Current through Register Vol. 47, No. 12, March 26, 2025
(a) Pursuant to
Public Health Law section 4414, every MCO that participates in public or
government sponsored programs with an enrolled population of 10,000 or more
persons in the aggregate in any given year shall develop and file with the
commissioner within 180 days of the effective date of these regulations a plan
for the detection, investigation and prevention of fraudulent activities in
this State and those fraudulent and abusive activities affecting policies or
State or local department of social services contracts issued or issued for
delivery in this State. The plan must include written policies, procedures and
standards of conduct that are distributed to all affected employees and
appropriate delegated entities, and that articulate the MCO's commitment to
comply with all applicable Federal and State standards and identify and address
specific areas of risk and vulnerability. The MCO must designate an officer or
director who has responsibility and authority for carrying out provisions of
the plan, and who reports directly to senior management. Any MCO that has filed
and implemented such a plan with the superintendent in compliance with section
409 of the
Insurance Law is exempt from the requirements of this section.
(1) For the purposes of this section, fraud
means any type of intentional deception or misrepresentation made by a person
with the knowledge that the deception could result in some unauthorized benefit
to himself or some other person in a managed care setting, including any act
that constitutes fraud under applicable Federal or State law, committed by an
MCO, contractor, subcontractor, provider, beneficiary or enrollee or other
person(s). A provider includes any individual or entity that receives funds in
exchange for the provision, or arranging for the provision, of health care
services to an MCO enrollee.
(2)
For the purposes of this section, abuse means provider practices that are
inconsistent with sound fiscal, business or medical practices and result in an
unnecessary cost to the State or Federal government or MCO, or in reimbursement
for services that are not medically necessary or that fail to meet
professionally recognized standards for health care in a managed care setting,
committed by an MCO, contractor, subcontractor, provider, beneficiary or
enrollee. It also includes enrollee practices that result in unnecessary cost
to the State or Federal government, MCO, contractor, subcontractor or provider.
For the purposes of this paragraph, provider includes any individual or entity
that receives funds in exchange for providing, or arranging for the provision,
of a service.
(b) A
fraud and abuse prevention plan shall include the following provisions:
(1) the establishment of a full-time special
investigation unit, separate and distinct from any other unit or function of
the MCO, which shall be responsible for investigation of cases of suspected
fraudulent and abusive activity and for implementation of the MCO's fraud and
abuse prevention and reduction activities under the MCO's fraud and abuse
prevention plan, which shall encompass activities of all contracted providers.
All documents related to the activities of the special investigations unit
shall be maintained for a period of not less than six years. If the MCO enters
into a management contract to perform all or part of this function, the
management contract shall be submitted to the department for prior approval and
included as part of the fraud and abuse prevention plan. The management
contract must provide for specified levels of staffing devoted to the
investigation of suspected fraudulent and abusive activities. In the event that
investigators employed by the management contractor will be working for more
than one MCO or on cases in states other than New York, the plan must apportion
and specify the percentage of the investigators' efforts which will be devoted
to working for the MCO on its New York cases. The agreement shall also require
that the management contractor cooperate fully with the department in any
examination of the implementation of the fraud and abuse prevention plan and
provide any and all assistance requested by the department, any other law
enforcement agency or any prosecutorial agency in the investigation and
prosecution of fraud and abuse and related crimes;
(2) a description of the organization of the
special investigations unit, including the titles and job descriptions of the
various investigators and investigative supervisors, the minimum qualifications
for employment in these positions in addition to those required by this
regulation, the geographical location and assigned territory of each
investigator and investigative supervisor, the support staff and other physical
resources, including database access available to the unit and the supervisory
and reporting structure within the unit and between the unit and the senior
management of the MCO. If investigators employed by the unit will be
responsible for investigating cases in more than one state, the plan must
apportion that percentage of the investigators' efforts which will be devoted
to New York cases;
(3) the
rationale for the level of staffing and resources being provided for the
special investigations unit which may include, but is not limited to, objective
criteria such as number of enrollees, number of claims received with respect to
New York MCOs on an annual basis, volume of suspected fraudulent and abusive
New York claims currently being detected, other factors relating to the
vulnerability of the MCO to fraud and abuse, and an assessment of optimal
caseload which can be handled by an investigator on an annual basis;
(4) a description of the relationship between
the officer or director responsible for carrying out the provisions of the
fraud and abuse prevention plan and the special investigations unit; between
such persons and the claims, quality, utilization review and underwriting
functions of the MCO; and between such persons and the department, other law
enforcement agencies and prosecutors;
(5) procedures for detecting and preventing
possible fraud and abuse, as well as procedures for case investigation and
detection of patterns of repetitive fraud and abuse involving one or more MCO,
including but not limited to the following areas:
(i) provision of preventive
services;
(iv) provision of
medically necessary services;
(v)
assignment of a PCP; and
(vi)
submission of claims for services not provided;
(6) criteria for referral of a case to the
special investigation unit for evaluation and designation of the individuals
authorized to make such a referral; criteria for referral of a case to the
department and designation of the individuals authorized to make such
referrals; and a policy to avoid duplication of effort due to concurrent
referrals by the officer, director or unit to more than one law enforcement
agency;
(7) provisions for
confidential reporting which ensure that the identity of individuals reporting
violations of the MCO's standards of conduct, policies and procedures and
applicable State and Federal standards, is protected. In addition, the MCO must
ensure that no individual who reports such violations or suspected fraud and
abuse is subjected to retaliation;
(8) for MCOs participating in programs
authorized by title XIX, provision for the department and/or the New York State
Medicaid Fraud Control Unit (MFCU) to conduct private interviews of MCO
personnel, subcontractors and their personnel, witnesses, and enrollees. MCO
personnel and subcontractors and their personnel must cooperate fully in making
MCO personnel, subcontractors and their personnel available in person for
interviews, consultation, grand jury proceedings, pre-trial conference,
hearings, trial and in any other process, including investigations at the MCO's
and subcontractor's own expense. In addition, the MCO must provide to the
department, its authorized representatives, and/or the MFCU, originals and/or
copies of all records and information requested, in the form requested, and
allow access to the MCO's premises. All copies of records must be provided free
of charge;
(9) provision for
in-service training programs for investigative, claims, quality, utilization
management and other personnel in identifying and evaluating instances of
suspected fraud and abuse, including an introductory training session and
periodic refresher sessions. This provision shall include course descriptions,
the approximate number of hours to be devoted to these sessions and their
frequency. In addition, the training and education required for the officer or
director responsible for carrying out the provisions of the fraud and abuse
prevention plan must be described;
(10) provision for coordination with other
units of the MCO to further fraud and abuse investigations, including a
periodic review of claims, underwriting, member services, utilization
management and complaint procedures and forms for the purpose of enhancing the
ability of the MCO to detect fraud and abuse and to increase the likelihood of
its successful prosecution, and for initiation of civil actions when
appropriate;
(11) provision for
prompt response to detected offenses, and for development of corrective action
initiatives;
(12) provision for
establishment and consistent application of appropriate disciplinary policies
for all employees who fail to comply with the MCO's standards of conduct,
policies and procedures and applicable State and Federal standards, as well as
publication and dissemination of the disciplinary policies and the range of
disciplinary actions for improper conduct;
(13) development of a fraud and abuse
awareness program, appropriate for the size of the MCO, focused on the cost and
frequency of fraud and abuse, and methods by which the MCO's enrollees,
providers and other contractors can prevent it;
(14) development of a fraud and abuse
detection procedures manual for use by officers, directors, managers, and
claims, underwriting, member services, utilization management, complaint, and
investigative personnel; and
(15)
the timetable for the implementation of the fraud and abuse prevention plan,
provided however, that the period preceding implementation shall not exceed six
months from the date the plan is submitted.
(c) Persons employed by special
investigations units as investigators or by an independent provider of
investigative services under contract with an MCO shall be qualified by
education or experience, which shall include an associate's or bachelor's
degree in criminal justice or a related field, or five years of insurance
claims investigation experience or professional investigation experience with
law enforcement agencies, or seven years of professional investigation
experience involving economic or insurance related matters. For the purposes of
evaluation of medical related claims, MCOs may employ or retain duly licensed
or authorized medical professionals. Notwithstanding these minimum
requirements, anyone employed as an investigator in a special investigation
unit or by a provider of investigative services under contract to an MCO as of
the effective date of these regulations may continue in such employment,
provided that the insurer identifies such person in writing to the
commissioner, giving the date such employment began and a description of the
person's qualifications, employment history and current job duties.
(d) Every MCO required to file a fraud and
abuse prevention plan shall file an annual report with the department no later
than January 15th of each year on a form approved by the department describing
the MCO's experience, performance and cost effectiveness in implementing the
plan and its proposals for modifications to the plan, to amend its operations,
to improve performance or to remedy observed deficiencies. The MCO must also
report at least annually the number of complaints regarding fraud and abuse
made to the MCO during the year. In addition, for each confirmed case of fraud
and abuse identified through complaints, organizational monitoring,
contractors, subcontractors, providers, beneficiaries, enrollees, etc., the
following shall be reported to the department on an ongoing basis when the case
is confirmed:
(1) the name of the individual
or entity that committed the fraud or abuse;
(2) the source that identified the fraud or
abuse;
(3) the type of provider,
entity or organization that committed the fraud or abuse;
(4) a description of the fraud or
abuse;
(5) the approximate range of
dollars involved;
(6) the legal and
administrative disposition of the case, including actions taken by law
enforcement officials to whom the case has been referred; and
(7) other data/information prescribed by the
department.
The reports shall be reviewed and signed by an executive
officer of the MCO responsible for the operations of the special investigations
unit.
