Deeper Than the Headlines: Exclusions for Doctors, Billers and Suppliers...Oh My!

On November 15, 2016, the HHS OIG announced that New Jersey OB/GYN, Dr. Labib Riachi, agreed to be excluded from participation in Federal healthcare programs for 20 years.

That is a long time to be excluded by the OIG and Gregory E. Demske, Chief Counsel to the HHS Inspector General said, "In cases such as this, collecting money from a wrongdoer is not sufficient and OIG will pursue exclusion to protect our patients and programs." This 20-year exclusion headline alone is significant, but the story deeper than the headline gets even more interesting.

Earlier this year in February, Dr. Riachi and the two companies he owns settled with the DOJ for $5.25 million to resolve allegations that he submitted bogus claims to Medicare and Medicaid for anorectal manometry (ARM), electromyography (EMG) and physical therapy services. Dr. Riachi is a urogynecologist, a specialist in treating urinary incontinence, prolapse and other pelvic floor dysfunctions. The claims in question were for several services associated with pelvic floor therapy, or PFT.

Usually, court records demonstrate that a whistleblower brought such allegations to light. But in this case, the records don’t mention a whistleblower at all, but rather significant clues that this investigation was started because of the government’s efforts in data analytics of billing claims.

For example, the legal complaint filed by the government stated that Dr. Riachi “was an extreme outlier: Medicare paid Riachi more than quadruple the next highest billing doctor and the amount paid to Riachi alone was more than the amount paid to the next ten highest billers combined.” The complaint goes on to state that, “on or about July 2011, Riachi became aware of the government’s investigation. Almost immediately, the defendants completely stopped billing Medicare for ARMs and EMGs.”

In addition to the multi-million-dollar settlement and exclusion from government health programs, the story takes two additional and interesting turns.

First, in May of 2016, (after the $5.25 million settlement but before the November 2016 announcement of his 20-year exclusion), Dr. Riachi filed a lawsuit against the companies which supplied him the equipment for PFT, including those “he engaged to give him proper guidance and advice.” He claimed in his complaint that the defendants were “to provide him with correct advice as to billing procedures and the acceptable use of the medical devices that he acquired.” The complaint also stated that because of the conduct of those who gave him faulty billing advice, he was “forced to pay millions of dollars back to the United States government” even though he “did nothing wrong.”

Ultimately, the defendants in this case made a motion to dismiss and the judge dismissed the case without prejudice in October of 2016.

The other interesting turn involves another recent action the government took. It appears that Dr. Riachi used a billing service to bill these claims, Millennium Billing, owned and operated by Susan Toy. In September 2016, the OIG announced that Ms. Toy entered into a $100,000 settlement agreement with the OIG and agreed to be excluded from participating in Federal healthcare programs for a minimum of five years.

The OIG reported that “Toy was responsible for preparing and submitting claims based, in part, on superbills identifying the services purportedly performed during a patient encounter. OIG contended that Toy prepared and submitted claims for Current Procedural Terminology code 91122 (anorectal manometry) for patient encounters where the procedure was neither performed nor identified as performed on the superbill.” It has been reported that this penalty is the first such penalty against a billing company from the HHS Office of Inspector General. Modern Healthcare quoted HHS OIG spokesman, Donald White, saying this demonstrates that OIG expects, "compliance throughout the full range of federal healthcare program processes.”

The OIG has published previous compliance guidance for third-party billing companies. Some of their recommendations might have been an issue in this case based on the OIG settlement announcement include:

• Ensure that proper and timely documentation of all physician and other professional services is obtained prior to billing to ensure that only accurate and properly documented services are billed
• Emphasize that claims should be submitted only when appropriate documentation supports the claims
• Provide that the compensation for billing department coders and billing consultants should not provide any financial incentive to improperly upcode claims
• Obtain clarification from the provider when documentation is confusing or lacking adequate justification
• Appropriate coding and billing depends upon the quality and completeness of documentation. Therefore, the OIG believes that the billing company must foster an environment where interactive communication is encouraged. Healthcare providers should be reminded that thorough, precise and timely documentation of services provided serves the interests of the patient, the interest of the provider, as well as the interests of the billing company.

It is not entirely clear what led to the involvement of Dr. Riachi’s billing company, but it is possible that during the investigation of Dr. Riachi the government found superbills which did not clearly demonstrate that the services should have been billed, but the billing company billed them anyway. Robert DeConti, from the OIG recently presented at a conference in Washington, D.C. and included Ms. Toy’s settlement on a slide titled, “Individual Accountability.” It is likely that during the investigation of Dr. Riachi, the government identified others, such as Ms. Toy, who they felt may have also shouldered some individual responsibility.