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Articles Posted in Health Law

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The Eliminating Kickbacks in Recovery Act of 2018 (“EKRA”) became effective October 24, 2018. ERKA makes it a criminal offense to knowingly and willfully offer, pay, solicit or receive any remuneration (i.e., anything of value), directly or indirectly, overtly or covertly, in cash or in kind, to induce a referral (or in exchange for a referral) to a lab, clinical treatment facility or recovery home.  Unlike the Federal Anti-Kickback Statue, ERKA applies to all payor sources.

Notably, the broad language of the ERKA permits the federal government to monitor arrangements intended to generate business for any laboratory, clinical treatment facility or recovery home for services payable by a federal health care program or commercial health insurers.  ERKA includes certain exceptions, as well as “preemption” language tied to the Federal Anti-Kickback Statute.

It is important that labs, clinical treatment facilities (i.e., a medical setting, other than a hospital, that provides detoxification, risk reduction, outpatient treatment and care, residential treatment, or rehabilitation for substance use, pursuant to licensure or certification under State law), and recovery homes, critically examine current compensation arrangements with employees and contractors, as certain types of payment arrangements will now be prohibited.

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The New York State Office of the Medicaid Inspector General (OMIG) maintains a Certification Program to ensure Medicaid providers are continuing proper compliance. This program works to eliminate any environment in a Medicaid provider’s system that may encourage fraud, waste, or abuse, as well as ensuring errors have the potential for self-correction if mistakes are located before the Medicaid program is billed. Providers who meet OMIG’s requirements must submit a certification at the time of enrollment and every December thereafter. This includes any Medicaid providers who have submitted $500,000 in Medicaid claims or those who may reach that goal in any consecutive 12-month time period, regardless of calendar year.

OMIG has identified seven compliance areas that must be covered by the Compliance Program:

  • Billings
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The practice of diagnosis and treatment of patients remotely by way of a telecommunications technology, also known as telemedicine, has gained popularity as companies who provide this type of healthcare have recently worked to make a name for themselves. Services such as CareClix, ConsultADoctor, and Teladoc are just a few of these providers who utilize telehealth as their primary healthcare service.

Telemedicine can be divided into two general categories: synchronous and asynchronous. Synchronous programs are those that occur in real-time, generally through a video conference or other similar means of communication between a patient and a medical provider. Asynchronous telemedicine, or “store and forward”, refers to the patient’s ability to gather all relevant information and communicate it to a medical provider over a delayed time period. The information is sent via secure email or other form of messaging service.

Beginning January 1, 2019 Medicare will be accepting certain medical services that fall under the classification of asynchronous telemedicine. The Centers for Medicare and Medicaid Services (CMS) published the final rule for the 2019 Physician Fee Schedule, which included a new code entitled “Remote Evaluation of Pre-Recorded Patient Information” (HCPCS code G2010). A list of the telehealth services that are currently covered by CMS can be found here.

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The results of the 2018 primary election have officially been tabulated and the impact that will be made on healthcare law is slowly becoming clear. The most notable healthcare development is in regards to the Affordable Care Act (ACA) that was enacted in March of 2010 under President Obama, the primary goal of which was to make reasonably priced health insurance available to more Americans than ever before. In recent months, Republicans have been working to repeal and replace the ACA but have thus far been unsuccessful. This most recent election has put that progress back even further. Now, 37 states including the District of Columbia have implemented or are working to implement the ACA’s Medicaid expansion which will increase the coverage of low-income adults who otherwise would not have access to healthcare. This recent growth in the number of states who have adopted the expansion plan may subsequently generate extra pressure for states who have not yet approved the plan.

Incoming Michigan Governor Gretchen Whitmer, who won over her Republican counterpart Bill Schuette, has made it known in the past that she supports the ACA. Whitmer has also recognized that premiums may be considered too high by many and understands something needs to be done to address the cost. In addition, the Michigan Health & Hospital Association (MHA) has plans to work closely with the Whitmer association transition team, ensuring that Michigan’s healthcare needs are fully addressed and that the results are in the public’s best interests. According to the MHA, issues that will be discussed include Healthy Michigan Plan work requirements and rural and behavioral health access, among other topics.

In New York, the departure of former long-time Chair of the Senate Health Committee turned key New York senator Kemp Hannon is causing speculations on whether New York’s political future will include more progressive attention to healthcare law. New York Governor Andrew Cuomo has already made it clear that passing both the Reproductive Health Act as well as the Comprehensive Contraception Coverage Act are going to be some of his first priorities. In addition, Senator Andrea Stewart-Cousins and Senator Gustavo Rivera have both made statements supporting a single-payer healthcare system under the New York Health Act.

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On November 1, 2018, the United States District Court for the District of Columbia issued a Memorandum Opinion, ordering the Medicare appeals backlog to be eliminated by FY 2022.

Specifically, the court ordered that the Department of Health and Human Services (HHS) achieve the following reductions from the current backlog of 426,594 pending appeals:

– 19 percent reduction by the end of FY 2019

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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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On Thursday, August 2, 2018, the Centers for Medicare & Medicaid Services (“CMS”) released its 2019 Inpatient Prospective Payment System and Long-Term Care Hospital Prospective Payment System Final Rule (the “2019 IPPS Final Rule”).[1]   With the goal to reduce unnecessary administrative burden on physicians and other qualified practitioners, the 2019 IPPS Final Rule revises the requirement that an inpatient hospital admission order be present in the medical record as a condition of Medicare payment.  Specifically, the 2019 IPPS Final Rule amends the regulations at 42 C.F.R. § 412.3(a) to remove the language stating that a physician order must be present in the medical record and be supported by the physician admission and progress notes in order for the hospital to be paid for the inpatient hospital services under Medicare Part A.  See p. 1390 et seq.

Significantly, CMS made no changes to the 2-midnight rule in its 2019 IPPS Final Rule.  Under the 2-midnight rule (codified at 42 C.F.R. § 412.3), an individual is considered an inpatient if formally admitted as an inpatient pursuant to an order for inpatient admission.  Unless an exception applies, an inpatient admission is generally appropriate for payment under Medicare Part A when the admitting physician expects the patient to require hospital care that crosses 2 midnights.  Therefore, although CMS removed the requirement for an inpatient hospital admission order to be present in the medical record as a condition of payment, an inpatient hospital admission order is still relevant and necessary.  The inpatient hospital admission order reflects the determination by the ordering physician or other qualified practitioner that inpatient hospital services are medically necessary, and it initiates the inpatient hospital admission for the purposes of 2-midnight rule compliance.

For more information, please contact Jessica L. Gustafson, Esq. or Abby Pendleton, Esq. at (248) 996-8510.

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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- Section 1877 of the Social Security Act, widely known as the physician self-referral law, prohibits a physician from making service referrals payable by Medicare to entities that they may have a financial relationship with. Section 50404 of the Bipartisan Budget Act (“BBA”) of 2018 added provisions to section 1877(h)(1) of the Social Security Act. The added section does not limit an applicable signature requirement to specific exceptions and entities are not restricted to the rule of only once every 3 years with the same referring physician. Moreover, the addition “does not include a reference to the occurrence of referrals or the payment of compensation during the 90 day-period when the signature requirement is not met.”

To be in accordance with the added provision to the Social Security Act, CMS proposed to delete §411.353(g), which is the special rule for certain arrangements involving temporary noncompliance with signature requirements, and instead codify in proposed §411.353(e). Alternatively, CMS has proposed to amend existing §411.353(g) by: “(1) revising the reference at §411.353(g)(1) to specific exceptions and signature requirements; (2) deleting the reference at §411.353(g)(2) to the occurrence of referrals or the payment of compensation during 90-day period when the signature requirement is not met; and (3) deleting the limitation at §411.353(g)(2).”

Public comments on the proposed rules are due by September 10,2018.

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