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Nearly $5 Billion to be Returned to Taxpayers as a Result of OIG Work in FY 2014

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Fiscal 2014 Report to Congress Outlines Achievements

Washington, DC - America's taxpayers are expected to see $4.9 billion in improperly spent Federal health care dollars returned to the Government from oversight and investigations conducted this year by the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS), according to a report issued today.

While the Semiannual Report to Congress reviews OIG activities for the last half of fiscal year (FY) 2014 (April 1, 2014 - September 30, 2014), it also summarizes the full year's achievements.

"It is a sacred trust we hold with the 120 million Americans who depend on HHS programs to live healthy, productive lives," said Inspector General Daniel R. Levinson. "The mission of this office is to protect the fiscal integrity of all HHS programs from those who would abuse and, in too many cases, even steal from them.

"This publication lays out a lengthy list of achievements made possible by our dedicated, professional staff and the collaborative efforts of our Government partners," he noted.

The $4.9 billion in expected recoveries for FY 2014 consist of nearly $834.7 million in program audits and about $4.1 billion in investigative work - which includes about $1.1 billion in areas such as States' shares of Medicaid restitution.

OIG also reported $15.7 billion in estimated savings resulting from legislative, regulatory, or administrative actions that were supported by report recommendations. Such savings generally reflect third-party estimates (such as those by the Congressional Budget Office) of funds made available for better use through reductions in Federal spending and/or avoidance of unnecessary expenditures.

OIG excluded 4,017 individuals and entities from participation in Federal health care programs in FY 2014. OIG also reported 971 criminal actions against individuals or entities that engaged in crimes against some of the 100 HHS programs overseen by OIG. There were 533 civil and administrative cases, including false claims and unjust-enrichment lawsuits filed in Federal district court and civil monetary penalties administrative matters, which included both OIG-initiated actions and provider self-disclosures.

Additional highlights of OIG accomplishments for FY 2014 include:

  • Medicare Fraud Strike Force efforts resulting in the filing of charges against 228 individuals or entities, 232 criminal actions, and $441 million in investigative receivables. The Strike Force teams coordinate law enforcement operations conducted jointly by Federal, State, and local law enforcement entities. The teams, now a key component of the Health Care Fraud Prevention and Enforcement Action Team, have a record of successfully analyzing data to quickly identify and prosecute fraud.
  • In May 2014, a nationwide Strike Force takedown in six cities resulted in charges against 90 individuals, including doctors, nurses and other licensed medical professionals, for their alleged participation in Medicare fraud schemes totaling approximately $260 million.
  • With the implementation of the Affordable Care Act, OIG's work will continue to encompass Health Insurance Exchanges, also called Marketplaces. In the report Certain Internal Controls Implemented by the Federal, California, and Connecticut Marketplaces To Meet Applicable Federal Requirements Were Less Than Effective, OIG found that not all internal controls implemented by the Federal, California, and Connecticut Marketplaces were effective in ensuring that individuals were enrolled in qualified health plans (QHPs) according to Federal requirements. The OIG report Marketplaces Faced Early Challenges Resolving Inconsistencies with Applicant Data, revealed that from October through December 2013, Marketplaces were unable to resolve 2.6 million of 2.9 million inconsistencies, which they reported most commonly as citizenship and income issues, although each applicant can have multiple inconsistencies.
  • Halifax Hospital Medical Center and its wholly owned staffing agency, Halifax Staffing, Inc. (collectively, Halifax), agreed to pay $85 million to resolve allegations that Halifax entered into certain prohibited contracts with oncologists and neurosurgeons in violation of the Stark (physician self-referral) Law, resulting in the submission of false claims. The Government alleged that, among other things, Halifax entered into improper contracts with doctors that greatly exceeded fair market value and varied with the volume and value of referrals. As part of the settlement, Halifax entered into an enhanced Corporate Integrity Agreement with OIG that requires Halifax to retain a compliance expert and a Legal Independent Review Organization to review Halifax's contracts with physicians and other health care providers.
  • In the report Improper Payments for Evaluation and Management Services Cost Medicare Billions in 2010, OIG found that Medicare inappropriately paid $6.7 billion for claims for evaluation and management (E/M) services in 2010 that were incorrectly coded and/or lacking documentation, representing 21 percent of Medicare payments for E/M services that year. E/M services are 50 percent more likely to be paid for in error than other Part B services.
  • The report Medicare and Beneficiaries Could Save Billions If CMS Reduces Hospital Outpatient Department Payment Rates for Ambulatory Surgical Center-Approved Procedures to ASC Payment Rates revealed that Medicare and beneficiaries could save $12 billion during calendar years 2012 through 2017 if CMS reduces hospital outpatient department payment rates for ambulatory surgical center (ASC)-approved procedures to the same level as ASC payment rates. When outpatient surgical procedures that do not pose significant risk to patients are performed in an ASC instead of an outpatient department, the payment rates are generally lower.