allegation of fraud through several mediums, including claims data mining and fraud hotline complaints (42 C.F.R. § 405.370(a)).
Every 180 days post-suspension based on credible allegations of fraud, CMS will reevaluate whether there is good cause to continue the suspension and request a certification from law enforcement that the matter is still under investigation and requires continued suspension.
Affected providers should promptly self-audit and ensure timely responses to CMS. Providers should take note that throughout the investigation process, their payments will be denied, and they may additionally have appeal rights specific to these determinations.
Providers who have been notified of suspension face substantial additional risks beyond suspension—including criminal investigations and charges as well as civil investigations and enforcement actions under the False Claims Act. Providers who have received suspension notices should seek counsel. All providers should take this opportunity to prepare by ensuring that their practices, procedures and documentation are compliant.
For More Information
If you have any questions about this Alert, please contact Erin M. Duffy, Daniel R. Walworth, Victoria (Tori) Hawekotte, any of the attorneys in our Healthcare Fraud and Abuse Group or the attorney in the firm with whom you are regularly in contact.
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