False Claims and Whistleblower Protection policy

Policy Statement

To provide education about False Claims Recovery to Care Initiatives’ employees, contractors and agents pursuant to Section 6032 of the Deficit Reduction Act of 2005 which establishes Section 1902(a)(68) of the Social Security Act.

Policy Explanation

CARE INITIATIVES is committed to its role in preventing health care fraud and abuse and complying with applicable state and federal law related to health care fraud and abuse. The Deficit Reduction Act of 2005 (“DRA”) requires education concerning the federal False Claims Act and other laws, including state laws, dealing with fraud, waste, and abuse and whistleblower protections for reporting those issues.

To ensure compliance with such laws, CAREINITIATIVES has adopted policies and procedures meant to detect and prevent fraud, waste, and abuse, and also supports the efforts of federal and state authorities in identifying incidents of fraud and abuse. This policy sets forth information concerning CARE INITIATIVES’ existing policies and procedures, including avenues for reporting concerns internally, and an overview of the Federal Civil False Claims and Program Fraud Civil Remedies Acts and other applicable federal and state laws.

CARE INITIATIVES takes health care fraud and abuse very seriously. It is our policy to provide information to all employees, contractors and agents about the federal and state false claims acts, remedies available under these provisions and about whistleblower protections available to anyone who claims a violation of the federal or state false claims acts. We also advise our employees, contractors and agents of the steps CARE INITIATIVES has in place to detect healthcare fraud and abuse.

CARE INITIATIVES policies and procedures are intended to detect and prevent fraud, waste, and abuse within its operation as a long-term care provider, including fraud, waste, and abuse in federal and state health care programs. CARE INITIATIVES has adopted a Corporate and Facility Compliance Program in an effort to assure compliance with federal and state law. For general review of our policies adopted to detect and prevent fraud, waste and abuse you may obtain a copy of the existing Standards of Business Conduct. For more specific information about departmental policies pertaining to detection and prevention of fraud, waste and abuse you may review specific departmental policy and procedure manuals or contact the supervisor for that department to discuss departmental protocols.

DEFICIT REDUCTION ACT OF 2005

Employee Information Requirements
President George W. Bush signed the Deficit Reduction Act (“DRA”) into law on February 8, 2006. Certain provisions of the law require states participating in the Medicaid program to amend their State Plans to mandate that providers and others that receive or make annual payments of at least $5 million under a state’s Medicaid program establish written policies for all their employees (and any contractor or agent) to provide “detailed information” about:

  • The federal False Claims Act
  • The federal Program Fraud Civil Remedies Act
  • Other federal/state laws pertaining to civil or criminal penalties for false claims and statements
  • Any whistleblower protections provided under such laws
  • The role of such laws in preventing and detecting fraud, waste and abuse
  • Policies and procedures of the provider for preventing and detecting fraud, waste and abuse.

In addition, to comply with the DRA, states must require that any employee handbook of a covered entity include a discussion of the above laws and of the rights of employees to be protected as whistleblowers. The DRA mandates went into effect January 1, 2007. Summaries of the mandated information that the DRA requires to be included in company policies, procedures, and the employee handbook are set forth below.

FEDERAL FALSE CLAIMS ACT

The Civil False Claims Act (31 U.S.C. §3729 et seq.) is a statute that imposes civil liability on any person who:

  • knowingly presents, or causes to be presented, a false or fraudulent claim, record or statement for payment or approval,
  • conspires to defraud the government by getting a false or fraudulent claim allowed paid,
  • uses a false record or statement to avoid or decrease an obligation to pay the Government, and
  • other fraudulent acts enumerated in the statute.

The term “knowingly” as defined in the Civil False Claims Act (“FCA”) includes a person who has actual knowledge of the information, acts in deliberate ignorance of the truth or falsity of the information, or acts in reckless disregard of the truth or falsity of the information. No proof of specific intent to defraud is required.

The term “claim” includes any request or demand for money or property if the United States Government provides any portion of the money requested or demanded. Potential civil liability under the FCA currently includes penalties of between five thousand five hundred and eleven thousand per claim, treble damages, and the costs of any civil action brought to recovery such penalties or damages. The Attorney General of the United States is required to diligently investigate violations of the FCA, and may bring a civil action against a person. The FCA also provides for Actions by Private Persons (qui tam lawsuits) who can bring a civil action in the name of the government for a violation of the Act. Generally, the action may not be brought more than six years after the violation, but in no event more than ten. When the action is filed it remains under seal for at least sixty days. The United States Government may choose to intervene in the lawsuit and assume primary responsibility for prosecuting, dismissing or settling the action. If the Government chooses not to intervene, the private party who initiated the lawsuit has the right to conduct the action.

FEDERAL PROGRAM FRAUD CIVIL REMEDIES ACT OF 1986

The Program Fraud Civil Remedies Act of 1986 (“Administrative Remedies for False Claims and Statements” at 38 U.S.C. §3801 et seq.) is a statute that establishes an administrative remedy against any person who presents or causes to be presented a claim or written statement that the person knows or has reason to know is false, fictitious, or fraudulent due to an assertion or omission to certain federal agencies (including the Department of Health and Human Services).

The term “knows or has reason to know” is defined in the Act as a person who has actual knowledge of the information, acts in deliberate ignorance of the truth or falsity of the information, or acts in reckless disregard of the truth or falsity of the information. No proof of specific intent to defraud is required.

The term “claim” includes any request or demand for property or money, e.g., grants, loans, insurance or benefits, when the United States Government provides or will reimburse any portion of the money. The federal department may investigate and with the Attorney General’s approval commence proceedings if the claim is less than one hundred and fifty thousand dollars. A hearing must begin within six years from the submission of the claim. The Act allows for civil monetary sanctions to be imposed in administrative hearings, including penalties of five thousand five hundred dollars per claim and an assessment, in lieu of damages, of not more than twice the amount of the original claim.

STATE FALSE CLAIMS ACTS

IOWA – Care Initiatives’ corporate headquarters is located in West Des Moines, Iowa. The company operates all of its long-term care and assisted living facilities within the state of Iowa thus making it subject to certain Iowa law. The Iowa “False Claims Act” (Iowa Code Sec. 685) adopts definitions, practices, penalties and protections similar to the Federal False Claims Act.
TEXAS – Care Initiatives is incorporated under the Texas Non-Profit Corporate Act and maintains a registered office in Texas thus making it subject to certain Texas law. The Texas State legislature has passed a Medicaid False Claims Act. It can be reviewed at TEX. HUM. RES. CODE Sec 36.001-36.117 and Texas Penal
Code Chapter 35A http://tlo2.tlc.state.tx.us/statutes/petoc.html.

FEDERAL WHISTLEBLOWER PROTECTION LAWS

WHISTLEBLOWER DEFINED
“Whistleblowing” is generally defined as the disclosure by a person, usually an employee in a government agency or private enterprise, to the public or to those in authority, of mismanagement, corruption, illegality, or some other wrongdoing. The person making the disclosure is often referred to as the “Whistleblower”.

FEDERAL FALSE CLAIMS ACT
The Civil False Claims Act provides for protection for employees from retaliation. An employee who is discharged, demoted, suspended, threatened, harassed, or discriminated against in terms and conditions of employment because of lawful acts conducted in furtherance of an action under the FCA may bring an action in Federal District Court.

OCCUPATIONAL SAFETY & HEALTH ACT OF 1970
Occupational Safety and Health (OSH) Act of 1970 created the Occupational Safety and Health Administration (OSHA) within the Department of Labor in order to reduce workplace hazards and implement safety and health programs. The federal agency, OSHA, sets and enforces workplace safety standards. The act prohibits an employer from discharging or discriminating against any employee who has exercised a right, made a complaint, or participated in an investigation or proceeding under or related to the act and establishes a procedure for relief. (29 U.S.C. § 660 (c); 29 C.F.R. § 1904.36, 1977.3-. 4)

HEALTH INSURANCE PORTABILITY & ACCOUNTABILITY ACT
Health Insurance Portability and Accountability Act of 1996 (HIPAA) directed the United States Department of Health and Human Services to establish standards for the privacy and security of protected health information, among other things. In addition to protecting individuals who exercised a right under the act, HIPAA prohibits all covered entities, including hospitals, from engaging in intimidating or retaliatory acts against any individual who refused to violate HIPAA or who has filed a complaint, participated in an investigation, compliance review, proceeding, or hearing under HIPAA. (45 C.F.R. § 164.530 (g).

PATIENT SAFETY & QUALITY IMPROVEMENT ACT OF 2005
The Patient Safety & Quality Improvement Act of 2005 establishes confidential reporting structure in which health care professionals and entities can voluntarily report information on errors in order to facilitate data analysis and encourage the development of patient safety improvements strategies.

Whistleblower Protection – The bill clearly prohibits any adverse employment action against any individual
that in good faith reported information. (42 U.S.C. § 299 et seq.)

CIVIL RIGHTS ACT OF 1991
Civil Rights Act of 1991 amended the Civil Rights act of 1964 to strengthen and improve federal civil rights laws by providing for damages and clarifying provisions, among other things. The act prohibits employers from retaliating or discriminating against any individual who utilizes the protections of the act or who has made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing under the act. (42 U.S.C. § 2000e-3a)

AGE DISCRIMINATION ACT OF 1975
Age Discrimination Act of 1975 prohibits any entity receiving Federal assistance, such as payments under the Medicare program, from discriminating against any individual on the basis of age. The act also prohibits an employer from discriminating, intimidating, or retaliating against any employee or applicant that opposes performing an unlawful practice under the act or makes a charge, testifies, assists or participates in an investigation or proceeding under the act. (29 U.S.C. § 623 (d); 45 C.F.R. § 90.46)

REHABILITATION ACT OF 1973, SECTION 504
Rehabilitation Act of 1973, Section 504, prohibits discrimination against any individual with a disability by any entity that receives Federal financial assistance, such as payments under the Medicare program. The law requires employers to adopt a grievance procedure for employees and allows for sanctions against person who had the ability to exercise control over the person who discriminated. (29 U.S.C. § 794; 45 C.F.R. § 84.6-.7).

AMERICANS WITH DISABILITIES ACT
Americans with Disabilities Act prohibits any employer with 15 or more employees from discriminating against any individual with a disability in any employment practice including hiring, firing, advancement, training, and compensation. The act prohibits retaliation, coercion, interference, or intimidation in relation to any right provided or protected under the act. (42 U.S.C. § 12203; 29 C.F.R. § 1630.12)

FAIR LABOR STANDARDS ACT
Fair Labor Standards Act establishes minimum standards for fair pay and hours for employees and applies to most employers in the country, including all Iowa hospitals. The act also prohibits employers from discharging or discriminating in any manner against any employee that has filed a complaint or participated in any investigation or proceeding under the act. (29 U.S.C. § 215(a)(3).

FAMILY MEDICAL LEAVE ACT
Family Medical Leave Act requires employers with at least 50 employees to grant eligible employees up to 12 workweeks of unpaid leave during a 12-month period to tend to a medical condition of the employee or to the employee’s family. The act prohibits discrimination, interference, or retaliation against any individual whether or not an employee, who exercised rights, made inquiries, filed a complaint, or participated in an investigation under this act. (29 U.S.C § 2615; 29 C.F.R. § 825.220)

MEDICARE CONDITIONS OF PARTICIPATION
Medicare Conditions of Participation (COPs) apply to any medical provider that signs a provider agreement to treat patients and receive reimbursement from Medicare Program. Although the COPs do not explicitly provide whistleblower protections, the regulations do require each provider as a condition of their participation to meet the requirements of the Civil Rights Act, the Rehabilitation Act of 1973, and the Age Discrimination Act of 1975. All three of those Acts do contain explicit whistleblower protections. (42 C.F.R. § 489.10)

STATE OF IOWA WHISTLEBLOWER PROTECTION LAWS-GENERAL OVERVIEW

Iowa Code § 88.9: Protects whistleblowers that file complaints, etc., under IOSHA or for exercising rights under the act.
Iowa Code § 91A.10: Protects all employees from retaliation in requesting or making a complaint with regard to wages or wage withholding.
Iowa Code § 135B.12: Ensures confidentiality of any person making a complaint to the
Department of Inspections and Appeals.
Iowa Code 216.11: Whistleblower protection for all employees filing a complaint, assisting, or
testifying in any proceeding under the Iowa Civil Rights Act.
Iowa Code § 272C.8: Prohibits retaliation against any employee who has filed or participated in a
complaint to any state licensing board or peer review committee.
Iowa Code § 915.23: Prohibits employer discrimination against an employee who served as a
witness in a criminal proceeding.
Iowa Common Law: Wrongful discharge. The Iowa common law action of wrongful discharge protects employees from retaliation when it would violate public policy and no remedy exists in state law. See Fitzgerald v. Salsbury Chemical, Inc., No. 52/98-1492 (Iowa 2000), among others.

CARE INITIATIVES POLICY & PROCEDURE DETECTING & PREVENTING FRAUD, WASTE, & ABUSE

Care Initiatives is committed to maintaining the highest level of professional and ethical standards in delivering quality health care services to its customers. These standards can only be achieved and sustained through the actions and conduct of all Care Initiatives’ personnel. Care Initiatives employees have an obligation to familiarize themselves with, and adhere to, all applicable federal and state laws and regulations that apply to the delivery and reimbursement of services provided by Care Initiatives for Medicare and Medicaid.

As part of this effort, Care Initiatives has developed initiatives to prevent potential fraud, abuse and waste in programs funded byMedicare and Medicaid and/or other government programs. One specific initiative adopted by Care Initiatives is consistent with recommendations by the U. S. Department of Health and Human Services to create a voluntary “corporate compliance” program. Care Initiatives has established the
Care Initiatives Corporate & Facility Compliance Program to provide guidance to employees on their responsibilities and to help them determine appropriate conduct in performing their duties. Our company has established a Compliance Officer and separate compliance committees within the Board of Directors and corporate office management team to oversee and monitor the implementation of the Corporate & Facility Compliance Program.

While all Care Initiatives’ employees/agents are obligated to follow the compliance policies and procedures, which include a written Standards of Business Conduct, management will provide access to the information, training and resources needed by staff to comply with applicable federal and state laws, including ethics laws, regulations, and policies. All employees/agents must help create a culture within Care Initiatives that promotes the highest standards of ethics and compliance, and which encourages everyone in Care Initiatives to address concerns, when they arise, consistent with policy and procedure. Where any question or uncertainty regarding such requirements exists, each affected employee/agent is required to seek guidance from his or her supervisor or the Care Initiatives’ Compliance Officer. Each Care Initiatives’ employee/agent is obligated to conduct himself/herself in a manner to assure the maintenance of the established standards. Care Initiatives prohibits any employee, contractor or agent from
knowingly presenting any claim for payment or approval that is inaccurate, false, fictitious or fraudulent.

Compliance with these standards will be an important factor in evaluating an employee’s performance. Compliance oversight will also be an important element in the evaluation of Care Initiatives supervisory employees responsible for the provision of services or for preparation of bills to seek reimbursement from Medicare, Medicaid and/or other federal programs. Employees who fail to comply with the Corporate & Facility Compliance Program, including the written Standards of Business Conduct, will be subject to additional training, direct supervision and/or appropriate disciplinary action.

CARE INITIATIVES’ EXPECTATIONS FOR EMPLOYEES, CONTRACTORS & AGENTS

Personal Obligation to Report
Care Initiatives is committed to compliance with all relevant laws and regulations. Each employee, contractor and agent has an individual responsibility to report any activity by any Care Initiatives’ employee, contractor, agent or vendor that the individual has reason to believe violates applicable laws, rules, regulations of the compliance program. All violations or suspected violations shall be reported immediately to the Compliance Officer with concurrent notification to the employee’s supervisor or to the Compliance Officer alone, if circumstances justify it. Employees who, in good faith, report a possible violation will not be subjected to retaliation. Employees who make a report that they know to be false or misleading will be subject to appropriate disciplinary action. Each Care Initiatives’ employee who is directly or indirectly involved in providing services and/or billing Medicare and Medicaid, has an individual responsibility to comply with Care Initiatives’ Medicare and Medicaid policies and procedures as they apply.

Internal Investigations of Reports
Care Initiatives is committed to investigating all reported concerns promptly and confidentially to the extent possible. The Compliance Officer will coordinate investigations with proper department supervisors, if appropriate, and shall report any findings of a violation to the Board of Directors and Senior Executive Officers of Care Initiatives. Furthermore, proper reporting, including self-reporting, to appropriate oversight agencies shall occur if circumstances warrant. Such agencies may include Office of the Inspector General, Centers for Medicare or Medicaid (CMS), Medicare Approved Contractors (MAC) and/or State Department of Inspections & Appeals. Recommended corrective actions may accompany such reports. It is Care Initiatives’ expectations that all employees shall cooperate with investigation efforts.

Corrective Action
When an internal investigation finds a violation, it is the policy of Care Initiatives to initiate appropriate corrective action, including, but not limited to, making prompt restitution of any overpayment amounts and
implementing systemic changes to prevent a similar violation from recurring in the future.

Disciplinary Action 
Any Care Initiatives’ employee who violates the Corporate & Facility Compliance Program policies may be subject to appropriate disciplinary action and/or retraining, to prevent recurrence of the violation. In determining the level of disciplinary action to be taken, management will consider the amount of training provided to the involved employee(s). The discipline imposed will depend on the nature, severity and frequency of the violation and may result in any of the permitted disciplinary actions as provided by law.

Internal Audit and other Monitoring
Care Initiatives is committed to the aggressive monitoring of compliance with its policies. Much of this monitoring effort will be conducted through scheduled and unannounced internal audits of issues that may involve actual or potential violations. Internal audits and monitoring will involve direct efforts of the Compliance Officer that may or may not include delegation of duties to various corporate and facility departments such as Operations, Medicare, Finance, Human Resources and/or Quality Assurance.

Acknowledgment Process
Care Initiatives will complete appropriate training of employees and certain contractors/agents regarding company policy. Following the training, those individuals will be required to sign an acknowledgment statement confirming they have received education regarding the Corporate & Facility Compliance Program that includes written Standards of Business Conduct. Employees and certain contractors/agents will be required to sign this acknowledgment as a condition of the employment or contractor relationship. Adherence to Care Initiatives’ policy and procedure and participation in related activities and training will be considered in decisions regarding hiring, promotion, evaluation and continuation of the employment or contract relationship.

CARE INITIATIVES EDUCATION CONCERNING NON-RETALIATION POLICY

Care Initiatives’ Stance Concerning Retaliation
Care Initiatives does not tolerate retaliation by any employee(s) against another employee for good faith reports of suspected noncompliance with company policies or potential violations of the compliance program. It is the established policy of Care Initiatives that it will not retaliate against or otherwise discipline any individual simply because he or she reports suspected misconduct or noncompliance.

Employee Education Concerning Retaliation
In an effort to make this policy known, Care Initiatives will make it clear to all employees at the time of their initial orientation and through periodic training thereafter that it will be a violation of the Compliance Program to intimidate or impose any other form of reprisal or retaliation on any employee or agent who uses the compliance reporting mechanism for its intended purposes.

Employee Encouragement to Communicate Policy Concerns
All personnel are encouraged to report their concerns if they believe that patient care is at risk or the ethical and business standards defined in the code have not been met. Care Initiatives is committed to fostering dialogue between management and employees. Our goal is that all employees, when seeking answers to questions or reporting potential instances of fraud and abuse, should know who to turn to for a meaningful response and should be able to do so without fear of retribution.

Compliance Officer Audit & Review of Retaliation Policy
The Compliance Officer is charged with assuring effective policies regarding employee retaliation are established and maintained. To that end, the Compliance Officer may take those actions necessary to conduct audit and review of application of the Non-Retaliation policies for the company. Such acts may include a review of personnel records and other information periodically to ensure that those who report suspected misconduct or noncompliance are not the victims of retaliation, retribution or other improper conduct. In addition, the Compliance Officer shall have the authority to withhold names of Care Initiatives’ personnel who report information. The Compliance Officer does not, however, have the authority unilaterally to extend any protection or immunity from disciplinary action or prosecution to Care Initiatives’ personnel who have engaged in misconduct or noncompliance.