http://www.tampabaycfe.org

September 2004

Medicaid Fraud and Abuse

TRAINING

Association of Certified Fraud Examiners

"Financial Statement Fraud"

CPE Credits: 16
November 4-5, 2004 at the Holiday Inn Tampa near Busch Gardens
(813) 971-4710
Hotel Cut-off Date: 10/5/2004
Early Registration Cut-off Date: 10/04/2004 

Tampa Bay Chapter

Chapter dinner meetings are a great way to network while enjoying a meal. At $15, it is also an easy and affordable way to obtain an hour of CPE.

Dinner Meetings

October 19, 2004
"Medicaid Fraud"

January 11, 2005
"Mail Fraud"

February 8, 2005
"T.B.A."

March 8, 2005
"Auditing for Financial Fraud"

April 12, 2005
"T.B.A."

6th Annual Fraud & Computer Crimes Seminar

May 10 - 11, 2005
FDLE Headquarters
4211 N. Lois Avenue
Tampa, Florida 33614

2004 - 2005
OFFICERS &
DIRECTORS

PRESIDENT
Penny Borjas, CFE, CIA
TriCenturion
(727) 786-8840 x15718

VICE PRESIDENT
Steve Hooper, CIA, CFE, CCSA
Clerk of the Circuit Court
Hillsborough County, FL
(813) 276-2029 x7648

SECRETARY
Roland Rodriguez, CFE, CBA
Bank of America
(813) 224-5211

TREASURER
Laura Krueger Brock, CFE, CPA
Cherry, Bekaert, Holland, LLP
(727) 822-8811

DIRECTOR
Mark Dubina, CFE
Florida Department of
Law Enforcement
(813) 878-7366

DIRECTOR
Ellen Wilcox, CFE
Florida Department of
Law Enforcement
(727) 298-2482

CHAPTER TRAINING
Wayne Boytim, CFE
City of Tampa
Internal Audit
(813) 274-7167

JOIN THE TAMPA BAY CHAPTER

Membership in the Tampa Bay Chapter costs only $20 to $25. There are four categories of members: CFE, ACFE Associate, Chapter Affiliate and Student. For more info, visit our web site.

ADVERTISE YOUR BUSINESS or JOB OPPORTUNITY

We have two pages of our web site devoted to publicizing members' businesses and career opportunities. If you are interested in advertising with us, visit the pages to see what is offered and send your copy to TampaCFE@ TampaBayCFE.org.

Background

The $12.5 billion annual budget for Fiscal Year 2003-04 ($12.9 total Medicaid, less approximately $400,000 for the KidCare program) makes Florida’s Medicaid health services program one of the largest in the country, serving approximately 2.1 million Floridians each month. With more than 100 million claims paid each year to approximately 77,000 medical service providers, the Florida program has become susceptible to fraud and abuse. While the estimates of the amount of fraud and abuse in Medicaid vary, it could cost taxpayers anywhere between 5-10% of the total Medicaid budget, or from around $615 million to $1.2 billion in 2003-04 in losses due to inappropriate billings.  Such inappropriate billings could be the result of simple errors or to abusive or fraudulent practices.

The Bureau of Medicaid Program Integrity was created to identify and deter fraud and abuse by overseeing the activities of Medicaid health care providers and recipients. (see 409.913, 409.920, and 409.9205, Florida Statutes.) To accomplish this, Medicaid Program Integrity staff

• develop and use statistical and other methodologies to identify misuse among recipients, and providers who exhibit aberrant billing patterns;
• conduct investigations and audits of providers with aberrant billing patterns;
• calculate provider overpayments;
• initiate the recovery of overpayments for instances of provider abuse;
• refer cases of suspected provider fraud to the Medicaid Fraud Control Unit in the Office of the Attorney General’s Civil Enforcement program for further criminal prosecution; and
• recommend administrative sanctions, such as fines or terminations, for providers who have abused or defrauded Medicaid.

Defining Medicaid Fraud and Abuse

Fraud is defined as "an intentional deception or misrepresentation made by a person with the knowledge that the deception results in unauthorized benefit to himself or another person." (see s. 409.913(1)(b), Florida Statutes.)

Abuse is defined as "practices that are inconsistent with generally accepted business or medical practices and that result in an unnecessary cost to the Medicaid program or in reimbursement for goods or services that are not medically necessary or that fail to meet professionally recognized standards for health care." Abuse also considers Medicaid recipient practices that result in unnecessary cost to the Medicaid program. (see s. 409.913(1)(a), Florida Statutes.)

Provider fraud and abuse can take many forms, but generally appears as

• billing for services not deemed "medically necessary," in which medical necessity is defined as those goods or services provided in accordance with generally accepted standards of medical practice;
• billing for services not provided;
• multiple billings for a single service;
• “upcoding” of claims, in which a provider performs a less expensive procedure but submits a claim for a more expensive one;
• “unbundling” of claims, in which a provider performs a single service, but submits individual claims for each component of the service, such as a birth delivery, at a higher overall cost;
• other third-party payers, such as private insurance or Medicare, are available to pay the claim; and
• recipients ineligible for service.

When the service provider intentionally commits one of these acts to increase income, fraud has occurred. Often times, however, such activities are the result of simple error or unintentional deviations from generally accepted standards of medical care. The question of establishing intent makes it difficult to distinguish clearly between fraud, abuse or simple error.

Recipient abuse occurs when Medicaid recipients engage in fraudulent activity to receive goods or services to which they are not entitled or engage in other abusive activity which results in unnecessary costs to the program. Although a problem, recipient abuses are significantly less costly to the program than provider fraud.

Methods Used to Identify Fraud and Abuse

Medicaid program integrity staff use a variety of methods to identify providers who have over-billed Medicaid and recipients who have abused the program. The Florida Medicaid Management System (FMMIS) assists in the identification process. The FMMIS is a computerized system used to process claims by the Medicaid fiscal agent, ACS State Healthcare (formerly known as Consultec).  The system also provides the agency with information it can use to manage and administer the Medicaid program.

The FMMIS includes the OMNI Subsystem that succeeds the Surveillance and Utilization Review Subsystem (SURS), which was designed to identify providers whose billing patterns were aberrant or departed significantly from their peers. The OMNI Subsystem is a data warehouse program intended to increase claims analysis and automated fraud and abuse detection capabilities. The OMNI Subsystem also identifies Medicaid recipients who receive services in excess of other categorically similar recipients.

In addition, Medicaid program integrity staff has developed other analytical tools that involve computer-assisted reviews of all providers within a class to identify providers within a class to identify providers whose claims exceed pre-set thresholds or have abused specific Medicaid policies. Staff also reviews results of audits and reviews contracted out to private CPA firms and peer review organizations.

Source: The Office of Program Policy Analysis & Government Accountability

Florida Medicaid Program - A Primer

The Florida Agency for Health Care Administration (AHCA) licenses and regulates health care facilities and health maintenance organizations (HMOs) across the state. AHCA also administers the Florida Medicaid program that provides health care to Florida’s low-income and disabled citizens. AHCA’s mission is to champion accessible, affordable, quality health care for all Floridians.

The Florida Medicaid program provides access to health care for low-income individuals and families. About half of the people served are children and adolescents under the age of 21. Medicaid also assists older people with the costs of nursing home care and other medical expenses. The program is funded by state and federal funds, with the counties contributing to the cost of inpatient hospital and nursing facility services.

The Medicaid program is different in every state. The federal government sets the general guidelines and each state decides the following:

• How to run the Medicaid program

• Who qualifies for Medicaid

• What services will be covered

• How much to pay for the services

In Florida, the Department of Children and Families determines eligibility for low-income children and family programs and institutional care programs. The Social Security Administration determines eligibility for the Supplemental Security Income program. Each program has its own income and asset requirements. AHCA develops and carries out policies related to the Florida Medicaid program and contracts with a fiscal agent that processes claims and enrolls health care providers.

AHCA has eleven Medicaid Area Offices that serve as the local liaisons to providers and beneficiaries. These area offices are responsible for:

• Consumer education and assistance

• Helping Medicaid beneficiaries with MediPass¹ and other managed care

• Managing the Child Health Check-Up and transportation programs

• Conducting credentialing site visits to health care providers

• Provider relations and training

• Exceptional claims resolution

Florida Medicaid covers a wide range of medical services. Although there are some limits, Florida Medicaid generally covers:

• Inpatient hospital services, including room and board, drugs, lab tests and other services for people who stay in the hospital

• Outpatient hospital services, such as services given in a hospital to people who do not stay overnight

• Procedures in ambulatory surgical centers

• Family planning (birth control), prenatal (pregnancy) care, and birth center (midwife) care

• Child Health Check-Up

• Physician services, such as office visits with physicians, nurse practitioners, chiropractors, podiatrists, optometrists and physician assistants

• County health department clinic services

• Community mental health services

• Home health care and care provided in nursing facilities

• Lab and X-ray services given outside a hospital or nursing facility

• Dental services for children under the age of 21 (adult services are limited to emergency procedures)

• Visual services such as vision exams and glasses for children under the age of 21 (some limited services for adults)

• Hearing services such as hearing exams and hearing aids (limited to children under the age of 21)

• Therapy services which include physical, respiratory, and speech-language therapies (limited to children under the age of 21)

• Hospice services for the terminally ill

• Prescription drug services

• Durable medical equipment and supplies, including ambulatory equipment such as canes, crutches, walkers, etc.

• Home and community-based services, including AIDS services and assisted living for the aged and disabled

• Transportation services to attend Medicaid covered services (ambulance and community transportation)

¹ MediPass is a Medicaid primary care case management program designed to ensure adequate access to primary care, reduce inappropriate utilization, and control program costs.

Source: http://www.floridahealthstat.com/

Chapter News

Financial Statement Fraud

Tampa, Florida – November 4 & 5, 2004

The complexity of financial statement fraud has received considerable attention over the past few years and will continue to cause concern.  This course is designed for those who regularly review and evaluate financial statements.  Auditors, both internal and independent, will benefit from an enhanced understanding of what the numbers mean and the increased ability to detect indicators of fraud.  This instructor-led course also discusses what the professional responsibilities of the accountant are in relation to accuracy of the statements, especially in light of new legislation and revised fraud standards.

Holiday Inn Tampa near Busch Gardens
2701 East Fowler Avenue
Tampa, FL 33612
Phone +1 (813) 971-4710

ACFE Member: US $575
Non-Member: US $695
CPE: 16 hours

Register before October 4^th and save $75.
For more information call (800) 245-3321 or to register online, please visit: www.CFEnet.com/events

Tampa Bay Ethics Award The Tampa Bay Chapter sponsored the Tampa Bay Ethics Award Breakfast again this year. The 2004 award was presented to H. Roy Kaplan, Ph.D. Dr. Kaplan is executive director of the National Conference for Community and Justice - Tampa Bay Region. He has led the human relations organization in addressing bias, bigotry and racism in the community. He works with children and adults on critical social issues such as race relations and promoting respect among all races, religions and cultures through advocacy, conflict resolution and educational efforts. The National Conference for Community and Justice provides training and education for students, teachers and administrators in the area of valuing diversity and reducing conflict. The NCCJ reaches approximately 25,000 people annually. Dr. Kaplan is truly dedicated to making the Tampa Bay community a better place for all people. Dr. Kaplan has been recognized nationally as a "Hero of Education" by the U.S. Department of Education for his efforts in providing students with alternatives to racial, social, cultural and personal injustice. He also has served as an adviser on the President's Commission on Race Relations, "One America." Dr. Kaplan has written numerous articles and three books, and has appeared on local and national radio and television shows to discuss such issues.

Back Row: Charles F. Hearns, Director, Department of Community Affairs, City of Tampa; Sandy Freedman, Former Mayor, City of Tampa; Bill McBride, Barnett, Bolt, Kirkwood, Long & McBride Front Row: H. Roy Kaplan, Ph.D.

Dinner Meeting News

October 19th Dinner Meeting

Lieutenant Phil Mickel will speak at our October 19th dinner meeting on Medicaid Fraud. Phil works for the Office of Attorney General's Medicaid Fraud Control Unit (MFCU) in Tampa. He has been with the MFCU four years. Prior to that, Phil worked for the City of Tampa Police Department for twenty-five years. Over half of that time was spent investigating or supervising organized and white collar crime investigations. He was a Supervisor in Criminal Intelligence, Narcotics, Selective Enforcement and Uniform Patrol.

Phil will provide us with an overall explanation of Medicaid, the responsibilities of the MFCU and the relationship to the Agency for Health Care Administration (AHCA) and the Department of Children and Families (DCF). He will then provide a review of a specific investigation involving twenty county jails and state prisons who contracted with a publicly traded corporation to provide medical care to inmates in those facilities. The investigation involved the fraudulent diversion of their costs to the Medicaid system.

The dinner meeting will be held at the Park Plaza Tampa Airport Westshore, located at 5303 West Kennedy Blvd., 11th Floor. The hotel is just west of Westshore Plaza on the north side of Kennedy Blvd. Evenings will begin with a social at 6:00 P.M., followed by a buffet dinner at 6:30 and a presentation at 7:00. The Board of Directors is pleased to announce that the price for one hour of continuing professional education and the dinner buffet will remain only $15 during our 2004 - 2005 meeting season.

To make your reservation, please use the following link Chapter Meeting Reservation and complete the form at the bottom of the page.  You can also make your reservation by emailing Wayne Boytim or calling him at (813) 274-7167 by the Friday before the meeting date. Reservations will be accepted after that date and walk-ups are always welcome. Please remember that cancellations are accepted up to the afternoon of the meeting. No shows will be billed after the second missed meeting. Please help us keep our costs down by letting us know if you are unable to attend.

GOVERNOR SIGNS BILL AIMED
AT STOPPING MEDICAID FRAUD

TALLAHASSEE - Governor Jeb Bush today signed legislation that will enhance the state’s authority to combat Medicaid fraud. Senate Bill 1064 gives the Agency for Health Care Administration (AHCA) more authority to contest fraud and abuse in the Medicaid program and broadens the Attorney General’s scope of authority to pursue entities that try to defraud Medicaid.

“Medicaid costs are growing at an unsustainable rate; part of that is caused by millions of dollars in fraudulent claims to the program each year. We have a responsibility to do all we can to ensure those who try to cheat the system, and thereby cheat taxpayers, are punished,” Governor Bush said.

“Because of this new law, the buying or selling of prescription drugs paid for by taxpayer dollars is now a Medicaid fraud crime. I commend the Legislature for creating, and the Governor for signing, this important legislation,” said Attorney General Charlie Crist. “Medicaid drug fraud has become an ever-increasing contributor to drug addiction and death. The increasing cost in human life and public funds means that targeting this crime is an issue whose time has come.”

“Medicaid prescription drug fraud is costing Florida taxpayers tens of millions of dollars. Many young Floridians die each year of drug overdoses from drugs like oxycotin that are illegally obtained through Medicaid fraud,” said legislation co-sponsor Senator Burt Saunders. “This legislation will go a long way to curbing these abuses."

SB 1064 allows for the following:

• Expands the authority of the Office of Statewide Prosecution to investigate and prosecute criminal violations of the Medicaid program.

• Medicaid drug reimbursement is now limited to prescriptions by Medicaid enrolled prescribers. Previously, non-Medicaid providers could write prescriptions to be paid by Medicaid.

• Allows the AHCA to seek any remedy allowed by law when the Department finds false or a pattern of erroneous claims.

Source: Press Release, State of Florida, Office of the Governor, June 23, 2004

A Message from our President

Oh boy, what a tough six weeks or so!!  We hope everyone in the Chapter weathered the storms safely.  For those of you who may not have, our thoughts and prayers are with you.  On a positive note, this is a good time to share your fraud knowledge with your neighbors and friends.  Let them know the various schemes that go along with disasters.  At a minimum maybe you can prevent someone from becoming a victim. 

Hopefully, the weather will permit us to have our October dinner meeting.  Sorry about having to cancel the September meeting.  The speaker who was scheduled for that meeting has graciously agreed to come and speak to us later in the year.  So barring any hurricanes, please come out and join us on October 19^th.

Sincerely,

Penny Borjas