Medicare

Published on: November 12, 2014

CMS Announces Increased Reimbursement for Telehealth

On October 31, 2014, the Centers for Medicare and Medicaid Services (CMS) released its CY 2015 Physician Fee Schedule Final Rule. The rule included several important changes as it relates to telehealth services. With respect to reimbursement rates, in the final rule CMS increased Medicare payments to telehealth originating sites by 0.8 percent.

In addition, the final rule provides seven new procedure codes that cover the following telehealth services:

Psychotherapy services (CPT codes 90845, 90846, and 90847);
Prolonged services in the office (CPT codes 99354 and 99355); and
Annual wellness visits (HCPCS codes G0438 and G0239).

For billing purposes, the originating site fee will be $24.83. CMS also introduced new CPT code 99490, which allows physicians to bill Medicare for chronic care management. The monthly, unadjusted, non-facility fee will be $42.60. Most importantly, CPT 99490 is considered a physician service and is, therefore, available nationwide and not restricted to rural-only telehealth.

Although these changes in the final rule have been received by many telehealth advocates and providers as welcomed developments, CMS did not eliminate the requirement for patients to be located in a rural area in order to receive telehealth services, despite suggestions from many commenters in response to the 2015 Physician Fee Schedule proposed rule to expand the reach of telehealth.

Published on: November 4, 2014

Office of Medicare Hearings and Appeals Hosts Second Medicare Appellant Forum

by Wachler & Associates, P.C.

On October 29th, the Office of Medicare Hearings and Appeals (OMHA) hosted its second Appellant Forum in Washington, D.C. OMHA is responsible for the Administrative Law Judge (ALJ) level of the Medicare administrative process, and thus operates the third level of appeals for Medicare audit denials. The Appellant Forum was intended to provide updates to Medicare audit appellants on the status of OMHA operations and to relay information regarding OMHA initiatives to reduce backlog in the processing of Medicare appeals.

Representatives from Wachler & Associates attended the Appellant Forum and gained valuable information for appellants facing delays in Medicare ALJ appeals. OMHA’s Chief ALJ, Hon. Nancy Griswold, explained the historical backdrop that led to OMHA’s current backlog in appeals and described OMHA’s attempts to find a “holistic solution” to ALJ workload.

Judge Griswold also updated providers on statistics regarding OMHA’s appellant workload. She explained that Medicare Part A and Part B appeals amount to 99% of the appeals pending at the ALJ level. Further, that despite increased productivity by ALJs, OMHA currently receives 4 times the amount of appeals per day as the ALJ’s are able to adjudicate per day. In January 2014, OMHA received 14,000 appeal receipts per week. The unprecedented amount of appeals has caused OMHA to fail to meet its 90-day statutory requirement for adjudication. As of September 2014, the average wait time for an ALJ decision was 514 days, which again marked a significant increase from the fiscal year 2013 average.

Published on: October 28, 2014

CMS Extends Fraud and Abuse Waivers for ACO Shared Savings Program

by Wachler & Associates, P.C.

On October 17, 2014, the Centers for Medicare and Medicaid Services (CMS) extended its interim final rule regarding fraud and abuse waivers for accountable care organizations (ACOs) that participate in the Medicare Shared Savings Program. The Medicare Shared Savings Program was one of the initial steps taken under the Affordable Care Act to both increase quality and lower costs in the Medicare program. ACOs that participate in the Medicare Shared Savings Program can share in the savings generated to Medicare.

Originally, the interim final rule was published in the November 2, 2011 Federal Register, and had the typical three-year period before becoming a final rule. The continuation of the interim final rule extends the timeline for an additional year, establishing a new deadline of November 2, 2015. The interim final rule offers five waivers to ACOs, which allow healthcare entities to form and operate ACOs without fear of violating federal fraud and abuse laws. The ACO waivers include:

An ACO participation waiver;

Published on: September 30, 2014

Medicare to Introduce More Star Ratings to Compare Providers

by Wachler & Associates, P.C.

CMS recently announced that it will soon be adding additional star ratings to the Medicare.gov website by 2015. CMS has already implemented the star rating system to provide consumers quality and safety information regarding nursing homes and physician groups on a five-star scale. The system is supposed to allow consumers to make informed decisions about their provider, while giving providers something to strive for. CMS Deputy Administer for Innovation and Quality, Dr. Patrick Conway, stated that the star rating system is based on scientific standards of both accuracy and rigor. Because providers differ on the quality of care and services they offer to customers, CMS touts its star rating system as giving consumers a “snap-shot” of the care an individual provider offers. By 2015, CMS plans to add hospital groups and dialysis and homecare providers to the rating system.

While advocates of the consumer-oriented star-rating system are excited about the inclusion of more provider types, many providers are speaking out against the system. According to a recent article on Modern Healthcare, after being notified of dialysis and homecare providers’ inclusion, a spokesman for Kidney Care Partners–a coalition of dialysis providers–claimed that the star rating system compares apples and oranges. The spokesman argued that the inaccurate comparison results in confused patients not really understanding what the amount of stars mean. Proponents of the rating system try to rebut views like those expressed by Kidney Care Partners, by arguing that the health care community should stress transparency, rather than worry about the imperfections in the rating system. Echoing these sentiments, Dr. John Santa, the Medical Director for Consumer Reports, stated that no provider will score well on every rating system, but the abundance of ratings will eventually provide a clearer picture of providers’ quality of care and safety.

Although proponents of the star rating system continue to espouse its positive aspects, many providers remain concerned. Because providers can lose accreditation for scoring poorly on certain measures of safety and quality, and even face fines, these ratings are becoming more important. Several providers urge CMS to delay the inclusion of more provider types to the rating system until it can provide a more complete performance rating. They assert that the measurement differences may result in one provider scoring high in one program and low in another and, although the system does not have to be perfect, it must be reliable. Opponents say that to allow otherwise is to misguide patients and may potentially lead to unfair financial penalties on the entities.

Published on: September 25, 2014

CMS Final Rule Provides Greater Flexibility for Meeting EHR Meaningful Use Requirements

by Wachler & Associates, P.C.

On August 29, 2014, the Department of Health and Human Services (HHS) published a Centers for Medicare & Medicaid Services (CMS) final rule allowing providers more flexibility in meeting the meaningful-use requirements for the electronic health records (EHR) incentive program. The final rule, which was an adoption of the May 2014 proposed rule, aims to assist providers in utilizing Certified EHR Technology (CEHRT) by giving eligible providers another year to continue using the 2011 Edition CEHRT, or a combination of the 2011 and 2014 Edition CEHRT. However, providers should be aware that in 2015 they are required to use the 2014 Edition CEHRT software.

Additionally, the final rule extends Stage 2 of meaningful use through 2016, thus delaying implementation of Stage 3. For those providers who first became meaningful users of EHR in 2011 or 2012, Stage 3 of meaningful use is now scheduled to begin in 2017. According to CMS, the updates in the final rule will better enable providers to participate and meet meaningful use objectives, including:

Electronic prescribing;

Published on: September 15, 2014

CMS Holds Conference Call on 68% Settlement Offer

by Wachler & Associates, P.C.

On Tuesday, September 9, the Medicare Learning Network (MLN) hosted a Conference Call regarding the newly revealed 68% settlement offer from the Centers for Medicare & Medicaid Services (CMS) for short-stay inpatient status claims. In an effort to ‘more quickly reduce the volume of inpatient status claims’ pending in the appeals process, CMS offered an administrative agreement to any hospital willing to withdraw all of their pending short-stay inpatient status claim denial appeals in exchange for partial payment of 68% of the net allowable amount as long as the date of admission was prior to October 1, 2013 and the claim is either pending appeal or the appeal has been filed and is pending review. In its release, CMS further noted that only acute care hospitals and critical access hospitals are eligible to submit a settlement request; psychiatric hospitals, inpatient rehabilitation facilities, long-term care hospitals, cancer hospitals, and children’s hospitals are not permitted to submit a settlement request.

The purpose of the Conference Call was to provide interested stakeholders an opportunity to speak with CMS representatives in order to ask questions and obtain a better understanding of how this settlement process will work. Wachler & Associates healthcare attorneys participated in the Conference Call and came away with a deeper understanding of how this process works, but there are still unanswered questions. First and foremost, submissions for settlement are due by October 31, 2014. If your entity cannot meet this deadline, you may ask CMS for an extension. Additionally, short-stay inpatient status claims pending at any level of the appeals process are eligible to be submitted for settlement.

In sum, eligible claims must also meet four requirements: (1) they must be pending in the appeals process or within the timeframe to appeal; (2) the date of admission for the claim must have been prior to October 1, 2013; (3) the denial must be based on a patient status review; and (4) the claim must not have been previously withdrawn or re-billed for payment under Part B. During the Conference Call participants requested clarification of whether the rebill for Part B must not have been submitted or whether it must not have been paid. CMS indicated that it would provider further clarification on this issue through the Frequently Asked Question (FAQ) page on CMS’ website for hospitals. In agreeing to settle all claims for the 68%, the entity agrees to the dismissal of all associated claims (the entity may not pick and choose which ones to settle) and agrees that the settlement will serve as the final administrative and legal resolution of all eligible claims. However, this resolution does not resolve any potential False Claims Act reviews by the Department of Justice. Additionally, eligible claims include claims from any Medicare contractor so long as the denial was based on a patient status review.

Published on: September 8, 2014

CMS Announces Settlement Offer to Hospitals

by Wachler & Associates, P.C.

In an effort to reduce the amount of cases currently pending appeal, specifically the backlog at the Administrative Law Judge (ALJ) level of appeal, the Centers for Medicare & Medicaid Services (CMS) announced an offer to hospital appellants to settle their patient status claim denials currently pending appeal. In exchange for hospitals’ withdrawal of their pending appeals, CMS has offered to pay hospitals 68% of the net payable amount of the claims.

In its announcement, CMS lists a number of conditions that must be met for a hospital to be eligible for settlement, including:

The provider must be either (1) an Acute Care Hospital, including those paid via Prospective Payment System, Periodic Interim Payments, and Maryland waiver, or (2) Critical Access Hospitals (CAH). Those entities which are not eligible for the settlement include: psychiatric hospitals paid under the Inpatient Psychiatric Facilities Prospective Payment System, Inpatient Rehabilitation Facilities (IRFs), long-term care hospitals (LTCHs), cancer hospitals and children’s hospitals.
The claim was not provided to a Medicare Part C (i.e., Medicare Advantage) enrollee.
The claim was denied upon review by a CMS audit contractor (e.g., Recovery Audit Contractor (RAC), Medicare Administrative Contractor (MAC), Zone Program Integrity Contractor (ZPIC) or Comprehensive Error Rate Testing Contractor (CERT)).
The claim was denied was based on the CMS contractor’s finding that the patient was inappropriately treated as an inpatient as opposed to outpatient.
The first day of the inpatient admission was before October 1, 2013.
The claim denial was timely appealed, or the provider has not yet exhausted their appeal rights.
The provider did not subsequently rebill and receive payment for the claim under Medicare Part B.

For those hospitals with eligible claims, CMS has provided instructions on its website detailing the process for hospitals to participate in the settlement offer. In order to take advantage of the settlement offer, hospitals must submit their settlement requests by October 31, 2014.

Published on: August 26, 2014

Community Health Systems to Pay $98.15 million to Settle False Claims Act Allegations

by Wachler & Associates, P.C.

On August 4, 2014, the United States Department of Justice (DOJ) announced that Community Health Systems (CHS) agreed to pay $98.15 million to settle False Claims Act (FCA) allegations that CHS knowingly billed Medicare, Medicaid and TRICARE for inpatient hospital services that should have been billed as outpatient or observation services. Seven actions were filed against CHS by whistleblowers under the qui tam provisions of the FCA, which allows individuals to file suit on behalf of the government and, in turn, obtain a portion of the recovery. These seven actions were filed in six different jurisdictions and alleged that, between 2005 and 2010, CHS engaged in a corporate scheme to increase admissions of Medicare, Medicaid, and TRICARE beneficiaries even though the admissions were not medically necessary at an inpatient level of care. Rather, the United States alleged that the patients could have been cared for in less costly outpatient or observation settings.

In addition to the $98.15 million settlement payment, CHS agreed to enter into a five-year Corporate Integrity Agreement with the Office of Inspector General (OIG) in which CHS is required to implement significant compliance protocols, including retention of an independent review organization (IRO) to review CHS’s inpatient admission claims. In exchange, CHS will be released from any civil or administrative monetary claims the United States has for the covered conduct under the FCA, Civil Monetary Penalties Law, or Program Fraud Civil Remedies Act.

According to the DOJ, this settlement agreement is the largest FCA recovery in the Middle District of Tennessee. The DOJ touted the Health Care Fraud Prevention and Enforcement Action Team’s (HEAT) coordinated nationwide effort for exposing the FCA noncompliance. Since the establishment of the Health Care Fraud Prevention and Enforcement Action Team (HEAT) in 2009, the DOJ has recovered over $20.2 billion in FCA cases, of which $14 billion has come from cases involving fraud against government health care programs.

Published on: August 1, 2014

Bipartisan House Bill Proposes Increased Medicare Coverage of Telemedicine

by Wachler & Associates, P.C.

A bill amending Title XVIII of the Social Security Act will be proposed soon, marking the culmination of bipartisan efforts in the House of Representatives. Representatives Glenn Thompson (R-Penn.) and Mike Thompson (D-Calif.) are prepared to announce a new telehealth bill, titled the Medicare Telehealth Parity Act of 2014, which would reduce the Social Security Act’s current limitations on reimbursable telemedicine technologies.

Currently, the Social Security Act only permits reimbursement for telemedicine uses in rural health professional shortage areas (HPSAs) and non-Metropolitan Statistical Areas (MSAs). Not only are these qualifications limiting, they are also difficult to discern. For example, in the 2000s, the Health Resource and Service Administration (HRSA) eliminated the “rural HPSA” category from its designations, resulting in confusion regarding the correct application of the term. The forthcoming bill seeks to slowly resolve these reimbursement complications through a cost-effective, four-year plan:

Within six months of the bill’s passage, it would mandate that Medicare provide coverage for telemedicine in urban areas with a population of 50,000 or less. Additionally, the six month period would be used to increase care sites to include retail clinics.
Two years following the bill’s passage, Medicare coverage would expand to urban areas with a population of 100,000 or less. Furthermore, the bill would include home telehealth to the list of care sites, while expanding reimbursable services to encompass physical and speech therapy.
Lastly, after four years have passed, the bill would make telemedicine reimbursable across the United States.

In addition to the four-year plan, the bill seeks to officially add remote patient monitoring (RPM) to the Social Security Act’s list of reimbursable services. The bill defines RPM as “the remote monitoring, evaluation, and management of an individual with a covered chronic health condition . . ., insofar as such monitoring, evaluation, and management is with respect to such condition, through the utilization of a system of technology that allows a remote interface to collect and transmit clinical data between the individual and the responsible physician . . . or supplier.” By offering government reimbursement for RPM services, thereby expanding RPM use, the bill hopes to increase Medicare savings over time.

Also, the Representatives’ bill would task the Secretary of Health and Human Services (HHS) with developing standards for remote patient monitoring. Finally, the United States comptroller would be directed to conduct a study within two years of the bill’s passage, to determine the efficacy and estimated Medicare savings from the expansion of telemedicine applications.

Published on: July 10, 2014

HHS Unveils Statistical Sampling Pilot Program for ALJ Hearings on Medicare Audit Appeals

by Wachler & Associates, P.C.

Last week, the Office of Medicare Hearings and Appeals (OMHA) announced the Statistical Sampling Pilot Program (Pilot Program). The Pilot Program offers Medicare providers an alternative route, along with the Settlement Conference Facilitation Pilot, to reach a final determination for claims pending at the administrative law judge (ALJ) hearing level without enduring the 2-3 year delay for hearing. Although the Pilot Program offers a time-saving and perhaps more efficient option for Medicare providers, engaging in the Pilot Program also comes with risks as Medicare providers may “put all of their eggs in one basket” and rely on a single ALJ to issue a decision that affects a large volume of claims. In some cases, the provider may know the identity of the ALJ prior to agreeing to statistical sampling, but in other cases the provider will not.

The Pilot Program is available to Medicare providers that have requested an ALJ hearing following a Medicare Qualified Independent Contractor (QIC) reconsideration decision. At this time, the ALJ hearing requests must either be assigned to an ALJ or must have been filed between April 1, 2013 and June 30, 2013 and it must meet all jurisdictional requirements, including that it was filed timely. In order to be eligible for the Pilot Program, the Medicare provider must have a minimum of eligible 250 claims and the claims must be one of the following: (1) pre-payment claim denials; (2) post-payment non-RAC claim denials; or (3) post-payment RAC claim denials from one RAC. In addition, claims that are assigned to different ALJs or were requested in different consolidation groups may be incorporated into the request for statistical sampling.

A Medicare provider that meets the eligibility requirements for the Pilot Program may request statistical sampling by submitting a “Request for Statistical Sampling” form that is available on OMHA’s website. The provider must also submit a spreadsheet, a template is also available on OMHA’s website, that provides detailed information about the claims requested to be included in the statistical extrapolation.