Nursing Homes Must Take a Proactive Approach to Defending ZPIC Audits

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Defense Attorneys Assisting Nursing Facilities with ZPIC Audits

Zone Program Integrity Contractor (ZPIC) audits can expose nursing homes to recoupment requests, denial of future Medicare payments, and federal prosecutions that can lead to civil fines and criminal penalties. If your nursing home has been contacted by a ZPIC, it is imperative that you seek legal representation promptly.

As a nursing home owner, executive, or administrator, your life is busy enough already. You are constantly working, constantly finding new ways to improve the level of care you provide for your residents, and constantly dealing with the mountain of paperwork that comes along with operating under Medicare’s stringent regulations.

The last thing you need is for an outside auditor to start asking questions. Unfortunately, throughout the health care industry, and within the eldercare and nursing home sector, in particular, providers are increasingly finding themselves being scrutinized by Zone Program Integrity Contractors (ZPICs) and other government-contracted auditors (such as Recovery Audit Contractors (RACs) and Medicare Administrative Contractors (MACs)).

These contractors get paid to unearth discrepancies between nursing homes billing practices and what is permissible under the Medicare billing regulations, and they will go to great lengths to find something wrong even when there is nothing there. With ZPIC audits having the potential to lead to recoupment requests, Medicare reimbursement denials, and federal investigations, nursing homes facing these audits need to take their situations very seriously.

About the Federal Government’s ZPIC Audit Program

The ZPIC audit program came about through the enactment of the Medicare Modernization Act in 2003. The Medicare Modernization Act directed the Centers for Medicare and Medicaid Services (CMS) to implement a “fee-for-service” reform program designed to combat widespread Medicare billing issues throughout the health care industry. This included entering into government contracts with Zone Program Integrity Contractors, private companies that receive taxpayer dollars to target providers suspected of improper billing practices and Medicare fraud.

ZPICs are specifically tasked with enforcing the regulations for Medicare Parts A and B against nursing homes and other designated types of providers. Although they are technically under the direction of CMS’s Center for Program Integrity (CPI), ZPICs largely operate according to their own policies, procedures, and interpretations of the Medicare rules.

Responding to a ZPIC Audit

If anyone within your organization has been contacted by a representative of a ZPIC, you need to act quickly to close communications and ensure that only authorized and appropriately trained employees discuss your nursing home’s business with the ZPIC. It is also highly recommended that you seek legal representation. An experienced health care attorney will be able to counsel your employees and deal with the ZPIC auditors on your behalf, ensuring that your nursing home does not disclose any more information than is absolutely necessary and helping you and your employees avoid other mistakes that could lead to adverse consequences.

The ZPICs currently assigned to audit nursing homes across the United States (subject to change) are:

  • Safeguard Services (Zone 1 California, Hawaii, and Nevada)
  • AdvanceMed (Zone 2 Alaska, Arizona, Idaho, Iowa, Kansas, Missouri, Montana, Nebraska, North Dakota, Oregon, South Dakota, Utah, Washington, and Wyoming)
  • Cahaba (Zone 3 Indiana, Illinois, Kentucky, Michigan, Minnesota, and Ohio)
  • Health Integrity (Zone 4 Colorado, New Mexico, Oklahoma, and Texas)
  • AdvanceMed (Zone 5 Alabama, Arkansas, Georgia, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, Virginia, and West Virginia)
  • Safeguard Services (Zone 6 Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, and Washington D.C.)
  • Safeguard Services (Zone 7 Florida)

If you or any of your nursing home’s employees have had any communications with AdvanceMed, Cahaba, Health Integrity, or Safeguard Services, we encourage you to contact us promptly for a free and confidential initial consultation.

What is Involved in a ZPIC “Audit”?

While referred to as an “audit”, being targeted by a ZPIC is far more akin to facing an investigation. Although they are private contractors, ZPICs have been endowed with the authority to exercise certain pseudo-law enforcement functions, including assisting CMS, the Department of Health and Human Services (HHS), the Office of Inspector General (OIG), the Department of Justice (DOJ) and other agencies in identifying nursing homes that should be subjected to direct federal investigations. As a result, ZPICs often act aggressively, interfering with nursing homes operations and demanding confidential information without telling nursing home employees that they are under no obligation to provide the information requested.

Here, too, having experienced legal representation can be critical. When dealing with a Zone Integrity Program Contractor, you need to assert your rights, but you need to do so without antagonizing the ZPIC into ramping up its investigative efforts. Many ZPIC auditors do not like to be told, (No) and successfully defending a ZPIC audit (concluding the audit without an adverse finding or follow-up investigation) requires a measured approach that takes into consideration all of the legal, human, and other factors involved.

Our ZPIC audit PDF contains complete information.

My Nursing Home Has Been Contacted by a Zone Integrity Program Contractor. What Should I Do Now?

Whether you have just been contacted by a ZPIC or your nursing home is currently in the middle of a disruptive ZPIC audit, there are steps that you can take to help ensure a favorable resolution. It is important to be as proactive as possible, and not wait until you are facing the prospect of filing an appeal and defending your nursing home in a federal Medicare fraud investigation.

Four Steps to Take When Facing a ZPIC Audit

1. Seek Legal Representation.

The importance of seeking legal representation during your ZPIC audit cannot be overstated. While you are an expert in your business and may even have a clear understanding of your nursing home’s obligations as a Medicare participant, facing a ZPIC audit is a unique animal. ZPIC auditors use a variety of tactics to try to find ways to seek recoupments and deny future payments, and it takes thorough knowledge not only of past and current Medicare billing regulations but also of ZPIC’s auditing practices, to make sure you do not face unjustified liability or future denials.

2. Implement a ZPIC Audit Response Protocol.

As we alluded to above, when dealing with a ZPIC audit, only your attorneys and certain high-level employees should be in communication with the ZPIC’s representatives. You need to implement protocols for funneling inquiries to designated points of contact, and you need procedures in place to ensure that no information gets turned over without high-level approval. It is also important to ensure that your employees do not destroy paper records or delete electronic files in an attempt to “help”. Such mistakes can have drastic consequences, including possibly even leading to federal charges.

3. Conduct an Internal Assessment.

Whatever the ZPIC might find, you need to find it first. If there are deficiencies in your billing system or faults in your administrative policies and procedures, you need to identify them and address them accordingly. Many ZPIC audits and ensuing federal investigations arise out of innocent human errors; and, if someone within your organization has made a mistake, the best thing you can do is usually to implement a proactive remedy.

4. Develop a Comprehensive Strategy Based Upon a Realistic Assessment of the Facts at Hand.

Once you know your situation, then you can develop a strategy focused on securing the best possible outcome in light of the facts at hand. Ideally, this means concluding the audit without any negative consequences. But, if an adverse outcome appears unavoidable, you may need to adjust your strategy to focus on the next step in the process. There are five stages of ZPIC appeals; depending upon the facts at hand, you may be able to overcome an adverse ZPIC finding by:

  • Asserting statutory defenses Federal health care laws include a variety of safe harbors and other provisions that can insulate nursing homes from liability for alleged Medicare billing violations.
  • Challenging the ZPIC’s methodology Assessing compliance with the Medicare billing regulations is complicated, and it may be the case that the ZPIC’s methodology used to find your nursing home in violation was flawed.
  • Challenging the ZPIC’s information The ZPIC is required to provide you with certain information about its adverse findings. If you receive incomplete or faulty information, this could provide the basis for a successful appeal.
  • Hiring outside experts ZPICs do not specialize in nursing homes they are responsible for auditing a wide range of health care providers. By hiring outside experts, you may be able to demonstrate that the ZPIC’s findings are inaccurate or unwarranted.
  • Identifying flaws in the ZPIC’s findings In many cases, ZPICs are just flat-out wrong. If the ZPIC’s findings are based on an out-of-date regulation or a regulation that did not apply during the relevant time period, they should not stand.

Put Our Health Care Fraud Defense Group on Your Side

To get help with your nursing home’s ZPIC audit, contact the The Criminal Defense Firm to schedule a confidential initial consultation. Our Health Care Fraud Defense Group includes skilled health care fraud defense attorneys and former federal prosecutors who have decades of experience successfully defending clients in fee-for-service contractor audits and federal investigations. We can help protect your nursing home call (888) 452-2503 or get in touch online to put our experience on your side today.

Not all attorneys of The Criminal Defense Firm are licensed in California and nothing contained in here is meant to constitute the unauthorized practice of law.
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