DHA may begin penalizing TRICARE fraudsters in early 2020

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Starting early next year, the Defense Health Agency, which administers TRICARE, should have a new tool to go after fraud and abuse: it’s going to be able to impose civil penalties.

“In the last 10 years, the federal government has been the victim of close to $10 billion of health care fraud,” said Bryan Wheeler, deputy general counsel at DHA, on Federal Drive with Tom Temin. “TRICARE alone, in the last four years, we’ve seen close to $2 billion of health care fraud, and we noticed that there is a provision that was available to us, that we weren’t taking advantage of. And that’s how we came up with this proposal.”

Wheeler said most of that $2 billion consists of pharmaceutical fraud, particularly compound pharmacy fraud. And while DHA put a stop to much of that in 2015, he said this tool will help them proceed in further actions against these types of fraud.

This tool isn’t actually all that new though; the Department of Health and Human Services has had this ability since the 1980s. The Health Insurance Portability and Accountability Act of 1996 then extended it to all federal health agencies.

“So we have a great model for our rules that HHS has already provided,” said Mike Zleit, associate general counsel of the Defense Health Agency. “And our regulation tracks as closely as possible, as applicable to TRICARE as we could, with the HHS regulation. That’s done for various purposes. So anybody who encounters the new Tricare program is going to be familiar with it, to the extent they have ever been involved with the Medicare program that’s been going on for quite some time.”

And that should include most medical providers. Zleit said any TRICARE providers are also required to be Medicare providers as well, so odds are they’ve encountered this program before.

In addition to fines, DHA will also have other enforcement options to wield against perpetrators of fraud or abuse. Providers could be barred or suspended from the TRICARE network, and some cases could also be forwarded to the Justice Department for prosecution.

And due to the level of collaboration between DHA and HHS, what happens in one, happens in the other. So any providers barred from TRICARE would likewise be barred from Medicare.

But mistakes do happen occasionally, and the program accounts for that as well.

“One of the elements of this new law or this new regulation that we’re posing is to do a self-disclosure protocol, which would allow people to self-disclose any violations, which will allow us to identify much broader scopes,” Zleit said. “And then we would then impose maybe a lesser penalty upon those people who self-disclosed any violations.”

In fact, Zleit said, DHA may decline to levy a monetary penalty entirely in self-disclosure cases where it investigates and determines it to be truly a matter of error.

This regulation was published as a proposed rule on May 1, 2019, and the public comment period ended July 1, 2019. Zleit said that after the comment period, the rule would be subject to review. Revisions would be made as necessary, and barring any outcomes, the program would move forward early in the calendar year 2020.

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