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CMS Proposes Significant Changes to the 2016 Medicare Physician Fee Schedule, including to Stark

August 16, 2015 Leave a comment

CMS Factsheet:

“On July 08, 2015, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule that updates payment policies, payment rates, and quality provisions for services furnished under the Medicare Physician Fee Schedule (PFS) on or after January 1, 2016. This year, CMS is proposing a number of new policies, including several that are a result of recently enacted legislation. The rule also finalizes changes to several of the quality reporting initiatives that are associated with PFS payments, including the Physician Quality Reporting System (PQRS), the Physician Value-Based Payment Modifier (Value Modifier), and the Medicare Electronic Health Record (EHR) Incentive Program, as well as changes to the Physician Compare website on Medicare.gov.”

The proposed rule includes provisions relating to the following;

  • physician quality reporting system
  • “Physician Compare”
  • EHR incentive program
  • Medicare shared savings
  • advance care planning
  • payment provisions on Part B drugs, misvalued codes, RVU reductions, “incident to” services, physician value-based payment modifier, etc.

Perhaps most significant in the area of healthcare business transactions are the physician self-referral (Stark law) updates:

  • expansion of recruitment and retention provisions to NPPs
  • updating physician-owned hospital requirements
  • reducing burdens of technical noncompliance through more reasonable regulations in a number of areas (based on information learned from self-dsiclosures and the rersults of recent cases)

The complete proposed rule as published in the Federal Register on July 15 can be found here.

Comments will be accepted by CMS on the proposed rule until September 8, 2015.

The Week in Health Law — “Back to School” Podcast for Healthcare Lawyers

August 16, 2015 Leave a comment

Great podcast for healthcare attorneys and keeping current — The Week in Health Law.

“TWIHL presents its first Back to School Special. We asked some wonderful health lawyers what were the compelling additions to this Fall’s health law curriculum. The answers are diverse and fascinating. To hear their explanations look for episode 22 when you subscribe at iTunes, listen at Stitcher RadioTunein and Podbean, or search for The Week in Health Law in your favorite podcast app.”

The King Case and the Reach of State Legislatures

September 21, 2014 Leave a comment

On September 11, 2014, the Third Circuit Court of Appeals decided the case of King v. Governor of the State of New Jersey.

The King case deals with a New Jersey statute that prohibits licensed counselors from “sexual orientation change efforts” with clients under the age of 18.  The plaintiff-appellants, who provide licensed Christian-based counseling to minor clients seeking to reduce or eliminate same-sex attractions, challenged the N.J. statute as improperly violating their First Amendment freedoms of speech and religion.

The court affirmed the lower court’s upholding of the statute but on the basis of a much more conservative/protective analysis of the First Amendment rights.

The 3rd Circuit’s holding is in line with recent holdings from the 4th, 9th, and 11th Circuits that establish special rules for the regulation of speech that occurs pursuant to the practice of a licensed profession. (The 11th Circuit case dealt with the Florida gun-gag law on doctors.)

Though, unlike the other Circuits, the 3rd Circuit in King held that the statute must be subjected to “intermediate scrutiny” (as opposed to a more deferential review or no review) in order to “adequately protect the First Amendment interests inherent in professional speech.”

The take away here for me is that the reach of state legislatures has gotten bigger.  State legislatures are enacting laws that challenge/support the influence of religious groups (challenge, as in the King case) or political groups like the NRA (support, as in the Florida gun-gag case).  The Constitution has been a shield upholding intrusive laws that support very specific political agendas (e.g., pro-gay, pro-gun).  The politics of a state’s legislators, and the views of their supporters, will likely continue to trickle down to impact on what may be said to patients/clients by their counselors and by any other regulated professions.  I suspect that legislators will explore new ways to intrude on matters of individual choice and conscience that should be outside their interest or concern.

Federal Government Report Summarizes Health Care Privacy Compliance Efforts

August 31, 2014 Leave a comment

The blogger below summarizes recent reports from HHS on privacy issues. These reports demonstrate (at least, to me) that protecting the privacy of patient health information in the manner prescribed by the HIPAA (and applicable state) laws and regulations may be largely unattainable.  I have concluded that privacy does not merit the emphasis being placed on it or the financial burdens required of the health care industry in order to comply.  The task is a lot like filling up a sieve. There are more important things to worry about in American healthcare.

government buildingThe U.S. Department of Health and Human Services (HHS) Office for Civil Rights (OCR) has issued two reports to Congress required by Section 13402(i) of the Health Information Technology for Economic and Clinical Health (HITECH) Act:

–“Annual Report to Congress on Breaches of Unsecured Protected Health Information For Calendar Years 2011 and 2012” (the Breach Report); and

–“Annual Report to Congress on HIPAA Privacy, Security, and Breach Notification Rule Compliance For Calendar Years 2011 and 2012” (the Compliance Report).

Both of OCR’s reports (as well as previous annual reports) may be accessed here. This post discusses the Compliance Report. We summarized the Breach Report in a separate post entitled “Federal Government Report on Data Breaches in Health Care.”

OCR is the office responsible for administering and enforcing the HIPAA Privacy, Security, and Breach Notification Rules. The Compliance Report summarizes OCR’s compliance and enforcement activity with respect…

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Harvard’s Bill of Health Blog: Contraceptive Mandates and Conscience – All Objections Are Not Equal

August 30, 2014 Leave a comment

The Harvard Law School Blog, Bill of Health, recently posted an article entitled “Contraceptive Mandates and Conscience – All Objections Are Not Equal.”

… studies show that medical professionals may object to services based on clinically false information. …  If medical professionals make decisions based on ignorance, one can suspect that lay employers and patients do as well.

This suggests that individuals often lack the information necessary to truly assess their stance on morally controversial services.  While the law does (and should) play a role in protecting conscience, it seems unsatisfying when such protection is granted to those holding underdeveloped views, and at the expense of (and detriment to) those seeking legal medical services.

This seems so simple and logical.  We do not let employers make other health-related decisions for their employees, why do we let some employers make reproductive decisions for their employees based on a religious view not shared by their employees?

Ohio Cardiologist Indicted for Performing Unnecessay Medical Procedures

August 24, 2014 Leave a comment

“The charges in this case are deeply troubling,” U.S. Attorney Dettelbach said. “Inflating Medicare billings alone would be bad enough. Falsifying cardiac care records, making an unnecessary referral for open heart surgery and performing needless and sometimes invasive heart tests and procedures is inconsistent with not only federal law but a doctor’s basic duty to his patients.”

“This doctor violated the sacred trust between doctor and patient by ordering unnecessary tests, procedures and surgeries to line his pockets,” Special Agent Anthony said. “He ripped off taxpayers and put patients’ lives at risk.”

Just another case where greed coupled with disregard for his patients’ welfare led a physician to commit fraud on the government and commercial insurers and to forsake his Hippocratic oath to do no harm.  Here, the physician not only ordered unnecessary and more invasive procedures than the patient needed but also falsified nuclear test results to justify the unnecessary procedures.

While there is no way to prevent greed like this (other than locking the bastards up), I have predicted in other posts that the migration of medical reimbursement from procedure based to quality of care of the patient will reduce the incentive to perform unnecessary tests and hopefully reduce this kind of fraudulent activity.

State Health Insurance Exchanges vs. the Immorality of Politics

August 17, 2014 Leave a comment

So, we have two decisions from two different U.S. Circuit Courts of Appeal, Halbig v. Burwell and King v. Burwell, and  coming to two different conclusions as to whether it is permissible to provide financial subsidies to residents of states which refused to establish their own health insurance exchanges.

Here is some background of the two cases (from the Daily Kos, 7/27/14, “The Halbig Case: or, the banality of conservative evil“):

[T]he Affordable Care Act expands access to health care by allowing states to create insurances exchanges on which private companies can sell insurance plans that meet federal standards. To help ensure affordability, the ACA subsidizes a certain portion of the premium on a sliding scale based on income. If a state either cannot or will not set up an exchange, there are also plans available on a federal exchange.

So far so good, right? Wrong. Because of the fervent opposition to the law, most states with Republican-controlled statehouses opted not to participate by building their own exchanges, and instead watched passively as their citizens became eligible for plans subsidized under the federal exchange. Just one problem, though: the authors of the Affordable Care Act did not seem to anticipate that states would refuse to establish exchanges out of political spite. Consequently, the provision of the Affordable Care Act authorizing the payment of subsidies refers specifically to plans under state-based exchanges, but does not explicitly authorize subsidies to help cover plans sold by the federal exchanges. The IRS issued a regulation that federal exchanges were eligible for premium subsidies. But a group of anti-Obamacare plaintiffs, headed by an attorney from the Federalist Society, argued that because Congress had not expressly mentioned subsidies to plans under the federal exchange, those subsidies were unlawful. And that argument won the first round in the DC Circuit Court, whose panel ruled that regardless of whether Congress intended the subsidies to also be available to plans under the federal exchange, a strict reading of the legislation said otherwise.

Let’s be honest.  These cases are not about the stated Constitutional challenge that the President and the IRS have gone beyond the statutory authority of the Affordable Care Act.  They are about politics and the continuing attacks on the President through the rant against Obamacare.

There is no concern about law or justice — and the political maneuvering is more insidious because it hides behind black robes.

If we start with the assumption that politics and politicians should have the goal of helping their constituents, under what theory does one bring these cases when the desired result will deprive millions of Americans of the health insurance that they have purchased?  How have so many lost so much perspective and purpose?

The “class war” that the President is often accused of promoting is really being fueled by a conservative myopic minority. Their willingness to hurt innocent citizens of less means who are seeking health insurance and rely on the subsidies provided is just bullying aimed at achieving some political end and helping no one.  Isn’t it time this immorality stopped?

HFMA Research Report — Value-Focused Acquisition & Affiliation Strategies

July 26, 2014 Leave a comment

A few weeks ago, the Healthcare Financial Management Association (“HFMA”) published a report examining healthcare acquisition and affiliation activity.  The report is titled “Acquisition and Affiliation Strategies” and is available as a free download.

There are no surprises in the Report’s so-called “research highlights.”  In fact, the highlights are ho-hum obvious:

An emphasis on value-focused strategies. The healthcare organizations interviewed for this report understand that the best way to gain market share is by meeting care purchasers’ demand for high quality, convenient access, and competitive prices. They are seeking acquisition and affiliation partners that will help them achieve these goals.

An understanding that different needs require different approaches. Organizational needs vary greatly depending on local market conditions and the organization’s mission, existing capabilities, and future goals. Organizations are considering a range of partners and partnership opportunities to meet these needs, often pursuing several options simultaneously.

The emergence of new organizational combinations. Healthcare organizations are growing both horizontally (e.g., hospital to hospital) and vertically (e.g., healthcare system to health plan), and different types of organizations are combining forces (e.g., academic medical centers and regional health systems).

A blurring of the lines between competition and collaboration. Market conditions and organizational needs are opening up collaborative possibilities for organizations that may have viewed one another as competitors.

The need to change governance and support structures as organizations change. As organizations grow and gain new capabilities, they are reevaluating and reshaping existing board and management structures, IT systems, financial systems and fund-flow models, and physician relationships to accommodate the changes.

However, the conclusion reached by the Report is very telling:

Few doubt that the forces transforming health care today will lead to further consolidation within the industry.  The difference is significant, however, between consolidation that seeks only to increase market power and an acquisition and affiliation strategy that seeks partners who can help produce the cost-efficiencies, gains in clinical quality, and access that care purchasers both need and demand. By taking the latter approach, healthcare organizations will be best-positioned to compete in their markets and win market share by offering patients, employers, and other purchasers a superior value proposition. [emphasis added]

The acquisition/affiliation focus of healthcare organizations has shifted away from market share and toward quality and cost-effective care.  That is an important shift.  Healthcare organizations that may have  looked like good targets in the past may no longer be desirable.  If an acquisition or affiliation is the goal, all parties need to make sure that their own healthcare houses are in order.  Otherwise, they may be standing at the altar alone.

New OIG Special Fraud Alert Aimed at Laboratory Payments to Referring Physicians

July 13, 2014 Leave a comment

Two of  my partners, Michael Gennett and Elizabeth Hodge, and I authored the following post for Akerman’s Healthcare Blog:


 

On June 25, 2014, the U.S. Department of Health and Human Services Office of Inspector General (OIG) issued a Special Fraud Alert entitled “Laboratory Payments to Referring Physicians.” While the Alert breaks no new ground (see, e.g., its 1994 Special Fraud Alert), it demonstrates the OIG’s continuing concerns about clinical laboratories’ offering inducements to referring physicians.

The Alert provides an in-depth discussion of laboratories’ paying referring physicians for collecting specimens and paying physicians for submitting patient data to a registry or database. The Alert explains that physicians who prepare specimens for transfer from the office to a laboratory have a CPT code (99000) to bill Medicare for a nominal charge. Where laboratories are separately paying the same physician for specimen collection, the double billing is evidence to the OIG of an obvious intent to induce referrals. Similarly, with respect to physicians submitting patient data for a database, even if the project has legitimate underpinnings, it may still be illegal if an intent is to induce referral. The Alert contains a detailed list of characteristics of specimen processing and data registry arrangements that it finds suspect.

The OIG ‘s concerns are not lessened in referral arrangements that “carve out” Medicare and other federal programs and focus only on commercial insurance. The OIG takes the position that, because physicians refer to a limited number of labs, inducements with respect to commercial insurance are likely intended to induce Medicare referrals also. Equally important, inducements for commercial insurance referrals may violate applicable state laws (for example, Florida’s Patient Brokering law).

Physicians should review their financial arrangements with outside clinical labs. The question to be asked always is whether one of the reasons for the arrangement is to induce referrals of patients for lab services. Although the Alert focuses on specimen processing and data registry arrangements, that does not mean that other arrangements are OK. The fraud and abuse concerns set forth in the Alert extend to any arrangement that provides some sort of financial benefit to physicians with the intent to induce referrals of patients for lab services.

______________________________

Following publication of the Alert, the OIG published a study entitled “Questionable Billing for Medicare Part B Clinical Laboratory Services.” In the Study, the OIG found that “[a]lmost half of the labs that exceeded the thresholds for five or more measures of questionable billing—compared to 13 percent of all labs—were located in California and Florida, areas known to be vulnerable to Medicare fraud.” The OIG’s recommended that it “[r]eview the labs identified as having questionable billing and take appropriate action” and also “[r]eview existing program integrity strategies to determine whether these strategies are effectively identifying program vulnerabilities associated with lab services.” As a result, clinical labs and physicians should exercise great vigilance in reviewing their financial and referral relationships with each other to insure that they comply with applicable federal (and state) fraud and abuse and other healthcare laws.

Dos and Donts of Deal Making in Healthcare

March 9, 2014 Leave a comment

Last week, I presented at a webinar sponsored by the American Association of Orthopaedic Executives.  The topic dealt was “2014 Healthcare Compliance.”  You can access the entire PowerPoint presentation at SlideShare.

I spoke about the dos and don’ts of healthcare deal making. The focus was on deals with physicians, but the concepts are applicable to deals involving all types of healthcare providers.  Below I summarize my Rules of Thumb for healthcare deals:

Rules of Thumb for Healthcare Deals

  • RULE #1:  Just because a proposed deal makes sense and would be appropriate in a business other than healthcare, doesn’t mean it’s legal. (Corollary —  Just because everyone is doing it, doesn’t mean it’s legal.)
  • RULE #2:  Determining the legality of a healthcare deal can be complicated, time consuming, expensive, and inconclusive.
  • RULE #3:  The risks of doing an illegal healthcare deal far outweigh the benefits.
  • RULE #4:  Get professional help early in the deal.

In subsequent posts, I will discuss steps in the deal and ways to screw up the deal.

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