Practice Areas

Client Alert: 2015 U.S. Department of Health and Human Services’ Office

November 2014
Renee H. Martin, JD, RN, MSN

The 2015 U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) Work Plan was released on October 31, 2014.  This should be considered mandatory reading for all healthcare providers looking to avoid fraud charges.

From an institutional perspective, a very effective method to probe for compliance issues at your organization is to compare the projects listed in the 2015 work Plan to your organization’s current practice.

Staying current on OIG and Centers for Medicare & Medicaid Services (CMS) rules is not only important for compliance reasons, but also due to serious financial implications for providers as well.  This new OIG Work Plan reports expected 2014 recoveries of over $4.9 billion, including nearly $834.7 million in audit receivables and about $4.1 billion in investigative receivables.  The investigative receivables encompass about $1.1 billion in non-HHS investigations in areas such as the states’ shares of Medicaid restitution and $15.7 million in savings from OIG recommendations.

The OIG was created to protect the integrity of HHS programs and the wellbeing of beneficiaries by:

This year’s work plan is extensive as always, but the following are highlights associated with Medicare Part A and B.

2015 Projects for Hospitals:

Policies and Practices:

The OIG will compare payments across government programs and across hospitals to identify significantly different amounts for the same or similar services (outliers).  It also will be looking at Medicare costs incurred because of deficiencies in services or defective medical devices, as well as non-compliance in areas with high payment error rates.  Key focus areas will be:

Billing and Payments:

The OIG will be examining the transition from volume-based to value-based payments.  Key focus areas will include:

Quality of Care and Safety:

Other Part A and Part B Program Management Issues:

New models:  The OIG will be performing a risk assessment of CMS’s administration of the pioneer accountable care organizations (ACO), to include internal controls over administration of the ACO model.

The OIG will continue to monitor billings from SNFs for medical necessity and for its three-day inpatient stay requirement, but will also focus on excessive claims for foot care.  It also will be auditing state agencies for their verification of a SNF’s successful completion of a corrective action plan generated from deficiencies found during survey.  Claims for hospice care delivered in an assisted living facility will be reviewed for length of stay, level of care, and common terminal illnesses.  For new home health agencies, the OIG will monitor for documentation to justify billing.

The OIG also will be looking for payment efficiencies across the healthcare continuum.  Payment disparities between outpatient and ambulatory surgery centers will be reviewed, as well as increases in acquisition costs for high-dollar drugs as part of review of prospective payment systems (PPS) for end-stage renal disease facilities.  Medical necessity for ambulance services also will be under review, as will coverage of billed chiropractic services.  Claims for “personally performed” anesthesia services must have supportive documentation.

OIG will be closely watching diagnostic services, including medical necessity of physical therapy, sleep-testing procedures, high-cost diagnostic radiology (such as MRIs), compliance with CMS billing requirements for independent clinical laboratories, and place-of-service codes on bills for services at ambulatory service centers and hospital outpatient departments.

DME providers and prescription drugs also will continue to be a high priority as they pertain to OIG activities in 2015.  Approval of powered mobility devices now will include face-to-face evaluation by a physician.  Market share among providers for diabetic testing strips will be evaluated as part of examination of claims for mail order supply services, and the OIG will look at CMS’s internal controls to prevent concurrent bills from multiple providers of diabetic test strips for the same time frame and the same beneficiaries.  Refills for test strips and drugs for nebulizer machines must be ordered by the physician as medically necessary, and not automatically refilled by the DME Provider.

This next year will not see the same intensity of review for medications as had been seen in previous years.  The OIG will be auditing for appropriate outpatient billings for certain drugs billed by unit of service (the number of times a service was performed) versus those billed by unit of administered dose.

By far the most interesting 2015 project the OIG will undertake is a harder look at information systems and their impact on protected health information (PHI).   The OIG also is reviewing controls over networked medical devices at hospitals for the security of PHI.


To reiterate, the importance of this work plan, for the 2014 fiscal year the OIG expects to recover over $4.9 billion.  In addition, it excluded 4,017 individuals and entities from federal healthcare programs and filed 971 criminal actions and 533 civil actions, including actions against false claims.

By publishing their work plan early in the fiscal year, the OIG hopes to educate healthcare providers, limit fraud, and protect the interests of beneficiaries. 

Please contact Renee H. Martin, JD, MSN, RN for any questions regarding this client alert or the OIG Work Plan by email: or by phone @ (610) 423-4200.