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Bar Journal - Spring 2004

Combating Health Care Fraud and Patient Abuse: The Role of the Medicaid Fraud Unit

By:
 

I. INTRODUCTION

The Medicaid Fraud Unit ("Unit") of the Attorney General’s Office has statewide jurisdiction to investigate and prosecute fraudulent and abusive practices in the provision of medical assistance under New Hampshire’s Medicaid program. The Unit’s duties cover fraudulent and abusive billing practices by health care practitioners as well as fraudulent activity relating to the State’s administration of Medicaid.1

The Unit has a second — and equally vital — responsibility. It investigates and prosecutes cases involving the victimization of vulnerable adults residing in New Hampshire’s nursing and assisted living facilities.2 Such acts of abuse encompass physical abuse, sexual assault, emotional abuse, neglect, and financial exploitation.

New Hampshire’s Medicaid Fraud Unit has been operating for twenty years (1984-2004). An eight-person team that includes two attorneys, three financial analysts/auditors, two investigators, and one legal assistant manages the Unit’s investigations and prosecutions. The Unit’s auditors are expected to have substantial prior experience investigating complex fraud matters. The Unit receives 75% federal funding for its operations. Over the past five years, the Unit’s investigations and prosecutions have resulted in the conviction of more than 30 individuals or entities and produced $5.5 million dollars in criminal and civil recoveries.

The Medicaid Fraud Unit benefits substantially from working closely with "sister" Units located in 46 other states plus the District of Columbia. Working together, the fraud units are able to collaborate on cases originating anywhere in the country. Collectively, the 48 fraud units are committed to advancing the same objectives nationwide: (1) to combat provider fraud in the nation’s Medicaid program; and (2) to protect the country’s long-term care residents from being victimized by health facility employees and unscrupulous third parties.

To contact the Unit on-line, visit our website at www.doj.nh.gov/medicaid.

II. THE FEDERAL MEDICAID PROGRAM

National Scope. Congress enacted the Medicaid program in 1965, at the same time as Medicare. Medicaid is commonly referred to as the nation’s health care safety net. It covers three main groups of low-income Americans: (1) parents and children, (2) the elderly, and (3) the disabled.

Unlike Medicare, in which both the administration and financing are exclusively the province of the federal government, Medicaid is a joint venture between the states and the federal government.3 While the federal government must approve each state’s Medicaid program, including proposed modifications, the states are responsible for the day-to-day administration of the Medicaid plan.4 The primary administrative duties of the state agency include enrolling eligible individuals, determining the benefits to be covered, determining the compensation for covered services, processing health care provider invoices, monitoring the quality of services, resolving grievances by applicants, enrollees, and providers, and accounting to the federal government for its share of Medicaid funds.

States must provide a minimum level of Medicaid benefits, for example: hospital care, nursing home care, and physician services. States can also opt to provide additional services. The more common optional services include prescription drugs, home and community-based care for the elderly and chronically ill ("HCBC-ECI"), and personal care and other community-based services for individuals with disabilities.

The federal government’s financial commitment to a state’s Medicaid program depends on the state’s per capita income. The guaranteed minimum matching rate is 50% while the maximum rate is 83%. The federal government covers approximately 57% of Medicaid costs nationwide. New Hampshire’s federal participation rate is 50%, a figure that has remained constant for several years.5

Nationally, Medicaid covers more individuals than Medicare. Approximately 40 million Americans are covered under Medicaid. About 4 million (10%) are elderly, about 7 million (17%) are blind or disabled, about 21 million (51%) are children, and about 8.6 million are adults in families with children (21%). Medicaid accounts for an estimated 7% of all federal outlays. It is the largest grant program to the states, accounting for over 40% of all federal funds flowing to the states. In the aggregate, states spend approximately 20% of their annual budgets on Medicaid.

The vast majority of Medicaid spending is used to benefit the elderly and disabled. Although approximately 73% of Medicaid beneficiaries are parents and children, that group accounts for less than 30% of Medicaid spending. The remaining 70% covers the needs of the elderly and disabled, who represent about 27% of Medicaid beneficiaries. The high-level of Medicaid spending for the elderly and disabled is driven largely by the costs associated with long-term care. Medicaid is the nation’s single largest purchaser of long-term care services, accounting for about 46% of all nursing home spending and 38% of all home health care spending.

Fraud and Abuse Enforcement: National Solution. When Congress initiated the Medicaid program, it did not implement safeguards to protect the program against fraudulent practices. With few controls to prevent fraud, and without any specific state or federal law enforcement entity responsible for monitoring illegal activity, the Medicaid program’s first decade of operation was marred by evidence (revealed in congressional hearings) of widespread fraud perpetrated by a dishonest segment of the health care community. Meanwhile, in New York, following revelations of abuses in the nursing home industry, an independent counsel’s office was established to investigate and prosecute Medicaid fraud and abuse. Within a few years, that office had convicted more than 50 nursing home owners and operators and recovered millions of dollars in restitution and fines.

Following New York’s lead, Congress passed legislation in 1977 that encouraged states to dedicate resources to investigate and prosecute health care fraud in the Medicaid program.6 The legislation offered 90% federal reimbursement for the first three years of operation, followed by 75% funding thereafter. Under the legislation, the fraud units are required to be organized like a task force, consisting of a team of attorneys, investigators, and auditors that are specially trained to investigate and prosecute health care fraud and patient abuse.7 Fraud unit operations must be detached from the state agency that administers the Medicaid program.8 The mandated independence is necessary because the duties of fraud units include investigating fraud in the state’s administration of the Medicaid program.

When signing the law creating the fraud units, President Jimmy Carter took care to recognize the high level of integrity demonstrated by most health care practitioners:

The overwhelming majority of doctors and nursing home administrators are honest, patriotic and deeply dedicated to giving good health care according to the law and in the best interests of their patients, and we want to make sure that they who are honest can have a more efficient means by which they can patrol or monitor their own professions.9

Twenty-seven years later, President Carter’s statement remains an accurate sentiment of New Hampshire’s Medicaid provider community.

Today, the nation’s 48 Medicaid fraud units are organized under the umbrella of the National Association of Medicaid Fraud Control Units ("NAMFCU").10 Collectively, the fraud units have a staff of 1450 people. For the federal fiscal year that ended September 30, 2002, the units reported 1,147 criminal convictions and more than $288 million dollars recovered through criminal restitution and civil settlements.

Federal oversight, including the annual certification of Medicaid fraud units, is the responsibility of the federal Office of Inspector General within the United States Department of Health and Human Services ("OIG-HHS"). The OIG-HHS is also responsible for enforcing the federal law that requires convicted health care practitioners to be excluded from participating in federal health care programs such as Medicaid and Medicare.11 The exclusion authority extends to conduct constituting patient abuse and neglect.12 For the federal fiscal year that ended September 30, 2002, OIG-HHS excluded 3,448 entities and individuals. Of that amount, 566 were credited to cases handled by the Medicaid fraud units.

Expansion of Authority. In 1999, Congress expanded the prosecution authority of Medicaid fraud units. Prior to the 1999 amendments, the units only handled patient abuse and exploitation cases wherein the victim resided in a health care facility that received Medicaid funds (i.e. nursing homes). With the law change, prosecution authority was extended to include victims of abuse, neglect or financial exploitation that reside in any "board and care" facility regardless of whether the victim or the facility receives Medicaid funding.13 Board and care facilities are defined as any residential setting that provides housing for two or more unrelated adults that either (1) receive nursing services by a licensed professional; or (2) receive a substantial amount of personal care services in order to perform daily living activities.14 Thus, not only was law enforcement authority extended beyond the state’s nursing home population to include residential care facility residents, the Medicaid-nexus requirement was eliminated.

The 1999 amendments also extended the authority of the fraud units to investigate cases involving Medicare, provided the targeted fraud had a primary effect on Medicaid funds.15 Before initiating a Medicare-related investigation, however, the fraud unit must first obtain OIG-HHS approval. Generally, the investigation and prosecution of Medicare fraud is the province of the United States Department of Justice and the individual United States Attorney Offices.

Coordination With Federal Authorities. The U.S. Attorney’s Office for New Hampshire has several personnel assigned to concentrate on the prosecution of health care fraud matters. When practical, New Hampshire’s Medicaid Fraud Unit and the United States Attorney’s Office join forces to collaborate on matters of mutual interest.

A recent example of this cooperation is the case of United States v. Farra, M.D. In Farra, the U.S. Attorney filed suit against the defendant under the Federal False Claims Act16 alleging that the defendant had submitted false claims under Medicare for conducting physician visits to New Hampshire nursing home residents. In December of 2003, the U.S. Attorney reached a settlement with the defendant for $285,000.17 Because the defendant’s conduct had a simultaneous, but less significant impact on New Hampshire’s Medicaid program, the Unit, through the assistance of the U.S. Attorney’s office, was able to recover state Medicaid damages in a parallel settlement.18

Pursuant to a recent initiative organized by United States Attorney Thomas Colantuono, with the full support of Attorney General Peter Heed, the Medicaid Fraud Unit participates in a health care fraud working group composed of representatives from state and federal law enforcement agencies. The group meets to share information, coordinate resources, and to identify matters for which the pooling of resources would be advantageous.

III. COMBATING MEDICAID PROVIDER FRAUD IN NEW HAMPSHIRE

Oversight. Any health care provider wishing to furnish services to a New Hampshire Medicaid beneficiary must first execute a provider enrollment agreement with the state agency. The enrollment agreement contains a series of integrity-based requirements that the provider must honor. For example, the enrollee may not charge Medicaid more than it charges non-Medicaid individuals for the same service; it must maintain any licenses and permits that are required by applicable state and federal law; it must abide by all rules, regulations, and billing manuals promulgated by the state; and it must maintain billing and treatment records for not less than six years. The enrollment agreement also expressly provides that New Hampshire’s Medicaid Fraud Unit has a right of access to any billing and treatment records relating to claims submitted to the Medicaid program. A provider who violates any provision of the enrollment agreement is subject to a range of enforcement options that can be initiated by the Unit, the state agency, or both.

In order to process and timely pay the large volume of claims submitted by providers, the state agency contracts with Electronic Data Systems ("EDS") to serve as its fiscal agent for paying Medicaid claims. EDS also serves as the state’s liaison to enrolled Medicaid providers, regularly communicating with the providers on such matters as changes in covered services and billing requirements. For the state fiscal year ("SFY") that ended in June of 2003, the State paid $770 million dollars to approximately 4000 enrolled providers for health care services furnished to more than 90,000 beneficiaries. The charts below illustrate New Hampshire’s concentration of Medicaid beneficiaries and the expenditures for SFY 2003.

AGE DISTRIBUTION OF
NH MEDICAID ENROLLEES

NH MEDICAID SPENDING
SFY 2003 $770 MILLION

In order to facilitate the reporting of fraudulent billing practices, the Unit includes a standard notice in the EDS quarterly newsletter to Medicaid enrolled providers. The notice offers instructions on how to contact the Unit (confidentially if desired) to report fraudulent and abusive billing practices. For information purposes, the Unit will also occasionally publish substantive material relating to concluded investigations. Through the newsletter sent to providers, the Unit has found an effective way to communicate with individuals who are in the best position to witness and report an employer’s fraudulent or abusive billing practices.

Although the Unit is required to operate independently of the state agency, it works closely with a team within the state agency that is also dedicated to identifying and rooting out fraudulent and abusive billing practices. Under federal Medicaid law, states are required to maintain a Surveillance and Utilization Review Sub-system ("SURS") Unit within its state agency that has the responsibility to identify improper billing by providers. Currently, the SURS Unit within New Hampshire’s Division of Health and Human Services ("DHHS") has nine positions, including four registered nurses, dedicated to this review function.

The SURS Unit is capable of searching for and identifying providers with aberrant billing patterns or practices. Its mission is aided by software technology that "flag" aberrational claims data. SURS Unit personnel have desktop access to the agency’s Medicaid Management Information System ("MMIS"), which is an automated database that allows for the computerized retrieval of the claims paid to any provider. SURS Unit personnel can conduct both desk and field reviews on providers that warrant further inquiry. An additional review tool used by the SURS Unit is to distribute explanation of benefit notices, or "EOMBs", to the consumer. The EOMB asks the Medicaid beneficiary to review the services claimed by the provider and to contact the SURS Unit to report any discrepancy. EOMBs can be targeted to the beneficiaries of a particular provider or to a particular covered service provided by multiple providers.

The Medicaid Fraud Unit and the state agency (through its SURS Unit) operate under a Memorandum of Understanding ("MOU") that is signed by the Attorney General and the Commissioner of DHHS. The MOU memorializes the state agency’s statutory obligation to refer all suspected cases of fraud to the Medicaid Fraud Unit. The MOU also contains the necessary assurances that the state agency will cooperate with the Unit’s investigations.19 Examples of the type of referrals that the SURS Unit might send to the Attorney General’s Office include:

  • A pharmacist billing the Medicaid Program for brand name drugs but dispensing generic drugs;
  • A dentist fraudulently billing Medicaid for a more expensive service than was rendered;
  • A medical transportation company that bills for non-existent trips or submits bills for exaggerated mileage figures;
  • A psychiatrist submitting claims to Medicaid for one-hour psychotherapy sessions when sessions of a much more limited duration were provided.

Medicaid Fraud Unit and SURS personnel meet regularly to review the status of pending prosecutions, investigations, and referrals, and to share ideas concerning the investment of resources into future investigations.

Like the SURS Unit, the Attorney General’s Medicaid Fraud Unit has direct access to the MMIS database. For example, in furtherance of an investigation, any member of the Unit can secure at his or her workstation a printout of all the claims of any given provider, organized by type of service. The claims data can be further manipulated to isolate beneficiary information and dates of service. Securing the relevant claims data is the typical first step of an investigation to be followed by obtaining the provider’s records and conducting interviews of beneficiaries and other material witnesses.

Case Illustrations. The following concluded matters are representative of the type of healthcare provider cases that the Medicaid Fraud Unit resolved in the past two years.

  • Recovered $359,000 from a pharmaceutical provider to resolve allegations that it overcharged Medicaid for certain medicines;
  • Recovered $32,000 from a home health agency to resolve allegations that it was improperly reimbursed for the services of a federally excluded licensee;
  • Recovered $43,000 from a medical equipment supplier to resolve allegations that it overcharged Medicaid for wheelchair equipment;
  • Recovered $638,000 from a national drug manufacturer to resolve allegations that the company violated Medicaid’s federal drug rebate law.
  • Recovered $7,500 from a physician to resolve allegations that the provider over-prescribed certain medications;
  • Recovered $112,000 from a community mental health provider to resolve allegations that the entity was improperly reimbursed for certain services.

Statutory Prohibitions. The Unit has an array of statutory remedies at its disposal when prosecuting cases involving fraudulent and abusive billing practices. The statutory provisions specifically address Medicaid providers and range from criminal enforcement to administrative sanctions. Under the criminal statute, RSA 167:61-a, it is a felony crime when a Medicaid provider — with intent to defraud – does any of the following:

  • Submits a false claim for payment;
  • Submits a claim for a good or service that was not medically necessary according to professionally recognized standards;
  • Creates a false record as documentation for any good or service provided or any expense claimed for reimbursement;
  • Makes a false statement or provides a false record to any law enforcement officer, or to any agent of DHHS, in connection with any audit or investigation;
  • Destroys or conceals any record that is required documentation for any good or service provided, or any expense claimed as reimbursement; with the purpose to hinder any law enforcement or agency audit or investigation;
  • Submits a claim for any good or service that should have been performed by a properly licensed individual but was not, or the license itself was obtained through misrepresentation;
  • Solicits or receives remuneration for purchasing or recommending the purchase of any good or service, or offering to pay any remuneration, to induce a person to purchase or recommend the purchase of any good or service;
  • Solicits or accepts, in addition to compensation under the Medicaid program, any gift or other consideration as a precondition of admitting or expediting the admission of a patient to a hospital, skilled nursing facility; or intermediate facility.

Any health care provider convicted under RSA 167:61-a must be excluded from federal health care programs pursuant to 42 U.S.C. § 1320a-7.

As a supplement to RSA 167:61-a, the Unit can also proceed with civil enforcement against a provider pursuant to RSA 167:61 to recover damages caused by the provider’s submission of false claims. The statute covers claims that the provider either knew were false or had reason to know were false. Because the action is civil in nature, the State’s burden of proof is the preponderance of the evidence standard and not the more arduous beyond a reasonable doubt standard applicable to criminal prosecutions.

Under RSA 167:61, the State can recoup its losses and impose punitive economic sanctions against the recalcitrant provider. The statute allows the State to recover all of the following: (1) restitution of the amount improperly paid; (2) interest on the improper payments; (3) punitive damages equal to the greater of three times the improper payments or $2,000 per false claim; and (4) costs and attorneys’ fees.

There is also RSA 126-A:3, III, which generally prohibits providers from charging Medicaid more than the provider charges its non-Medicaid customers, regardless of whether Medicaid’s allowed rate is higher.20 The statute is designed to secure for the State the provider’s "best price" offered to other customers.21 A violation of RSA 126-A:3, III,

exposes the provider to administrative penalties equal to the greater of 10% of the overcharge or $100 per violation.22 A knowing violation of RSA 126-A:3, III can also provide the basis for an enforcement action under either RSA 167:61 or RSA 167:61-a.

Finally, the state agency is required to suspend or terminate any Medicaid provider who has been convicted of violating RSA 167:61-a,23 or who, after notice of overpayment and identification of the claims resulting in the overpayment, fails to reimburse DHHS.24 The state agency is also required to terminate the enrollment of any provider that violates the rules relative to Medicaid.25 Suspension means the removal of the provider from participation in Medicaid for not less than 60 days or more than 6 months.26 Termination means the removal of the provider for an indefinite period of time.27

A Pending Proposal to Amend RSA 167:61. At the request of DHHS and the Office of the Attorney General, legislation was filed this session (Senate Bill 509) that would over haul New Hampshire’s current civil false clams statute (RSA 167:61). The bill is modeled after the Federal False Claims Act. As such, the central purpose of the proposal is to create a new right of action to allow private parties to sue on the State’s behalf to recover damages and penalties based on the submission of false claims to DHHS. The private plaintiff, called the relator, would file the action under seal and serve a copy of the complaint upon the Attorney General. While the action remained under seal (and thus unknown to the defendant), the State would have the opportunity to investigate the allegations and decide whether to intervene in the litigation. If the State intervenes, it takes primary control of the lawsuit. If the State elects not to intervene, the seal is lifted and the relator may proceed with the action on behalf of the State.

The proposed legislation provides that if the lawsuit filed by the relator leads to a settlement or judgment, then the relator is entitled to a share of the recovery. If the State intervenes, the relator’s share can range from 15% to 25%. If the State does not intervene, and the relator obtains a successful result by proceeding alone, then the relator’s share increases to a range of 25% to 30%. Apart from creating a private right of action, Senate Bill 509 would also substantially increase the current penalty provision for false claims from the current maximum of $2,000 per claim to a range of not less than $5,000 or more than $10,000 per claim. The goal of the proposed legislation is to further induce individuals to assist the State in discovering and deterring fraud in the Medicaid program.

III. COMBATING PATIENT ABUSE AND FINANCIAL EXPLOITATION

Fielding Patient Abuse and Financial Exploitation Referrals. Currently in New Hampshire there are 87 licensed nursing facilities and an additional 137 assisted living facilities. Collectively, these residential settings represent home for approximately 10,500 New Hampshire citizens, or almost 1% of the state’s population. Of the more than 7,000 individuals residing in the state’s nursing facilities, approximately 66% are covered under Medicaid. The Attorney General’s Medicaid Fraud Unit concentrates its investigation and prosecution efforts on those who abuse or financially exploit the vulnerable adults living in these settings.28 Cases involving financial exploitation could involve an employee of the facility or a third-party fiduciary outside the facility that is responsible for managing the victim’s finances.

The Division of Elderly and Adult Services ("DEAS") within DHHS administers New Hampshire’s adult protection law.29 The statutory scheme affords protection to incapacitated adults who are abused, neglected or financially exploited, or who are incapable of self-care due to illness or disability. The law contains a mandatory reporting provision.30 It requires anyone who suspects that an incapacitated adult has been subjected to abuse, neglect, self-neglect, or exploitation to make a report to DEAS.31 A knowing failure to report is punishable as a misdemeanor.32 If a report indicates that a crime may have been committed, DEAS refers the matter to the appropriate law enforcement agency.33

In addition to DEAS, the State has in place an effective Long-Term Care Ombudsman Program ("LTCOP").34 The LTCOP advocates for the residents of New Hampshire’s nursing and assisted living facilities and is often the first responder when a report of alleged abuse, neglect or exploitation originates in those settings.35 The majority of the Medicaid Fraud Unit’s investigations and prosecutions originate as referrals from the LTCOP and DEAS. However, the Unit also receives reports directly from other state agencies, law enforcement, and private citizens.

The Unit also receives referrals from twelve DHHS district offices around the State that review Medicaid applications for long-term care coverage. Applicants for Medicaid must provide full financial disclosures so that the caseworker can determine whether the applicant is financially eligible for Medicaid coverage. Federal law imposes various limitations on financial eligibility for Medicaid that takes into account asset transfers that occur prior to seeking Medicaid coverage. Generally, applicants must provide complete financial disclosures and report asset transfers that occur up to five years prior to the application.36

Often, the Medicaid application is prepared, not by the applicant, but by the applicant’s authorized representative under a durable power of attorney executed pursuant to RSA 506:7. If the caseworker’s financial investigation generates information that the authorized representative has possibly diverted the applicant’s assets before seeking Medicaid, then the information will be referred to the Unit for further investigation.

Case Illustrations. The following concluded matters are representative of the type of patient abuse and financial exploitation cases that the Unit resolved in the past two years.

  • Convicted the bookkeeper of nursing home for misappropriating patient funds;
  • Convicted an individual that used a durable power of attorney to steal more than $30,000 in disability income from the resident of an assisted living facility. The defendant was sentenced following trial to three years in state prison;
  • Convicted a personal care attendant for submitting false time slips to obtain Medicaid reimbursement;
  • Convicted an individual that used a durable power of attorney to conceal $300,000 in assets while obtaining Medicaid for a nursing home resident;
  • Convicted a physician for sexually assaulting a hospital patient;
  • Convicted the trustee of a trust for stealing $75,000 from a fund established for a nursing home resident.

Recent Legislation Focusing on Abuse and Exploitation. During the past two years, legislation has been enacted relative to patient abuse and the financial exploitation of vulnerable adults. The Medicaid Fraud Unit represented the Department of Justice in support of these initiatives.

Criminal Neglect Law (RSA 631:8): This new criminal law was enacted in 2002. It establishes felony-level criminal penalties for the neglect of elderly, disabled and impaired adults. The purpose of the legislation was to fill an identified gap in existing statutes governing assault crimes. The law contains a definition for "caregiver" and imposes a duty of care on those who satisfy the definition.37 Under the statute, neglect occurs when the defendant fails to perform the functions expected of a caregiver.38 The statute is limited to cases in which the victim suffers "serious bodily injury" and the defendant caused the harm purposely, knowingly, or recklessly.39

Durable Powers of Attorney (RSA 506:6 and RSA 506:7): A durable power of attorney serves as a legal document by which one person (the principal) gives another person (the agent or attorney in fact) legal authority to act on behalf of the principal even after the principal becomes legally incompetent. The agent has a fiduciary duty to act in the principal’s best interest and to avoid self-dealing. In New Hampshire, the provisions governing durable powers of attorney are set forth at RSA 506:6 and RSA 506:7. Common abuses of durable powers of attorney include misappropriating the principal’s funds, making gifts of the principal’s assets to the agent or others at the expense of the principal’s quality of life, and selling property for less than fair market value. During recent years, many of the exploitation reports received by DEAS concern the suspected misconduct of persons managing a vulnerable adult’s finances under a durable power of attorney.

During the 2003 legislative session, several amendments were made to the statutes governing financial durable powers of attorney. The amendments are intended to provide clearer standards and greater court oversight and control over the practice of agents making gifts from the principal’s funds. The assets of incompetent adults are sometimes transferred to others to artificially impoverish the incompetent adults and to render them eligible for Medicaid. Gifts of this nature can be a concern because they raise questions of financial exploitation. Persons who lose their financial resources in this manner may suffer in a variety of ways and experience a significant deterioration in their quality of life. The recent changes to RSA 506:6 and RSA 506:7 include:

  • Provisions to prohibit the agent from making gifts pursuant to a durable power of attorney unless the document contains an explicit authorization or the agent obtains prior court approval;40
  • Provisions mandating that durable powers attorney contain separate signed acknowledgments for the principal and agent that: (a) alert the principal to the broad powers being conveyed to the agent and, (b) alert the agent of his or fiduciary duty to he principal. The agent has no authority to act under the durable power of attorney until he or she executes the acknowledgment;41
  • Provisions that transfer the burden of proof to the agent to justify a gift if the durable power of attorney does not contain the required signed acknowledgments and explicit authority to make the gift;42
  • Provisions that authorize both the Department of Justice and county attorneys to file actions under RSA 506:7 to challenge the actions of an agent acting pursuant to a durable power of attorney;43
  • Provisions requiring DHHS, the Department of Justice and county attorneys to be notified when the court has concerns relative to the consequences that a proposed gift would have for the principal due to the imposition of any period of Medicaid ineligibility, or when there are concerns that the principal is at risk of being abused or financially exploited within the meaning of RSA 161-F:43.44
  • Financial Exploitation Commission (Chapter 227, Laws 2003): This law established a 13-member commission to study the problem of financial exploitation and recommend ways to better protect vulnerable adults. The Attorney General’s two designees on the Commission are from the Consumer Protection Bureau and the Medicaid Fraud Unit. The Commission’s report is due November 1, 2004.

ENDNOTES

  1. The Unit’s scope of authority is set forth at New Hampshire RSA 21-M:8-a. The Unit’s jurisdiction does not extend to so-called "recipient fraud," in which an individual commits fraud in order to gain access to health care services under the Medicaid program. Beneficiary fraud is investigated by the Office of Special Investigations ("OSI") within the New Hampshire Department of Health and Human Services ("DHHS"). The prosecution of such cases is typically handled through the county attorney offices.
  2. RSA 21-M:8-a, II.
  3. Technically speaking, state participation in Medicaid is optional. However, all states and the District of Columbia have elected to provide Medicaid covered services.
  4. Federal oversight of state Medicaid programs is the responsibility of the Centers for Medicare and Medicaid Services ("CMS"), a division of the United States Department of Health and Human Services.
  5. Other New England states receiving the minimum matching rate include Massachusetts and Connecticut. Maine (64%) and Vermont (62%) receive a higher rate of reimbursement.
  6. 42 U.S.C. §1396b(q).
  7. 42 U.S.C. §1396b(q)(6).
  8. 42 U.S.C. §1396b(q)(2). Most fraud units are incorporated into the state’s Attorney General’s Office.
  9. Statement of President Jimmy Carter on October 25, 1977 during signing ceremony for P.L. 95-142.
  10. NAMFCU was formed in 1979. Headquartered in Washington D.C. with the National Association of Attorneys General ("NAAG"), the Association’s mission is to promote the collaborative efforts of the units on issues of mutual interest and to coordinate effective national training programs for the units’ attorneys, auditors, and investigators.
  11. 42 U.S.C. § 1320a-7.
  12. To learn more about the exclusion database, and to view New Hampshire’s excluded entities and individuals, go to http://oig.hhs.gov/fraud/exclusions.html. 13. 42 U.S.C. §1396b(q)(4).
  13. 42 U.S.C. §1396b(q)(4)(B).
  14. 42 U.S.C. §1396b(q)(3).
  15. 31 U.S.C. §§ 3729-3733.
  16. The settlement included Medicare restitution of $133,000 and penalty damages of more than $150,000.
  17. Assistant United States Attorney Patrick Walsh handled the Farra case.
  18. Pursuant to RSA 167:58, the state agency is statutorily required to cooperate with the Attorney General in the investigation of identified instances of possible fraud or abuse in the Medicaid program, and must refer to the Attorney General all cases where there is a substantial potential for fraud and abuse.
  19. RSA 126-A:3, III(a).
  20. RSA 126-A:3, III(b). A provider’s usual and customary charge is generally the lowest charge, fee, or rate charged by the provider for any product or service at the time such product or service was provided, inclusive of any discounts offered by the provider. If the provider offers a sale for a limited period of time, it is the sales price. If the provider regularly accepts less than its full charge, then the amount regularly accepted is the usual and customary charge. If any good or service is offered free of charge by the provider, then no charge shall be made to the state agency.
  21. RSA 126-A:3, IV.
  22. RSA 167:60, I.
  23. RSA 167:60, II.
  24. RSA 167:59, IV.
  25. RSA 167:58, VI.
  26. RSA 167:58, VII.
  27. For an in-depth discussion of patient abuse and financial exploitation in health care facilities, see Mary P. Castelli, "Patient Abuse: Protecting the Patient from the Caregiver," New Hampshire Bar Journal, December 1998 (Vol. 39, No. 4), pp.58-63.
  28. RSA 161-F:42-57.
  29. RSA 161-F:46.
  30. The definitions for "abuse" and "exploitation" are defined under RSA 161-F:43.
  31. RSA 161-F:50.
  32. The website for DEAS adult protection program can be found at www.dhhs.state.nh.us/dhhs/adultprotection.
  33. RSA 161-F:10-19.
  34. The website for the LTCOP can be found at www.dhhs.state.nh.us/dhhs/deas/long-term-care-ombudsman.
  35. For an in-depth discussion of the financial eligibility issues and resource limitations under Medicaid, see John E. Tobin, Jr., "Medical Eligibility and Spousal Protection for Elderly Nursing Home Residents," New Hampshire Bar Journal, December 1997 (Vol. 38, No. 4), pp 28-37.
  36. RSA 631:8, I(b).
  37. RSA 631:8, I(f).
  38. RSA 631:8, II and III.
  39. RSA 506:6, V (Supp. 2003).
  40. RSA 506:6, VI and VII (Supp. 2003).
  41. RSA 506:7, IV(b) (Supp. 2003).
  42. RSA 506:7, I(g) (Supp. 2003).
  43. RSA 506:7, VIII (Supp. 2003)

Author

Attorney Jeffrey S. CahillAttorney Jeffrey S. Cahill is the Director of the Medicaid Fraud Unit and a Senior Assistant Attorney General at the Department of Justice, Concord, New Hampshire.

 

 

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