Compliance

Published on: October 23, 2023

OIG Updates Work Plan for October 2023

The Department of Health and Human Services (HHS) Office of Inspector General (OIG) announced several new changes in its Work Plan update for October 2023. The OIG Work Plan forecasts the projects that OIG plans to implement over the foreseeable future. These projects usually include OIG audits and evaluations. Below are the highlights from the Work Plan update of which providers and suppliers should take notice.

First, OIG will perform an audit of the Morehouse School of Medicine’s National Infrastructure for Mitigating the Impact of COVID-19 (NIMIC) initiative. The NIMIC initiative is a 3-year, $40 million cooperative agreement between HHS’s Office of Minority Health and the Morehouse School of Medicine to fight COVID-19 in racial and ethnic minority, rural, and socially vulnerable communities. The Morehouse School of Medicine is leading the initiative to coordinate a strategic network to deliver COVID-19 related information to communicates hit hardest by the pandemic.

Second, OIG will audit the accuracy of the Child Care and Development Fund (CCDF) attendance records at Minnesota child care centers. The CCDF is the primary federal funding source devoted to subsidizing the child care expenditures of low-income families. OIG has stated that it identified issues with the completeness and accuracy of child care attendance records and with related billings for child care services. Minnesota, as well as possibly additional states, have been selected by OIG for a review to determine whether the state(s) complied with federal and state requirements related to attendance records and whether payments for services at child care centers were allowable.

Published on: October 19, 2023

Employee Safe Harbor Protections Affirmed in Recent OIG Advisory Opinion

by Wachler & Associates, P.C.

On October 10, 2023, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) issued an advisory opinion reinforcing the broad protection of physician employees under the safe harbor provision of the Anti-Kickback Statute (AKS). The AKS is a federal criminal law which prohibits payment for the inducement or reward of patient referrals or generation of business where any item or service payable by a federal healthcare program is involved. Remuneration under the law has been interpreted to mean “the transfer of anything of value, directly or indirectly, overtly or covertly, in cash or in kind.” Violation of the AKS can result in severe penalties, including imprisonment of up to 10 years, a maximum fine of $100,000, and exclusions from Medicare and Medicaid reimbursement.

There are several statutory and regulatory exceptions to the AKS, which allow for specific remuneration arrangements when certain criteria are met. One statutory exception protects payments made by employers to employees who are in bona fide employment relationships for providing covered items and services under the employment agreement. Similarly, safe harbor regulations have been promulgated by HHS which clarify that “remuneration” under the AKS does not include payments under the bona fide employer-employee relationship described above.

In the recent advisory opinion, the OIG considered whether employer payment of bonuses based on net profits to employed physicians in a multi-specialty ambulatory surgery center (ASC) would constitute a violation of the AKS. The employer practice operated two separate ASCs – noted to be divisions and not subsidiaries – and planned to compensate physician employees via a bonus structure where employed physicians who performed procedures at the ASCs would receive 30% of the practice’s net profits in addition to base employment compensation. The OIG concluded that this type of arrangement would not violate the terms set forth in the AKS.

Published on: October 2, 2023

OIG Announces Plan to Investigate Managed Care Contracts

by Wachler & Associates, P.C.

In August 2023, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) announced its strategic plan to investigate the life cycle of Medicare and Medicaid managed care contracts. OIG’s plan will scrutinize these contracts from inception through enrollment, reimbursement, services, and renewal. In order to address fraud, waste, and abuse risks, the goal of OIG’s plan is to hold accountable Medicare Advantage organizations (MAOs) and Medicaid managed care organizations (MCOs).

Currently, more than half of Medicare enrollees and more than 80% of Medicaid enrollees are covered by managed care programs. In order to oversee the approximate $700 billion that the federal government spent on managed care programs in 2022, OIG has set out four phases of managed care that it intends to investigate: (1) plan establishment and contracting, (2) enrollment, (3) payment, and (4) provision of services.

In the first phase, OIG intends to review activities that occur when the Centers for Medicare & Medicaid Services (CMS) or states initially establish or renew managed care contracts. In this contract review phase, OIG will evaluate whether MAOs and MCOs are providing the government with accurate information, including in their bids, and abiding by the contract terms for their plan design, service offerings, and coverage area. In the second phase, OIG will review enrollment processes. Specifically, OIG will focus on potentially aggressive marketing campaigns and inaccurate information collection.

Published on: September 22, 2023

CMS Proposes Rule Establishing New Nursing Home Accountability and Staffing Standards

by Wachler & Associates, P.C.

As part of the Biden Administration’s initiative to improve quality and safety in nursing home care, the Centers for Medicare & Medicaid Services (CMS) issued a notice of proposed rulemaking on September 1, 2023, entitled “Minimum Staffing Standards for Long-Term Care Facilities and Medicaid Institutional Payment Transparency Reporting.” This initiative resulted in part from a 2022 Nursing Home Staffing Study, which sought to establish “the level and type of staffing needed to promote acceptable quality and safety.” Notably, the study projected that the cost of implementing such new minimum staffing requirements could range from $1.5-6.8 billion, increasing the burden on an industry already struggling with personnel shortages and demanding regulatory requirements.

The proposed rule is comprised of three core staffing proposals, including establishing new minimum staffing standards for RNs and NAs, requiring an RN to always be onsite, and enhancing facility assessment requirements. There are staggered implementation protocols and possible hardship exemptions for qualifying facilities included in the proposed rule. CMS also announced a collaboration with the Health Resources and Services Administration (HRSA) to assist in training and growing the nursing workforce, by investing over $75 million in scholarships and tuition reimbursement.

The first core staffing proposal establishes a minimum staffing standard of 0.55 hours per resident day (HPRD) for RNs and 2.45 HPRD for NAs. Practically speaking, this translates to a facility with 100 residents having two RNs for each 8-hour shift and a third RN for one shift during the day, as well as ten NAs per 8-hour shift. As these are minimums, CMS noted that they expect facilities to increase staffing above this baseline pursuant to the individual facility assessment and acuity levels.

Published on: September 8, 2023

CMS Increases Scrutiny on Hospice Providers

by Wachler & Associates, P.C.

The Centers for Medicare & Medicaid Services (CMS) recently announced that it intends to increase scrutiny on hospice providers as a result of increased reports and CMS findings suggesting potential hospice services fraud. CMS stated that it is strengthening its hospice program integrity strategy through actions such as site visits and proposed regulations to minimize impacts to Medicare beneficiaries.

As part of this revitalized focus on hospice integrity, CMS has highlighted several observed situations that it views with heightened scrutiny. Certain reports cited by CMS have supposedly identified instances of hospices certifying patients for hospice care when they were not terminally ill and providing little to no services to patients. CMS has also indicated that the listed address for some hospices appears to be non-operational. One particular alleged trend CMS has focused on is known as “churn and burn,” where a new hospice opens and starts billing, but once that hospice is audited or reaches its statutory yearly payment limit, it shuts down, keeps the money, buys a new Medicare billing number, transfers its patients over to the new Medicare billing number, and starts billing again.

In response to these purported findings, CMS embarked on a nationwide hospice site visit program, making unannounced site visits to every Medicare-enrolled hospice. As of mid-August 2023, CMS has visited over 7,000 hospices, and indicated that nearly 400 hospices are being considered for potential administrative action as a result. While many of these hospices may very well be able to demonstrate compliance with Medicare requirements, if CMS finds grounds to conclude that a hospice is allegedly non-compliant, this may result in significant consequences such as suspension or revocation. Further, CMS has noted that rapid hospice growth trends in four states – Arizona, California, Nevada, and Texas – has led the Centers to implement a provisional period of enhanced oversight in these states. During this provisional period, CMS plans to conduct medical reviews before making payments on claims submitted by newly enrolling hospices.

Published on: September 1, 2023

CMS Announces New Voluntary Primary Care Model in Eight States

by Wachler & Associates, P.C.

The Centers for Medicare & Medicaid Services (CMS) recently announced the Making Care Primary (MCP) Model, a new voluntary primary care model that will be tested in eight states. The new model aims to improve care management and care coordination, equip primary care clinicians with tools to form partnerships with healthcare specialists, and leverage community-based connections to address patients’ health needs as well as their health-related social needs, such as housing and nutrition. CMS plans to work with eight state Medicaid agencies to engage in full care transformation across payers, with plans to engage private payers in the future. The MCP Model is slated to launch July 1, 2024 in eight participating states – Colorado, North Carolina, New Jersey, New Mexico, New York, Minnesota, Massachusetts, and Washington.

The MCP Model is a 10.5-year multi-payer model with three participation tracks that build upon previous primary care models. MCP’s overarching goal is to improve care for beneficiaries by supporting the delivery of advanced primary care services, which are foundation for a high-performing health system. To achieve this goal, the Model will provide a pathway for primary care clinicians with varying levels of experience in value-based care to gradually adopt prospective, population-based payments while building infrastructure to improve behavioral health and specialty integration and drive equitable access to care. The Model also attempts to strengthen coordination between patients’ primary clinicians, specialists, social service providers, and behavioral health clinicians, ultimately leading to chronic disease prevention, fewer emergency room visits, and better health outcomes.

Three domains define the MCP Model’s care delivery approach:

Published on: August 21, 2023

HHS, DOL, and Treasury Issue Long-Awaited Mental Health Parity Proposed Regulations

by Wachler & Associates, P.C.

On August 3, 2023, the US Departments of the Treasury, Labor, and Health and Human Services (Departments) issued proposed rules under the Mental Health Parity and Addiction Equity Act (MHPAEA) to reduce barriers to access to mental health and substance use disorder treatment. The proposed rules emphasize the Departments’ focus on mental health parity and aligns with their overarching goal to better ensure that health plans afford access to mental health or substance use disorder benefits as easily as medical or surgical benefits.

By way of background, in 1996, the Mental Health Parity Act of 1996 was enacted by Congress, requiring parity in aggregate dollar and annual dollar limits for mental health benefits. In 2008, the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) added additional requirements, expanding the Mental Health Parity Act of 1996. The MHPAEA requires group health plans and insurance issuers to ensure that financial requirements and treatment limitations are not more restrictive for mental health or substance use disorder benefits than medical or surgical benefits. The Consolidated Appropriations Act in 2021 further expanded the MHPAEA by requiring health plans that cover both medical or surgical benefits and mental health or substance use disorder benefits to conduct and document comparative analyses of non-quantitative treatment limitations (NQTL) for both types of benefits.

Although the Departments have issued a fair amount of sub-regulatory guidance regarding the NQTL comparative analysis requirement, the proposed regulations are the first formal regulatory guidance they have issued in about ten years. Recently, audits by the Departments of health plans have directed their focus to MHPAEA compliance. Plan sponsors have expressed frustration with the lack of guidance and varying applications of the existing guidance, complaining that the Departments’ requests are not supported by law, not practical in application, and contradictory.

Published on: August 16, 2023

OIG Final Rule Implementing Information Blocking Penalties

by Wachler & Associates, P.C.

The Department of Health and Human Services (HHS) Office of Inspector General (OIG) issued a final rule (Final Rule) on June 27, 2023, which implements statutory provisions for specific individuals or entities subject to the information blocking requirements established by the 21^st Century Cures Act (Cures Act). The Cures Act imposes civil money penalties (CMP) of up to $1 million per violation of information blocking, which is defined as “a practice that interferes with, prevents, or materially discourages access, exchange, or use of electric health information,” except as required by law or covered by an exception.

The Final Rule authorizes HHS to impose CMPs, assessments, and exclusions on individuals and entities that engage in alleged fraud or other misconduct related to HHS grants, contracts, and other agreements, as well as increases the maximum penalties for certain CMP violations. OIG may impose CMPs of up to $1 million per violation of information blocking on a health information technology (Health IT) developer of certified health IT or a health information network or health information exchange (HIN/HIE), as those terms are defined by OIG.

Penalties may be imposed on certified Health IT developers and HIN/HIEs that do not actually interfere with access, exchange, or use of electronic health information (EHI) if the requisite intent is present. Specifically, such individual or entity may have CMP exposure under the Final Rule if it knew or should have known that a practice was likely to interfere with access, exchange, or use of EHI. Additionally, OIG has clarified that a discrete action by an actor that implicates information blocking would be viewed as a single violation. Thus, it appears that the number of violations will be directly connected to the number of discrete acts.

Published on: August 14, 2023

CMS Announces GUIDE: A Medicare Dementia Care Model

by Wachler & Associates, P.C.

On July 21, 2023, the Centers for Medicare & Medicaid Services (CMS) announced a new payment model for providers furnishing dementia care, called Guiding an Improved Dementia Experience (GUIDE). A wide range of Medicare Part-B providers and suppliers are eligible to participate, with the exception of durable medical equipment and laboratory suppliers. The model is a comprehensive package of person-centered assessments, care plans, and care coordination. Additionally, this new payment model aims to further enhance the quality of life for people living with dementia by improving dementia care, reducing strain on unpaid caregivers, and helping people with dementia remain in their homes and communities.

GUIDE’s approach to dementia care takes into account staffing considerations, quality standards, and services for beneficiaries and unpaid caregivers. Under the GUIDE model, beneficiaries are required to be screened for psychological and health-related social needs. As a GUIDE participant, providers are required to establish and maintain an interdisciplinary team consisting of a care navigator and a clinician, with the option of including additional members. The care navigator must have training in care planning and dementia assessment while the clinician is required to have dementia proficiency through experience caring for patients 65 years or older and for adults with cognitive impairment. GUIDE participants are required to provide support services alongside caregiver training.

There are two options for providers considering implementing GUIDE:

Published on: August 9, 2023

OIG Declines to Impose Sanctions on Online Healthcare Directories

by Wachler & Associates, P.C.

The Department of Health and Human Services (HHS) Office of Inspector General (OIG) released Advisory Opinion 23-04 (Advisory Opinion) on July 11, 2023, addressing arrangements between online healthcare directories and certain third-party websites (Directories) with federal healthcare program beneficiaries. In the Advisory Opinion, the OIG declined to impose sanctions on healthcare provider Directories offering these sort of advertising services to providers.

Under the proposed arrangement, healthcare provider Directories are serving as marketplaces in which users and potential patients can book medical appointments with physicians and other healthcare providers (Providers) who are listed on the online Directories. Patients can filter their results by searching for different types of medical providers, and the Directories generate personalized results using a proprietary algorithm.

Although no fee is charged to the patients for using the directory, Providers pay a fee to be included in the directory through an array of payment methods. Whenever potential patients click on a Provider’s profile during their searches, a “per-click” fee is charged to Providers. A “per-booking” fee is also charged to Providers for each new patient the Providers receive through the Directory which may vary in amount based on location, specialty, and other factors impacting the fair market value of the marketing service. Providers can also set spending caps, which would remove the Providers from the directory once a certain amount of booking fees has been met.