Michigan Health Law Link : Michigan Health Care Lawyer & Attorney : Smith Haughey Rice & Roegge Law Firm : Ann Arbor, Grand Rapids, Traverse City

On July 28, 2011, Michigan submitted an application to the Department of Health and Human Services (HHS) requesting a waiver of the Affordable Care Act's (ACA) medical loss ratio requirements for its individual health insurance.

Many insurance companies spend a portion of consumers' premiums on administrative costs and profits, including executive salaries, overhead, and marketing. Under the ACA, consumers will receive more value for their premiums. New regulations require health insurers to spend 80% (individual and small group revenue) to 85% (large group revenue) of premiums on direct care for patients and efforts to improve care quality. This percentage is called the medical loss ratio (MLR). Starting in 2012, insurers who come short of the MLR must provide a rebate to their customers under the ACA.

To compensate for transitional difficulties, the ACA allows the Secretary of Heath and Human Services to adjust the MLR standard for a State "if it is determined that meeting the 80 percent medical loss ratio standard may destabilize the individual market and . . . result in fewer choices for consumers." On July 28, 2011, Michigan submitted an application to HHS, requesting an adjustment to the MLR standard. The request may be found here.

Michigan's application requests a phase-in of the MLR requirements between now and January 1, 2014 where the MLR for 2011 would be 65%, followed by 70% for 2012, and 75% for 2013. Michigan's request stated that without this adjustment to its MLR requirements, "fourteen (14) companies would be scheduled to issue rebates totaling $30.6 million, with eight (8) paying rebates in excess of their after tax profit for 2010." This could lead such insurance companies to stop offering health insurance in Michigan. Currently, "the market is dominated by one insurer, Blue Cross Blue Shield of Michigan, [who] already operates at an MLR [of 93%]." Thus, the loss of competitors could substantially reduce a consumer's choice of where to purchase health insurance. In addition to Michigan's request, U.S. House Representatives Dave Camp and Fred Upton have together submitted a letter to HHS in support of Michigan's adjustment.

According to the HHS website, Michigan's application is under review for completeness. Upon a finding by HHS that the application is complete, public comment will be invited regarding Michigan's request for ten days.

Smith Haughey Rice & Roegge will continue to monitor the progress of Michigan's request to adjust federally mandated MLR requirements.

Summer Associate Peter Afendoulis assisted in the writing of this entry.

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A new published health law opinion from the Michigan Court of Appeals could have some far reaching effects on HIPAA litigation.

In the case of Isidore Steiner, DPM, PC v Marc Bonanni, Dr. Bonanni was employed by Isadore Steiner, DPM, PC and his contract included a non-competition and non-solicitation provision.  After Dr. Bonanni left his employment with them, Isidore Steiner, DPM, PC sued him for allegedly violating the non-solicitation provision of the contract and stealing their patients.  In order to prove their allegations, Isidore Steiner, DPM, PC sought Dr. Bonanni's patient list during the discovery portion of the case. 

The Michigan Court of Appeals found that the patient list was not discoverable as it was privileged under Michigan law. The Michigan Court of Appeals held on April 7, 2011 that Michigan law protects the very fact of the physician-patient relationship from disclosure, absent patient consent; this means that the name, address, and contact information is protected from disclosure in litigation. The Court found that HIPAA (which would have allowed for disclosure) does not preempt state law on this matter because state law is more stringent.

Generally, HIPAA requires patient consent for the disclosure of protected health information, just as Michigan state law does. In litigation, however, HIPAA has special provisions that allow for the disclosure of protected health information in response to a subpoena or court order if the provider receives adequate assurances that notice was provided to the patient or that reasonable efforts were made to secure a QPO. However, Michigan law does not have such an exception and requires the patient's consent to reveal private patient information. Thus, it would seem that non-solicitation provisions in employment contracts may potentially lose some of their weight unless a violation can be proven without reference to patient information. If an ex-employee violates this contractual provision, the employer does not have access to the ex-employee's patient list to prove its allegations of violation of the employment contract under this latest Michigan Court of Appeals ruling.

Click here to read the entire opinion.

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A new Drug Enforcement Agency (DEA) rule could substantially impact the way prescriptions for controlled substances can be transmitted from a physician to a pharmacy. As physicians and pharmacies seek to cut costs and maximize efficiency, electronic record keeping and prescription filing has become more commonplace. In response, the DEA has relaxed previous restrictions on electronically filing controlled substance prescriptions. However, recognizing the high risks posed by abusing or forging controlled substance prescriptions, the DEA has created a system of requirements which must be met before a physician is able to take advantage of the new rule.

The DEA defines controlled substances as drugs and other substances that have a potential for abuse and psychological and physical dependence; these include opioids, stimulants, depressants, hallucinogens, anabolic steroids, and drugs that are immediate precursors of these classes of substances. Once classified as a controlled substance, drugs are then broken down into one of five categories depending on the potential for abuse and risk of dependance. Today, controlled substances account for between 11% and 12% of prescriptions written in the United States.

Under the previous rule, physicians were prohibited from electronically sending prescriptions for schedule II-V controlled substances to pharmacies. However, under the current rule, which was published March 31, 2010 in the Federal Register, physicians who meet certain requirements will be permitted to e-file those prescriptions beginning June 1, 2010. To be eligible to e-file controlled substance prescriptions, physicians must meet two of three factors. The “two-factor authentication protocol,” which seek to guard against fraudulent prescription filings by confirming the prescribers true identity includes:

1. A password or PIN number,
2. biometric data- either a fingerprint or iris scan, or 
3. a “hard token”- a secured device separate from a computer that can provide a password to a physician at the time of e-filing.

To be eligible to e-file controlled substance prescriptions, physicians must validate their identity with a designated agency. When applying for the proper credentials to utilize e-filing programs, physicians must supply verifiable information such as government issued identification or financial account information.

Currently, Michigan laws vaguely address the current state of e-filing prescriptions for controlled substances. MCL 333.7333(7) states that physicians may electronically transmit prescriptions as long as they do not conflict with federal law. The law does not differentiate between controlled substance and non-controlled substance prescriptions. As a result, we may see future clarification from the Michigan legislature or the Board of Pharmacy regarding this issue. Importantly, physicians and pharmacies that currently possess the technology to e-file prescriptions must ensure that their systems comply with the new DEA “two-factor authentication protocol” requirements for controlled substances. Licensed physicians who cannot afford to implement the required technology or simply wish to opt out of the program are still able to produce physical prescriptions which can be presented at a pharmacy.

Smith Haughey Rice & Roegge will continue to monitor developments in this area and distribute updated information as it becomes available.

Summer clerk Brian Shekell contributed to this post.
 

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On May 26, 2010, CMS officials finally clarified one of the outstanding issues for insured health care providers relative to the mandatory reporting requirements contained in Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007. Section 111 imposes an affirmative duty on certain “reporting entities” to make reports to the Centers for Medicare & Medicaid Services (CMS) of personal injury claims settled with Medicare beneficiaries.

For some time now, insured health care providers have been in a holding pattern as they wait for promised guidance from CMS as to whether a common practice by some health care providers to offer something of value to a patient as a risk management tool triggers a Section 111 reporting obligation. Typically, in these instances, a Medicare beneficiary does not retain legal counsel, does not come in making a demand for anything per se, but will have a complaint. And occasionally a provider will attempt to resolve the complaint with the Medicare beneficiary by, for instance, giving him/her a gift certificate for the hospital cafeteria.

CMS had previously indicated that it considers at least some write-offs of charges and other offers of items of value to Medicare beneficiaries to be a form of “self-insurance” that may trigger Section 111 reporting obligations. CMS' recent Alert, which addresses risk management write-offs, clarifies that reductions in the amount due on a medical bill and other efforts at offering something of value, constitutes self-insurance for the purpose of the Medicare Secondary Payer provisions. CMS notes, however, that the specific factual scenario will determine whether reporting under Section 111 is required. According to the Alert:

• No Report Required. In instances where the entity is a physician, provider or supplier and has reduced its charges or written-off a portion of the charge to a Medicare beneficiary as a risk management tool, the provider, physician or other supplier is expected to submit a claim to CMS reflecting the unreduced permissible (e.g., limiting charge) charges and showing the amount of the reduction provided or write-off as a payment from liability insurance (including self-insurance). CMS indicates that its interests are protected through this billing procedure and no Section 111 reporting is required.

• Reporting Required. In instances where a provider, physician, or other supplier has provided property of value to a Medicare beneficiary as a risk management tool when there is evidence, or a reasonable expectation, that the individual has sought or may seek medical treatment as a consequence of the underlying incident giving rise to the risk, the entity shall report the write-off or value of the property provided as a TPOC from liability insurance (including self-insurance). Significantly, CMS states in the Alert that if the value of the property provided is less than the TPOC reporting threshold, it need not be reported under Section 111.

With respect to the first instance, providers, physicians and other suppliers should assess internal practices to determine whether claims submitted to CMS reflect the unreduced permissible charge and also show the amount of the reduction provided or write-off. Per CMS’ Alert, deductions or discounted services must be reflected in the provider's original billing and are therefore not subject to reporting.

In instances where a provider, physician or other supplier provides property of value to a beneficiary, the critical inquiry in evaluating whether a report will be required concerns whether there is a “reasonable expectation the individual has sought or may seek medical treatment as a consequence of the underlying incident giving rise to the risk.” Providers should take to care to develop plans to internally document the basis for this conclusion.

Finally, CMS officials also disclosed that they plan to issue an updated Version 4.0 of the User Guide in July 2010.

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On May 16, 2010, the Centers for Medicare and Medicaid Services (CMS) issued Transmittal 327 which revises the signature requirements for medical review activities of Medicare claim review contractors. Transmittal 327 has an effective date of March 1, 2010 and an implementation date of April 16, 2010, but the changes are effective retroactively to the November 2010 report period for comprehensive error testing. The transmittal updates Chapter 3, Section 3.4.1.1 of the Medicare Program Integrity Manual to require that services provided or ordered for medical review purposes are authenticated by the author. The previous version of this section only required authentication by a legible identifier. Specifically, Transmittal 327 amends Section 3.4.1.1 to:

1. Expressly state that stamp signatures are not acceptable. The transmittal clarifies that the method of authentication for services provided or ordered for medical review purposes must be by handwritten or electronic signature.
2. Add a new exception for clinical diagnostic tests when a treating physician, who authenticates medical documentation by handwritten or electronic signature, indicates that he or she intended the clinical diagnostic test be performed. The amended section suggests that such medical documentation could be in the form of a progress note.
3. Provide that if handwritten signatures are illegible, reviewers should consider evidence in a signature log or attestation statement to determine the identity of the author.
4. Finally, when providers fail to meet handwritten signature requirements of Section 3.4.1.1, reviewers should contact providers to inquire as to whether they want to submit an attestation statement or signature log within 20 calendar days.

Interestingly, Transmittal 327 appears to reconcile with similar regulations concerning signatures and authentication of orders, which are contained in the Medicare Conditions of Participation at 42 CFR 482.24(c)(1), by expressly indicating that other regulations and CMS instructions take precedence over signature guidelines set forth in Section 3.4.1.1. Thus, only when the relevant regulations, national or local coverage determinations, and CMS manuals lack specific signature requirements and/or guidelines to determine legibility or presence of signatures for medical review purposes, should Section 3.4.1.1 requirements be followed.

Therefore, based on the new information from CMS in Transmittal 327, acceptable methods for handwritten signatures are:

• a legible full signature;
• a legible first initial and last name
• an illegible signature accompanied by signature log or attestation statement;
• initials over a printed or typed name; and
• initials accompanied by a signature log or attestation statement.

On the other hand, unacceptable signature methods are as follows:

• Rubber stamp signatures, except for clinical diagnostic tests when a treating physician who authenticates medical documentation by handwritten or electronic signature, indicates that he or she intended the clinical diagnostic test be performed;
• illegible signatures with no additional documentation to identify the signature;
• initials with no additional documentation identifying them;
• an unsigned note; and
• a note with the statement “signature on file.”

Smith Haughey Rice & Roegge will continue to monitor developments in this area and distribute updated information as it becomes available.

Summer clerk Charissa Huang contributed to this post.

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For over a year now, the health care team at Smith Haughey Rice & Roegge has been busy assisting insurers and third-party administrators as they develop plans and procedures to comply with Section 111 of the Medicare, Medicaid, SCHIP Extension Act (MMSEA). On February 25, 2010 CMS posted new information on its Web site informing liability insurers, workers’ compensation insurers and self-insured entities (defined as “NGHPs”) that reporting of live claim input files is moved from the original deadline of April 1, 2010 to January 1, 2011. The immediate impact of this change is that entities subject to the reporting requirements now have additional time to register and test their processes for reporting claims to CMS. Additionally, CMS indicates that in February they will publish the next version of the “NGHP Section 111 User Guide” and alerts related to particular policy issues.

By way of background, Section 111 of the MMSEA amended the Medicare Secondary Payer Statute to impose mandatory data reporting requirements on liability insurers, no-fault insurers and workers’ compensation insurers. MMSEA Section 111 now places an affirmative obligation on insurers to: (a) determine if a claimant is entitled to Medicare; and (b) notify CMS of said entitlement and report specific information regarding the claim directly to CMS.

MMSEA builds off of a separate federal statute called the Medicare Secondary Payer (MSP) Statute. Under the MSP Statute, Medicare is designated as the secondary payer for Medicare beneficiaries who also have group health plan (GHP) coverage, as well as for Medicare beneficiaries who receive settlements, judgments, awards or other payment from liability insurance (including self-insurance), no-fault insurance, or workers’ compensation (non-group health plans or NGHPs). The purpose of the Section 111 mandatory reporting requirement is to notify CMS of instances when Medicare beneficiaries receive payments that relieve CMS of its obligation to cover medical costs.

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On August 24th, 2009 we finally saw the publication of interim final regulations implementing the security breach notification provisions of the Health Information Technology for Economic and Clinical Health Act ("HITECH").

While the regulations appear to parallel the statutory provisions of HITECH, the process covered entities must follow before notifying a patient of certain breaches of their protected health information (PHI) is not as strict as initially feared. For instance, under the new regulations, covered entities will still engage in a very subjective and fact specific risk assessment before determining when to notify a patient of a breach. The regulations also provide guidance to covered entities and their business associates (BAs) relative to their mutual obligations under the new rules.

Summarized below are some key points and issues we perceive to be relevant to covered entities and business associates under the new regulations.

The breach rules only apply to “unsecured” PHI.

Unsecured PHI is defined as PHI that has not been secured through the use of a technology or methodology specified by HHS. According to HHS guidance released in April 2009, encryption and destruction are the only two ways to secure PHI and avoid breach notification under the Act.  

Click here for a link to HHS’ April 2009 “Guidance Specifying the Technologies and Methodologies That Render Protected Health Information Unusable, Unreadable, or Indecipherable to Unauthorized Individuals for Purposes of the Breach Notification Requirements”.

Fact specific risk assessment.

The Regulations define a "breach" as the acquisition, access, use, or disclosure of PHI in a manner not permitted under the Privacy Rule that "compromises the security or privacy" of the PHI." A use or disclosure compromises privacy or security only if it creates "a significant risk harm to the individual as a result of the impermissible use or disclosure." The regulations identify a number of factors covered entities or business associates may consider during this assessment, including:

1. who impermissibly used or to whom the information was impermissibly disclosed;
2. steps taken to mitigate an impermissible use or disclosure (i.e. lost or stolen laptop is returned and forensic analysis reveals that its information was not opened, altered, transferred or otherwise compromised);
3. the type and amount of PHI involved.

In the event a notification is deemed necessary based on the facts all notification to individuals and HHS and must be given without “unreasonable delay,” but no later than 60 days after discovery.”

Exceptions to Breach Rule.

There are also key exceptions relative to the breach rule in situations where there is:

1. an unintentional acquisition, access or use of PHI;
2. inadvertent disclosure; or
3. disclosure of PHI to person not reasonably able to retain such information.

Business Associates.

Under the new regulations, BAs must comply with the privacy and security regulations, just like covered entities. BAs must have policies and procedures documenting compliance with the privacy rule’s use and disclosure provisions and the security rule’s administrative, physical and technical safeguards requirements.

An interesting issue is raised relative to when BAs acting as “agents” of a covered entity versus BAs acting as “independent contractors” and the breach notification time frames requirements under both scenarios. If a business associate is acting as an agent of a covered entity then the business associate’s discovery of the breach will be imputed to the covered entity. Accordingly, the covered entity will have to provide notifications to the patient and HHS based on the time the business associate discovers the breach, not from the time the business associate notifies the covered entity. Conversely, if the business associate is an independent contractor of the covered entity (i.e., not an agent), then the covered entity must provide notification based on the time the business associate notifies the covered entity of the breach.

Among other issues, BA agreements may need to be amended to:

1. clearly address the agent versus independent contractor status of the BA; and
2. the timing of BA notification to a covered entity following a breach.

Grace Period, Enforcement and Penalties.

Finally, the regulations account for a grace period allowance before HHS expects to begin enforcement. The regulations took effect on September 23, 2009, but HHS has delayed seeking sanctions until February 22, 2010.

The caveat to this allowance period, however, is that the regulations significantly broaden the enforcement and penalties associated with a violation. Under the new system, HHS will employ a tiered penalty system based on the mental state of the offender. Additionally, HHS has also delegated some of the enforcement mechanisms to state Attorney General offices. Effective February 18, 2009, the Michigan Attorney General can bring actions under HIPAA independently of HHS. Finally, the regulations allow for penalties to be shared with those harmed by the disclosure (though, we have not seen regulations or guidance from HHS on the definition of the “harm” necessary to share in penalties).

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In the face of Section 111 and the industry's effort to comply with same, some good news for a change!

On July 29, 2009, the Second Circuit ruled that the Medicare Secondary Payer Statue does not permit a private individual to file a qui tam action on behalf of the federal government.  In this case, the plaintiff tried to file suit against an insurance company alleging that the company had failed to meet its obligations to ensure that it, and not the Medicare program, paid for certain claims for medical care from its insureds or others it was obligated to cover.  See Woods v. Empire Health Choice, Inc.  No. 07-4208-cv (2d Cir. July 29, 2009).

While this is a great result for health care insurers and self-insured providers who have more than enough to worry about right now, it is also a good reminder of something to be mindful of as more and more individuals are becoming aware of the new lottery game that is the qui tam lawsuit.  For those outside the jurisdiction of the Second Circuit, remember that this decision is something to hope for but not binding on your federal courts.  Good faith efforts to comply with the MSP (and Section 111) reporting obligations is very important both in the context of your interaction with the Medicare program but also in your interaction with your employees and other individuals who may be watching and questioning your conduct and your commitment to do what is right. 

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I have read Section 111 and all of the guidance put out by the Centers for Medicare and Medicaid Services ("CMS"), listened to most of the the teleconferences sponsored by CMS on the subject and had the opportunity to talk to different clients and stakeholders about the new requirements and what they are hearing from various consultants and legal advisers about the new reporting requirements.  And, what I have concluded from all of this reading, listening and talking is the following:

• There are lots of attorneys and consultants out there scaring and confusing hospitals and hospital insurers about Section 111 and what CMS is going to do with this new reporting system;
• The Medicare Secondary Payer system and these new reporting requirements are a much greater burden for workers' comp and no fault carriers than other NGHP liability insurers (and I never appreciated that until recently);
• CMS keeps saying that this new reporting system is, for them, at least for now ... about collecting data and NOT about trying to find liability insurers who they can make "pay twice" for a Medicare beneficiary's medical expenses;
• As it relates to what goes on in health care, with respect to patient complaints and disputes and the settlement of those disputes, there is A LOT that CMS is still trying to understand and figure out so, there is A LOT we don't know yet about what does and does not have to be reported;
• If you are a self-insured hospital ... if you are "first dollar" self-insured ... unless your excess carrier is telling you that they will act as your reporting agent, it is probably a good idea to register with CMS some time over the next month or two and test your system so that you can report if you have to;
• CMS has said on numerous occasions that you don't have to register if you don't think you will have anything to report so, for now, if you are an insured hospital that doesn't expect to "settle" a dispute with a Medicare beneficiary outside of your insurance policy, for more than $5,000, you can relax a bit ... let's wait and see what CMS does;
• If you are an insured hospital and you have a "deductible" your insurer can and probably will work with you to establish a system so that you don't have to report anything ... talk to them and if they say there is nothing they can do ... might be time to shop for insurance; 
• CMS is still learning and thinking about health care providers and the little patient related settlements you enter into from time to time with your patients when they are unhappy ... they understand that they don't need to know about all of those, despite the way the current guidance reads and there will likely be better guidance in the future to carve some of that out of the reporting requirements; and
• CMS is not, in this particular instance, looking for the "gotcha" moments ... i.e. this is not about CMS looking for opportunities to slap $1,000 per day fines on insurers and self-insured providers.  If you make a good faith effort to understand what you have to report and if you try to report correctly, you will get a chance to learn how to do it right.

Bottom line, if you are a liability insurer or a TPA for a self-insured health care provider, you have to register and you should get working on that right away ... developing the appropriate procedures and working through the IT issues will take time so don't delay.  If you are a self-insured hospital or other health care provider, you have two options: (1) register and set up the internal systems to begin reporting, or (2) hire a Section 111 reporting agent (a new cottage industry ... part of the federal stimulus plan!!!).  If you are an insured health care provider, take a breath and sit tight, there is more to come on what if anything you might have to report and since the registration deadline has been extended to September 1 and you don't have to report any settlements that occur before January 1, 2010, lets just wait and see what CMS does.   CMS may clarify some of the confusion over the next few months and things might not be so bad after all.

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On Wednesday, May 21st, the OIG posted a new Advisory Opinion, 09-05 evaluating a poposed on-call compensation arrangement between a hospital and the specialists on its medical staff.   The Hospital proposed an arrangements where members of its medical staff who agreed to provide on-call coverage to the Hospital's emergency department on a schedule established by the Hospital would be compensated on a per encounter basis for encounters with those patients who came to the Hospital ED who were otherwise indigent and uninsured.

What makes this Advisory Opinion interesting is not the Hospital's proposed methodof paying the on-call physicians although it is creative and will be something I will propose to clients who struggle with how to do this.  Its not the fact the OIG felt that any on-call compensation arrangement would pass muster under an Anti-Kickback analysis, OIG has recognized that such arrangements can be necessary and appropriate in certain circumstances.  

It is the fact that the OIG seems to have given up on the idea of trying requiring that such arrangements be limited to areas where there are physician/specialist shortages.  OIG acknowledges that, "on-call coverage compensation potentially creates considerable risk that physicians may demand such compensatiion a s a condition of doing business at a hospital, even when neither the services provided nor any external market factor (e.g., a physician shortage) support such compensation."  But, despite this acknowledgement, OIG required nothing in the proposed on-call compensation arrangement to ensure that this was not a situation where the physician specialists were merely holding the Hospital hostage.

As a result,  we need to expect that more and more and more physician specialists will now demand that their hospitals pay them to take call coverage in the ED and will point to this Advisory Opinion as the basis for asserting that there are no compliance justifications or market force elements that might exist in the particular hospital's market to justify a hospital's refusal to make those payments.   At a time when more and more hospitals are operating at a net loss and without any extra income to cover such expenses, hospitals will be increasingly asked by physicians to find the money somewhere. 

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The Federal Trade Commission ("FTC") announced yesterday that it will delay enforcement of the Red Flag Rules until August 1, 2009 (enforcement was scheduled to begin today).  The Red Flag Rules require creditors and financial institutions with covered accounts to implement programs to identify, detect and respond to patterns, practices, or specific activities that would indicate identity theft.  The definition of "creditor" includes any entity that regularly extends or renews credit and all entities that regularly permit deferred payments for goods or services.  This definition also includes professionals, such as physicians and lawyers, who provide services and bill later. 

There is also some good news for entities that have a low risk of identity theft - the FTC will soon release a template to help them comply with the Red Flag Rules.  This is in response to feedback from low risk entities that they were having difficulty determining how to tailor the Rules to fit their businesses. 

Although this is the second time the FTC has delayed enforcement of the Red Flag Rules, the November 1, 2008 deadline by which creditors should have been in compliance has always remained the same. 

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Do EMTALA’s requirements extend beyond the emergency department? Does a hospital’s obligations under EMTALA end when a patient presenting to the emergency department is admitted to the hospital as an inpatient? Until this week, most health law experts would have answered “yes” to both of these questions. But in the recent case of Moses v. Providence Hospital, the 6th Circuit Court of Appeals says “no” and, in doing so, adds quite a bit of ambiguity to EMTALA compliance efforts.

EMTALA’s (Emergency Medical Treatment and Active Labor Act) is a federal statute that imposes specific obligations on Medicare-participating hospitals that offer emergency services to provide a medical screening examination (MSE) when a request is made for examination or treatment for an emergency medical condition (EMC), including active labor, regardless of an individual’s ability to pay. Hospitals are then required to provide stabilizing treatment for patients with EMCs. If a hospital is unable to stabilize a patient within its capability, or if the patient requests a transfer, an appropriate transfer should be implemented.

In Moses, the plaintiff was the estate of Marie Moses Irons, whose husband was taken to the emergency department of Providence Hospital with various physical symptoms such as high blood pressure and severe headaches, as well as slurred speech, disorientation, hallucinations and delusions. He had also demonstrated threatening behavior towards his wife. The patient was evaluated by hospital staff and admitted as an inpatient for further testing and treatment. After approximately six days, the patient was deemed stable and discharged. Ten days later, the patient murdered his wife.

The first issue considered by the Court was whether a non-patient has standing to sue under EMTALA. The Court found that the plain language of the statute (namely that “any individual” who suffers harm due to a hospital’s violation of EMTALA may bring suit) clearly allowed for standing by a non-patient. This holding is troubling because it is contrary to the legislative history of the statute and the intent of the statute as a whole.

Also troubling is the Court’s decision that a hospital’s obligations under EMTALA does not end upon inpatient admission of the patient. The Court, by ignoring CMS guidance on this issue stating that admitting an individual as an inpatient satisfies the hospital’s EMTALA’s obligations, held that a hospital’s decision to admit a patient for further testing does not satisfy EMTALA’s requirement that the hospital treat the patient so as to stabilize him. The Court disregarded the CMS guidance as “contrary to EMTALA’s plain language” and as not having any retroactive effect on this case since the patient’s stay ended prior to the regulation’s creation. The Court held that EMTALA forbids a patient’s release unless his condition is stabilized to the point where no further deterioration of the condition is likely. Therefore, because EMTALA requires a hospital to treat the patient to stabilize the condition, simply admitting a patient is not enough. As the Court stated, EMTALA “requires more than the admission and further testing of a patient; it requires that actual care, or treatment, be provided as well.”

The lower court in Moses, like many courts in other circuits, found that EMTALA is not intended to be a federal malpractice statute and that under EMTALA, a court should only be concerned with whether the patient was diagnosed with an emergency medical condition and whether he was discharged when he was not stable. EMTALA does not guarantee that a hospital will correctly diagnose a patient’s condition. Interpreting EMTALA to require stabilization treatment after diagnosis of an EMC and during an inpatient admission raises questions not answered by Congress such as when the duty to treat terminates, for how long treatment must be provided and when a temporal delay in treatment constitutes a violation of the duty to provide stabilization treatment. To require this would make EMTALA a malpractice statute. The lower court believed that issues about how well a patient is treated are dealt with under state malpractice law, not EMTALA.

Given these prior EMTALA holdings, it is difficult to understand how the 6th Circuit could have gotten it so wrong. One explanation is that the Court’s decision is less “wrong” than it is poorly drafted. In reading the opinion, it seems that the Court had serious doubts as to whether the hospital and the physicians really discharged the patient because they thought he was stable or because his insurance had denied coverage for the care he might have required. Questions of fact on these issues would have justified denying the hospital’s motion for summary disposition. Unfortunately, instead of directly challenging the veracity of the hospital’s position, the Court published an opinion which leaves hospitals and future courts in this jurisdiction with a terribly confusing opinion and considerable risk when treating the next patient admitted through the emergency department who is determined stable for discharge. The Court could have reached such a conclusion without disregarding CMS regulations and without taking a position contrary to all other circuits.

Unless and until Moses is overturned or reconsidered, the lessons to be learned might come down to these:

• Clearly document whether the patient is found to have an emergency medical condition.
• Clearly document when the patient is found to be “stable” and what clinical observations led to that conclusion.
• Where recommendations for treatment are made and ultimately not followed, document the reasons why the recommendations were not followed.
• Where inconsistencies exist in a medical record regarding a patient’s stability for discharge or need for further inpatient services, resolve those inconsistencies BEFORE discharging the patient.
• In the 6th Circuit… don’t take anything for granted!

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The deadline by which health care providers must have their FTC Red Flag Rules compliance program in place is fast approaching. Although the deadline for compliance was November 1, 2008, the FTC postponed enforcement of the Red Flag Rules until May 1, 2009.  Health care providers, along with financial institutions and other creditors, must be in compliance with the FTC’s Red Flag Rules by then.  As we explained in a posting in October 2008, health care providers who periodically allow patients to pay for medical services over time through a series of payments should have written policies that identify the “red flags” or indicators of possible identity theft they may come across in the course of business, establish procedures to detect those red flags and to respond appropriately to mitigate and prevent harm, and develop procedures for training staff and keeping applicable policies current.  Health care providers should also have procedures in place to ensure that their vendors are in compliance with the Red Flag Rules. This could mean amending existing business associate agreements or asking for copies of the vendors’ Red Flag policies.

For those health care providers who are still unsure about what the Red Flag Rules mean, the FTC has issued a “How-to Guide” that gives an easy-to-understand overview of the Rules.

In addition, a sample Red Flag Policy for health care providers developed by the American Hospital Association can be found here. Your compliance counsel should also be able to assist with developing a Red Flag Rules compliance program.
 

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I just spent three days at a national conference in Baltimore, MD where all things Medicare and Medicaid were discussed.  There is no way to give sufficient detail in a blog post to all that we discussed and all that there is to think about and attend to following this conference but, let me share just a few of the highlights...

The Anti-Markup rule continues to be on the minds of attorneys advising health care providers.  If you work with physicians who bill globally for diagnostic tests that they order, the time is now to make sure that those diagnostic services are being billed appropriately by the physician.  Particularly as it relates to the professional interpretations of those services, the options for physicians are very limited.  More importantly, what was okay last year may not be now so just because it was an arrangement previously blessed, doesn't me that it still is ... time to check.  On the technical component side, remember that the technical component of a diagnostic test is performed where the patient is AND where the supervising physician is while the test is being done.  And, remember that if you don't get this right, you can be left without the ability to bill anything.

Lots of people paying attention to "patient status"... i.e. inpatient, outpatient and observation status.   The coordination of medical staff and hospital bylaws, hospital policies, and physician documentation to get the patient slotted into the correct status seems to have many health care institutions and their attorneys on edge.  Certain the RACs don't help with the stress here.  Pay attention to Condition Code 44 for a patient that you are moving from inpatient to outpatient status.  Apparently, there are a lot of hospitals and providers that may not realize that this change needs to be made BEFORE the patient leaves the hospital if you are going to bill the maximum amount. 

Since I mentioned them, on the subject of RACs, it appears that the "good news" may be that providers will likely see coding audits start before the medical necessity audits.  In addition, it appears that health care providers will get some notice as the RACs expand their medical necessity scope.  CMS has indicated that before RACs can expand the scope of their medical necessity audits to review new "issues", they must get approval from CMS and CMS intends to post those new issues on its Web site if the RACs are granted authority to audit those issues.  On the less good news side of things, physicians should expect to get a fair amount of attention in this round of RAC audits.  CMS has indicated that the RACs will be doing crossover audits of physicians when they find hospital admissions that seem to raise concern.   Condition Code 44 came up in this discussion as well.  Clearly there is a sense that hospitals have not been handling the use of this code correctly.  Finally, CMS has indicated that RACs will have authority to review the use of "present on admission" codes as part of their coding reviews.

But, as usually, the most interesting discussions, at least for me, focused on Stark and the latest word on the DFRR.  The conference began with the buzz about the OIG Open Letter indicating that the voluntary disclosure protocol is no longer available for the disclosure of violations that involve only the Stark law and not the Anti-Kickback statute.   There was much debate about whether this new OIG position suggest that the OIG is overwhelmed by disclosures of potential Stark violations (suggesting that perhaps its too easy for a health care provider to find itself cross ways with Stark) or whether it suggests that OIG intends to more aggressively go after Stark violations and no longer wants providers to seek the safe haven of the voluntary disclosure protocol to take away their opportunity.   I will admit that I tend to be more of a skeptic as to OIG's intentions the more that I think about the DFRR.

The latest word on the DFRR is still that no one knows for sure if or when hospitals that are going to get the DFRR questionnaire will get it.  The expectation is that of the 400 that may go out, approximately 290 of those will go to all of the hospitals that got the original voluntary survey request in 2006 and failed to respond.  That means that if you were not one of those hospitals, your chances are slim that you will get a questionnaire ... at least in this first round.  Still, if you don't feel particularly lucky or just want to continue to move forward in getting a handle on some of your Stark compliance stuff, here are some good suggestions that came out of these discussions: 

• query your accounts payable, check ledgers, and accounts receivable department for a list of ALL financial arrangements involving a physician;
• look for all leases for equipment and space that involve physicians;
• get a complete handle on your non-monetary compensation tracking and your medical staff incidental benefits;
• gather all of the documentation you can find for all of these;
• check them all for compliance with at least one Stark exception;
• for any possible non-compliance, determine whether you are in a "period of disallowance"; and
• before you even think of responding to a DFRR request, if you get one, check with legal counsel.  Because of the details of the questionnaire, how you respond is very important.

Obviously, this is just a small window into what was three solid days of all that is Medicare.  There is certainly more to come on this topic, particularly given that the season of CMS proposed payment rule is just about to begin.

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On January 16, 2009, The Center for Medicaid and State Operations ("CMSO") issued a directive to all State Medicaid Directors to begin requiring Medicaid providers to ensure that individuals who are providing services to Medicaid beneficiaries are not excluded from participation in the Medicare or Medicaid program. 

Normally, health care providers cross-check the HHS-OIG excluded provider list on a regular basis (usually annually or on a rotating annual basis, where a provider's staff is very large).   The OIG has required such excluded provider checks as part of an effective compliance program for many years.  But now, with this new letter from CMSO, the burden for such checks has been ratcheted up. 

Until this letter issued last month,  the burden for identifying excluded individuals who provide services in the Medicaid program was left with the States.  Now, the States have placed the burden squarely on providers.  Specifically, CMSO has directed States that they should advise all current providers to screen all employees and contractors to determine whether any of them have been excluded.  States are suppose to require providers to "search the HHS-OIG website monthly to capture exclusions and reinstatements that have occurred since the last search."  As always, providers need to immediately report to the State any exclusion information that is discovered. 

Obviously, the big issue is whether OIG, CMSO and the States really expect every Medicaid provider to check ALL employees and contractors against the excluded provider list every month or whether providers can continue to check the list in a reasonable fashion given the size of its organization.  I do know that some Michigan Medicaid providers, including community mental health agencies, are asking their contract hospitals to confirm that they are checking all employees on a monthly basis. 

Providers who do not already check all employees and contractors against the excluded provider list, on a monthly basis, would do well to check with the Michigan Medicaid program to confirm whether the State intends to enforce such an unrealistic expectation on Medicaid providers who are already overly burdened by the Medicaid program, without adequate compensation.  Certainly this is just another argument physicians will us to determine not to participate in the Medicaid program.

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Health care providers may no longer seek payment directly from sexual assault survivors for any portion of the costs of a sexual assault medical forensic examination, including any insurance deductible, co-pay, denial of claim or other out-of-pocket expenses, if the survivors do not have insurance, or if they refuse to have the claim submitted to their insurance carrier. Instead, effective December 29, 2008, health care providers are eligible to seek reimbursement for these costs directly from the state Crime Victims Services Commission (formerly the Crime Victims Compensation Board).

Prior to seeking reimbursement from the Crime Victims Services Commission, health care providers must advise the patient, either orally or in writing, that a claim will not be submitted to their insurance carrier without their express written consent and that they may decline to consent if they believe that submitting the claim would substantially interfere with their personal privacy or safety. If the patient declines to have the claim submitted to his or her insurance carrier or if the patient is uninsured, the provider may then seek reimbursement from the Crime Victims Services Commission. The provider may not bill the patient directly.

If the patient consents to have the claim submitted to his or her insurance carrier, the health care provider must submit the claim to the patient’s insurance carrier, including Medicare or Medicaid. If reimbursement cannot be obtained from the patient’s insurance carrier, the health care provider may then submit the claim for reimbursement to the Crime Victims Services Commission. If reimbursed by the patient’s insurance carrier for any portion of the claim, the health care provider may not also seek reimbursement from the Crime Victims Services Commission or the patient for the balance of the claim.

In order to be eligible for reimbursement, the examination must include all of the following: collection of a medical history, a general medical examination, a detailed oral, anal, or genital examination, and administration of a sexual assault evidence kit and related medical procedures and laboratory and pharmacological services.

The Crime Victims Services Commission will not pay more than $600 for the cost of performing a sexual assault medical forensic examination. This includes payments up to $400 for the use of an emergency room, clinic, or examination room and the sexual assault medical forensic examination, up to $125 for laboratory services, and up to $75 for dispensing pharmaceutical items related to the sexual assault.

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The Departments of Education and Health and Human Services have issued joint guidance on how the Family Educational Rights and Privacy Act (FERPA) and the Health Insurance Portability and Accountability Act of 1996 (HIPAA) apply to student health records. The guidance also addresses certain disclosures that are allowed without consent or authorization under both laws, especially those related to health and safety emergency situations.

FERPA is a federal law that generally prohibits an institution from disclosing the education records or personally identifiable information from education records, without a parent or eligible student’s written consent. An eligible student is one who is over 18 years of age or who attends a post-secondary institution at any age. FERPA applies to institutions that receive funds pursuant to any program administered by the U.S. Department of Education, including medical and other professional schools. Please note that if an institution receives funds in this manner, FERPA applies to the recipient as a whole, including all its components, such as a department within a university.

“Education records” are broadly defined to include records that are directly related to a student and that are maintained by an educational institution or by a party acting for the institution. At the elementary and secondary levels, this can include student health records. In post-secondary institutions, medical and psychological treatment records of eligible students are excluded from the definition of “education records” if they are made, maintained, and used only in connection with treatment of the student and disclosed only to individuals providing the treatment. If the disclose is for purposes other than treatment, the records are then subject to FERPA’s requirements and can only be disclosed with the student’s written consent or under one of several enumerated exceptions to written consent.

HIPAA requires covered entities (health plans, health care clearinghouses and health care providers) to implement appropriate safeguards to protect the privacy of patients’ identifiable health information and to set limits and conditions on the uses and disclosures that may be made of such information without patient authorization. HIPAA also gives patients rights over their health information, including rights to examine and obtain a copy of their health records, and to request corrections.

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Since November 4, 2008, when voters in Michigan approved the new Michigan Medical Marihuana Act (the "MMMA"), many of our clients have been wondering what the implications of the MMMA are for them.  What follows is a summary for health care providers of what they should understand about the MMMA. 

Quick facts for health care providers about the MMMA:

1.  Qualified patients are allowed to use up to 2.5 grams of medical marihuana to treat certain debilitating and chronic diseases, including but not limited to cancer, glaucoma, HIV, AIDS, hepatitis C, and Crohn’s disease, without risk of prosecution. Patients are also allowed to cultivate up to 12 marihuana plants for their use.

2.  To obtain a registry identification card, patients and their caregivers (if the patient requires assistance with using medical marihuana) must provide the Michigan Department of Community Health with a signed written certification from a physician identifying the patient’s debilitating condition and stating that, in the physician’s professional opinion, the patient is likely to receive therapeutic or palliative benefit from the medical use of marihuana.

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CMS has submitted its 2009 Physician Fee Schedule Final Rule to the Officer of the Federal Register for publication and the document should be published some time in November.  As is usually the case, CMS has loaded the Physician Fee Schedule Final Rule with lots of interesting information.  In addition to an updated list of the CPT codes that constitute "designated health services" under the Stark Law, and a re-opening of the comment period for the proposed Stark exceptions on gain sharing arrangements, this Final Rule contains a set of newly revised Anti-Markup Rules relative to the reassignment of billing for diagnostic testing services.

Originally, 42 CFR 414.50 contained a rule that prohibited a physician, who intended to bill for the technical component (TC) of a diagnostic test that was performed by someone other than the physician,  from "marking up" the charge for the TC component of the diagnostic test above the actual cost of the test.  In other words, if a physician wanted to purchase certain TCs of diagnostic tests from a hospital and then bill globally for the test (billing the hospital's TC and his own professional interpretation (PC) of the same test) the physician was prohibited from billing more for the TC of the test than what the hospital charged the physician to perform the test.  This rule was generally known as the "Anti-Markup Rule."

In 2008, CMS revised the Anti-Markup Rule so that if a physician or other supplier bills for the TC or PC of a diagnostic test that was ordered by the physician or other supplier (or ordered by someone related to that physician or supplier through common ownership or control) and if the diagnostic test is either purchased from an outside supplier (such as a hospital) or performed at a site other than the office of the billing physician or supplier, the payment to the billing physician or supplier for the TC or PC of that diagnostic test cannot exceed the lowest of : 

1. the performing supplier's net charge to the physician;
2. the billing physician or supplier's actual charge; or 
3. the fee schedule amount for the test that would be allowed if billed by the performing supplier directly.

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It never ceases to amaze me the number of varying directions from which hospitals and health care providers get regulated! 

The most recent federal agency to jump on the health care regulation bandwagon appears to be the Federal Trade Commission (FTC).  On November 9, 2007, the FTC, in conjunction with federal bank regulators, issued a set of regulations intended to combat identity theft.  These regulations are commonly referred to as the "Red Flag Rules."  The Red Flag Rules require financial institutions and other "creditors" to implement a program designed to detect, prevent and mitigate identity theft in connection with the creation and maintenance of "covered accounts."

Many hospitals and health care providers began to pay attention to these regulations a few months ago when word started to "eek out" that the Red Flag Rules might apply to hospitals and other health care providers. While the application of these rules to any specific transaction will depend upon the specifics of the transaction at issue, what does seem pretty clear at this point is that if you are affiliated with a health care provider that periodically allows patients to pay for their medical services through a series of payments, over time, that health care provider is likely a "creditor" and needs to comply with the Red Flag Rules.  Health care providers should, with very limited exception, expect to comply with the Red Flag Rules as of November 1, 2008.

Compliance with the Red Flag Rules is, in many ways, tied to your HIPAA compliance program and the policies and procedures health care providers already have in place.  Similar to the HIPAA Security and Privacy  Regulations, the Red Flag Rules deal with access to information in patient medical records and billing account records and the extent to which those records may be accessed and used to commit identity fraud.

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Last week, the Office of Inspector General (OIG) published its "Work Plan" for federal fiscal year 2009.   Many health care providers use the annual OIG Work Plan as a road map to guide their annual compliance efforts and this has always been a strategy that I have supported.  Although I usually suggest that compliance officers and the health care providers they represent look not just at the current year's Work Plan but the past two or three years Work Plans, collectively,  I think it is very important for health care providers to be aware of what the OIG thinks it should pay attention to, in any particular year.  Its also noteworthy to understand how the OIG's focus changes from year to year and over time. 

Of particular note in this year's Work Plan is the continuation of some significant reviews and the initiation of others that are in areas where health care providers often struggle.  They include OIG's review of:

• Provider-Based Status for Inpatient and Outpatient Facilities
• Hospital Owned Physician Practices Billed as Outpatient Services
• Provider Bad Debt Allocations
• Medicare Secondary Payer Compliance
• Diagnostic X-rays Performed in Hospital Emergency Departments
• EMTALA Compliance
• Never Events
• Physician Services Performed by Non-Physicians
• Medicare Payments for Sleep Services
• Services Performed by Clinical Social Workers
• Outpatient Physical Therapy Provided by Independent Therapists
• Payments for Colonoscopy Services

Given some of the questions that I have received from clients in the past six months, I see EMTALA Compliance and Medicare Payments for Sleep Studies as particularly interesting and suggestive of the fact that OIG and CMS think that providers are not doing things correctly in these areas. 

Your compliance committee should take the time to review the new OIG Work Plan and modify its compliance focus accordingly.

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DHS entities need to move quickly to take inventory of their existing financial arrangements to determine or confirm that all appropriate financial arrangements are in writing and fully executed by the parties. They must then evaluate the nature of the compensation under any space or equipment leases which may involve referring physicians, to ensure that the compensation is not on a percentage or per click basis. If those agreements do determine compensation in that manner, then they must be renegotiated as quickly as possible. Finally, DHS entities need to begin to budget and allocate appropriate resources in the event that they are one of the 500 institutions to receive a DFRR request. DHS entities will have only 60 days to respond to a DFRR request if received.

On August 1, 2008, the Center for Medicare and Medicaid Services ("CMS") issued its most recent revisions to the Stark law regulations. Changes were published in the Federal Register on August 19th as part of the FY 2009 Inpatient Prospective Payment System. Many of the changes made by CMS were previewed in language proposed in CMS’s proposed physician fee schedule for 2008 published last fall. Those not previewed at that time were previewed this year in the FY 2009 Proposed IPPS Rule.

There are several topics of particular interest for physicians and DHS entities in these revised regulations. They include:

• Clarifications and limitations regarding the ability of physicians and DHS entities to carry out their perspective obligations under a negotiated financial arrangement in the absence of a fully executed written agreement, where the execution of a written agreement is a required element of the relied upon Stark exception;
   
• The elimination of percentage based compensation in all lease agreements for space and/or equipment;
   
• The elimination of the per click compensation methodology in all lease agreements for either space or equipment; 
   
• Expand the definition of DHS entity to include those who perform DHS; 
   
• A decision by CMS to move forward with its DFRR financial transaction reporting program.

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Hospitals periodically develop anxiety over the use of signature stamps by medical staff members.  Many institutions have gone so far as to say "no" to any and all signature stamps.  Others have limited use of signature stamps so that only the physician him or herself can use the stamp and, frankly, if the physician is the only one who can use the stamp ... "What is the point?"

Well, based upon CMS Transmittal 248, issued early in the spring, it would appear that there is no point in having signature stamps for physicians because they are not acceptable and will not be given any credit if CMS audits for signed orders or other medical record documentation where a physician signature is required.

What is perhaps even more troubling about the language in this Transmittal is not that CMS appears to be putting an end to the usefulness of the signature stamp,  but that CMS has cleared the way for auditors to deny claims based solely on the type or lack of physician signature.  This is true even if all other aspects of the documentation support the medical necessity and appropriate delivery of the service. 

So, at this point, hospitals should be sending out alerts to their medical staff members, advising them that signature stamps are not allowed for use anywhere in the medical record.  Outpatient diagnostic departments such as lab and radiology should be advised that orders for services that come with a stamped signature as the authorization for the service cannot be accepted.  Failure to take this approach could result in overpayment problems during an audit. 

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On August 26, 2008 the OIG issued Advisory Opinion No. 08-10, expressing significant concern for a proposed block lease arrangement between a physician group that operates a free-standing facility providing certain cancer treatment services, including intensity-modulated radiation therapy (IMRT) and a urology group that often treats patients who might benefit from receiving IMRT.

The proposed arrangement involved the urology group entering into a series of contracts that would create a "block lease" of the other physician group's IMRT facilities, including space, equipment, administrative and clinical personnel, and radiologist services to supervise the IMRT procedures.  In evaluating the arrangement under the federal anti-kickback statute, the OIG noted that the urology group would not actually participate in performing any component of the IMRT service and would contract out substantially all of the services, including all of the professional services. 

The OIG concluded that the proposed arrangement was designed to allow the group owning the IMRT facility to do, indirectly, what the anti-kickback statute is intended to prohibit it from doing directly ... "pay the urology group a share of the profits for their IMRT referrals."  The OIG concluded that by agreeing to a deal that gave the urology group the opportunity to retain the difference in reimbursement between what was paid for IMRT services provided to the urology group's patients and the rents and fees it would pay to purchase the services, the urology group would be receiving improper remuneration for referrals for IMRT services. 

For physician groups currently engaged in block lease arrangements, this Advisory Opinion should be reviewed carefully.  Counsel to such group may need to advise their clients that a renegotiation of existing arrangements is required in order to bring such financial arrangements squarely into compliance with the federal anti-kickback statute and avoid the risk of civil and criminal sanctions.

A copy of Advisory Opinion 08-10 can be found here. 

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When the physician self-referral statute (the Stark Law) was first enacted in 1989, it contained a financial relationship reporting requirement.  Although the initial regulations issued in 1991 contained information and details on that reporting requirement (42 CFR 411.361), CMS never initiated or implemented the requirement .... until now.

CMS first began to hint at its intention to begin to ask for disclosure of information on hospital/physician financial relationships in 2007 and, in its FY 2009 IPPS proposed rule suggested that it planned to send a formal information collection instrument known as the "Disclosure of Financial Relationships Report" (DFRR) to 500 hospitals (both acute care and specialty hospitals).   CMS suggests that the purpose for collecting this information is to: (1) identify arrangements that potentially may not be in compliance with the Stark Law; and (2) identify practices that may assist CMS in future rule making regarding the Stark Law.

Although CMS originally estimated that the effort associated with providing it with the information required on the DFRR would be minimal, it now acknowledges that hospitals may need to work with accounting and legal advisers in order to complete the DFRR.  Still CMS has indicated in the final IPPS rule for FY 2009 that each hospital who receives a DFRR will have only 60 days to complete the Report.  In implementing this reporting requirement, CMS believes that the information it is requesting is that which a hospital should be keeping in the normal course of its business activities.  CMS also hopes that hospitals who receive the DFRR will elect to submit their responsive information electronically, but hospitals will be able to submit information, including supporting documentation in a paper copy.

Fortunately, at least for now, CMS has determined that the DFRR will be used only in a one-time collection effort ... at least for now.  A final PRA notices will be published in the Federal Register in the near future that will include a revised DFRR, including revised instructions for completion.  Following a 30 day comment period, CMS will then be in a position to begin formal distribution of the DFRR to a randomly selected group of 500 hospitals across the country. 

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On July 31, 2008, the Centers for Medicare and Medicaid Services (CMS) released its FY 2009 final rule for the Inpatient Prospective Payment System.   Included with in the manyy regulatory changes contained in this final rule are new provisions regarding the requirements of the Emergency Medical Treatment and Active Labor Act (EMTALA).  Among these are new rules for hospitals to develop "community on-call plans" as a means of meeting their on-call services obligations under EMTALA. 

The new rules allow for two or more hospitals to collaberate to develop a community on-call coverage plan that applies within a specific geographic area and divides the coverage of certain types of services between the participating hospitals at designated times.  Specifically, a formal community on-call plan among a group of hospitals needs to include:

1. A clear delineation of on-call responsibilities for each hospital participatingin the plan;
2. A description of the geographic area covered by the plan;
3. the signature of an appropriate representative ofeach participating hospital;
4. Assurances that local and/or regional EMS protocols include information on any such community on-call arrangements;
5. A statement  from each hospital participating in the plan affirming their respective obligations under EMTALA to perform medical screening and stabilizing treatment within its capacity, and to comply with EMTALA transfer and acceptance of transfer requirements; and
6. An annual assessment by the participating hospitals of the efficacy of the plan.

Hospitals subject to EMTALA who struggle to maintain adequate ER coverage of key specialty areas including orthopedic surgery, cardiology and neurology should review these new rules and evaluate the potential to work with neighboring health care institutions to take advantage of this new opportunity as a way to better serve their communities and ease the often unweilding burden on specialty staffing caused by the EMTALA requirements.

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