Medicare Compliance & Reimbursement

7 ways to protect your organization from bad advice.

Many health care providers enlist the help of consultants to navigate today's complicated regulatory environment. And while many consultants give first-rate advice, some fall short of the mark -- leaving their clients facing False Claims Act violations or other charges from the feds.

Most health care providers employ consultants for legal or financial advice, notes Tessa Chenaille with Chenaille Compliance Consulting in Medford, MA. Those areas, such as compliance and billing, are what make people feel "anxious," she says. That's because those are the areas to which the feds pay close attention.

Warning: If you act on bad advice from a consultant, you can be held responsible for the actions resulting from that advice, be they false claims or other compliance breaches. However, there are ways to avoid being the victim of faulty advice.

Here are some steps you can take to ensure that "reliance on bad advice does not lead to False Claims Act liability," according to a recent Law Watch from the law firm Foley & Lardner:

1. Do not predetermine the reimbursement strategy based on economic factors.

2. Seek advice of the consultant before submitting the claims at issue or making a change in reimbursement methodology.

3. Check the consultant's references to make sure the consultant selected is recognized as an expert in the field and has substantial experience in the particular reimbursement matter under consideration.

4. Clearly define the role of the consultant as an advisor.

5. Present the consultant with all material information including additional facts learned after the commencement of the consultant's work.

6. Obtain the consultant's advice in writing.

7. Strictly follow the consultant's advice.

Another idea: One thing you can do to help ensure you're getting solid advice is to ask for the source of the consultant's information, counsels attorney Rob Wanerman with Epstein Becker & Green in Washington. The primary source should be publicly available information, such as files from the Centers for Medicare & Medicaid Services, that the consultant is digesting for you, he says.

Providers today must "insist on a much more sophisticated level of disclosure" from their consultants than in the past, Wanerman notes. You must ask where the consultant's information came from, how current it is, what kind of follow-up is required, what they're basing their interpretation of the information on, how reliable the information is, etc.

Even information that comes from an official source might not be ironclad, Wanerman warns. There are degrees of solidity and quality among official sources, he explains. For example, something published in the Federal Register is very solid, whereas a letter from a CMS staffer could prove very flimsy.

Be on the lookout for these signs that a consultant might do you more harm than good:

1. Stay away from consultants who lack experience or who won't provide references, says Chenaille.

2. Beware consultants who've developed their own reimbursement strategy and haven't had that strategy "blessed by anyone," warns Wanerman.

3. Avoid consultants who aren't familiar with your specialty and don't know much about the regulatory environment in which you work, Wanerman cautions.

4. Steer clear of consultants who blindly follow the crowd.

5. Absolutely avoid any consultant who promises specific results, such as a certain percentage increase in reimbursement, Foley & Lardner advises.

6. Don't agree to pay a consultant a percentage-based fee, Foley & Lardner counsels.

Many providers will go with a consultant based on the company's good reputation -- but recent trouble at the well-respected consulting firm Ernst & Young proves that this isn't always a safe route, points out Wanerman.

Ernst & Young recently lost a round in the ring with the Securities & Exchange Commission, and has been barred from accepting new corporate clients for several months. An SEC administrative law judge handed down this ruling as part of Ernst & Young's punishment for inappropriately auditing a client's books while at the same time helping the company market and develop a new software product. The accounting firm also must pay $1.7 million in restitution.

This punishment comes on the heels of Ernst & Young being under fire for its role as HealthSouth Corp.'s auditor. The firm has been sued by shareholders seeking billions of dollars in damages in connection with its audits of HealthSouth and other big companies with accounting troubles.

Editor's Note: To read an HHS Office of Inspector General Special Advisory Bulletin on the practices of business consultants, go to http://oig.hhs.gov/fraud/docs/alertsandbulletins/consultants.pdf.