Anticipating COVID-19 enforcement action: Risks for providers

Federal and local governments have issued numerous waivers and provided significant funding in order to enable health care providers to combat the COVID-19 pandemic. These waivers and additional funding have given providers more flexibility to address health care needs during the pandemic. However, as working conditions begin to normalize, government enforcement activity is likely to return to its pre-pandemic levels, with an increased focus on providers that abused or misused this flexibility during the pandemic. Based on statements from government agencies, the following are potential areas of upcoming COVID-19-related enforcement activity for health care providers:

• Upcoding: Modern Healthcare recently reported (subscription required) that the Department of Health and Human Services (HHS) has stated that the Office of Inspector General (OIG) will be monitoring health care providers’ billing and claims data to detect any upcoding by providers seeking to take advantage of higher COVID-19 reimbursement rates. An OIG official stated that the agency would be “monitoring through our data accompanying bills and claims with a COVID diagnosis as a way to potentially upcode.”

• CARES Act Provider Relief Funds: On May 20, 2020, the OIG updated its Work Plan, which details the agency’s upcoming audits and evaluations, to include an audit of the distribution of Provider Relief Funds to health care providers under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Under the CARES Act, Provider Relief Funds may only be used to prevent, prepare for and respond to COVID-19 and may only reimburse providers for expenses that are attributable to the virus. OIG’s updated Work Plan states that the audit will include a review of payments to ensure compliance with these requirements.

• Fraud and abuse – Funds and emergency flexibility: The OIG and the Department of Justice (DOJ) have both stated that they intend to pursue enforcement actions against any potential fraud or abuse that occurs in providers’ response to COVID-19. In its strategic plan for oversight of COVID-19, the OIG makes it clear that it plans to fight any fraud or abuse involving misused funds or exploitation of “emergency flexibilities granted to health and human service providers.” The DOJ has also instructed its attorneys to “prioritize the detection, investigation, and prosecution of all criminal conduct related to the current pandemic” and has already announced several arrests of individuals for misuse of COVID-19 funds.

Health care providers should remain vigilant over their compliance and governance processes to avoid potential COVID-19 enforcement action in these areas.