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Articles Posted in Health Law News

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In the FY 2015 IPPS/LTCH proposed rule (79 FR 28169) and final rule (79 FR 50146), CMS discussed and then implemented Section 2718(e) of the Public Health Service Act, which was enacted as part of the Affordable Care Act. The rule aimed to improve the transparency of hospital charges by requiring hospitals to either post standard charges online or to comply with patient requests for such information.

In April 2018, in response to consumer concern and surprise over out-of-network physician services at in-network hospitals, as well as the price of emergency department services, CMS further requested comment on a proposed rule that would require more transparency in hospital pricing. The new rule was officially finalized on August 2, 2018 and requires hospitals to make public a list of their standard charges via the Internet in a machine-readable format, which hospitals must update at least annually. CMS received positive feedback in April from providers and hospitals, and CMS commented in the final rule that this change aligns with American Hospital Association State Transparency Survey data indicating that 35 States already require hospitals to release pricing information for certain charges and that 7 States rely on voluntary disclosure of standard pricing data.

This final rule is a result of a push by the Trump Administration hoping to lower medical costs by encouraging price transparency among medical providers and improve public accessibility to information.  According to CMS Administrator Seema Verma, the Trump administration’s work in this area is just beginning. CMS and the Trump Administration is further encouraging individual states to tackle price transparency via legislation which would allow prospective patients to shop around for the best pricing for future medical services.

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Medicare officials are investigating pharmacies that sell compounding made-to-order gels, lotions, and creams for possible fraud and patient safety risks.  In general, made to order creams used in pain treatments can dramatically improve a patient’s quality of life, but HHS regulators are concerned for patient safety if these drugs are not properly monitored. For example, in 2012, a Massachusetts pharmacy failed to maintain sterile conditions and sold tainted made-to-order injections that killed 64 Americans.  Although State Boards usually regulate these compounded drugs, they are not considered FDA approved.

Medicare officials have identified several target pharmacies allegedly charging extremely high prices, selling large percentages of identical drugs, and that have substantially increased billing for these products.   Price hikes on compounded gels and creams, combined with an increase in dispensed prescriptions, has led to a rise in Medicare spending on pain creams from $13.2 million in 2010 to $323.5 million in 2016.  Regulators are beginning to take measures against pharmacies with suspicious billing patterns, especially in the cities of Detroit, Houston, Los Angeles and New York, all of which have high concentrations of red-flagged pharmacies.

The Health Law Partners frequently counsels compounding pharmacies at a national level on proactive and reactive strategies against fraud and abuse allegations.  For more information on this topic, please contact Adrienne Dresevic, Esq. or Clinton Mikel, Esq. at (248) 996 –8510 or by email at adresevic@thehlp.com or cmikel@thehlp.com.

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The National Guideline Clearinghouse (NGC) website, “guideline.gov,” compiles the latest information on medical treatment for use by healthcare organizations, physicians, bulk purchasers, educational institutions, and state and local governments, while also providing guidance on medications and procedures ranging from miniscule to critical. The NGC contains over 20 years of evidence-based clinical practices and medical guidelines, and was first created by the Agency for Healthcare Research and Quality (AHRQ) in partnership with the American Medical Association (AMA). AHRQ created the NGC to keep patients safe, develop and track changes to healthcare, and to help doctors and nurses improve the quality of patient care.

Although the database is accessed daily, the operating costs are about $1.2 million per year and with the Trump Administration looking to execute budget cuts, the Department of Health and Human Services (HHS) has decided to delete the database after July 16, 2018. AHRQ officially halted updates to the database and has stopped creating new guideline summaries as of July 2, 2018. AHRQ is receiving expressions of interest from stakeholders interested in carrying on NGC’s work. It is not clear, however, when or if NGC will be available again. AHRQ’s official announcement is available here: https://www.guideline.gov/home/announcements.

Not only is the future of the database uncertain, but so is the future of the AHRQ. The 2019 fiscal year budget proposed by President Donald Trump would transfer AHRQ’s duties to the National Institutes of Health (NIH), creating a new agency titled the National Institute for Research and Quality. It is unclear whether this new agency will relaunch the database, but at this point there appears to be no plans of another agency or organization taking over or continuing the operation of the NGC. The deletion of the NGC and the elimination of such a vast resource is a major loss to the medical community.

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July 2018 – On July 12, 2018, the Centers for Medicare & Medicaid Services (“CMS”) proposed rules aimed at fundamentally improving the nation’s healthcare system and restoring the doctor-patient relationship. The proposal is “one of the most significant reductions in provider burden undertaken by any administration,” according to CMS director Seema Verma. The new proposed rules include the promotion of digital health technology, expanded telemedicine coverage, new documentation requirements, and a newly developed focus on interoperability.

The proposed rules are promoting digital health technology by expanding telemedicine coverage. According to the new rules, CMS will start to pay physicians for virtual check-ins over the phone with their patients to see if the need to come in for an office visit and will also pay them for remote evaluation of images and videos taken by their patients. The intended purpose of this proposed rule is to ameliorate patient concerns in a convenient manner by reducing unnecessary cost to the system with needless office visits.

Moreover, the enactment of the proposed rules would overhaul the current documentation requirements. Instead of having a system with four kinds of documentation requirements, the proposed rules would create a system with one set of documentation requirements that would have four distinct code levels. The overhaul is estimated to save clinicians an estimated 51 hours per year if 40% of their patients are in Medicare. The idea is to have the clinicians documenting material that will capture the patient’s health data rather than spending time typing information to bill a certain level of code.

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March 2018 – Recent additions to the Medicare Shared Savings Program (“MSSP”), include several changes aimed to encourage Medicare beneficiaries to take a more proactive approach with their health care.

By way of background, on March 23, 2010, Section 3022 of the Affordable Care Act added section 1899 (42 U.S.C. § 1395jjj) to the Social Security Act, requiring that the U.S. Department of Health & Human Services (“DHHS”) establish the MSSP. The program provides for a new type of health care entity, an Accountable Care Organization (“ACO”), that is held accountable for the quality and experience of care for a population of assigned Medicare beneficiaries while reducing the rate of growth in health care spending for that population. Under the MSSP, an ACO’s quality and financial performance is assessed annually by the Center for Medicare and Medicaid Services (“CMS”) based on its assigned beneficiaries to determine whether the ACO has met the quality performance standards and reduced growth in expenditures compared to a historical financial benchmark. ACOs that meet or exceed a minimum savings rate and satisfy minimum quality performance standards are eligible to receive a portion of the shared savings generated which incentivizes ACOs to improve the coordination and quality of care. There are different tracks or programs, depending on the amount of risk an ACO wishes to assume.

On February 9, 2018, President Trump signed H.R. 1892, entitled the Bipartisan Budget Act of 2018, into law which, among other things, inserts 42 U.S.C. § 1395jjj(m) providing that certain ACOs (limited to ACOs in risk-bearing tracks) may apply to establish an ACO Beneficiary Incentive Program to provide incentive payments to beneficiaries who are furnished certain qualifying services by an ACO.

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In the world of litigation healthcare providers can potentially fall victim to the False Claims Act (“FCA”) when they file medical claims for reimbursement from either Medicaid or Medicare. FCA claims against hospitals and other healthcare related entities usually involve allegations that the healthcare provider knowingly or recklessly filed a false claim for payment from a federally funded government program. Under the FCA qui tam provisions, private citizens, known as “relators”, can file lawsuits where they have suffered no personal injury. Instead, these relators allege the federal government was defrauded and can obtain a substantial monetary reward if they are successful in recovering a judgement from the court.

A hotly contested issue in qui tam cases is whether the violation of the regulation alleged in the case is material to the government’s obligation to pay a healthcare claim. For instance, whenever a physician or supplier of medical services completes a form 1500, it certifies the claims were medically indicated and necessary and that any “false claims, statements, or documents, or concealment of a material fact, may be prosecuted under applicable Federal or State laws.” Historically, the issue in a lot of cases involving alleged false claims is whether the claim made by the healthcare provider is either a “condition of payment” or a “condition of participation” in the governmental program. If the alleged false claim only violated a condition of participation, as opposed to a condition of payment, then there could be no false claim in violation of the FCA. Courts reasoned that conditions of payment were central to the government’s decision to pay claims as opposed to a mere violation of a condition of participation that could be handled administratively by the enforcing governmental agency.

After the United States Supreme Court’s ruling in Universal Health Servs. v. United States ex rel. Escobar 136 S. Ct. 1989 (2016), the old condition of payment or condition of participation standards for materiality were largely abandoned. Instead, the Supreme Court, adopted a new “rigorous” materiality standard. Escobar, 136 S.Ct. at 2004 n.6. Although promulgated conditions of payment in statutes or regulations are relevant in attempting to establishing materiality, they are not “automatically dispositive.” Id. at 2003. Moreover, the Supreme Court held that “A misrepresentation cannot be deemed material merely because the Government designates compliance with a particular statutory, regulatory, or contractual requirement as a condition of payment. Nor is it sufficient for a finding of materiality that the Government would have the option to decline to pay if it knew of the defendant’s noncompliance.” Escobar, a relator is now faced with a steeper climb to show that the violation of a particular statute or regulation is material to the government’s decision to a pay the medical claim.

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In its recent Advisory Opinion No. 17-05, OIG stated that the Proposed Arrangement (“Arrangement”) would not violate the anti-kickback statute (“AKS”) nor would it prompt administrative sanctions under the Civil Monetary Penalties (“CMP”) provision of the Social Security Act, prohibiting inducements to beneficiaries.

The Proposed Arrangement discussed in the Opinion centers around a retail pharmacy chain offering a voluntary membership program to Federal healthcare program beneficiaries that includes discounts on certain prescriptions and clinic services.

OIG further noted that Program Members receiving discounts would also be eligible to earn rewards in the form of credits when certain merchandise in-store photo-finishing services were purchased. On its face, the Arrangement would appear to invoke prohibitions of the CMP and AKS, since the discounted items and services and earned credits could induce a beneficiary to select the retail pharmacy chain as his or her supplier for federally reimbursable items or services.

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Home Health Agencies will now have an additional 6 months to comply with a new CMS rule intended to advance the quality of patient care.

CMS published a final rule on July 10th delaying the effective date for its rule addressing conditions of participation for home health agencies. CMS has moved the effective date of the rule back 6 months from its original July 13, 2017 to January 13, 2018. This delay pushes back the implementation of regulations primarily focused on improving patient quality of care.

Under the new rule Home Health Agencies are directed to begin implementing data-driven performance improvement projects. These data-driven programs are concentrated on quality assessment programs targeting indicators related to improved outcomes for patients and other quality indicators across the home health spectrum of care. This quality program requirement is now set to phase-in on July 13, 2018 instead of January 13, 2018.

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The Health Law Partners (HLP) is proud to be part of the upcoming Physician Legal Issues Conference co-sponsored by the American Bar Association Health Law Section and Chicago Medical Society.  The conference will take place at the Intercontinental Hotel in Chicago on June 8-9, 2017.  Adrienne Dresevic, Esq., a founding partner of the HLP, is Co-Chairing the conference this year.  Abby Pendleton, Esq., a founding partner of the HLP, will be a featured speaker at the conference. Ms. Pendleton’s speech is titled, Your Practice is Being Audited: Complying, Fighting and Winning. Her session addresses key issues when facing an audit including: appeals processes and auditors’ concepts, considerations affecting the decision to appeal, successful strategies for appeals, and using the audit to enhance future compliance. Attend the conference to learn the latest on health reform, payor alignment, clinical integration, and other issues that impact the legal profession. Programming includes topics such as: Stark Law, Health Reform, Anti-Kickback, and more!

 

To the view the brochure with program details please click here.  To register for the conference please click here.

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Compliance programs are mandatory (pending final regulations) for all health care organizations post-Affordable Care Act. In some states, and for some provider/supplier types, compliance programs are already mandatory. In any event, compliance programs in health care organizations are crucial in today’s overregulated environment, with qui tam attorneys, whistleblowers, regulators, and payors seeking any potential excuse to recoup.

Compliance programs work as a set of internal controls that assist in preventing, detecting, and resolving illegal or unethical conduct/errors that may take place. In order to ensure compliance with all appropriate laws and regulations, radiology providers and suppliers should implement compliance programs that at a minimum meet all laws and regulations.

The elements of effective compliance programs are relatively straightforward and known. However, many organizations struggle to implement, execute, measure, and evaluate their compliance programs.

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