Wachler & Associates Health Law Blog

President Obama signed the “Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010.” The law includes a provision that clarifies Medicare’s position for payment of hospital outpatient services provided on either the day of or the three days prior to an inpatient admission. The 3-day payment window policy is effective for services provided on or after June 25, 2010. Medicare may not reopen claims submitted prior to June 25, 2010 to require a separate bill for outpatient non-diagnostic services.

The 3-day payment window, which has been unofficially followed by Medicare since 1991, allows a hospital to charge for all diagnostic services and non-diagnostic services “related” to the inpatient stay that are provided during the 3-day payment window.

The law defines “other services related to the admission” as including services that are not diagnostic services (other than ambulance and maintenance renal dialysis services) for which payment may be made by Medicare that are provided to a patient by a hospital: (1) on the date of the patient’s inpatient admission; (2) during the 3 days immediately prior to the date of admission, unless the hospital shows that the services provided were not related to the admission.

The U.S. Department of Health and Human Services Office of Inspector General (OIG) issued Advisory Opinion 10-08 to address the provision of dietitian and social worker services at a freestanding radiation oncology center (Center) at no extra charge to the beneficiaries. The OIG determined that the proposed arrangement would not violate the Federal Anti-Kickback Statute and thus, the OIG would not impose administrative sanctions.

The proposed arrangement involved patients at the Center receiving dietitian and social worker services at no additional charge. The OIG addressed the arrangement as it affected Medicare beneficiaries. The services would not be advertised as “free” or “at no charge.” Patients would receive the dietitian services after being identified for risk of nutritional complications and social worker services would be provided during the patient’s treatment. Under the proposed arrangement, the services would not be separately billed, and the applicable cost sharing amounts for the Medicare beneficiaries would not be routinely waived.

The Centers for Medicare and Medicaid Services (CMS) informed the OIG that the dietitian and social worker services provided at the Center would fall within the reimbursement the Center received for the patients. Thus, the amounts that the Medicare beneficiaries pay to share the costs would be partially attributable to the costs of the dietitian and social worker services and the Center would not be provided the services free because of this reimbursement. If this form of reimbursement had not been factored into the proposed arrangement, then the services would not be part of the reimbursement and could implicate the Anti-Kickbac Statute.

On June 18 the U.S. Senate passed a six-month plan to prevent the Medicare physician 21 percent payment cut. The measure, which will cost $6.4 billion, was pushed through with the concern that the steep payment cut would raise the possibility that medical providers would turn away patients covered by Medicare. It will delay the cuts until November 30, 2010 while Congress tries to create a long-term plan. The plan was passed unanimously and lawmakers attribute its passage to the efforts to offset its attributed costs.

Almost immediately after the U.S. Senate announced the passage of the plan, Medicare announced that it would process Medicare claims received for June at the lower rate. This is because the U.S. House of Representatives will not be able to consider the plan until next week. However, there are indications that the bill’s success in the House may be complicated. House Speaker Nancy Pelosi announced that the House will not pass the Senate bill until the Senate agrees to act on job-creation legislation. If the bill does pass in the House, Medicare providers will have the burden to resubmit their claims to be made whole.

For more information on Medicare payments or the physician fee cut, please visit www.wachler.com or contact a Wachler & Associates attorney at 248-544-0888.