The Centers for Medicare and Medicaid Services will use stricter penalties and regulation to help curb fraud and abuse by providers that participate in health insurance programs operated by the federal government.
CMS will now be able to revoke healthcare providers' participation in government programs like Medicare and Medicaid for working with other entities that have previously been barred from participating in those programs, according to a Sept. 5 finalized rule. Additionally, the agency now has the authority to give out stiffer penalties for providers and entities that violate fraud and abuse regulations.
The finalized rule is projected to save approximately $47.35 billion over a 10-year period, according to CMS. The new regulations are scheduled to take effect Nov. 4.
Centers for Medicare and Medicaid Services Administrator Seema Verma said in a Sept. 5 statement that the agency now has the tools to be more proactive when going after fraud or abuse. Source: The Associated Press |
CMS Administrator Seema Verma said in a Sept. 5 statement that the agency has previously operated in the dark regarding fraud and abuse, with little authority to act proactively.
"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. 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," Verma said. "Now, for the first time, we have tools to stop criminals before they can steal from taxpayers."
The finalized rule outlines a new regulation the agency called the "affiliations" authority. The regulation allows CMS to stop new organizations or entities from participating in Medicare, Medicaid or the Children's Health Insurance Program if they are affiliated with another organization that has had its participation revoked. If organizations are already participating in any of the programs, CMS can revoke their enrollment for the same affiliations, according to the statement.
The agency's definition of "affiliation" includes a 5% or greater direct or indirect ownership or interest an individual or entity has in another organization, a general or limited partnership interest an individual or entity has in another organization, or an interest where an individual is acting as an officer or director of a corporation, according to the rule.
The rule also gives CMS the authority to enforce stiffer penalties for providers that violate fraud and abuse regulations. If a provider or supplier is revoked from participation in Medicare for the first time, the agency can now block them from reenrolling for 10 years, up from the previous three-year penalty. If a provider or supplier is revoked for a second time, CMS can block them from reenrolling for 20 years.
Under the finalized rule, CMS can also revoke providers' Medicare participation if they try to reenter the program under a different name, if a provider has an outstanding debt to CMS for an overpayment that was referred to the U.S. Department of the Treasury, or if a provider bills for services or items from noncompliant locations.
CMS can also stop providers or suppliers from participating in Medicare for three years if it is found out that they submitted "false or misleading information" in their initial application, according to the Sept. 5 statement.

