Life Science Compliance Update

February 13, 2018

OIG Releases Review of QPP


The Office of the Inspector General (OIG) released a review of the Quality Payment Program (QPP), concluding CMS has made progress towards implementing the QPP, but challenges remain. CMS appears on track to deploy the IT systems needed for data submission but the OIG has identified two vulnerabilities that are critical for CMS to address in 2018 because of their potential impact on the program's success.

OIG Study

According to the OIG, it interviewed CMS staff and reviewed internal CMS documents as well as publicly available information. The OIG conducted qualitative analysis to identify key milestones (both those achieved and those yet to come), priorities, and challenges related to QPP implementation.

In 2016, OIG conducted an early implementation review of CMS’s management of the QPP. It found that CMS had made significant progress towards implementing the QPP, including fostering clinician acceptance, adopting integrated business practices, building IT systems, and developing key program policies.

However, the review also identified two potential vulnerabilities that were critical for CMS to address in 2017 because of their potential impact on the program’s success: (1) Completing information technology systems to support critical QPP functions. In the past, CMS has experienced delays and complications related to major information technology (IT) initiatives. If CMS does not complete the complex IT systems underlying the QPP on schedule, implementation of quality-based payment adjustments may be delayed. (2) Ensuring clinician readiness to participate in the QPP. If clinicians lack sufficient information and assistance, they may struggle to meet QPP reporting requirements or choose not to participate at all.

The OIG’s objectives in this follow-up review were to assess CMS’s progress in mitigating these potential vulnerabilities and to identify emerging challenges. If CMS fails to sufficiently address these issues, the QPP may be unable to achieve its goal of promoting high-value care and patient outcomes while minimizing burden on clinicians.

Large IT System Necessary to Support QPP

As described by the OIG, building the IT systems to support the QPP is a significant undertaking for CMS, requiring both public-facing products (e.g., an interface for data submission) and back-end systems (e.g., a module to calculate MIPS final scores). These complex systems must be completed on schedule so that key elements of the program, such as data submission, can occur according to the timeframe specified in statute and regulation. The IT systems for the QPP encompass the following six products:

  • The platform is the infrastructure that underlies and supports all of the other QPP products. It ensures that various development efforts are coordinated and employ common methods.
  • The website is the central site where all clinicians, their partners, and developers interested in interacting with the QPP come to perform tasks. Ultimately, it will include both public webpages with general information and other pages where individual users can access secure, authenticated accounts providing QPP performance information.
  • The eligibility product uses CMS data sources to determine clinicians’ eligibility for the QPP (i.e., whether they are required to participate to avoid a negative payment adjustment), including whether they are qualified to participate under the MIPS track or the Advanced APM track.
  • The data submission product enables clinicians, as well as other staff or vendors authorized to provide data on their behalf (e.g., office administrators, registries), to submit MIPS data to CMS. CMS will support a variety of submission mechanisms.
  • The scoring product will enable CMS to calculate each clinician’s final MIPS score based on the data submitted. These scores will also be used to determine the payment adjustment that each MIPS clinician will receive in 2019.
  • The feedback product will produce individualized reports providing clinicians with information about their performance, including their respective final MIPS scores and payment adjustments.

In its assessment, the OIG states, “IT development appears on track to deploy all products necessary for data submission to begin on January 1, 2018.” This is good news for CMS, as the first vulnerability described by the OIG is related to the agency’s IT systems. Specifically: “If clinicians do not receive sufficient information and assistance, they may struggle to succeed under the QPP or choose not to participate. This is of particular concern for small practices and clinicians in rural or medically underserved areas, who may lack the resources to fully engage in the QPP without customized technical assistance to meet practice-specific needs,” says the OIG.

Clinician Readiness for QPP

As described by the OIG, CMS officials have consistently stated that clinicians’ acceptance of and readiness to participate is crucial to the program’s success. For 2017—the program’s first performance period—CMS set a goal of 90 percent participation in QPP. To reach this goal, CMS has used multiple channels to educate clinicians, provide technical assistance, and collect feedback. For example, CMS held numerous webinars and other events; issued subregulatory guidance; and established a Service Center to respond to questions and resolve problems. CMS also awarded a variety of contracts to provide technical assistance specific to clinicians’ practice types and needs.

Through these efforts, CMS has raised awareness of the QPP, and a majority of eligible clinicians have reported to CMS that they intend to participate. CMS staff said that because the QPP was an entirely new initiative, it was necessary for early outreach efforts to focus on general education and awareness. However, CMS staff report that as QPP implementation continues, a greater focus on specialized, practice-specific technical assistance will be needed to help clinicians fully participate in the new program.

This results in the second vulnerability outlined by the OIG. If clinicians do not receive sufficient technical assistance, they may struggle to succeed under the QPP or choose not to participate. According to clinician feedback collected by CMS demonstrates widespread basic awareness of the QPP, but also indicates uncertainty regarding details of participation such as who must report and how to submit data.

Further, to date, CMS contractors have focused largely on general education initiatives, with fewer resources devoted to more customized, practice-specific technical assistance. CMS needs to continue to assess progress and increase the proportion of contractors’ efforts devoted to specialized technical assistance to support high levels of clinician participation. Small practices and clinicians in rural or medically underserved areas, who may have fewer administrative resources and less experience with prior CMS quality programs, should be prioritized for assistance, according to the OIG.

January 17, 2018

Like the Little Drummer Boy, the Beat Goes on as OIG Enforcement Shows Few Signs of Letting Up


As life science compliance professionals know, it is important to monitor what the HHS OIG focuses on. This article reviews the OIG’s focus in 2017 and looks ahead to what may be in store for 2018.

For life science compliance professionals, following the activities of the Office of Inspector General (“OIG”) for the Department of Health and Human Services is both a question of curiosity and necessity. With the limited amount of formal guidance available, the OIG’s actions provide vital clues as to the agency’s thinking and focus in the near future.

As we closed out 2017, two overarching themes emerged. The first was the need to invest in internal auditing and measurement of compliance programs, and the second the advent of more coordinated investigations involving pain management drugs. For 2018, as discussed below, we believe both themes will continue with the OIG being hyper-focused on anything involving opioids and pain management.

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January 09, 2018

HHS OIG Releases Report on Potential Drug Misclassifications


A report recently released by the Department of Health and Human Services (HHS) Office of Inspector General (OIG) found that manufacturers may have misclassified as many as 885 drugs in the Medicaid rebate program in 2016. In September 2016, Congress asked OIG to evaluate the accuracy of manufacturer-reported drug classification data in the Medicaid rebate program, and the extent to which CMS oversees drug classification data submitted by manufacturers. In response to the congressional request, this study evaluates drug classification data submitted to the Medicaid rebate program and CMS’s policies and procedures to ensure appropriate oversight of this data. This report is the result of that request.

Although this number of misclassifications only accounts for three percent of the approximately 30,000 drugs within the program, ten misclassified drugs could have resulted in up to $1.3 billion lost in base and inflation-adjusted rebates for Medicaid over the last four years. The highest total reimbursement came in 2016 from these drugs. Congress had originally asked the OIG to look into drug misclassifications within the Medicaid rebate program due to outcry over rising EpiPen prices and the way Mylan had classified the drug and device as a generic under the program since 1997.

The Centers for Medicare & Medicaid Services (CMS) does not have the legal authority to require manufacturers to change their classification, and therefore must ask manufacturers to change their own data when they determine it may be incorrect, though CMS does work with the manufacturers to assist them in correcting the errors. Additionally, CMS does not track or maintain a central database of potential errors or their resolutions and investigators had no way to determine which drugs CMS had identified as potentially-misclassified or what steps were taken to address the potential errors in data. By classifying their drug as a generic, manufacturers are able to obtain a lower base rebate and are not subject to penalties if their drug’s price increases faster than inflation.

CMS routinely seeks to identify potential misclassifications and takes action when they are identified. To identify potential misclassifications, CMS compares Medicaid drug classifications reported by manufacturers to FDA data on a quarterly basis. If CMS identifies any errors in manufacturer-reported data, CMS stated that it typically contacts the manufacturer to request that the manufacturer correct the reported information. CMS may terminate a manufacturer from participation in the Medicaid rebate program for good cause. 8 If a manufacturer does not correct errors in reported data, CMS could potentially determine that the manufacturer is subject to termination for good cause.

A majority of the identified misclassifications were labeled as Generics under Medicaid, yet classified as brand-name drugs by the United States Food and Drug Administration (FDA). The report found that fifty-four manufacturers may have potential misclassifications, but it was four companies alone that were responsible for more than 50% of the errors in classification.

In conclusion, the report recommended that CMS (1) follow up with manufacturers associated with potentially-misclassified drugs identified in this report to determine whether current classifications are correct, (2) improve its Drug Data Reporting for Medicaid System to minimize inconsistent data submissions and track potential classification errors for follow up, and (3) pursue a means to compel manufacturers to correct inaccurate classification data reported to the Medicaid rebate program. CMS concurred with all three recommendations.


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