January 22, 2016

2016 Top Health Care Lawyers

The HLP is proud to announce that two of its attorneys, Robert S. Iwrey and Alan G. Gilchrist, were recently named as 2016 Top Lawyers in Health Care Law by Detroit's premier business journal, DBusiness. DBusiness conducted a peer review survey polling 19,000 attorneys in Wayne, Oakland, Macomb, Washtenaw and Livingston Counties in Michigan and 39 health care attorneys were given the award of 2016 Top Lawyer based on the nominations received. Both Mr. Iwrey and Mr. Gilchrist have received such recognition multiple times over the years.

December 15, 2015

Broad Cross-Section of Medical Professionals Prescribing Prescription Opioids

Researchers have examined Medicare claims from 2013 to see which doctors prescribed opioids (including OxyContin, morphine and codeine) and how many prescriptions they filled. Research found that these drugs are being prescribed by a broad cross-section of medical professionals, rather than concentrated among a small group of practitioners. While it is not surprising that pain management specialists and anesthesiologists wrote the most prescriptions for opioids when compared to other specialties, primary care physicians such as family practitioners had the highest volume of opioid prescriptions since there are more primary care physicians than specialists. As such, primary care physicians should recognize that future efforts to curb opioid prescribing (including but not limited to state licensing and DEA registration actions) are likely to focus on them. Moreover, the Centers for Disease Control and Prevention has issued new guidelines urging physicians to take a more conservative approach to prescriptions and to closely monitor their patients' use of opioids.

"Broader Strategies Necessary to Counter Painkiller Over Prescribing, Researchers Say" [link]

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December 9, 2015

AFIRM Act Seeks to Improve the Medicare Audit and Appeals Process

On December 9, 2015, Senate Finance Committee Chairman Orrin Hatch (R-Utah) and Ranking Member Ron Wyden (D-Ore.) introduced Senate Bill 2368, the Audit & Appeal Fairness, Integrity, and Reforms in Medicare (AFIRM) Act of 2015. The purpose and goal of AFIRM is to improve the Medicare audit and appeals process by reducing the burden on providers and implement reforms to the Medicare audit and appeals process.
In fiscal year 2014, the Centers for Medicare & Medicaid Services (CMS), conducted audits of more than one billion claims in an effort to curb approximately $60 billion in improper Medicare payments. This many audits has resulted in a corresponding number of appeals leading to a backlog of nearly one million claims causing a near two year backlog.
Among the many ways that AFIRM seeks to resolve this backlog are the following:
 Increase the amount in controversy limits for review by an administrative law judge (ALJ) to $1,500 or more. For cases not meeting this threshold, a Medicare Magistrate program allows senior attorneys with expertise in Medicare law and related policies to adjudicate cases in the same way as ALJs. This is intended to allow ALJs to maintain their focus on complex cases (AFIRM § 1-3).
 Establish a process whereby an ALJ can certify an appeal for expedited access to judicial review (AFIRM § 5).
 Establish a voluntary alternate dispute resolution process allowing multiple claims with similar issues of law or fact to be settled together where they are submitted by the same individual or entity (AFIRM § 6).
 Permit an adjudicator, with the consent of the appellant, to use statistical sampling and extrapolation in reaching a decision (AFIRM § 6).
 Establish a process whereby the Office of Medicare Hearings and Appeals and the Departmental Appeals Board of the Department of Health and Human Services (HHS) can refer cases to law enforcement where there is a credible suspicion of fraudulent activity (AFIRM § 7).
 Publish on the internet appeal information that includes at least the following (AFIRM § 9):
o the percentage of appeals that received fully favorable, partially favorable, and unfavorable decisions;
o the percentage of appeals that received fully favorable, partially favorable, and unfavorable decisions for each ALJ;
o for each type of service, the percentage of appeals that received fully favorable, partially favorable, and unfavorable decisions; and
o the average length of time that has passed between the initial request for review and a final decision.
 Establish alternative resolution dispute processes permitting an individual or entity entitled to a redetermination by a Medicare administrative contractor, or a reconsideration by a qualified independent contractor, to enter into an alternative dispute resolution with CMS (AFIRM § 9).
 Authorize the Secretary to designate a point of contact to oversee and undertake at least the following (AFIRM § 10):
o Develop a strategy for claim review determinations that identifies and reduces claim errors that have the largest impact on improper payment rates and are likely to negatively affect quality of care, in addition to reducing unnecessary burdens on providers of services and suppliers;
o Develop methods to ensure review contractors do not unnecessarily conduct duplicate reviews of individual claims;
o Work with review contractors to develop a uniform, consistent, and transparent review process to reduce the burden on providers of services and suppliers;
o Develop qualification standards for review contractors requiring prepayment and post-payment reviews of claims to be conducted or approved by medical doctors with knowledge of relevant Medicare laws, regulations, and program instruction;
o Verify that decisions by review contractors are consistent with Medicare laws, regulations, and program instruction; and
o Determine whether additional punitive actions against ineffective review contractors could be taken and what, if any, financial incentives or disincentives could be used to promote accuracy of a review contractor's reviews.
 Appoint a Medicare Reviews and Appeals Ombudsman who will (AFIRM § 11):
o identify, investigate and assist in the resolution of complaints and inquiries related to the Medicare audits and appeals process;
o identify trends in complaints and inquiries to provide recommendations for improvements to the claims review and appeals system;
o design a system to measure and evaluate reviewer responsiveness to addressing inquiries from providers of services and suppliers; and
o publish appeal data.
 Establish a compliance incentive program to increase the accuracy of providers of services and suppliers in addition to encouraging consistency with review guidelines, regulations and program instructions for review contractors (AFIRM § 13).
Jessica Gustafson and Abby Pendleton, founding partners of The Health Law Partners, P.C., practice in all areas of healthcare law devoting a substantial portion of their practice on Recovery Audit Contracts and Medicare audit appeals. For more information, please contact Abby Pendleton, Esq. or Jessica Gustafson, Esq., or visit The HLP website.

December 9, 2015

Physician Groups Settle with Anthem Blue Cross and Blue Shield Over "Out-of Network Shenanigans"

Seven physicians groups, including the Connecticut State Medical Society, the American Medical Association, the California Medical Association, the Medical Association of Georgia and others, have reached a settlement with insurance company Anthem Blue Cross and Blue Shield ("Anthem") over allegations of 'out-of network shenanigans'. The suit, which was filed in 2007, accused Anthem of unfair practices when determining reimbursement rates for out-of-network care. Patients were unsure as to which providers were in or out of network and patients were responsible for higher than expected charges due to being misled about how much of the bill for out-of-network care the insurance company would accommodate.

The settlement amount has not been revealed but, according to general counsel for the Connecticut State Medical Society, Anthem will be upgrading their provider finder tool and will also provide a very small monetary reward to the medical societies involved.

"DOCTOR GROUPS SETTLE WITH ANTHEM OVER 'SHENANIGANS'" [LINK]

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November 30, 2015

Michigan Physicians Beware of Self-Prescribing & Prescribing for Family Members

Although there is no federal or state law barring physicians from providing health care services to themselves or their immediate family members including prescribing medication, there are limitations imposed by both applicable ethical rules and third party payor billing policies. For example, the American Medical Association ("AMA") has Ethics Opinion 8.19 which provides, in pertinent part, that: "physicians generally should not treat themselves or members of their immediate families" since their "professional objectivity may be compromised" and they may fail to: "probe sensitive areas when taking the medical history" or "perform intimate parts of a physical examination." AMA Ethics Opinion 8.19 does indicate that self-treatment or immediate family treatment may be appropriate in emergency circumstances or isolated settings where there is no other available qualified physician, however, it warns that controlled substance prescribing for themselves or immediate family members should only be done in emergencies. Michigan physicians should be aware that a violation of the AMA Ethics Opinion 8.19 could give rise to an administrative action against the physician's medical license under MCL 333.16221(b)(vi) which authorizes such action for lack of good moral character as evidenced by violation of the ethics opinion. It should also be noted that many third party payors have policies that bar claims for reimbursement for services rendered by physicians to themselves or their immediate family members. For examples, Blue Cross Blue Shield of Michigan does not cover services that health care providers render to themselves or any first-degree relatives, including parents, siblings, spouse and children. This bar covers not only controlled substances but all care services and does not provide for any exceptions. Thus, in the rare event that a Michigan physician does provide self-treatment or immediate family treatment, he or she should document the treatment using a S.O.A.P. format and indicate the emergency reason (which is required if prescribing a controlled substance) and/or isolated circumstances (if not prescribing a controlled substance). Moreover, in either case, the physician should not bill a third party payor for his/her services unless such payor allows such claims (which is unlikely).

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November 23, 2015

Providers Likely To Face Higher Penalties For Fraud and Regulatory Violations

On November 2, 2015 the President signed The Bipartisan Budget Act of 2015, requiring that civil monetary penalties must be raised to account for inflation, followed by an annual review for further increases. Providers accused of False Claims Act (FCA) violations are likely to see an increase as high as 40% over the current penalty ranging from $5,500 to $11,000. Higher penalties may add up quickly in FCA cases, which generally involve hundreds of alleged tainted claims.

This could potentially have a negative impact on providers that have earmarked monies for quality of care improvement efforts who must now spend the money on paying higher penalties. The threat of higher penalties might also influence a provider's decision to settle FCA cases due to the risk of astronomical penalties that may be imposed.

Budget Deal Raises Stakes for False Claims, Civil Monetary Penalties [link]

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November 20, 2015

Per Alabama Court The Government Must Show More Than Difference of Opinion to Prove Falsity in False Claims Act (FCA) Action

After a ten week trial, a federal court in Alabama has granted a hospice care provider, Aseracare Inc.'s motion for a new trial in a False Claims Act (FCA) case. The Government alleged that this hospice care provider knowingly submitted false claims to Medicare for patients who were not terminally ill and thus did not qualify for hospice benefits. However, the Alabama federal court determined that there was reversible error in the jury instructions that left out that the FCA requires proof of an objective falsehood and that a minor difference in opinion is not enough to show falsity. At this time, the court is considering summary judgment given that the government maintains its only evidence for proving falsity is expert testimony and medical records of the patients at issue.

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November 12, 2015

NPDB Revamps its FAQs

Recently, the National Practitioner Data Bank (NPDB) website revised both the content and appearance of its Frequently Asked Questions (FAQs) pages in order to provide more insight and better guidance to its users based upon its call center statistics and other customer feedback. The revised questions and answers are now organized into new categories by audience: Health Care Professionals, Organizations, and Other Topics. There is also a FAQ search bar that allows the user to type in a keyword to search for a topic. See: http://www.npdb.hrsa.gov/faqs/faqs.jsp

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November 9, 2015

Investigations Mounting Against Widespread Pharmacy Fraud Claims to Military Health Program

The Wall Street Journal has reported that Federal prosecutors are investigating widespread fraud, in at least four states, by compounding pharmacies in claims submitted to TRICARE--the health-insurance program that insures over 9 million U.S. military members (active, guard/reserve and retired) and their families. Some of the allegations include: false billings, physicians writing prescriptions despite not meeting the beneficiaries in person, and improper kickbacks being received in exchange for referring business to a government agency.

"U.S. Targets Pharmacies Over Soaring Claims to Military Health Program" [link]

The major increase in spending on compounded drugs is believed to be the primary reason behind a $1.3 billion deficiency in the military's health-care budget earlier this year. As a result, funds had to be redirected from other programs to compensate for the shortage and Prosecutors are considering and pursuing civil and criminal charges against the pharmacies, physicians and drug marketers.

This action by Federal prosecutors is yet another example of the increased enforcement by federal authorities against the pharmaceutical industry seen in the last six months.

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November 4, 2015

Congress Considering Additional Legislation to Help Curb Medicare Prescription Drug Abuse

It was just released that Congress is contemplating whether Medicare will be able to restrict at-risk drug abuse beneficiaries to a limited number of pharmacies and providers when they seek narcotics. Currently, Medicaid and the Veterans Affairs (VA) are able to impose these restrictions, but Medicare is not.

If successful, this action will help prevent opioid abuse by averting doctor shopping and encouraging physicians and insurers to aid patients battling drug abuse.

"Congress Looks to Curb Medicare Prescription Drug Abuse"

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November 3, 2015

The U.S. Department of Health and Human Services Office of Inspector General has released their Work Plan for Fiscal Year 2016

The United States Department of Health and Human Services Office of Inspector General ("HHS-OIG") has released its Work Plan for Fiscal Year 2016. This plan summarizes new and continuing areas of review and activities that HHS-OIG plans to pursue as well as describing its primary objectives. The newest additions to the work plan are:

• Medical device credits for replaced medical devices
• Medicare payments during Medicare Severity Diagnosis Related Groups (MS-DRG) payment window
• Content Management System (CMS) validation of hospital-submitted quality reporting data
• Skilled nursing facility prospective payment system requirements
• Orthotic braces-reasonableness of Medicare payments compared to amounts paid by other payers
• Osteogenesis stimulators-lump-sum purchase versus rental
• Orthotic braces-supplier compliance with payment requirements
• Increased billing for ventilators
• Ambulatory surgical centers-quality oversight
• Physicians-referring/ordering Medicare services and supplies
• Anesthesia services-non covered services
• Physician home visits-reasonableness of services
• Prolonged (E & M) services-reasonableness of services
• Histocompatibility laboratories-supplier compliance with payment requirements
• Accountable Care Organizations: Strategies and Promising Practices
• Medicare payments for unlawfully present beneficiaries in the United States-mandated review
• Medicare payments for incarcerated beneficiaries-mandated review
• Content Management System (CMS) management of ICD-10 implementation
• Medicare Advantage organization practices in Puerto Rico
• Medicare Part D beneficiaries' exposure to inappropriate drug pairs
• Medicare Part D Eligibility Verification transactions
• Part D Pharmacy Enrollment
• Increase in prices for brand-name drugs under Part D
• Specialty drug pricing and reimbursement in Medicaid
• Express Lane Eligibility
• State agency verification of deficiency corrections
• Medical loss ratio-recoveries of MCO rebates from profit-limiting arrangements
• Review of States' methodologies for assigning Managed Care organization payments to different Medicaid FMAPs
• Managed long-term-care reimbursements
• Center for Disease Control (CDC)-oversight of the Select Agent Program
• Controls over networked medical devices at hospitals
• Food and Drug Administration (FDA)-tobacco establishment compliance with the Family Smoking Prevention and Tobacco Control Act
• Health Resources and Services Administration (HRSA)-compliance with Maternal, Infant, and Early Childhood Home Visiting (MIECHV) Requirements
• IHS-change card program review
• NIH-controls over subcontracting of NIH grant and contract work
• Controls over the preparation and receipt of select agent shipments
• Review of Office for Human Research Protections compliance evaluations to ensure human subject protection
• Foster Care-States' protocols for the use and monitoring of psychotropic medications for children in foster care
• States' implementation of guardian ad litem requirements
• Consumer Operated and Oriented Plan Loan Program-CO-OP compliance with requirements and CMS monitoring activities
• Allowability of contract expenditures
• Rollup of State-based marketplace eligibility determination audits and Content Management System (CMS) oversight
• Health Resources and Services Administration (HRSA)-compliance with Maternal, Infant, and Early Childhood Home Visiting (MIECHV) requirements

The U.S. Department of Health and Human Services Office of Inspector General has released their Work Plan for Fiscal Year 2016

The HHS-OIG expects significant recoveries in audit receivables, investigative receivables and non-HHS investigative receivables resulting from their Work Plan, as well as tremendous savings in legislative, regulatory, and/or administrative actions.

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November 2, 2015

Significant Changes to Stark Regulations Finalized in 2016 Medicare Physician Fee Schedule

In July, we blogged about the major Stark Law provisions in the 2016 Proposed Medicare Physician Fee Schedule (the "Proposed Rule"). On October 29, 2015, the Centers for Medicare & Medicaid Services ("CMS") released the final 2016 Medicare Physician Fee Schedule (the "Final Rule") (available here), with few changes between the proposed rule and final rule as it related to the Stark provisions. The Final Rule will be published in the Federal Register on November 5, 2015. These are the first major changes to the Physician Self-Referral Rule (Stark Law) since 2009.

CMS stated that the Stark Law updates are meant to accommodate health care delivery/payment system reform, reduce burdens, facilitate compliance, clarify certain applications of the Stark Law, and issue new Stark exceptions. Below is a brief summary of the provisions adopted in the Final Rule:

(a) CMS adopted the proposed Stark exception for recruitment assistance and retention payments from hospitals, federally-qualified health centers (FQHCs), and rural hospital clinics (RHCs) to physicians to assist with employing non-physician practitioners (NPPs) in their geographical area. The only change from the Proposed Rule is the addition of a definition for the geographical area serviced by the FQHCs and RHCs, which is:

The "geographic area served" by a federally qualified health center or a rural health clinic is the area composed of the lowest number of contiguous or noncontiguous zip codes from which the federally qualified health center or rural health clinic draws at least 90 percent of its patients, as determined on an encounter basis. The geographic area served by the federally qualified health center or rural health clinic may include one or more zip codes from which the federally qualified health center or rural health clinic draws no patients, provided that such zip codes are entirely surrounded by zip codes in the geographic area described above from which the federally qualified health center or rural health clinic draws at least 90 percent of its patients.

(b) CMS standardized the various terms used for the principle of "takes into account" referrals (e.g., variations include "based on" or "without regard to"). CMS settled on standardizing the language to "takes into account" the volume or value of referrals.

(c) CMS clarified that the regulations in 42 CFR 411.357(t) regarding retention payments in underserved areas is correct. The Final Rule clarifies that the retention payment must not exceed the lesser of an amount equal to 25 percent of the physician's current annual income averaged over the previous 24 months.

(d) CMS clarified that the Stark exception requiring that a lease arrangement be set out in writing does not require a single formal contract, but a collection of documents may satisfy the "writing" requirement. CMS did so by replacing the term "agreement" with the term "lease arrangement" throughout the regulation.

(e) CMS extended the "holdover" lease arrangement provision from six months to indefinitely (as opposed to a definite, but longer than six-month period as contemplated in the Proposed Rule). The new holdover lease language is applicable so long as the lease arrangement met the conditions of the exception prior to its expiration, the holdover is on the same terms and conditions as the immediately preceding arrangement, and that the holdover continues to satisfy the requirements of the exception.

(f) CMS revised the language of the exception to the definition of "remuneration" for items/devices/supplies that are used solely for one or more of the six purposes (i.e., collection, transportation, processing, storing, ordering, or communicating the specimen/results). The revision clarifies that the item can be used for more than one of the six purposes, so long as it is used solely for one or more of those purposes.

(g) CMS adopted the language in the Proposed Rule with regard to the clarification that employees or independent contractors do not "stand in the shoes" of their physician organization's arrangements "unless they voluntarily stand in the shoes of the physician organization as permitted under 42 CFR 411.354(c)(1)(iii) or (c)(2)(iv)(B).

(h) CMS expanded the exception for ownership of publicly traded securities with the language from the Proposed Rule to include protection for "trading on an electronic stock market or over-the-counter quotation system in which quotations are published on a daily basis and trades are standardized and publicly transparent."

(i) CMS added a new exception for timeshare lease arrangements between a physician and a hospital or unrelated physician organization for the use of premises, equipment, personnel, items, supplies, or services if certain conditions are met. The exception does not apply to advanced imaging, radiation therapy, or clinical/pathology laboratory equipment (other than equipment used to perform CLIA-waived laboratory testing).

(j) CMS added language to clarify that the physician-owned hospital disclosure requirements are not met by posting the ownership interest disclosure on a social media website, electronic patient payment portal, electronic patient care portal, or an electronic health information exchange.

Continue reading "Significant Changes to Stark Regulations Finalized in 2016 Medicare Physician Fee Schedule" »

October 27, 2015

U.S. Government's Plan to Hold Individuals Accountable for Corporate Wrongdoing

A top priority of the Department of Justice (DOJ) is battling corporate fraud and now the focus is on holding the individuals who carry out the wrongdoing accountable. The DOJ released a memorandum this month setting forth six key steps that should be taken by federal law enforcement agents in any investigation of corporate misconduct: (1) to be qualified for any cooperation credit, corporations must provide the Department all applicable facts about the individuals involved in the corporate misconduct; (2) criminal and civil corporate investigations should target individuals from the commencement of the investigation; (3) routine communication must be present between criminal and civil attorneys handling corporate investigations; (4) no corporate resolution will provide protection from criminal or civil accountability for any individual, unless it is an out of the ordinary circumstance; (5) before resolution of corporate cases, a plan to resolve similar individual cases must be memorialized; and (6) civil attorneys should focus on individuals as well as the company and determine if suit should be filed against the individual wrongdoer(s) based on considerations above that wrongdoer's ability to pay.

"U.S. Department of Justice's Plan for Individual Accountability for Corporate Wrongdoing"

As a result of these changes, healthcare corporations are likely to see a rise in the number of individual prosecutions. Healthcare corporations are well advised to seek the early assistance of learned, experienced healthcare legal counsel when first contacted by any agents regarding federal inquiries or federal payor audits (e.g., Medicare or Medicaid audits) to limit individual criminal or civil liability.

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October 23, 2015

President Obama Announces New Steps to Fight Opioid Abuse Epidemic

On October 21, 2015, President Obama announced new initiatives to fight the nation's opioid abuse epidemic. The President discussed several plans for doing so, such as: expanding access to drug treatment, increasing the number of physicians who can prescribe a drug used to treat opiate addiction, doubling the number of providers that can prescribe a drug to reverse the effects of an opioid overdose, and directing the Centers for Disease Control and Prevention to invest $8.5 million in opioid addiction prevention.

Continue reading "PRESIDENT OBAMA ANNOUNCES NEW STEPS TO FIGHT OPIOID ABUSE EPIDEMIC"

In Michigan and New York, prescription drug abuse has become a high priority for law enforcement officials including enforcement actions directly targeting physicians, dentists and other prescribers as well as dispensers such as pharmacies and pharmacists. Such health care providers are well advised to take appropriate care to prevent the abuse and misuse of controlled substances and to maintain proper documentation of the medical necessity and legitimacy of such prescriptions.

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October 21, 2015

Recent Increase in NCI ZPIC Audit Activity


In the last few weeks, we have seen a flurry of activity in Zone Program Integrity Contractor ("ZPIC") audits for the Centers of Medicare and Medicaid Services ("CMS"). Recently, many providers - and home health agencies, in particular - have received ZPIC audit notifications from NCI, Inc. ("NCI") In April 2015, CMS awarded NCI the ZPIC contract for Zone 3, which covers Illinois, Indiana, Kentucky, Michigan, Minnesota, Ohio and Wisconsin. NCI is charged with performing program integrity investigations, making coverage and coding determinations, implementing administrative actions, coordinating fraud and abuse mitigation activities, developing a list of entities requiring monitoring, and assisting in the investigation and prosecution of fraud and abuse cases.
Home health agencies are under major scrutiny, and it appears that NCI has turned its attention to combating fraud and abuse in the home health arena. Any providers and suppliers who have received a ZPIC audit notification should contact an experienced healthcare attorney to assist you with the process. The Health Law Partners are experienced in working with providers and suppliers through the ZPIC audit process. For more information, please contact Adrienne Dresevic, Esq., at adresevic@thehlp.com or (248) 996-8510.