Disclosures Involving Excluded Persons
Many SDP disclosures involve violations of employing or contracting with individuals who are on OIG’s List of Excluded Individuals and Entities (“LEIE”). With the update, OIG has specified what is needed for a complete disclosure of this violation. A disclosure must include, among other things, biographical information on the excluded party, description of the disclosing party’s screening process, and a description of how the conduct was discovered. The disclosing party must also screen all current employees and contractors against the LEIE.
OIG has also provided guidance on calculating damages for this disclosure. For direct providers who bill separately, the disclosing party must provide the total amounts claimed and paid by federal healthcare programs for the items or services. If items or services are not billed separately, a formula will be used based on the excluded party’s total cost of employment or contracting. This amount will be multiplied by the disclosing party’s federal program payor mix.
Disclosures Involving Anti-Kickback and Stark Law
Since the 2009 Open Letter, conduct involving only potential violations of the Stark Law is not eligible for SDP. To qualify, violations must potentially involve both the AKS and Stark Law. It is the disclosing party’s responsibility to describe each disclosed arrangement and determine on their own why each arrangement may violate the AKS and, if applicable, the Stark Law.
If a disclosure is limited solely to the Stark Law, this potential violation should be disclosed to the Centers for Medicare and Medicaid Services (“CMS”) through their Self-Referral Disclosure Protocol (“SRDP”). Providers should be prepared for the possibility that OIG and CMS will work together.
A disclosing party must include the total remuneration provided through the agreement, but a party may explain why portions of the remuneration should not be considered by the OIG when determining the settlement amount.
Disclosures Involving False Billings
For potential improper claim disclosures, a disclosing party must estimate the total financial impact to government healthcare programs. To do this, a party can either disclose all claims with specific information or use a sample size. When using the latter method, a party must use a statistically valid sample of not less than 100 claims and use the mean point estimate for calculating the effect. The ’98 version only required 30 claims and called for a “minimum precision level.”
The updated SDP does offer a short list of benefits for disclosing parties. Resolution will continue to occur in most matters without a corporate integrity agreement. This has been the general policy since the 2008 Open Letter. OIG will maintain its general practice to require a minimum multiplier of 1.5 times the single damages for many instances. Lastly, there will be a suspension of the obligation to report and return overpayments to the federal healthcare programs while the SDP is pending.
In evaluating the pros and cons of the updated SDP, the scales weigh heavily in favor of OIG and against self-disclosure. Entry into the SDP should be carefully considered. The new version offers only minor benefits while posing significant risks to a disclosing party who is seeking to come forth with potential violations.
McBrayer, McGinnis, Leslie & Kirkland, PLLC