By Kelsey Waddill

– A CMS rule expands its ability to revoke or deny providers’ position serving in federal networks in an effort to combat fraud in Medicare, Medicaid, and CHIP.

“The provisions we are finalizing in this rule are necessary to address various program integrity issues and vulnerabilities,” the rule explained. “We believe that these provisions will help make certain that entities and individuals who pose risks to the Medicare and Medicaid programs and CHIP are removed from and kept out of these programs; this final rule with comment period will also assist in preventing providers and suppliers from circumventing Medicare requirements through name and identity changes, as well as through elaborate, inter-provider relationships.”

Federal programs like Medicare and Medicaid are common targets for fraudulent activity.

In 2017, the Department of Justice (DOJ) retrieved $2.4 billion from Medicare, Medicaid, and federal healthcare programs. This accounted for 64 percent of the takings from all federal fraudulent cases that year. In 2018, the DOJ raked in $27.68 million in False Claims Act violations alone.

In the last five years, CMS noted in the rule, over 2,000 entities have been affiliated with other entities or individuals whose Medicare enrollment was revoked and the 2,000 entities received $51.9 billion, including adjusted factors, from CMS.

READ MORE: HHS Charges Dozens in $1.2B Telemedicine, DME Fraud Scheme

“For too many years, we have played an expensive and inefficient game of ‘whack-a-mole’ with criminals – going after them one at a time – as they steal from our programs,” said CMS Administrator Seema Verma. “These fraudsters temporarily disappear into complex, hard-to-track webs of criminal entities, and then re-emerge under different corporate names. These criminals engage in the same behaviors again and again. Now, for the first time, we have tools to stop criminals before they can steal from taxpayers. This is CMS hardening the target for criminals and locking the door to the vault. If you’re a bad actor you can never get into the program, and you can’t steal from it.”

The rule requires providers and suppliers to notify CMS if they have ever been affiliated with a company or individual that exhibits any fraudulent behaviors. Fraudulent behaviors may include failure to pay back debt, having payments for a federal healthcare program withheld, being denied entry to Medicare, Medicaid, or CHIP, or having “disclosable events,” which occur when CMS revokes a provider or supplier’s ability to bill Medicare, Medicaid, or CHIP.

In addition to these new stipulations, the rule gives CMS more authority to crack down on fraudulent providers and suppliers.

Under the new regulations, a provider or supplier can be denied entry to Medicare, Medicaid, or CHIP or their position can be revoked if they attempt to return to the program with a different identity, make a payment to a non-compliant site, have a history of inappropriate ordering or certifying of Medicare Parts A or B products or services, or receive an overpayment from the Treasury Department and fail to repay it.

If a provider or supplier gives fraudulent information when first applying to a public payer program, CMS now has the power to establish a longer re-enrollment bar, blocking the applicant from participating in the public payer programs for up to three years.

READ MORE: Walgreens Agrees to $296M Settlement in Healthcare Fraud Cases

For providers and suppliers who are accepted into the Medicare program but then have their status revoked, CMS can also extend their re-enrollment bar for up to a decade, as opposed to three years which was the previous maximum.

The second time that a provider or supplier is revoked, they can face up to a 20 year wait before they are allowed to re-enroll, according to the new regulations.

Providers and suppliers who have a history of termination or suspension in a state Medicaid program or if they are unable to practice in a state due to their license being suspended will be blocked from enrolling in Medicare.

The data collection process will likely cost providers and suppliers around $937,500 each year for the first three years.

Individual cases of fraud can cost taxpayers millions of dollars. However, with these new stipulations and heightened enforcement capabilities, CMS foresees major savings over the course of the next two decades.

READ MORE: DOJ Recovers $2.5B in Healthcare Fraud, False Claims in 2018

CMS projects that 2,600 providers and suppliers will be revoked each year. Over the course of the next decade, this could save $4.16 million.

However, due to the extended re-enrollment and reapplication bans of up to ten years, which will likely impact around 400 revocations, the actual savings over the course of the next ten years will amount to $1.79 billion. The caused savings from those re-enrollment bars applicable past ten years and up to twenty will not be realized for the next two decades but could result in $4.48 billion saved.

The affiliation stipulations could have saved CMS anywhere from $2.06 billion to $6.22 billion over the last five years. The agency suggests that the next ten years could see savings of $47.35 billion

The commenting period ends November 4, 2019 at 5pm.

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CMS Finalizes Rule to Crack Down on Medicare, Medicaid Fraud – HealthPayerIntelligence.com