AUSTIN, TX — Today, the Sunset Advisory Commission approved key policy recommendations to change the current system used by the Office of the Inspector General (OIG) to investigate fraud in healthcare provider claims. At last month's Sunset hearing, Chair Jane Nelson appointed Senator Juan "Chuy" Hinojosa as Chairman of a workgroup to study the current OIG investigation process and recommend changes to the current system.

"I am pleased with the recommendations adopted today by the Sunset Advisory Commission and I thank the entire OIG workgroup for their hard work and dedication in crafting policy recommendations to achieve a fair and transparent system that protects the public. We can no longer have an OIG that accuses providers of fraud, presumes them guilty, and denies them due process.

The Legislature envisions an OIG that targets the healthcare providers who are defrauding our taxpayers and not those who commit clerical errors. The recommendations adopted today will work to alleviate these concerns by providing due process, increasing transparency, and getting at actual fraud while not wasting our resources on innocent providers," Senator Hinojosa stated.

Some of the OIG workgroup changes include amending the statutory definition of fraud by clarifying that it does not include unintentional technical, clerical, or administrative errors as well as streamlining and significantly expediting the current process. In an effort to increase transparency, recommendations will require the OIG to provide a detailed summary of all evidence as to the credible allegation of fraud to a provider as well as a timeline detailing the next steps in the investigation process and an explanation of the provider's due process rights.

These Sunset recommendations come on the heels of a state appeals court ruling two weeks ago that ruled the OIG's expansive use of a key tactic — withholding Medicaid payments from providers that it investigates — was illegal. The 3rd Court of appeals found that the OIG had improperly expanded a law allowing regulators to withhold payments from providers against whom there was a credible allegation of fraud. The court concluded the agency has been overreaching by using such holds that had nothing to do with fraud, such as unintentional billing errors or paperwork irregularities.

"The ruling of the 3rd Court of Appeals further confirms the many concerns that have been expressed by our healthcare providers and legislators in the last two years — that the OIG utilizes improper tactics, overreaches, and punishes providers for unintentional clerical errors and program violations. While I advocate for the prevention of fraud and abuse in our Medicaid system, the OIG and present structure is dysfunctional. I look forward this coming session to continue working on this critical issue for our healthcare providers so that we have an OIG our state can be proud of," concluded Senator Hinojosa.

To see a full listing and explanation of the recommendations, please visit the Sunset Advisory Commission website at: http://www.sunset.texas.gov/

The Sunset Advisory Commission is a 12 member legislative commission tasked with identifying and eliminating waste, duplication, and inefficiencies in government agencies. It is composed of five State Senators, five State Representatives, and two public members. The Commission reviews policies and programs of state agencies and recommends reforms, improvements, changes, dissolution of agencies, elimination of wasteful programs, and any other changes that are needed to ensure transparent, cost-effective, and productive state programs.

Public participation is a key aspect of the Sunset Review process. The Commission seeks public input through hearings on every agency under Sunset review and recommends actions on each agency to the full Legislature in the next Session.

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