Articles Posted in Health Law

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On October 20, 2011, CMS released the much awaited final rule for implementation of the Medicare Shared Savings Program for providers and suppliers participating in Accountable Care Organizations (ACOs). The following are 20 notable aspects of the final rule:

•1. While the proposed rule would have required all ACOs to share risk of loss in the final year of the three year participation period, the final rule created an alternative for a “shared savings only” track (one-sided model) that will not require any sharing of losses. The final rule also retains the proposed two-sided model that will allow ACOs to share in an increased portion of savings, so long as the ACO also agrees to share in any losses to the program.

•2. The final rule will allow ACOs beginning in April 1, 2012 or July 1, 2012 to have a longer first performance year (21 months or 18 months respectively) and an option to receive an interim payment calculation following the first 12 months of participation. One-sided ACOs receiving an interim payment will be required to demonstrate a self-executing repayment mechanism similar to that which the two-sided ACOs must demonstrate.

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According to a breaking news article by HealthData Management, the Centers for Medicare and Medicaid Services (CMS) has sent a Shared Saving/Accountable Care Organizations final rule to the Office of Management and Budget (OMB) for review. A review by OMB is one of the last stages before a rule becomes published in the Federal Register. The final rule is expected to include several changes due to the substantial amount of industry criticism the proposed rule faced during the comment period. According to HealthData Management, the concerns raised about the proposed rule included: (1) the proposed 65 measures would be excessively burdensome for newly formed ACOs, (2) allowing pathologists and laboratory professionals to be included as eligible physicians, and (3) giving ACO-enrolled patients the ability to restrict access to their health information could severely limit the ACO’s ability to improve the health of the individual.

If you have any questions about ACO participation, or any other health law questions, please contact a Wachler & Associates attorney at 248-544-0888.

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Today, the Office of Inspector General (OIG) released the fiscal year 2012 Work Plan. The plan describes the activities the OIG plans to continue, as well as activities it plans to initiate. The 2012 fiscal year, and the programs described, runs from October 1, 2011 through September 30, 2012. Below is a list of several new and continuing OIG activities for various health care providers.

Home Health Services (New)

  • States’ Survey and Certification of Home Health Agencies: Timeliness, Outcomes, follow-up, and Medicare Oversight
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In its role of overseeing the Medicare and Medicaid Programs, the Senate Finance Committee released a staff report alleging that the four largest publicly traded home health agencies were providing medically unnecessary care by encouraging therapists to meet the 10 visit threshold in order to receive a  “bonus” payment  under the PPS system.  The report was based on an investigation initiated by Committee Chairman Max Baucus and Senior Member Chuck Grassley.  The Senators instigated the investigation based upon a Wall Street Journal analysis.

Among other findings, the report alleges that an analysis of therapy billings from these home health agencies show a pattern of concentrated billings at or just above the 10 visit threshold.  The report further alleges that the companies encouraged billing of medically unnecessary services to reach this threshold.

Home Health Agencies should be aware that Medicare contractors will likely be closely scrutinizing PT visit frequency and patterns.  Also, providers are likely to see changes in the payment system as a result of this report.

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The Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Process was mandated by Congress through the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, which replaced the current fee schedule payment procedure for DMEPOS items with a competitive bidding process. The purpose of the statute is to set DMEPOS payment amounts in a more effective manner, which will result in saving the Medicare program money and reducing beneficiary out-of-pocket expenses.

Bids closed for Round 1 of the DMEPOS competitive bidding program on December 21, 2009. In November of 2010 CMS announced the winners of Round 1 and in January of this year implemented the contracts.

This past summer, the Centers for Medicare and Medicaid Services (CMS) began its pre-bidding supplier awareness program. For this fall, CMS will announce the bidding schedule, begin the bidder education program, and commence the bidder registration period to obtain user ID and passwords. The bidding will begin in winter 2012.

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A new bill was recently introduced in the House of Representative in an effort to amend the Health Care Quality Improvement Act of 1996 (HCQIA) to require greater due process rights for health care professionals before any reports are made to the National Practitioner’s Data Bank (NPDB).

According to the Association of American Physicians and Surgeons, the bill, H.R. 2472, seeks to counter hospitals’ current practice of reporting adverse actions taken against physicians regardless whether the physician had been afforded a hearing or adequate notice about the investigation. According to supporters of the bills, rather than granting physicians an opportunity to defend themselves against these actions, hospitals have been bypassing these due process steps and reporting the actions to the NPBD. Reports to the NPBD have proven to be extremely detrimental to physicians and have resulted in a number of physicians losing their careers.

The bill amends 42 U.S.C. 11133(a) to prohibit a review entity from reporting to the NPDB while the physician is under investigation. Also, the bill would bar a hospital’s ability to submit a report to the NPDB before a physician is afforded a hearing and adequate notice of the adverse actions taken by the hospital. The amendment also seeks to change the current immunity power of a professional review body. The current HCQIA grants the professional review body immunity from actions taken against it even if the reviewer fails to follow the guidelines for adequate notice and hearing procedures described in the Act. The new bill may provide a means for a physician to bring a cause of action against a professional review body when the entity has failed to provide the required notice and hearing prior to filing a report to the NPBD or if the entity has conducted a “sham” peer review.

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Wachler & Associate’s attorney Amy Fehn, as a member of the ABA’s ACO Task Force, recently participated in the drafting of comments on CMS’ proposed regulations for ACO participation in the Medicare Shared Savings Program. The proposed regulations will govern the way in which ACOs will contract with CMS to become responsible for the delivery of care to an assigned population of Medicare fee for service beneficiaries. The ABA’s ACO Task Force prepared comments to help CMS properly develop ACOs by highlighting some of the problematic areas of the proposed regulations. Click here to view the full version ABA’s comments on the ACO proposed regulations.

For assistance with interpreting the ACO Shared Savings program regulations, or for assistance with creating an infrastructure conducive to ACO participation, please contact a Wachler & Associates attorney at 248-544-0888.

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The Center for Medicare and Medicaid Services (CMS) has extended the deadline for the submission of the Pioneer ACO Model program letters of intent to June 30, 2011. Additionally, the Application deadline has been extended to August 19, 2011. Applications received from organizations that have not submitted a letter of intent will not be considered.

Click the following links to complete the Pioneer ACO letter of intent and application. If you wish to participate in CMS’ Pioneer ACO Model program and need assistance in doing so, please contact a Wachler & Associates attorney at 248-544-0888.

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The U.S. Department of Health and Human Services, Office of Inspector General (OIG) issued a favorable advisory opinion for a Requestor regarding a vaccine reminder program. In February 2011, the Requestor, a manufacturer of pneumococcal bacteria vaccines for immunization of infants and toddlers, expanded a vaccine reminder program to entities that insure and treat patients covered by federal healthcare programs. Prior to February the reminder program was only to the parents or guardians of children who may have needed one or more doses of the vaccine.

Under the expansion, the Requestor offers the reminder program to entities regardless of the number of children that have been or will be vaccinated. The Requestor also pays for the reminders, either through telephone calls or postcards and there is no other charge to the entities that wish to participate. The reminder postcards or telephone calls do not refer to a specific product and do not recommend a specific avenue for vaccination. They merely suggest that the child’s parent or guardian contact a clinic to determine if a vaccine is required.

The OIG analyzed the program under the beneficiary inducement statute and the anti-kickback statute. The OIG first concluded that the reminder messages to the parents from the Requestor were not inducements since they only inform the parents about the potential need to have a vaccination. Further, the OIG determined that the relationship between the Requestor and the healthcare entities did not violate the anti-kickback statute. Although there is some independent value to the entities from the program, there is a low risk of fraud and abuse because of several factors, including: the arrangement was narrowly tailored and transparent, available to all health insurers and entities regardless of their use of the Requestor’s vaccines and the reminder messages do not recommend a specific vaccine or course of vaccination, thus they still encourage patient’s freedom of choice.

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The Office of the National Coordinator for Health Information Technology (ONC) announced a new program on Wednesday to encourage the innovation of health information technology through prizes and challenges. The program, called Investing in Innovations (i2) Initiative, was created under the America Compete Reauthorization Act of 2010 and has already awarded the first $5 million to two projects.

For more information on health care law developments, please visit www.wachler.com.

Investing in Innovations (i2) Initiative http://healthit.hhs.gov/portal/server.pt?open=512&mode=2&objID=3635&in_hi_userid=11673

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