Sunset Commission Finalizes Recommendations to Heel in HHSC-OIG

In today’s public hearings, members of the Texas Sunset Advisory Commission passed staff recommendations and supplemental additions made by a special work group, relating to the Health and Human Services Commission Office of the Inspector General.

The final report is now online and can be downloaded here.*

A 14-minute excerpt of the video of the proceedings shows the presentations and passing of the amendments and recommendations by the Commission.

Additions and changes to staff recommendations

In addition to the staff recommendations made in their Sunset report, Sen. Juan “Chuy” Hinojosa, on behalf of his working group, made the following amendments per the video to streamline and expedite due process for providers:

1. That Medicaid providers under investigation be immediately notified by OIG management when state or OIG employee fraud has been found that impacts their cases.

2. SOAH to hold a CAF (credible allegation of fraud) payment hold appeal hearing within 45 days of the start of the payment hold with OIG being required to provide much more documentation to the provider about why they have been put under payment hold.  Each side will get four hours to present their case and the judge will make an adjudication.

3. That OIG rules be updated to conform with the limited circumstances when CAF holds can be placed.

4. OIG to pay all costs of SOAH hearing.

5. An updated definition of fraud to clarify that fraud does not include program violations or unintended technical errors.

6. Providers will only get one informal resolution meeting with OIG rather than two and the process will run concurrently to the hearing process.

7. CAF holds should not be placed on Medicaid providers for services that are pre-approved by the Commission or its contractors unless there is other evidence that fraud has been committed.

Rep. Raymond briefing the Commission on his amendments.
Rep. Raymond briefing the Commission on his amendments.

Rep. Raymond recommended an amendment meant to assist pharmacies to get a hearing before the HHSC Appeals court on OIG overpayment demands.  At  present, they have no recourse to any kind of due process.

Work lauded by Commission Chair

Senator Jane Nelson, chair of the Commission, lauded the additional review work  and told the hearing “You got exactly to what we want and that is going after fraud and not going after things we don’t want to go after.”


* The final recommendations are:

Issue 10

starting on pg 142 of the report

Poor Management Threatens the Office of Inspector General’s Effective Execution of Its Fraud, Waste, and Abuse Mission.

Main points

10.1 Remove the gubernatorial appointment of the inspector general and require the executive commissioner to appoint and directly supervise the inspector general.

10.2 Require OIG to undergo special review by Sunset in six years.

10.3 Require OIG, by rule, to establish prioritization and other criteria to guide its investigation processes.

10.4 Require OIG to complete Medicaid provider preliminary investigations within 45 days and full investigations within 180 days.

10.5 Require OIG, by rule, to establish criteria for scaling its enforcement actions for Medicaid provider investigations to the nature of the violation, including penalties.

10.6 Require OIG to conduct quality assurance reviews and request a peer review of sampling methodology used in its investigative process.

10.7 Define OIG’s role in managed care, including strengthened oversight of special investigative units.

10.8 Remove the prohibition on participation in both the Health Insurance Premium Payment program and Medicaid managed care.

10.9 Allow OIG to share confidential drafts of investigative reports concerning child fatalities with DFPS.

10.10 Direct OIG to narrow its employee investigations to focus on high priority
allegations, such as those at state institutions and related to program integrity, and develop guidelines for investigations of child fatalities.

10.11 Direct OIG to actively take steps to improve training for its staff and communication with HHS system programs and providers.

10.13 OIG should track basic performance measures needed to monitor the efficiency and effectiveness of its investigative processes.

10.14 OIG should establish a formal plan for reducing its backlog and improving inefficiencies in the process.


Issue 11

starting on pg 157

Credible Allegation of Fraud Payment Hold Hearings Do Not Achieve the Law’s Intent to Act Quickly to Protect the State Against Significant Cases of Fraud.

11.1 Streamline the CAF hold hearing process to more quickly mitigate state financial risks.

11.2 Clarify good cause exceptions for OIG’s application of a credible allegation of fraud payment hold.

11.3 Clarify OIG’s authority to place payment holds only in serious circumstances.

11.4 Require OIG to pay all costs of CAF hold hearings at SOAH.

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