Feds penalize Kalispell Regional for compliance failure

According to the Office of Inspector General, Kalispell Regional Healthcare was penalized $65,000 for failing to comply with certain requirements of a corporate integrity agreement signed in September 2018.

The Office of Inspector General sent a letter on Aug. 28, 2019, to Kalispell Regional that demands stipulated penalties “based on the failure to comply with the obligation to meet board member training requirements and for a false certification by or on behalf of KRHS (Kalispell Regional Healthcare System) as part of its Implementation Report.”

Kalispell Regional entered into a corporate integrity agreement following a $24 million settlement with the federal government in September 2018. The settlement ended a lawsuit that alleged the hospital knowingly violated federal anti-kickback statutes and the False Claims Act since at least 2011.

In February 2019, a former health-care reporter for the Daily Inter Lake filed a Freedom of Information Act request with the federal Department of Health and Human Services. The request was for a copy of the “implementation report” – a document the hospital must submit to the Office of Inspector General within 120 days of entering into the corporate integrity agreement, detailing the status of its compliance activities. In May, the Department provided 139 pages of the 149-page report.

Kalispell Regional’s implementation report was signed off on Jan. 21, 2019, by Tate Kreitinger, the Kalispell Regional compliance officer at the time. The report claimed to be “reflecting full satisfaction of the CIA [corporate integrity agreement] requirements that were to be met during the first 90 or 120 days after the CIA’s Effective Date.”

The effective date of the corporate integrity agreement was Dec. 23, 2018.

The “Training Plan” section of the implementation report addressed the General Compliance Training Program, which was “at least a one-hour program” that was meant to inform some 3,670 individuals in need of training as identified by the hospital of the corporate integrity agreement, federal anti-kickback statutes, Stark Law and more.

The report states the Board of Trustees of Kalispell Regional Healthcare and “a majority” of the Board of Managers of The HealthCenter received training on Nov. 15, 2018. The report further claims those who were unable to attend that training “have all received training covering the compliance topics,” which included the board’s responsibilities for review and oversight of the compliance program.

But the Office of Inspector General’s Aug. 28 letter states “Mr. Kreitenger, KRHS’s Compliance Officer at the time of the submission of the report, falsely certified to the best of his knowledge that KRHS was in compliance with all the requirements of the CIA. The report included a statement misrepresenting that the board members who were unable to attend a Nov. 15, 2018, training session all received the required training prior to the end of the 90-day compliance period, even though the training had not occurred.”

The letter states that Kalispell Regional notified the Office of Inspector General on July 15, 2019, that six board members did not receive the required training until July 2.

Michael Onusko took over as Kalispell Regional’s system compliance officer on Feb. 4, 2019. Kretienger – who was and remains the chief executive officer of The HealthCenter – held the position until Feb. 3, 2019.

The Daily Inter Lake reported last week that Kalispell Regional is nearing a deal to take on full ownership of The HealthCenter.

The report describes the role of “compliance officer” as a “member of senior management that reports to the KRH CEO and the KRH Board of Trustees’ Compliance and Audit Committee.” The compliance officer is also authorized to “implement all necessary actions to ensure achievement of the objectives of an effective compliance program,” among other duties.

The Office of Inspector General reports on its website that Kalispell Regional paid the stipulated penalty on Sept. 10, 2019. Kalispell Regional was unable to confirm from where the $65,000 was pulled to pay the Office of Inspector General.

“We identified [the issue] and we self-reported,” said Kalispell Regional spokeswoman Mellody Sharpton. “We will continue to self-report.”

“It’s not going to negatively impact patient care in any way,” she added.

On Sept. 9, 2019, an independent review organization began work investigating the hospital’s compliance program, Sharpton said. She said it will be completed near the end of the month and will be sent to the Office of Inspector General.

Reporter Colin Gaiser may be reached at cgaiser@dailyinterlake.com or at 758-4439