Medicare Compliance & Reimbursement

Providers who self-disclose their offenses to the government are about to save a lot of time and money.

Corporate integrity agreements (CIAs) created a double-whammy effect for providers who disclosed their compliance gaffes to the Office of Inspector General. Not only did they face penalties and fines, they also had to deal with CIAs -- but not anymore.

According to an April 15 Open Letter from Inspector General Daniel Levinson, those who voluntarily "disclose in good faith, fully cooperate with OIG, and provide requested information in a timely manner will generally not be required to enter into Corporate Integrity or Certification of Compliance Agreements [CCAs] with OIG."

"The elimination of the CIA is a huge change because CIAs are very expensive and very burdensome," says John B. Reiss, PhD, JD, with Saul Ewing, LLP. "They put a huge additional cost on the enterprise and stress on those involved."

Whether the disappearance of the CIA encourages more non-compliant practices to self-disclose their wrongdoings remains to be seen.

"One of the problems I perceive with the OIG's self-disclosure requirement is that they generally go for double-digit penalties, and that's a pretty strong disincentive," Reiss says. "So I think that whether the change is enough to overcome the inevitability of the double penalty is the question that will remain."

The self-disclosure process also entails other unpleasantries that many providers may prefer to avoid.

"I'm not sure that the likelihood of the imposition of a CIA or CCA is the tipping point in a provider's decision to make a self-disclosure protocol (SDP) disclosure," says William W. Horton, JD, of Haskell Slaughter Young & Rediker, LLC. "Entering the SDP process means that the provider gives up the opportunity to assert any defenses against a claimed violation, perhaps at a time before the provider has completed its own investigation."

"I think the position taken in the Open Letter is positive and will have some incremental impact on the likelihood of self-disclosures, but it would surprise me if the impact were a large one," Horton says.

Levinson's letter is available on-line at http://www.oig.hhs.gov/fraud/docs/openletters/OpenLetter4-15-08.pdf.