VSP considers insurance fraud and abuse as professionally unacceptable and criminal behavior and takes every precaution to ensure such activities are detected, eliminated, and referred to appropriate governmental authorities. VSP will vigorously pursue all fraudulent and abusive activities and supports all efforts to combat such practices by enforcing the following measures concerning, but not limited to, the health care provider, contract laboratories, VSP employees, clients, agents, and patients.

The components of our Fraud, Waste and Abuse Business Plan are:

• The Fraud, Waste and Abuse Policy
• Education
• Prevention and Internal Controls
• Detection
• Investigation
• Sanctions and Disciplinary Action
• Full Cooperation with Law Enforcement and Regulatory Authorities
• Reporting
• Applicable Regulations and Laws

VSP recognizes that the best defense against becoming a victim of fraudulent or abusive behavior is an educated work force capable of preventing, detecting and eliminating such activities. VSP is dedicated to providing appropriate education and training in this area. Company-wide training of all employees will cover the following topics:

• VSP's Fraud and Abuse Policy
• The true costs of insurance fraud and how it directly affects them
• Definition of what constitutes fraud and abuse, including money laundering
• Indicators of fraudulent and abusive activities
• Reporting of suspected fraud and abuse
• Roles and responsibilities of the Special Investigative Unit (SIU)
• Responsibilities of each employee in reporting suspected or known fraudulent or abusive activities

Education and training for providers, contract laboratories, clients, agents, and patients concerning fraud and abuse will consist of:

• Definition of what constitutes fraud and abuse
• Indicators of fraudulent and abusive activities
• Repercussions of fraud and abuse
• Reporting of suspected fraud and abuse

VSP will maintain a comprehensive system of internal controls designed to prevent and detect occurrences of fraud and abuse. The system of internal controls will consist of:

•  An organizational structure which segregates functions of claims processing, claims recording, and claims payment as well as maintenance of patient and provider membership tables and provider and laboratory fee tables
• Procedures incorporated into the manual work flow to maximize the probability that questionable claims will be identified and investigated
• System checks that identify all claims which meet pre-set indicators and criteria that are known to be outside the norm of our industry standards and services
• Provider peer review processes and procedures
• Internal claim audits of a statistically valid sampling
• A system of supervisor accountability for the review and approval of their unit’s actions

Well-trained personnel are able to routinely spot indicators of fraud and abuse. VSP’s SIU will coordinate all information received and lead any investigations regarding the detection and reporting of fraudulent and abusive activities.

Detection of fraud or abuse can come from the following areas:

Claims Processors

• All claims processors will be familiar with the indicators of fraud and abuse
• Suspicious claims will be reviewed to determine if any misrepresentation has occurred
• Pertinent information will be documented
• Any fraudulent or abusive claim submissions will be forwarded to the SIU for appropriate action

Claims Auditors

• The claims auditors will continuously review reimbursement claims received during the normal course of daily audits with the purpose of identifying fraud and abuse
• The claims auditors will be made available to perform special reviews of any situation where fraud or abuse is suspected

Customer Care Representatives

• All customer care representatives will be familiar with the indicators of fraud and abuse
• Calls concerning provider fraud and abuse will be documented and the information forwarded to the SIU.
• All non-provider calls concerning fraud and abuse will be documented and the information forwarded to the SIU.

Quality Management Specialists

• All quality management specialists will be familiar with the indicators of fraud and abuse.
• Any potential fraud or abuse issues that are identified during a quality assurance review will be forwarded directly to the SIU.

SIU

• The SIU will routinely run reports against our claims systems to identify activities that are uncharacteristic of our industry.
• Abnormal utilization patterns will be researched and appropriate action taken.

Hotline

• An Anti-Fraud Hotline has been made available for all parties (providers, contract laboratories, employees, clients, agents, and patients) to report any suspected fraud or abuse.
• The toll-free number is 800.877.7236.

All cases of suspected fraudulent or abusive activities employed/practiced by providers, contract laboratories, VSP employees, agents, clients, or patients will be fully investigated with the involvement of the SIU and VSP Legal Counsel as needed. The following items will be considered to be a part of the investigation:

• Information gathering
• Claim validity
• Scope of the investigation
• Ability to prosecute
• Ability to recover monies owed
• On-site or desk level investigations conducted by VSP personnel
• Use of outside investigators and experts

All cases of suspected fraudulent or abusive activities employed/practiced by providers, contract laboratories, VSP employees, agents, clients, or patients will be fully investigated with the involvement of the SIU and VSP Legal Counsel as needed. The following items will be considered to be a part of the investigation:

• Information gathering
• Claim validity
• Scope of the investigation
• Ability to prosecute
• Ability to recover monies owed
• On-site or desk level investigations conducted by VSP personnel
• Use of outside investigators and experts

Fraudulent and/or abusive billing practices could result, without limitation, in the following sanctions and/or disciplinary actions:

• Providers—suspension or removal from the VSP doctor network, assessment and collection of restitution, assessment and collection of reasonable audit costs and expenses, referral to the appropriate state’s governing Board of Optometry, Board of Ophthalmology, or Medical Boards, referral to the appropriate state’s law enforcement or other government agency(ies) and reporting to the National Practitioner Data Bank and/or other appropriate data reporting agency
• Contract Laboratories—suspension or removal from the approved listing of VSP laboratories and restitution collected
• VSP employees—termination and restitution collected
• Agents—suspension or removal as VSP agent, restitution collected, and referral to the appropriate state’s governing Insurance Department

Upon the expiration or termination of the VSP Network Doctor Agreement, a doctor will no longer be or be considered a VSP Network Doctor. From the date of expiration or termination onward, unless the parties otherwise agree in a separate writing, the doctor, in any capacity, unless prohibited or limited by law, will: (a) no longer directly or indirectly submit any VSP patient claims for reimbursement to VSP for any purpose, (b) directly or indirectly advertise or indicate in any manner or in any way that he/she is a VSP Network Doctor, affiliated with or authorized by VSP and/or a VSP out of network provider, or any variation thereof, (c) act as, or hold himself/herself out to the public to be, a VSP Network Doctor and/or a VSP out of network provider, or any variation thereof and/or (d) submit any VSP patient claims for reimbursement to VSP as an out of network provider. The doctor will promptly advise all VSP patients that as of the date of expiration or termination, he/she no longer is a participant on the VSP doctor network. The doctor shall not issue/make any disparaging, slanderous and/or libelous remarks regarding/concerning VSP and its business to any VSP client, VSP patient and/or any third party for any reason whatsoever.

In cases where sufficient evidence is gathered to indicate that fraudulent activity has in fact occurred, VSP's Corporate Legal Counsel will coordinate actions with law enforcement agencies as well as be prepared to initiate civil litigation in furtherance of all anti-fraud objectives. VSP will cooperate fully with all law enforcement agencies in the subsequent prosecution of fraudulent activities.

The SIU will collect data and maintain documentation of investigations to provide support for Company actions. Cases under review or turned over to law enforcement for prosecution will be documented and reported to the Corporate Compliance Officer quarterly. The Corporate Compliance Officer will report the quarterly results to the Finance Committee of the Board. To meet standards of compliance, the SIU will report to states and requesting clients as required. The Company will also evaluate the effectiveness of its anti-fraud and abuse efforts on an annual basis.

The SIU will collect data and maintain documentation of investigations to provide support for Company actions. Cases under review or turned over to law enforcement for prosecution will be documented and reported to the Corporate Compliance Officer quarterly. The Corporate Compliance Officer will report the quarterly results to the Finance Committee of the Board. To meet standards of compliance, the SIU will report to states and requesting clients as required. The Company will also evaluate the effectiveness of its anti-fraud and abuse efforts on an annual basis.

VSP helps administer many Federal and State healthcare programs such as Medicare and Medicaid that apply the following laws and regulations:

Anti-Kickback Statute

Prohibits anyone from knowingly and willfully soliciting or receiving anything of value in return for referring healthcare goods or services for which payment may be made in whole or in part under a federal health care program. The penalties are severe. If a person or entity is found guilty of violating the statute, a fine of up to $25,000 or imprisonment of up to five years may be imposed.

Certain provider activities are “safe harbors” that are outlined in the law.

In addition to the Federal Anti-Kickback Statute, many states have adopted state anti-kickback statutes. Many of these statutes have the same elements and penalties as the Federal Anti-Kickback Statue.

Federal Physician Self-Referral

Prohibits a physician (or immediate family member) who has a financial relationship with an entity from making a referral to that entity for furnishing a designated health service (DHS) for which Medicare or Medicaid would otherwise pay. Congress provided for a number of exceptions to this prohibition and gave CMS the authority to create additional exceptions.

Federal False Claim Act

Federal False Claim Act prohibits any individual or business from submitting, or causing someone else to submit, to the government a false or fraudulent claim payment. These false claims acts apply to all types of goods, services and government contracting, and have been particularly effective in combating healthcare fraud. The fines for filing a false claim includes up to three times the government damage plus $5,500 to $11,000 per false claim.

In addition to the Federal False Claim Act, many states have adopted state false claim statutes. Many of these statutes have the same elements and penalties as the Federal False Claim Act.