SECTION 357.585. Grounds for Fraud Referral and Administrative Sanction

The department may impose sanctions against a provider or a provider's employee who permits, does, or causes any of the following or for any other reason provided by law or duly-issued regulation. This list is not all inclusive:

(1) submitting a false statement or misrepresentation, or omitting pertinent facts when claiming payment under Medicaid or when supplying information used to determine the right to payment under Medicaid;

(2) submitting a false statement, information, or misrepresentation, or omitting pertinent facts to obtain greater compensation than the provider is legally entitled to;

(3) submitting a false statement, information, or misrepresentation, or omitting pertinent facts to meet prior authorization requirements;

(4) failing to disclose or make available upon request to the department or its authorized agents, representatives of the Department of Health and Human Services, or the Attorney General's Medicaid Fraud Control unit any records the provider is required to maintain or any records necessary to verify items or services furnished under Title XVII or Title XX to determine whether payment for those items or services is due or was properly made. This includes providing documentation or allowing examination of records or both. This also includes records of services provided to Medicaid recipients and payments made for those services, including but not limited to, documents related to diagnosis, treatment, service, lab results, and x-rays. Accessible information must include information that is necessary for the agencies specified in this paragraph to perform statutory functions;

(5) failing to provide and maintain quality services to Medicaid recipients within accepted medical community standards or standards required by statute, regulation, or contract;

(6) failing to comply with the terms of the Medicaid contract or provider agreement, assignment agreement, the provider certification on the Medicaid claim form, or regulations published by the department;

(7) furnishing or ordering services to patients (whether or not eligible for benefits) under Title XVIII or a state health care program that substantially exceed the recipient's needs, are not medically necessary, are not provided economically or are of a quality that fails to meet professionally recognized standards of health care;

(8) rebating or accepting a fee or a part of a fee or charge for a Medicaid patient referral;

(9) violating any provision of the Human Resources Code, Chapter 32, or any rule or regulation issued under the Code;

(10) submitting a false statement or misrepresentation or omitting pertinent facts on any application or any documents requested as a prerequisite for Medicaid participation;

(11) failing to meet standards required for licensure or required by state or federal law, department rule, provider agreement, or provider manuals for participation in the Medicaid Program;

(12) charging recipients for allowable services that exceed the amount the department or its agents pay for except when specifically allowed by the department;

(13) refusing to execute or comply with a provider agreement or amendments when requested;

(14) failing to correct deficiencies in provider operations after receiving written notice of them from the department or its authorized agents;

(15) engaging in any negligent practice resulting in death, injury, or substantial probability of death or injury to the provider's patients and to persons who receive or benefit from the provider's services;

(16) pleading guilty or nolo contendere, agreeing to an order of probation without adjudication of guilt under deferred adjudication, or being a defendant in a court judgment or finding of guilt for a violation relating to performance of a provider agreement or program violation of Medicare, the Texas Medicaid Program, or any other state's Medicaid Program;

(17) failing to repay or make arrangements that are satisfactory to the department to repay identified overpayments or other erroneous payments;

(18) failing to abide by applicable statutes regarding handicapped individuals or civil rights;

(19) being terminated, suspended, or excluded from participation in any federal program having an unpaid debt under any federal program, or being otherwise sanctioned under any federal program involving the provision of health care, including the Department of Defense, the Veterans Administration, and any state health care program for actions or failure to act that would be considered abusive or fraudulent. This includes any reasons related to the person's professional competence or performance or financial integrity. Any appeal by the provider for an action taken against him under this item does not consider the validity of a sanction or action taken by Medicare or any other state's Medicaid Program;

(20) submitting or causing to be submitted under Title XVIII or a state health care program claims or requests for payment containing unjustified charges or costs for items or services that substantially exceed the person's usual and customary charges or costs for those items or services to the public or the private pay patients;

(21) failing to comply with Medicaid policies, published Medicaid bulletins, policy notification letters, provider policy or procedure manuals, contracts, statutes, rules, regulations, or previously sent interpretations to the provider of any of the items listed;

(22) submitting claims with a pattern of inappropriate coding or billing that results in excessive costs to the Medicaid Program;

(23) billing for services or merchandise that was not provided to the recipient;

(24) submitting to the Medicaid Program a cost report containing costs not associated with the Medicaid Program or not permitted by Medicaid program policies;

(25) submitting a false statement or misrepresentation that, if used, has the potential of increasing any individual or state provider payment rate or fee;

(26) charging recipients for services when payment for the services was recouped by Medicaid because of any of the reasons stated in §79.2303 of this title (relating to Recovery From Providers);

(27) failing to notify and reimburse the department or its agents for services paid by Medicaid if the provider also receives reimbursement from a liable third party;

(28) misapplying, misusing, embezzling, failing to promptly release upon a valid request, or failing to keep detailed receipts of expenditures relating to any funds or other property in trust for a Medicaid recipient;

(29) pleading guilty or being convicted of a violation of state or federal statutes relating to dangerous drugs, controlled substances, or any other drug-related offense;

(30) pleading guilty of, being convicted of, or engaging in conduct involving moral turpitude;

(31) having a voluntary or involuntary action taken by a licensing agency or board to require the provider or employee to comply with professional practice requirements of the board after the board receives evidence of noncompliance with licensing requirements;

(32) pleading guilty or being convicted of a violation of state or federal statutes relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct relating to the delivery of a health care item or service or relating to any act or omission in a program operated or financed by any federal, state, or local government agency;

(33) being convicted in connection with the interference with or obstruction of any investigation into any criminal offense described in §79.2112(f) of this title (relating to Administrative Sanctions or Actions) or paragraphs (16), (29), (30), or (32) of this subsection.

(34) having its license to provide health care revoked or suspended by any state licensing authority, or losing this license because of action based on assessment of the person's professional competence, professional performance, or financial integrity, or surrendering this license while a formal disciplinary proceeding is pending before licensing authorities when the proceeding concerns the person's professional competence, professional performance, or financial integrity;

(35) substantially failing, as a health maintenance organization under Title XIX or any entity furnishing services under waiver granted by the United States Department of Health and Human Services (HHS) under that title, to provide medically necessary items or services that are required under law or under contract, if the failure has adversely affected or is substantially likely to adversely affect the medicaid recipient of these items or services;

(36) substantially failing, as an eligible organization under a risk sharing contract as defined in 42 USCA §1395mm, to provide medically necessary items or services that are required under law or contract, if the failure has adversely affected or has the potential to adversely affect the patient;

(37) committing an act described in the Social Security Act, §1128A or §1128B.

(38) meeting any of the conditions specified in §79.2112(f) or (g) of this title (relating to Administrative Sanctions or Actions);

(39) failing to fully and accurately make any disclosure required by the Social Security Act, §1124 or §1126.

(40) failing to disclose information about the ownership of a subcontractor with whom the person has had business transactions in an amount exceeding $25,000 during the previous 12 months or about any significant business transactions (as defined by HHS) with any wholly-owned supplier or subcontractor during the previous five years;

(41) failing, as a hospital, to comply substantially with a corrective action required under the Social Security Act, §1886(f)(2)(B);

(42) defaulting on repayments of scholarship obligations or items relating to health profession education made or secured, in whole or in part, by HHS when HHS has taken all reasonable steps available to HHS to secure repayment.

(43) developing false source documents or failing to sign source documents, to retain supporting documentation, or to comply with the provisions or requirements of the department pertaining to electronic claims submittal.

Source Note: The provisions of this §357.585 adopted to be effective July 1, 1986, 11 TexReg 2825; amended to be effective December 15, 1988, 13 TexReg 5828; transferred effective September 1, 2004, as published in the Texas Register September 17, 2004, 29 TexReg 9013