PURPOSE: This rule establishes the basis on which certain claims for Title XIX services or merchandise will be determined to be false or fraudulent and lists the sanctions which may be imposed and the method of imposing those sanctions. (1) The following definitions will be used in administering this rule:

1. (A) Adequate documentation means documentation from which services rendered and the amount of reimbursement received by a provider can be readily discerned and verified with reasonable certainty. Adequate medical records are records which are of the type and in a form from which symptoms, conditions, diagnosis, treatments, prognosis and the identity of the patient to which these things relate can be readily discerned and verified with reasonable certainty. All documentation must be made available at the same site at which the service was rendered.
2. (B) Affiliates means persons having an overt, covert or conspiratorial relationship so that any one (1) of them directly or indirectly controls or has the power to control another;
3. (C) Closed-end provider agreement means an agreement that is for a specified period of time, not to exceed twelve (12) months, and that must be renewed in order for the provider to continue to participate in the Medicaid program;
4. (D) Fiscal agent means an organization under contract to the state Medicaid agency for providing any services in the administration of the Medicaid program;
5. (E) Medicaid agency or the agency means the single state agency administering or supervising the administration of a state Medicaid plan;
6. (F) Open-end provider agreement means an agreement that has no specific termination date and continues in force as long as it is agreeable to both parties;
7. (G) Participation means the ability and authority to provide services or merchandise to eligible Medicaid recipients and to receive payment from the Medicaid program or those services or merchandise;
8. (H) Person means any natural person, company, firm, partnership, unincorporated association, corporation or other legal entity;
9. (I) Provider means an individual, firm, corporation, pharmacy, hospital, long-term care facility, association or institution which has a provider agreement to provide services to a recipient pursuant to Chapter 208, RSMo;
10. (J) Records means any books, papers, journals, charts, treatment histories, medical histories, tests and laboratory results, photographs, X rays and any other recordings of data or information made by or caused to be made by a provider relating in any way to services provided to Medicaid recipients and payments charged or received. Medicaid claim for payment information appointment books, financial ledgers, financial journals or and Procedure of General Applicability

any other kind of patient charge without corresponding adequate medical records do not constitute adequate documentation;

1. (K) Supervision means the service was performed while the provider was physically present during the service or the provider was on the premises and readily available to give direction to the person actually performing the service;
2. (L) Suspension from participation means an exclusion from participation for a specified period of time;
3. (M) Suspension of payments means placement of payments due a provider in an escrow account;
4. (N) Termination from participation means the ending of participation in the Medicaid program; and
5. (O) Withholding of payments means a reduction or adjustment of the amounts paid to a provider on pending and subsequently submitted bills for purposes of offsetting overpayments previously made to the provider.

1. (2) Program Violations.

   1. (A) Sanctions may be imposed by the Medicaid agency against a provider for any one

2. (1) or more of the following reasons:

   1. 1. Presenting, or causing to be present-

ed, for payment any false or fraudulent claim for services or merchandise in the course of business related to Medicaid;

1. 2. Submitting, or causing to be submit-

ted, false information for the purpose of obtaining greater compensation than that to which the provider is entitled under applicable Medicaid program policies or rules, including, but not limited to, the billing or coding of services which results in payments in excess of the fee schedule for the service actually provided or billing or coding of services which results in payments in excess of the provider’s charges to the general public for the same services, or altering or falsifying medical records to obtain or verify a greater payment than authorized by a fee schedule or reimbursement plan;

1. 3. Submitting, or causing to be submit-

ted, false information for the purpose of meeting prior authorization requirements or for the purpose of obtaining payments in order to avoid the effect of those changes;

1. 4. Making available, and disclosing to

the Medicaid agency or its authorized agents, all records relating to services provided to Medicaid recipients and Medicaid payments, whether or not the records are commingled with non-Title XIX records is mandatory for all providers. Copies of records must be provided upon request of the Medicaid agency or its authorized agents. Failure to make these records available on a timely basis at the same site at which the services were rendered, or failure to provide copies as requested, or failure to keep and make available adequate records which adequately document the services and payments shall constitute a violation of this section and shall be a reason for sanction;

1. 5. Failing to provide and maintain qual-

ity, necessary and appropriate services, including adequate staffing for long-term care facility Medicaid recipients, within accepted medical community standards as adjudged by a body of peers, as set forth in both federal and state statutes or regulations. Failure shall be documented by repeat discrepancies. The discrepancies may be determined by a peer review committee, medical review teams, independent professional review teams, utilization review committees or by Professional Standards Review Organizations (PSRO). The medical review may be conducted by qualified peers employed by the single state agency;

1. 6. Engaging in conduct or performing an

act deemed improper or abusive of the Medicaid program or continuing the conduct following notification that the conduct should cease. This will include inappropriate or improper actions relating to the management of recipients’ personal funds or other funds;

1. 7. Breaching of the terms of the Medi-

caid provider agreement of any current written and published policies and procedures of the Medicaid program (such as are contained in provider manuals or bulletins) or failing to comply with the terms of the provider certification on the Medicaid claim form;

1. 8. Utilizing or abusing the Medicaid

program as evidenced by a documented pattern of inducing, furnishing or otherwise causing a recipient to receive services or merchandise not otherwise required or requested by the recipient, attending physician or appropriate utilization review team; a documented pattern of performing and billing tests, examinations, patient visits, surgeries, drugs or merchandise that exceed limits or frequencies determined by the department for like practitioners for which there is no demonstrable need, or for which the provider has created the need through ineffective services or merchandise previously rendered;

1. 9. Rebating or accepting a fee or portion

of a fee or charge for a Medicaid patient referral; or collecting a portion of the service fee from the recipient, except this shall not apply to Title XIX services for which recipients are responsible for payment of a copayment or coinsurance in accordance with 13 CSR 70-4.051 and 13 CSR 70-55.010; 13 CSR 70-3

1. 10. Violating any provision of the State

Medical Assistance Act or any corresponding rule;

1. 11. Submitting a false or fraudulent

application for provider status which misrepresents material facts. This shall include concealment or misrepresentation of material facts required on any provider agreements or questionnaires submitted by affiliates when the provider knew or should have known the contents of the submitted documents;

1. 12. Violating any laws, regulations or

code of ethics governing the conduct of occupations or professions or regulated industries. In addition to all other laws which would commonly be understood to govern or regulate the conduct of occupations, professions or regulated industries, this provision shall include any violations of the civil or criminal laws of the United States, of Missouri or any other state or territory, where the violation is reasonably related to the provider’s qualifications, functions or duties in any licensed or regulated profession or where an element of the violation is fraud, dishonesty, moral turpitude or an act of violence;

1. 13. Failing to meet standards required

by state or federal law for participation (for example licensure);

1. 14. Excluding from Medicare for any

reason arising out of improper conduct related to the Medicare program;

1. 15. Failing to accept Medicaid payment

as payment in full for covered services or collecting additional payment from a recipient or responsible person, except this shall not apply to Title XIX services for which recipients are responsible for payment of a copayment or coinsurance in accordance with 13 CSR 70-4.051 and 13 CSR 70-55.010;

1. 16. Refusing to execute a new provider

agreement when requested to do so by the single state agency in order to preserve the single state agency’s compliance with federal and state requirements; or failure to execute an agreement within twenty (20) days for compliance purposes;

1. 17. Failing to correct deficiencies in

provider operations within ten (10) days after receiving written notice established by a signed receipt of delivery of these deficiencies from the single state agency or within the time frame provided from any other agency having licensing or certification authority;

1. 18. Being formally reprimanded or cen-

sured by a board of licensure or an association of the provider’s peers for unethical, unlawful or unprofessional conduct; any termination, removal, suspension, revocation, denial, probation, consented surrender or other disqualification of all or part of any license, permit, certificate or registration related to the provider’s business or profession in Missouri or any other state or territory of the United States;

1. 19. Being suspended or terminated from

participation in another governmental medical program such as Workers’ Compensation, Crippled Children’s Services, Rehabilitation Services and Medicare;

1. 20. Using fraudulent billing practices

arising from billings to third parties for costs of services or merchandise or for negligent practice resulting in death or injury or substandard care to persons including, but not limited to, the provider’s patients;

1. 21. Failing to repay or make arrange-

ments for the repayment of identified overpayments or otherwise erroneous payments prior to the allowed forty-five (45) days which the provider has to refund the requested amount;

1. 22. Billing the Medicaid program twice

for the same service when the billings were not caused by the single state agency or its agents;

1. 23. Billing the state Medicaid program

for services not provided prior to the date of billing (prebilling), except in the case of prepaid health plans or pharmacy claims submitted by point-of-service technology; whether or not the prebilling causes loss or harm to the Medicaid program;

1. 24. Failing to reverse any pharmacy

claims submitted by point-to-service technology, while representing services not received by the recipient, by the time established by pharmacy manual on the Friday evening following the date the claim was submitted by point-of-service technology.

1. 25. Conducting any action resulting in a

reduction or depletion of a long-term care facility Medicaid recipient’s personal funds or reserve account, unless specifically authorized in writing by the recipient, relative or responsible person;

1. 26. Providing services by a nonenrolled

person without the direct supervision of a provider and billed by the provider as having performed those services, or services billed by a provider but performed by a similarly licensed practitioner, nonenrolled due to Medicaid sanction, whether or not the performing practitioner was under supervision of the billing provider;

1. 27. Making any payment to any person

in return for referring an individual to the provider for the delivery of any goods or services for which payment may be made in whole or in part under Medicaid. Soliciting or receiving any payment from any person in return for referring an individual to another supplier of goods or services regardless of whether the supplier is a Medicaid provider for the delivery of any goods or services for which payment may be made in whole or in part under Medicaid is also prohibited. Payment includes, without limitation, any kickback, bribe or rebate made, either directly or indirectly, in cash or in-kind;

1. 28. Having services billed and rendered

which were upgraded from those actually ordered or billing or coding services in a manner that services are paid for as separate procedures when, in fact, the services were performed concurrently or sequentially and should have been billed or coded as integral components of a total service as prescribed in Medicaid policy for payment in a total payment less than the aggregate of the improperly separated services;

1. 29. Conducting civil or criminal fraud

against the Missouri Medicaid program or any other state Medicaid (medical assistance) program, or any criminal fraud related to the conduct of the provider’s profession or business;

1. 30. Having sanctions or any other

adverse action invoked by another state Medicaid program;

1. 31. Failing to take reasonable measures

to review claims for payment for accuracy, duplication or other errors caused or committed by employees when the failure allows material errors in billing to occur. This includes failure to review remittance advice statements provided with the payment document which results in payments which do not correspond with the actual services rendered;

1. 32. Submitting improper or false claims

to the state or its fiscal agent by an agent or employee of the provider;

1. 33. Failing to retain worksheets or other

documents and records verifying data transmitted to a billing intermediary, whether the intermediary is owned by the provider or not. The documentation must be retained for five (5) years. Long-term care providers are required to retain financial records for seven (7) years;

1. 34. Removing or coercing from the pos-

session or control of a recipient any item of durable medical equipment which has reached Medicaid-defined purchase price through Medicaid rental payments or otherwise become the property of the recipient without paying fair market value to the recipient;

1. 35. Failing to timely submit civil rights

compliance data or information or failure to timely take corrective action for civil rights compliance deficiencies within thirty (30) days after notification of these deficiencies or failure to cooperate or supply information required or requested by civil rights compliance officers of the single state agency; and

1. 36. Billing the Medicaid program for

services rendered to a recipient in a longterm care facility when the resident resided in a portion of the facility which was not Medicaid-certified or properly licensed or was placed in a nonlicensed or Medicaid-noncertified bed.

1. (3) Any one (1) or more of the following sanctions may be invoked against providers for any one (1) or more of the program violations specified in section (2) of this rule:

   1. (A) Failure to respond to notice of overpayments or notice of deficiencies in provider operations within the specified forty-five (45)-day time limit shall be considered cause to withhold future provider payments until the situation in question is resolved;
   2. (B) Termination from participation in the Medicaid program for a period of not less than sixty (60) days nor more than ten (10) years;
   3. (C) Suspension of participation in the Medicaid program for a specified period of time;
   4. (D) Suspension or withholding of payments to a provider;
   5. (E) Referral to peer review committees including PSROs or utilization review committees;
   6. (F) Recoupment from future provider payments;
   7. (G) Transfer to a closed-end provider agreement not to exceed twelve (12) months or the shortening of an already existing closed-end provider agreement;
   8. (H) Attendance at provider education sessions;
   9. (I) Prior authorization of services;
   10. (J) One hundred percent (100%) review of the provider’s claims prior to payment;
   11. (K) Referral to the state licensing board for investigation;
   12. (L) Referral to appropriate federal or state legal agency for investigation, prosecution, or both, under applicable federal and state laws;
   13. (M) Retroactive denial of payments; and
   14. (N) Denial of payment for any new admission to a skilled nursing facility (SNF), intermediate care facility (ICF) or ICF/mentally retarded (MR) that no longer meets the applicable conditions of participation (for SNFs) or standards (for ICFs and ICF/MRs) if the facility’s deficiencies do not pose immediate jeopardy to patients’ health and safety. Imposition of this sanction must be in accordance with all applicable federal statutes and regulations. and Procedure of General Applicability

2. (4) Imposition of a Sanction.

   1. (A) The decision as to the sanction to be imposed shall be at the discretion of the Medicaid agency. The following factors shall be considered in determining the sanction(s) to be imposed:

      1. 1. Seriousness of the offense(s)—The

state agency shall consider the seriousness of the offense(s) including, but not limited to, whether or not an overpayment (that is, financial harm) occurred to the program, whether substandard services were rendered to Medicaid recipients, or circumstances were such that the provider’s behavior could have caused or contributed to inadequate or dangerous medical care for any patient(s), or a combination of these. Violation of pharmacy laws or rules, practices potentially dangerous to patients and fraud are to be considered particularly serious;

1. 2. Extent of violations—The state Med-

icaid agency shall consider the extent of the violations as measured by, but not limited to, the number of patients involved, the number of Medicaid claims involved, the number of dollars identified in any overpayment and the length of time over which the violations occurred. The Medicaid agency may calculate an overpayment or impose sanctions under this rule by reviewing records pertaining to all or part of a provider’s Medicaid claims. When records are examined pertaining to part of a provider’s Medicaid claims, no random selection process in choosing the claims for review as set forth in 13 CSR 70- 3.130 need be utilized by the Medicaid agency. But, if the random selection process is not used, the Medicaid agency may not construe violations found in the partial review to be an indication that the extent of the violations in any unreviewed claims would exist to the same or greater extent;

1. 3. History of prior violations—The state

agency shall consider whether or not the provider has been given notice of prior violations of this rule or other program policies. If the provider has received notice and has failed to correct the deficiencies or has resumed the deficient performance, a history shall be given substantial weight supporting the agency’s decision to invoke sanctions. If the history includes a prior imposition of sanction, the agency should not apply a lesser sanction in the second case, even if the subsequent violations are of a different nature;

1. 4. Prior imposition of sanctions—The

Medicaid agency shall consider more severe sanctions in cases where a provider has been subject to sanctions by the Missouri Medicaid program, any other governmental medical program, Medicare or exclusion by any private medical insurance carriers for misconduct in billing or professional practice. Restricted or limited participation in compromise after being notified or a more severe sanction should be considered as a prior imposition of a sanction for the purpose of this subsection;

1. 5. Prior provision of provider educa-

tion—In cases where sanctions are being considered for billing deficiencies only, the Medicaid agency may mitigate its sanction if it determines that prior provider education was not provided. In cases where sanctions are being considered for billing deficiencies only and prior provider education has been given, prior provider education followed by a repetition of the same billing deficiencies shall weigh heavily in support of the medical agency’s decision to invoke severe sanctions; and

1. 6. Actions taken or recommended by

peer review groups, licensing boards or Professional Review Organizations (PRO) or utilization review committees—Actions or recommendations by a provider’s peers shall be considered as serious if they involve a determination that the provider has kept or allowed to be kept, substandard medical records, negligently or carelessly performed treatment or services, or, in the case of licensing boards, placed the provider under restrictions or on probation.

1. (B) Where a provider has been convicted of defrauding any Medicaid program, has been previously sanctioned due to program abuse, has been terminated from the Medicare program, the Medicaid agency shall terminate the provider from participation in the Medicaid program.
2. (C) When a sanction involving the collection, recoupment or withholding of Medicaid payments from a provider is imposed on a provider, it shall become effective ten (10) days from the date the provider receives notice established by a signed receipt of delivery of the imposition of the sanction. When any other sanction is imposed on a provider it shall become effective thirty (30) days from the date the provider receives notice established by a signed receipt of delivery of the imposition of the sanction. If, in the judgment of the single state agency, the surrounding facts and circumstances clearly show that serious abuse or harm may result from delaying the imposition of a sanction, any sanction may be made effective immediately upon receipt of notice by the provider.
3. (D) A sanction may be applied to all known affiliates of a provider, provided that each decision to include an affiliate is made on a case-by-case basis after giving due regard to all relevant facts and circumstances. The violation, failure or inadequacy of per- 13 CSR 70-3

formance may be imputed to an affiliate when the affiliate knew or should have known of the provider’s actions.

1. (E) Suspension or termination of any provider shall preclude the provider from participation in the Medicaid program, either personally or through claims submitted by any clinic, group, corporation or other association to the single state agency or its fiscal agents for any services or supplies provided under the Medicaid program except for those services or supplies provided prior to the suspension or termination.
2. (F) No clinic, group, corporation or other association which is a provider of services shall submit claims for payment to the single state agency or its fiscal agents for any services or supplies provided by, or under the supervision of, a person within the organization who has been suspended or terminated from participation in the Medicaid program except for those services or supplies provided prior to the suspension or termination.
3. (G) When the provisions of the previously mentioned are violated by a provider of services which is a clinic, group, corporation or other association, the single state agency may suspend or terminate the organization, the individual person, or both, within the organization who knew or should have known of the violation.
4. (H) When a provider has been sanctioned, the single state agency shall notify, as appropriate, the applicable professional society, board of registration or licensure, federal and state agencies of the finding made and the sanctions imposed.
5. (I) Where a provider’s participation in the Medicaid program has been suspended or terminated, the single state agency shall notify the county offices of the suspensions or terminations.

6. (J) Except where termination has been imposed, a provider who has been sanctioned may be required to participate in a provider education program as a condition of continued participation. Provider education programs may include:

   1. 1. Telephone and written instructions;
   2. 2. Provider manuals and workshops;
   3. 3. Instruction in claim form completion;
   4. 4. Instruction on the use and format of

provider manuals;

1. 5. Instruction on the use of procedure

codes;

1. 6. Key provisions of the Medicaid pro-

gram;

1. 7. Instruction on reimbursement rates;

and

1. 8. Instruction on how to inquire about

coding or billing problems.

1. (K) Providers that have been suspended from the Missouri Medicaid program under subsections (3)(B) and (C) may be reenrolled in the Medicaid program upon expiration of the period of suspension from the program after making satisfactory assurances of future compliance. Providers that have been terminated from the Missouri Medicaid program under subsection (3)(B) may be reenrolled in the program at the sole discretion of the single state agency and only after providing satisfactory evidence that the past cause for termination has ceased and that future participation is warranted.

1. (5) Amounts Due the Department of Social Services From a Provider.

   1. (A) If there exists an amount due the Department of Social Services from a provider, the single state agency shall notify the provider or the provider’s representative of the amount of the overpayment. If the amount due is not sooner paid to the Department of Social Services by or on behalf of the provider, the single state agency, forty-five

2. (45) days from the date the provider receives the notice, established by a signed receipt of delivery, may take appropriate action to collect the overpayment. The single state agency may recover the overpayment by withholding from current Medicaid reimbursement. The withholding may be taken from one (1) or more payments until the funds withheld in the aggregate equal the amount due as stated in the notice.

   1. (B) When a provider receives notice, established by a signed receipt of delivery, of an overpayment and the amount due is in excess of one thousand dollars ($1000), the provider, within ten (10) days of the notice, may submit to the single state agency a plan for repayment of forty percent (40%) of the overpayment amount and request that the plan be adopted and adhered to by the single state agency in collecting the overpayment. No repayment plans will be considered for the first sixty percent (60%) of the overpayment amount. If this repayment plan is timely received from a provider, the single state agency shall consider the proposal, together with all the facts and circumstances of the case and reject, accept or offer to accept a modified version of the provider’s plan for repayment. The single state agency shall notify the provider of its decision within ten (10) days after the proposal is received. If no plan for repayment is agreed upon within thirty

3. (30) days after the provider receives notice of the overpayment, the Medicaid agency may take appropriate action to collect the balance of the amount due.

   1. (C) If a plan agreed to and implemented under provisions of subsection (5)(B) for repayment of amounts due the Department of Social Services from a provider is breached, discontinued or otherwise violated by a provider, the single state agency, immediately upon the next payment to the provider, may begin to withhold payments or portions of payments until the entire amount due has been collected.
   2. (D) Repayment or an agreement to repay amounts due the Department of Social Services by a provider shall not prevent the imposition of any sanction by the single state agency upon the provider.

AUTHORITY: section 208.201, RSMo Supp. 1987.* This rule was previously filed as 13 CSR 40-81.160. Original rule filed Sept. 22, 1979, effective Feb. 11, 1980. Amended: Filed Nov. 25, 1981, effective March 11, 1982. Emergency amendment filed April 14, 1982, effective April 24, 1982, expired July 10, 1982. Amended: Filed April 14, 1982, effective July 11, 1982. Amended: Filed April 16, 1985, effective Sept. 1, 1985. Emergency amendment filed Dec. 5, 1986, effective Dec. 15, 1986, expired April 13, 1987. Amended: Filed Dec. 16, 1986, effective April 11, 1987. Amended: Filed Jan. 7, 1987, effective April 26, 1987. Emergency amendment filed April 15, 1988, effective April 25, 1988, expired Aug. 22, 1988. Amended: Filed June 2, 1988, effective Aug. 25, 1988. Amended: Filed Aug. 2, 1990, effective Feb. 14, 1991. Emergency amendment filed Dec. 17, 1993, effective Jan. 1, 1994, expired April 30, 1994. Emergency amendment filed April 15, 1994, effective April 30, 1994, expired Aug. 13, 1994. Amended: Filed Feb. 16, 1994, effective Aug. 28, 1994. *Original authority: 208.201 RSMo 1987.