A team of attorney’s from the Reed Smith law firm published an article recently in the AHLA Health Lawyer’s Weekly discussing the “Deficit Reduction Act of 2005 ” (DRA)(Pub. L. No. 109-171).
In addition to cutting Medicare and Medicaid services, tucked away iis an item requiring all entities that make or receive at least $5 million in annual Medicaid payments to establish specific written policies and procedures to inform employees and others about certain federal and state false claims and whistleblower laws. This provision takes effect beginning January 1, 2007. Implementing federal regulations are not required, although they may be forthcoming. To ensure that appropriate procedures are in place by that deadline, entities with significant interactions with state Medicaid programs (including through their participation in the Medicaid rebate program) should begin now to review their employee training and compliance procedures.
Overview of Employee Training and Compliance Requirements: There are six new employee training and compliance requirements under the DRA, which are summarized below:
1. Affected Entities: The new requirements apply to any entity that receives or makes annual payments of at least $5,000,000 under a state Medicaid plan. The inclusion of entities that make payments, along with entities that receive them, make these provisions applicable to a broad array of entities in the healthcare industry, including, for instance, pharmaceutical manufacturers that pay rebates to state Medicaid programs, along with providers that receive Medicaid payments for services rendered.
2. Written Policies and Procedures: The DRA requires written policies and procedures. Training is not specifically required, but the provisions contemplate that entities dealing with state Medicaid programs will inform their employees of their policies.
3. Who to Inform: The policies and procedures must inform all employees, including management, and anyone who could be considered a contractor or agent of the entity
3. Content of the Policies and Procedures: The policies and procedures must provide information on the following laws, including the role of such laws in preventing and detecting fraud, waste, and abuse in federal healthcare programs:
* The federal False Claims Act
* Federal administrative remedies for false claims and statements;
* State laws pertaining to civil or criminal penalties for false claims and statements; and
* Whistleblower provisions under the federal and state laws.
4. Describe the Entity´s Policies and Procedures: The policies and procedures must also provide details regarding the entity´s policies and procedures for protecting against fraud, waste, and abuse.
5. Employee Handbook: The entity must include in its employee handbook: (a) the specific discussion of applicable fraud and abuse laws, (b) the rights of employees who are whistleblowers to be protected from retaliation, and (c) the entity´s policies and procedures for detecting and preventing fraud, waste and abuse.
Watch for more details and tools for physicians and other providers in the months to come.