Sunday, August 19, 2012

False Claims Act Investigations of Non-Evidence Based ICD Procedures

News has been coming out about what is reported to be the U.S. Department of Justice's latest False Claims Act initiative:  "the national false claims investigation of Medicare billing for implantable cardiac defibrillator (ICD) procedures."  According to the National Heart Lung and Blood Institute, ICDs are small devices implanted  in the chest or abdomen that are used to treat irregular heart beats by using electrical pulses or shocks to bring the heart back to a normal rhythm.  A study published early last year by JAMA, the Journal of the American Medical Association, examined an enormous patient sample where implantable cardiac defibrillators were used.  Out of over 100,000 patients who received such devices, the article found that 22.5% of those patients received ICD devices even though they did not meet "evidence-based criteria for implantation:"  what the authors called "non-evidence based" ICD procedures.  Patients who  received non-evidence based ICDs, the study found, had a significantly higher rate of in-hospital death and complications.

In an article reprinted at (and apparently several other cites as well), "Feds Turn corner in ICD Investigation; Hospital Liability in Divided Into Categories," its author, Larry Husten, writes that DOJ "is apparently about to take a big step forward in its national false claims investigation of Medicare billing for implantable cardiac defibrillator (ICD) procedures" and whether such ICD procedures are medically necessary.  "DOJ, reports Husten, "now has a blueprint for determining hospital liability" under the False Claims Act.  According to Husten, Medicare will normally reimburse the use of ICDs, but a number of the "covered indications" for when such devices may be used have "timing requirements."  "Medicare," writes Husten, "won’t pay for a patient’s ICD implant within 40 days of an acute myocardial infarction (MI) or within three months of a coronary artery bypass graft (CABG) or percutaneous transluminal coronary angioplasty (PTCA). . . . . The idea is to first give patients time to recover from the heart attack to determine whether the patient really is at elevated risk for cardiac arrest."  Husten writes that there are exceptions to when such devices can be implanted notwithstanding these timing requirements; however, he quotes an anonymous source who says that "it doesn’t look like the government will go easy when hospitals billed in violation of the timing requirement in other circumstances."

The press attention to this new initiative appears to be prompted in part by the  Hospital Corporation of America ("HCA")  recent disclosure that it provided information to the Civil Division of the U.S. Attorney's Office for the Southern District of Florida about the "the medical necessity of interventional cardiology services provided at about 10 HCA hospitals, mostly in Florida."

In a recent article, "Hospitals face hefty False Claims penalties over defibrillator cases," on the investigation of ICD usage by Joe Carlson of Modern, he writes that for the "past two years" DOJ has been conducting a "patient-by-patient investigation into thousands of implantable cardioverter defibrillators . . . for Medicare beneficiaries between 2003 and 2010 at hospitals across the country. . . . .  More than 100 U.S. hospitals are believed to have received requests for records on their implanted defibrillators, with the first round going out in March 2010."

I think there has been some question as to whether DOJ can really pursue such large scale "medical necessity cases" as involved here with ICDs.  Carlson, for example quotes one attorney who rightly points out that "the government would have to be prepared to show that a hospital acted with intent to defraud, or with deliberate indifference or reckless disregard for the CMS rules, in order for False Claims penalties to come into play."  In certain False Claims Act cases based on alleged statistical abnormalities, however, I have not found that the government was prepared to show either fraud or deliberative indifference.  Rather, the government draws the inference that fraud or deliberate indifference occurred based on the statistical abnormality alone, and hospitals faced with the prospect of a False Claims Act suit, often settle rather than fight the issue of medical necessity.   For example, in the pneumonia up-coding cases, hospitals were accused of overusing higher reimbursable diagnostic codes for a certain type of pneumonia.  Rather than fight these cases, hospitals settled in droves, even in many instances where there was substantial evidence to support their use of such codes.  Another example can be found in the recent DOJ kyphoplasty settlements.  In those cases, DOJ accused the hospitals of admitting  too many kyphoplasty patients for a one day stay and argued that the patients should have been observed instead.  Here again, hospitals settled, often protesting their innocence.    My point is medical necessity cases are much easier to bring when there is a gross or large statistical aberration in the procedure at issue by the hospital or medical provider:  the government does not need evidence of fraud or recklessness beyond the aberration itself in order to drive settlements.

A. Brian Albritton
August 19, 2012