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Former senior government officials say it’s no surprise that newly appointed Health and Human Services (HHS) Inspector General (IG) Janet Rehnquist is taking a low-key approach to her new job. It may not make much difference, they add, because the real solutions to the problems gripping health care fraud enforcement must come from Congress.
"The IG can make a difference at the margins, but with respect to grand shifts in policy, that’s up to Congress," argues former HHS Principal Deputy General Counsel Robert Charrow. "The IG can steer a ship a few degrees to the right or left, but only Congress can turn the ship around."
Former IG Richard Kusserow, who held the post from 1981 to 1989, says he steered a slightly different course than his predecessor, and his successor, June Gibbs Brown, did the same. "The mission of the OIG is pretty well established," he explains. "It is mostly a matter of the priorities that she puts on special projects."
Rehnquist, the 44-year-old daughter of Chief Justice William Rehnquist, was officially confirmed by the U.S. Senate earlier this month and reported to the OIG on Aug. 8 with little fanfare. HHS issued no press release, and the OIG does not even have information on the background of the former U.S. attorney from Virginia who also held posts as associate counsel during the first Bush administration and the Permanent Subcommittee on Investigations in the U.S. Senate.
Rehnquist’s low profile is very appropriate for the moment, argues Kusserow, president of Strategic Management Associates in Alexandria. "She is trying to figure out exactly how the clock works before messing with it, and that’s exactly what she should be doing," he contends.
When Brown took over as IG, she had the benefit of being part of the Inspector General community, including posts at the Defense and Interior departments, notes Kusserow. "Her learning curve was not nearly as steep," he says, noting that the OIG includes 1,500 people and four departments — audit, investigations, evaluations, and inspections — as well as general counsel.
The most important question for health care providers is not who occupies the Inspector General post, but fixing the things that now govern health care fraud enforcement, says Charrow, of the law firm Crowell Moring in Washington, DC. Specifically, he says the anti-kickback laws governing federal health care programs vest "extraordinary discretion" in the OIG and HHS, and are so expansive that they prohibit conduct that is perfectly legitimate in other settings.
The safe harbor system, which was designed to alleviate that problem, has its own grave problems, adds Charrow. For one thing, he says, former IG Brown was reluctant to issue safe harbors, and when she did, they tended to be "extraordinarily rigid."
According to Charrow, the implementation of prospective payment systems in place of fee-for-service has reversed incentives and leaves hospitals, not the government, holding the bag for the cost of kickbacks. But he says the anti-kickback laws give the government a way to micromanage medical care that it is not anxious to relinquish.
According to Charrow, the most needed reform is the ability of providers to sue the Centers for Medicare and Medicaid services (CMS). "The ability to have meaningful judicial review of CMS and OIG actions would be first on my priority list, he says.
Charrow is not alone. Last month, the Chicago-based American Hospital Association (AHA) told the Senate Aging Committee that direct access to the courts is essential to provide fundamental fairness for hospitals participating in the Medicare program.
However, as a result of the Supreme Court’s decision in Shalala v. Illinois Council on Long Term Care, providers are being denied the ability to challenge the legality of actions by HHS that under other statutes would be immediately subject to review, says AHA.
Hospitals also need access to judicial review when there is no process for resolving a dispute, AHA contends. The laboratory billing investigation is a case in point. In that instance, hospitals received demand letters from U.S. Attorneys, effectively accusing them of fraud and demanding repayment.
When hospitals sought the court’s protection, the Sixth Circuit sided with the hospitals and held that the administrative process provided no review at all for hospitals. But the Supreme Court’s decision puts that view that at risk.
"Unfortunately for hospitals, that interpretation effectively insulates HHS from legal accountability for many of its actions and places hospitals in the position of having to violate a regulation in order to challenge the legality of HHS’ decisions and policies," argues AHA. "That means the price of admission to the court for hospitals is termination from the Medicare program."
"Congressional action is needed to ensure fundamental fairness for hospitals," the association argues. "The Medicare statute needs to be clarified so that when a hospital challenges the legality of HHS’ actions, a hospital or other provider is entitled to bring an action in court."
Charrow says the real test for HHS Secretary Tommy Thompson is whether he is willing to go to Congress and ask for that accountability. "That would signal dramatic change, but if he doesn’t say that and he becomes captain of the bureaucracy he can only make changes at the margin," he says. "That to me is the bright line test."