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When Payor Audits Put Your Practice at Risk, Get Expert Help

Payor Audit & Practitioner Defense Attorneys

Payor audits can lead to severe consequences, including substantial recoupments, network exclusion, and even referrals for criminal investigation. Your initial response to a payor audit is critical. Do not wait until your rights are compromised.

Healthcare providers need to hold payors accountable for their legal obligations and provider agreements. Our founding partner has extensive experience working with major insurance companies and understanding their audit strategies. No one understands the law applicable to payor audits better than our team.

Our nationally recognized payor audit defense attorneys have more than 40 years of combined healthcare and legal experience. Put decades of inside knowledge and expertise on your practice's side today. If you are facing a payor audit, act now to protect your revenue and reputation.

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PAYOR AUDITS DEFENDED
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PAYOR AUDIT EXPERTISE

Practitioner Audit Defense Attorneys

Our payor audit defense team has helped clients avoid millions of dollars in recoupments, maintain network participation, win appeals, and defend themselves against aggressive payor tactics.

When your practice's financial stability and reputation are threatened, our team of experienced payor audit attorneys is your strongest advocate.

1200+

Clients served

2500+

matters handled

24/7

availability

100%

flexible rates
Our PBM audit defense team has helped clients avoid millions of dollars in recoupments, remain in-network, win reinstatement, and defend themselves against abusive PBM tactics.

When your license or livelihood is threatened, our team of pharmacy PBM audit attorneys is your fiercest ally.

1500+

Clients served

5000+

matters handled

24/7

availability

100%

flexible rates
"Anthony is the definition of a 'plug and play' athlete. Put him the game and he will change it."
- Former Acting U.S. Attorney, E.D.N.Y
PAYOR AUDIT CASE STUDIES
PBM Case
Studies

Recent Payor Audit Victories

Discover how healthcare providers targeted by payor audits and faced with substantial recoupment demands fought back and won with our expert legal representation.
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PAYOR AUDIT WIN 1

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PAYOR AUDIT WIN 2

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Awards & Recognition
Our process

Payor Audit Defense Strategy

01

Initial Case Assessment

We use a free consultation to understand the specifics of your audit, gather relevant documents, and identify potential defenses and strategies.
02

Comprehensive Audit Review

Our team conducts a thorough review of the audit findings to construct a compelling factual narrative that counters the payor's allegations and exposes any overreach or misinterpretations.
03

Legal Analysis and Response

Our detailed response leverages federal and state law to hold the payor accountable for its obligations and protect your rights throughout the audit process.
04

Negotiation and Appeals

We use our knowledge of the payor's internal processes to obtain favorable settlements, win appeals, and preserve your hard-earned revenue.
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FAQ

Frequently Asked Questions

What documents and information should I prepare for my initial consultation?

Initially, we'll need any audit notification letters, audit reports, and relevant financial records, such as billing statements and remittance advices. As we develop your defense strategy, we may request additional documentation. We will provide specific guidance on the most relevant supporting materials for your case.

What should I do if the payor conducts an audit without providing sufficient notice?

Lack of proper notice or failure to adhere to contractual audit requirements may violate state laws or your provider agreement. We leverage these issues to negotiate more favorable outcomes and protect your rights during the audit process.

Do payors target specific types of healthcare providers for audits?

While certain specialties or provider types may face increased scrutiny, all healthcare providers must contend with the risk of payor audits. Having experienced legal advocates levels the playing field and ensures your rights are protected.

Can you help if my network participation or credentialing is jeopardized?

Yes. We work tirelessly to ensure that any potential sanctions comply with applicable laws and your provider agreement. Payors are prohibited from acting in bad faith or arbitrarily, and we hold them accountable to protect your practice.

Will appealing audit findings or negotiating settlements impact my network contracts?

Retaliation for exercising audit appeal rights is prohibited. We incorporate proper legal safeguards into audit responses and settlements. Maintaining your existing contracts is always a priority.

What are the costs of legal representation in a payor audit?

We offer flexible fee arrangements based on the scope of representation required and the stage of the audit. The earlier we are involved, the better, as we can help limit the audit's scope and implement a more effective defense strategy, ultimately making legal representation more cost-efficient.

Can your guidance help prevent future payor audits?

Absolutely. We provide tailored compliance recommendations to help healthcare providers reinforce areas prone to payor scrutiny. Proper documentation and adherence to billing and coding guidelines are critical to minimizing the risk of future audits.

Can payor audits impact my reimbursement rates or value-based contract metrics?

Potentially. Depending on the scope of the audit and the findings, your reimbursement rates or performance metrics in value-based contracts may be affected. Our specialists work to minimize any potential consequences and ensure that audit outcomes are fair and accurately reflect your practice's performance.

Health Law Alliance

Book a Free Consultation

We hold payors accountable to their audit and legal obligations, protecting your practice's revenue and reputation. Do not wait until your rights are compromised. Schedule a free consultation now to discuss your case and explore your options.

Healthcare Fraud Defense STRATEGY

Healthcare Fraud Defense Information

Healthcare Fraud Defense

Government investigations may come in many forms, but criminal matters involving potential jail time, mandatory exclusion, loss of licensure, and reputational harm are the most severe and scary scenarios that anyone can face. Unfortunately, it often is not clear, particularly at the outset, whether an investigation involves criminal violations or what your status might be in the investigation. For example, our clients might be informed that the FBI is interviewing patients, or that their partners have received subpoenas. The uncertainty that results from these types of events is particularly difficult for our clients to manage, and typically involves sleepless nights, loss of appetite, anxiety and potential depression.

Our experienced healthcare defense attorneys understand what clients are going through, and focus on providing them with insight into the government’s investigation and how best to defend it. There are a variety of potential outcomes, many of them involving far less severe ramifications than might be contemplated. Indeed, in healthcare, parallel criminal, civil, and administrative laws provide an opportunity for potential resolution of government investigations under terms that do not involve loss of liberty or livelihood. The range of outcomes that might be available depends on the evidence available to the government, but cases involving patient harm typically receive more focus from a criminal perspective than run-of-the-mill billing irregularities, particularly when the federal government is involved.

That said, there are several notable exceptions. At Health Law Alliance, our healthcare defense attorneys have decades of federal and state prosecutorial experience, and we rely on that background to highlight areas of increased risk. In particular, the below agencies focus on the prosecution of criminal healthcare fraud.

Medicare Fraud Strike Force and Prescription Opioid Strike Force

The Medicare Fraud Strike Force, operated by the U.S. Department of Justice (DOJ) in regions across the country, is particularly adept at prosecuting healthcare fraud criminal matters. Medicare Fraud Strike Force Teams harness data analytics and the combined resources of federal, state, and local law enforcement entities to prevent and combat healthcare fraud, waste, and abuse. More specifically, the Strike Force uses advanced data analysis techniques to identify aberrant billing levels in healthcare fraud “hot spots” – cities with high levels of billing fraud – combined with traditional investigative techniques to target suspicious billing patterns in addition to emerging schemes and fraudulent practices that move from one location to another.

First established in March 2007, prosecutors operate in 16 Strike Forces, including the National Rapid Response Strike Force based in Washington, DC. The Strike Force Model centers on a cross-agency collaborative approach, bringing together the investigative and analytical resources of DOJ’s Fraud Section, the Federal Bureau of Investigation (FBI), the U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG), the Centers for Medicare & Medicaid Services (CMS), Drug Enforcement Administration (DEA), Defense Criminal Investigative Service (DCIS), Federal Deposit Insurance Corporation Office of the Inspector General (FDIC-OIG), Internal Revenue Service (IRS), Department of Labor-OIG, United States Postal Service – Office of the Inspector General (USPS-OIG), Veterans Administration – Office of the Inspector General (VA-OIG), and other agencies. Strike Force Health Care Fraud and Prescription Opioid teams are located across the country, as depicted by the chart below:

The Medicare Strike Force has filed thousands of criminal actions and indictments and recovered billions of dollars in assets resulting from healthcare fraud. The Strike Force teams bring together the Office of Inspector General (OIG), the Department of Justice (DOJ), Offices of the United States Attorneys (USAOs), the Federal Bureau of Investigation (FBI), local law enforcement, and others. These attorneys and investigators have a proven record of success in analyzing data and investigative intelligence to quickly identify fraud and bring prosecutions. The interagency collaboration also enhances the effectiveness of the Strike Force model. For example, OIG refers credible allegations of fraud to the Centers for Medicare & Medicaid Services (CMS) so that it can suspend payments to the alleged healthcare fraud perpetrators, thereby preventing losses to federal programs. Finally, the Medicare Strike Force does not focus exclusively on healthcare fraud but also prosecutes wire fraud, mail fraud, bank fraud, money laundering offenses, violations of the Anti-Kickback Statute (AKS), false statements offenses, Title 42 offenses, Title 26 offenses, and Title 21 offenses, in the highest intensity regions.

Department of Justice’s Health Care Fraud Unit

The Medicare Strike Force is a specialized department within the DOJ’s Health Care Fraud Unit, based in Washington, D.C., with operations across the country. DOJ’s Health Care Fraud Unit is led by over 80 experienced white-collar prosecutors who focus solely on prosecuting the nation’s most complicated healthcare fraud matters and the illegal prescription, distribution, and diversion of opioids and other controlled substances. The Health Care Fraud Unit’s mission is to protect the public treasury from wide-scale healthcare fraud, protect patients from significant fraudulent schemes that result in patient harm, and to detect, limit, and deter fraud and illegal prescription, distribution, and diversion of controlled substance offenses. The Health Care Fraud Unit endeavors to prosecute defendants who orchestrate schemes that result in the loss of hundreds of millions or billions of dollars, the distribution of tens of millions of opioids or controlled substances, and complex money laundering, tax, and other financial crime offenses.

The Health Care Fraud Unit prides itself on conducting the most trials of any DOJ component, including the U.S. Attorney's Offices. DOJ prosecutors, referred to as “Trial Attorneys,” have participated in the largest and most complex healthcare fraud and opioid distribution trials in the country. Notably, the Health Care Fraud Unit is a leader in using advanced data analytics and algorithmic methods to identify newly emerging healthcare fraud schemes and to target the most egregious fraudsters. The Health Care Fraud Unit’s team of dedicated data analysts works with prosecutors to identify, investigate, and prosecute cases using data analytics. At the Health Law Alliance, our healthcare defense attorneys have extensive experience in the use of data analytics to identify potential fraud, waste, and abuse, having served as the Chief Compliance Officer and Executive Leadership Team member for UnitedHealth Group, with oversight of Optum and UnitedHealthcare, including Special Investigative Units (SIUs) within those platforms.

The Health Care Fraud Unit’s cases are complex and wide-reaching. In particular, the National Rapid Response Strike Force was created in 2020 to investigate and prosecute fraud cases involving major healthcare providers that operate in multiple jurisdictions. The National Rapid Response Strike Force coordinates with the Civil Division’s Fraud Section and Consumer Protection Branch, U.S. Attorneys’ Offices across the country, state Medicaid Fraud Control Units (MFCUs), the FBI, HHS-OIG, and other agency partners to investigate and prosecute multi-jurisdictional and corporate healthcare fraud. The National Rapid Response Strike Force’s recent successes include the conviction of owners of a multi-state network of rural hospitals in a $1 billion billing fraud matter; the $500 million global resolution with Tenet Healthcare Corporation and related individual prosecutions for a hospital kickback scheme; the prosecution of billions of dollars in telemedicine fraud; prosecution of over $1 billion in fraudulent addiction rehabilitation facility fraud as part of the Sober Homes Initiative; and leadership of the Unit’s efforts to prosecute those seeking to criminally exploit the COVID-19 pandemic, including the conviction at trial of the President of a Silicon Valley technology company for healthcare fraud, illegal kickback, and securities fraud related to the announcement of purportedly revolutionary testing for COVID-19 using only a few drops of blood, i.e., Elizabeth Holmes and associates.

In addition, in 2022, the DOJ Criminal Division announced the formation of the New England Prescription Opioid (NEPO) Strike Force, a joint law enforcement effort to investigate and prosecute healthcare fraud schemes in the New England region, and to prosecute individuals involved in the illegal distribution of prescription opioids and other controlled substances. NEPO leverages the success of the October 2018 formation of the Appalachian Regional Prescription Opioid (ARPO) Strike Force, a joint effort between DOJ, FBI, HHS-OIG, DEA, and state and local law enforcement to combat healthcare fraud and the opioid epidemic in locations that have been harmed significantly by addiction. ARPO has partnered with federal and state law enforcement and U.S. Attorneys’ Offices throughout Alabama, Kentucky, Ohio, Virginia, Tennessee, and West Virginia to prosecute medical professionals involved in the illegal prescription and distribution of opioids.

U.S. Attorneys’ Offices Health Care Fraud Units

In addition to DOJ’s Strike Forces and Health Care Fraud Units, all of the U.S. Attorneys’ Offices are staffed by federal prosecutors, referred to as Assistant United States Attorneys (AUSAs), who investigate and prosecute healthcare fraud crimes in their respective jurisdictions. There are 93 U.S. Attorneys’ Offices in the country, and the U.S. Attorney in each district is the chief federal law enforcement officer, reporting to the Attorney General of the United States. The U.S. Attorneys’ Offices are coordinated by the Executive Office for U.S. Attorneys, which oversees the DOJ’s Health Care Fraud and Abuse Act Program, established as part of the Health Insurance Portability and Accountability Act of 1996 (HIPAA). To most, HIPAA is better known for privacy and nondiscrimination rules, but the statute also created a number of healthcare offenses and enforcement tools, including the “HIPAA subpoena,” and mandated that the DOJ and HHS-OIG coordinate to support efforts to investigate and prosecute healthcare fraud.

To this end, HIPAA provided a funding source, specifically requiring that amounts equaling recoveries from healthcare fraud investigations be deposited in or transferred to the Federal Hospital Insurance Trust Fund. Recoveries are then appropriated from the Trust Fund to the Health Care Fraud and Abuse Control Account in an amount the Attorney General and HHS Secretary certify annually are necessary to finance healthcare fraud enforcement activities. Appropriations from the Control Account fund attorneys, investigators, and litigation support to combat healthcare fraud. Since 1997, over $57 billion has been collected by the DOJ and HHS. Of that, nearly $40 billion has been returned to the Medicare Trust Funds, an average of approximately $1.5 billion per year, and Medicaid, Tricare, the Veteran’s Administration, among others. In the same period, 13,628 defendants have been convicted of healthcare fraud offenses, an average of 545 every year. These numbers are startling, to be sure.

State Medicaid Fraud Control Units

All states also operate Medicaid Fraud Control Units (MFCUs), typically within the State Attorney General’s Office, to investigate and prosecute Medicaid-related fraud. The Social Security Act (SSA) requires each state to effectively operate an MFCU unless the Secretary of Health and Human Services (HHS) determines that (1) the operation of a Unit would not be cost-effective because minimal Medicaid fraud exists in a particular state; and (2) the state has other adequate safeguards to protect enrollees from abuse or neglect. MFCUs are funded jointly by the federal and state governments. Each Unit receives a federal grant award equivalent to 90 percent of total expenditures for new Units and 75 percent for all other Units.

MFCU cases often begin as referrals from external sources or are generated from data mining. MFCU staff review referrals of possible fraud to determine the potential for criminal prosecution or civil action. If the Unit accepts a referral, the case may result in various outcomes. Criminal prosecutions may result in convictions; civil actions may result in civil settlements. Both criminal prosecutions and civil actions routinely include the assessment of monetary recoveries. The approach of the MFCUs varies state-by-state, with some offices, such as Pennsylvania’s MFCU, that pursue criminal cases exclusively. In other words, the Pennsylvania MFCU will either bring a criminal case or decline the matter completely; that office does not interpret its enabling statutes to permit the resolution of investigations on civil terms. Other state MFCUs, however, investigate and prosecute both criminal and civil cases. The OIG has the authority to exclude convicted individuals and entities from any federally funded healthcare program, such as Medicaid, on the basis of convictions referred from MFCUs. In addition to achieving these outcomes, MFCUs may also make recommendations to their state governments to strengthen program integrity.

PBM AUDIT STRATEGY

PBM Audit Information

The Role of Pharmacy Benefit Managers in Pharmacy Audits

To design an effective PBM audit response strategy, providers must understand the chain of events both prior to the initiation of a PBM audit and afterwards. For example, Special Investigative Units (SIUs) are often the genesis of a pharmacy audit, and the presence or absence of "audit risk factors" is informative on potentially broader exposure beyond the claims under audit. Any decision to resolve an audit should be informed and result in a full and final settlement of all liability, but PBM audit settlements need to be structured carefully to achieve this goal.

PBMs that Conduct the Most Pharmacy Audits


CVS Caremark, OptumRx, and Express Scripts, control at least 80% of the market, making them the three biggest PBMs. Humana also ranks among the largest. In addition, these PBMs regulate access to networks for smaller competitors, such as ESI's partnership with Prime. Plan sponsors, such as United Health, Cigna and Aetna, are vertically integrated with these PBMs, increasing audit risk for pharmacies because network sanctions are more likely to affect a significant aspect of a pharmacy's business across both government and commercial claims.

Common Pharmacy Audit Areas


PBMs and payors use artificial intelligence and data mining across medical and pharmacy claims to identify areas of potential inquiry. Among other areas, these inquiries typically involve high-reimbursing medicines, brand/generic substitution, inventory discrepancies, co-payment collection, prior authorization, and telehealth relations. Separately, DEA conducts audits and inspections for compliance to controlled substance regulations.  

Types of Pharmacy Audits


Common types of PBM audits include desk audits; on-site audits; invoice audits; and prescription audits. Irrespective of the type of PBM audit, all interactions with PBMs should be taken extremely seriously and can lead to severe consequences if not handled appropriately. For example, there has been a sharp increase in the federal prosecution of pharmacists for audit-related conduct, including answering PBM questions incorrectly. Accordingly, pharmacies should consider using outside audit counsel to avoid these pitfalls.

Preparing for Pharmacy Audits


Pharmacies can take various steps to prepare to meet PBM audits, including routine self-audits. In fact, the government publishes comprehensive guidance and a checklist to assist pharmacies in their audit planning, including self-audits around prescribing practices, controlled substance management, invoice management, and billing practices. If you need assistance designing or implementing an audit protection plan, please do not hesitate to contact us.

Defending Pharmacy Audits


Defending against a PBM audit requires comprehensive knowledge of the rights, responsibilities, and intricacies of pharmacies and their laws and regulations.  If your pharmacy has been identified for a PBM audit, there are a number of potential defenses available to you. The first defense against a PBM audit is to be proactive, and audit planning can lessen the chance of unfavorable findings. That said, it is often necessary to involve an attorney to hold PBMs to their obligations under law and provider agreements. For this reason, national audit services and pharmacy audit consultants are often ineffective.

Pharmacy Audit Appeals


Audit discrepancies and findings can be appealed based on the specific procedures outlined in the provider manuals. It is important to follow these requirements exactly, within the timeframes established, or your appeal rights could be lost and further review denied. In an appeal, it is critically important to make a complete record of why the audit findings or sanctions should be reversed, including through documentation, legal arguments, and corrective actions, if any. Depending on the outcome of the appeal, you may have further legal recourse against the PBM.

Potential Consequences of Pharmacy Audits

PBM audits can have severe repercussions depending on the results of the pharmacy audit, including recoupments, network sanctions, and criminal, civil and administrative investigations involving jail time, significant fines, and license revocation or exclusion. We publish a 10-part PBM Audit Guide that discusses the overlap between PBM audits and government investigations and how to successfully manage audit risk. This resource is complimentary to subscribers HERE.