October 1994
Philanthropy Journal of North Carolina • 11
Taking action
Avoiding fraud in health care is key
ne need look no further
f J than the leadership of any
local not-for-profit health
care facility to find a high level of
concern about the problem of health
care fraud and abuse. But how does
that concern translate into action?
Usually, it doesn’t.
With all the focus on fraud,
what’s missing? No one is telling our
health care providers how to avoid
the enemy.
The government-contracts indus
try is no stranger to the tarnished
reputation that comes with allega
tions of fraud and abuse.
Responsible health care providers
should take a tip from the veterans
in defense and public works: Take
action to avoid fraud.
If you’re not convinced, consider
this: The government is already tak
ing enforcement action and offering
significant financial rewards to for
mer employees and others who can
be effective whistle-blowers. Far-
reaching anti-fraud and abuse laws
are on the books, and new legisla
tion is on its way. These laws make
health care fraud a felony, not just a
fine.
Action can take the form of a
fraud-and-abuse compliance pro
gram. Corporate compliance pro
grams are widely used in other
industries. Health care providers
that don’t know about compliance
programs are increasing their risk
of doing business.
The first step in developing a
compliance program is identifying
the legal duties the provider is oblig
ed to meet and the systems in piace
for meeting those obligations.
Unfortunately, health care compli
ance can look a lot like managing
red tape. Yet, so-called “technicali
ties” must be observed to stay with
in the bounds of the law.
Paradoxically, health care
reform initiatives are pushing
providers into new business prac
tices and financial arrangements
that may very well be pathways to
illegal activity. Moreover, because of
newly enacted prohibitions, “estab
lished” practices and procedures
may no longer be permitted.
Fraud takes many forms.
Starting in 1995, physicians who
have a financial relationship with a
hospital may no longer be allowed to
send their patients to that facility tor
inpatient or outpatient services. If
the hospital renders services pur
suant of a prohibited referral, it will
not be allowed to bill the patient,
any third-party payer or any other
entity tor those services.
An optometrist who pays ad hoc
“rent” to an ophthalmologist for the
time spent in the physician’s office
examining only referred patients is
impermissibly paying for referrals.
Sham office leases in which the
space is not actually used are
among the most common and abu
sive kickback schemes.
An area of significant abuse is
the practice of offering free gifts that
may well induce Medicare beneficia
ries to purchase additional or
unnecessary items or services.
Rebates given to induce business
activity - legitimate and common in
other industries - can be expressly
prohibited in the health care indus
try.
Consider the range of improper
Medicare bilhng practices: misusing
a billing code; billing for non-covered
services; billing for services that
were medically unnecessary in rela
tion to the diagnosis; or failing to
have adequate documentation to
verify the services provided.
This first phase of action can be
invaluable: The process of develop
ing a compliance plan itself reduces
the risk of a violation. For example,
health care providers may establish
for the first time who in the organi
zation has responsibility tor differ
ent phases of the operation.
If a violation is detected, the
presence of a plan dramatically
reduces a provider’s potential penal
ties. The fact that a provider had a
qualifying plan must be considered
under the Federal Sentencing
Guidelines. In particular instances -
tor example, filing “false” claims
with Medicare over a series of years
- the existence of a plan can reduce
penalties by miUions of dollars.
Top management in charitable
facilities
cannot
hide
behind
the fact 1
that staff
or out
side con
tractors handled Medicare billing. In
fact, investigators often target low-
level staff when searching for
incriminating information. Just
because the ranking officials are
wearing ’’white hats” does not mean
that their institution does not need
to take action to develop a plan tor
compliance to avoid health care
fraud.
While opinions may differ on the
savings that will result from a fraud-
free health care industry, Americans
have reached the consensus that
health care fraud must be eliminated.
To reach that goal, providers must
convert this concern over health care
fraud into action.
Joy H. Thomas is a lawyer in
the health law section of Moore &
Van Allen in Raleigh.
Johnston
Continued from page 10
the virtues of an Eagle Scout plus
special people skills, self-confi
dence, exceptional analytical ability,
strong moral character and a happy,
optimistic disposition.
Some common challenges faced
by development officers are unreal
istic expectations, jealousy of col-
legues, the tyranny of deadlines,
fatigue, lack of staff and equipment
and the temptation to get quick
results by lowering ethical stan
dards.
Other pressures include putting
personal success above the welfare
of the institution, shifting failures to
others, emphasizing programs with
sales appeal over those that are
important to the nonprofit mission,
wallowing in feelings of self-pity and
- perhaps most important - losing
sight of the goal because of preoccu
pation with process.
No rules can be made to fit
everyone. The challenges can be
met only by individual effort.
The process starts by reviewing
the kind of life we want and the kind
of person we aspire to be. We look
at the Institutions we Work for to
see if we believe in their mission
and leadership. We ask if we have
served the institution well. If the
answers to those questions are no,
we should depart gracefully and
soon.
We recheck our ethical patterns.
Courtesy is necessary; insincerity
destroys self-respect. Fudging num
bers - however it is rationalized - is
dishonest and damages the institu
tion. Self-pity is destructive. Shifting
blame corrodes effectiveness and
hurts the team. Job-hopping without
regard for legal and moral commit
ments is unfair and casts mistrust
on us and our profession.
Most important, we revisit our
personal support system; family,
friends, religious or philosophical
beliefs and values. A solid base for
our lives helps us meet and master
the chaOenges of our job.
A basic qualification for the
development job is the ability to
handle uncertainty and pressure
and convert them to motivating
forces.
A career in development is one of
the best on the planet. We sit at the
center of power and decision-mak
ing. We contact exciting and power
ful people. We have the rare satis
faction of knowing our work makes
a difference.
Many years of observation have
convinced me that development peo
ple are among the most talented,
highly-prlncipled and dedicated in
the world. We do our jobs well and
the world is better because of it.
Pressure? We can handle it.
Johnson
Continued from page 10
have taken steps to improve the
economic status of their families.
Women report that they have
entered the paid labor force for the
first time; are no longer on public
assistance; have been promoted;
have become volunteers and lead
ers in their communities; are men
toring young people; and are shar
ing what they have learned with
their friends, family members and
neighbors.
Essentially, we found what
works is: being aware of the imme
diate environment and culture in
which people live and work; orga
nizing local advisory councils or
committees that include community
leaders, business people, and
potential program participants;
flexible planning; non-traditional
teaching methods, especially
retreats and workshops that
include ‘people who have made it’
as role models; training local facil
itators and planners in cultural
diversity; providing help with iden
tifying achievable, realistic short
term goals or dreams and how to
achieve them; giving long-term
support to women and families;
including them in other agency-
sponsored activities; and recogniz
ing, praising and rewarding partic
ipants.
Of course, much remains to be
done. In order to improve the eco
nomic situations of families, the
challenges for women in North
Carolina are numerous and often
complex. For example; How do we
encourage women to get technical
education in fields where jobs
exist? How can we help women
learn to manage family and work
responsibilities? How can we sup
port child care and family leave
policies? How can we work to elim
inate gender stereotypes at home
and in the workplace?
EDFW provided education as
an avenue to increase economic
self-sufficiency. Education works.
This project helped put knowledge
to work in support of women and
their families.
There is an old saying that goes
like this: When a woman is empow
ered, the whole family benefits.
I say: Investing in people pays.
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