4 New OIG Work Plan Updates in June 2023

In June 2023, the U.S. Department of Health and Human Services Office of Inspector General (OIG) added many more items to their work plan. Let’s take a look at some that may be particularly important for compliance professionals in the health care industry.

Emergency Preparedness for Biospecimen Research

The National Institutes of Health (NIH) awards billions of dollars for research each year. According to the OIG, the NIH awarded approximately $29 billion in 2022 to extramural research recipients, including more than 2,500 non-federal organizations such as universities, medical schools, hospitals, and other research facilities.

The OIG wants to know how prepared the fund recipients are in the event there of an emergency. In particular, they are interested in those who perform research with biospecimens (e.g., blood, plasma, and tissue) because facilities with these substances could be at risk during emergencies.

OIG has stated that limited criteria for extramural recipients' emergency preparedness exists, which may make federal funds vulnerable to waste. With this in mind, the OIG intends that this Work Plan evaluation item will determine how recipients that conduct biospecimens research prepare for emergencies. They also want to know how the NIH oversees their preparedness. Lastly, OIG is planning for this work to demonstrate the potential costs (e.g., financial, delays in research) that emergencies have on biospecimen research conducted by extramural recipients.

NIH Contracts

A second work plan item added in June is also related to the NIH. This item, however, is related to the close-out process for NIH contracts, as past OIG work revealed issues with contract close-out procedures.

The close-out process:

1. 1. Ensures that goods and services were provided as intended
   2. Validates final costs and payments
   3. Frees up excess funds for possible use elsewhere

For the last fiscal year, the NIH was responsible for approximately 22 percent of HHS contracting actions, or $8.5 billion.

The OIG expects their work in this area will determine whether NIH closed contracts according to federal regulations and HHS policies and procedures.

High-Risk Diagnosis Codes

During the Health Care Compliance Association’s April Compliance Institute, Inspector General Christi Grimm said, “Our work has demonstrated there are significant problems with risk adjustment. Simply put, the financial incentives created by risk adjustment may be driving upcoding in the severity of diagnoses to garner additional payments.” It should come as no surprise that the OIG has added a Work Plan item focused on nationwide audits of Medicare Part C high-risk diagnosis codes.

As many are aware, payments to Medicare Advantage (MA) organizations are risk-adjusted on the basis of the health status of each enrollee. MA organizations are required to submit risk-adjustment data to the Centers for Medicare and Medicaid Services (CMS). Miscoded diagnoses may cause CMS to improperly pay MA organizations.

In the same speech, Grimm also stated that OIG has already looked at 20 insurance companies that received $5 billion in risk adjustment payments in 2017. They found these “20 companies received more than a half-billion dollars in risk adjustment payments for patients that plans had been diagnosed as having serious mental illness, such as major depressive, bipolar, and paranoid disorders. Yet no service records showed those same enrollees had received treatment for these serious conditions. The same applies for other serious illness and disease.”

It makes sense that the OIG will probably include mental diagnoses in their upcoming audits, but they are likely to include many other high-risk diagnoses identified in recent audits. Some of these include acute stroke, vascular claudication, breast cancer, colon cancer, prostate cancer, lung cancer, acute heart attack, and embolism.

For these audits, OIG will focus on enrollees who received diagnoses at high risk for being miscoded, which could result in increased risk-adjusted payments from CMS to MA organizations. They plan to determine whether these diagnosis codes, as submitted by MA organizations to CMS for use in CMS's risk-adjustment program, complied with federal requirements.

Medicare Hospice Audit

When Medicare beneficiaries enroll in hospice, they agree to cease curative therapies for their terminal illness. Rather, the intent of hospice is to help patients maintain the best quality of life possible for their condition until their likely death. Usually, such services are provided in a patient’s home or location other than the inpatient floor of a hospital. But occasionally, inpatient hospice services are necessary. The OIG has stated that the reimbursement rate for hospice general inpatient (GIP) care is the second-highest daily rate that Medicare pays for hospice services.

GIP care is provided only for pain control or acute or chronic symptom management that cannot be managed in other settings. It is intended to be short-term care.

In this newly announced hospice audit, the OIG will “focus on claims for enrollees who were transferred to GIP care immediately after an inpatient hospital stay for a period during which the enrollee's inpatient stay reached or exceeded the geometric mean length of stay for the assigned diagnosis-related group. These hospice GIP claims are at high risk for inappropriate billing because GIP care may exceed an enrollee's needs or may not be provided.”

OIG will determine whether hospice providers that billed for GIP care complied with Medicare requirements.

Conclusion

Emergency preparedness for biospecimen research, NIH contract close-out procedures, high-risk diagnosis codes reported by Medicare Advantage plans and auditing of certain hospice services are only some of the recently added work plan items by the OIG in June 2023. But these are likely to be areas that could affect your institution. As such, compliance professionals should be aware and may even find it necessary to proactively look at these areas themselves.

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