Health Law Informer

A home health agency has scored a second win in its fight to prevent CMS from withholding Medicare payments (to effectuate a recoupment of alleged overpayments), at least for the time being.  We previously reported on the home health agency’s first win before the Fifth Circuit (which reversed the Northern District of Texas’s jurisdictional dismissal of the lawsuit).  See Family Rehab., Inc. v. Azar, 886 F.3d 496 (5th Cir. 2018).  We now report on its second win: the Northern District of Texas’s decision, on remand, to grant the home health agency’s temporary restraining order (TRO) motion and to at least temporarily enjoin CMS from withholding further Medicare payments.  See Family Rehab., Inc. v. Azar, No. 3:17-CV-3008-K, 2018 BL 196462 (N.D. Tex. Jun. 4, 2018), TRO extended by Order of Jun. 18, 2018.

To recap, a Zone Program Integrity Contractor (ZPIC) in 2016 alleged that the Medicare program had overpaid a home health provider, Family Rehab, nearly $7.9 million.  Family Rehab asked for a redetermination from its Medicare Administrative Contractor (MAC).  The MAC, however, affirmed the ZPIC’s conclusion.  The provider then asked a Qualified Independent Contractor (QIC) to reconsider the decision.  The QIC slightly reduced the demand to over $7.6 million.  Since the MAC by regulation can begin recouping overpayments after the QIC issues its decision, the MAC then noticed its intention to begin recouping the alleged overpayment.  Family Rehab then requested an ALJ hearing. Continue reading…

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On June 1, 2018, New Jersey Governor Phil Murphy signed into law the Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act (the “Act”), available at: http://www.njleg.state.nj.us/bills/BillView.asp?BillNumber=A2039, which becomes effective on the 90^th day after enactment.

The Act enhances consumer protections related to surprise out-of-network healthcare charges, and affects health care facilities, health care professionals, and health insurance carriers. Requirements under the Act specific to facilities, professionals, and carriers are summarized below.

Health care facilities or carriers that violate any provision of the Act will be liable for not more than $1,000 for each violation, where each day on which a violation occurs is considered a separate violation, up to $25,000 per occurrence. Health care professionals who violate the Act will be liable for up to $100 per violation, where each day on which a violation occurs is considered a separate violation, up to $2,500 per occurrence. Other penalties may be initiated by the Commissioner of Banking and Insurance, the Commissioner of Health, or the relevant professional or licensing board, as appropriate, pursuant to rules that may be adopted under the Act.

The Act also creates an arbitration process to resolve out-of-network billing disputes, so healthcare providers should be prepared for the new, multi-step arbitration process that will be utilized in New Jersey. Continue reading…

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The Fifth Circuit has recently held that its courts have jurisdiction to hear a lawsuit seeking to enjoin Medicare from recouping funds until after a hearing because (1) the provider’s claim is collateral to the underlying recoupment and (2) the recoupment may result in the provider’s bankruptcy and in a disruption to its patients.

In 2016, a Zone Program Integrity Contractor (ZPIC) concluded that Medicare had overpaid Family Rehab (a home health provider) nearly $7.9 million.  Family Rehab asked for a redetermination from its Medicare Administrative Contractor (MAC); the MAC affirmed the ZPIC’s conclusion.  The provider then asked a Qualified Independent Contractor (QIC) to reconsider the decision.  The QIC slightly reduced the demand to over $7.6 million.  The MAC then noticed its intention to begin recouping the overpayment.  (The MAC can begin recouping overpayments after the QIC issues its decision.)  Family Rehab then requested an ALJ hearing.

Despite the statutory requirement for an ALJ to issue a decision within 90 days of a request for a hearing, the hearing is not projected to occur until at least 3 to 5 years from now.  Since the recoupments will continue during the delay, the provider faces the possibility of going bankrupt and terminating operations before it could even conclude the 4-part Medicare appeal process (which has been described by the court as Byzantine).  The recoupments would cut off nearly all of the provider’s revenue stream.  Faced with these issues, Family Rehab sued the Secretary of Health and Human Services (HHS) in federal court and sought a temporary restraining order and an injunction to prevent the recoupment of any overpayments until the conclusion of the administrative appeals process. Continue reading…

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The recent Medicare Payment Advisory Commission (“MedPAC” or “Commission”) report should serve as a shot across the bow to telehealth advocates seeking broader Medicare coverage of telehealth. In reading the telehealth chapter, it is clear to me that the MedPAC commissioners are not fully sold on telehealth because, among other reasons, they recommend that the Medicare program proceed cautiously before any expansion of the telehealth benefit. The report also makes certain conclusions that are sure to vex many in the telehealth community.

For those not familiar with MedPAC, it is an independent congressional agency that advises Congress on Medicare-related issues, and it is influential in lawmakers’ consideration of Medicare issues.  By way of quick background, the 21st Century Cures Act of 2016 required the Commission to provide information regarding: 1) the extent to which Medicare covers telehealth; 2) the extent to which commercial insurers cover telehealth; and 3) ways in which the telehealth coverage policies of commercial insurance plans may be incorporated into the Medicare program. This required the Commission to do a broad-reaching examination of the telehealth sector beyond Medicare.

As a preliminary matter, the Commission notes that in 2016, 108,000 beneficiaries accounted for approximately 300,000 telehealth visits totaling $27 million in reimbursement under the Medicare physician fee schedule. Most of the services were basic physician office and mental health services.  More interesting was the Commission’s observation that Medicare beneficiaries using telehealth tended to be under the age of 65, Medicare/Medicaid dual eligibles, and “to disproportionately have chronic mental health conditions.”

Continue reading…

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Bergen County Superior Court Judge Robert Contillo issued a recent decision deemed favorable by Horizon Healthcare Services Inc. (“Horizon”) in a case involving three healthcare providers (“Providers”) that challenged Horizon’s newer tiered health coverage plan for hospitals: OMNIA. The Providers alleged that Horizon unfairly designated them as Tier 2 Providers, a tier in which OMNIA Members access providers while incurring higher out-of-pocket costs than they would when accessing those providers in Tier 1. Although certain other claims may proceed, Judge Contillo dismissed the breach of contract claim because he determined that Horizon did not breach the network hospital agreements by “failing to include [the Providers] in Tier 1” because “[t]he plain and unambiguous language [under the agreement] does not guarantee that [the Providers] be included in Horizon’s new products, networks or subnetworks.”

This decision illustrates that tiered designation disputes between hospitals and payors may hinge on the language of the applicable network hospital agreements. Hospitals and other providers are encouraged to review their existing contracts and address this issue in future contracts to determine the level of discretion payors may have in including them in tiered and limited network products. As insurers continue to develop new products designed to lower costs, this will continue to be an important consideration for most providers.

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Each year, REACH Health publishes an industry benchmark survey that provides great insight into what telemedicine industry leaders are thinking.  Its most recently published survey is no different.  The 2018 survey was conducted among healthcare executives, physicians, and other professionals during December 2017 and January 2018.  Survey participants spanned the industry with almost half representing health systems and hospitals. Here are some takeaways from the survey:

• 70 percent of respondents view telemedicine as a top or high priority.
• About half are taking an enterprise approach to telemedicine, a significant increase from last year’s survey.
• A majority of organizations plan to increase or maintain investments in telemedicine.
• Improving patient outcomes and providing access to rural patients were the two top objectives for telemedicine programs cited by respondents.
• 60 percent view the designation of a full-time dedicated program manager as a key to success of a telemedicine program.
• Improved patient satisfaction was the most cited contributor to ROI, consistent with the past few surveys.
• Facility settings that require more specialized treatment tended to have more mature telemedicine programs. Related to that, certain specialties such as stroke, behavioral health, radiology, and neurology, have more mature telemedicine programs.
• Integrated audio/video for live engagement was the technology feature considered the most valuable to an organization with over 90 percent of respondents agreeing.

Continue reading…

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The Pennsylvania Department of Health (DOH) published the much anticipated final version of the temporary regulations under the Medical Marijuana Act applicable to Clinical Registrants and Academic Clinical Research Centers (ACRC) in Pennsylvania (“Temporary Regulations”). The Clinical Registrant/ACRC relationship was first developed in Pennsylvania with a specific focus on research.  A Clinical Registrant is a unique category of Medical Marijuana Organization under Pennsylvania law that is granted a permit to act as both a grower/processor and dispensary. An ACRC is “an accredited medical school” in Pennsylvania that “operates or partners with an acute care hospital licensed and operating” in Pennsylvania. The Temporary Regulations require Clinical Registrants and ACRCs to enter into Research Contracts together and provide some broad guidance about the content of those written agreements. Additionally, the Temporary Regulations address certification of ACRCs, capital requirements, approvals for clinical registrants, and the process for Clinical Registrant applicants who wish to convert their already issued grower/processor or dispensary permits to Clinical Registrant permits.

For more information about the Temporary Regulations or the Medical Marijuana Act, contact Chris Raphaely, J. Nicole Martin or another member of Cozen O’Connor’s Cannabis Industry Team.

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CMS outlined changes to the nursing home survey process in a October 2017 memo to state survey agency directors, which scaled down the use and severity of civil monetary penalties (CMPs) for certain nursing home deficiencies. Shortly thereafter, CMS released a November 2017 memo that among other things, outlined an 18-month moratorium on the imposition of CMPs, discretionary denials of payment for new admissions and discretionary termination by surveyors for survey deficiencies identified by the following eight  “F” tags: Continue reading…

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The sweeping Republican tax reform bill, H.R. 1 (115), was passed by Congress on Wednesday afternoon, and signed by President Trump today. Although the President said on Wednesday that, “ObamaCare has been repealed in this bill,” due to the bill’s elimination of the Individual Mandate, it remains to be seen whether this will truly strike the final blow to ObamaCare (the Affordable Care Act, or “ACA”) as envisioned by the President.

If the ACA manages to survive, it will not be for lack of trying on the Trump administration’s part. On top of the elimination of the Individual Mandate, the Trump administration has removed some subsidies, halved the insurance enrollment period, destroyed the Obamacare marketing campaign, and has permitted skimpy new health plans that will inflict even more damage on the ACA. All together, these add up to an incremental corrosion of the law.

However, although the ACA is weakened, it has so far survived the assault, even if in a diminished form. In fact, numerous polls have found that the ACA is increasingly popular with the American public. And several factors indicate that the ACA may be able to weather the storm. Continue reading…

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In the recently published fall update of the fifth annual edition of its telehealth report, the Center for Connected Health Policy, the federally designated National Telehealth Policy Resource Center, provides a current summary guide to telehealth-related laws, regulations, and policies for all 50 states and the District of Columbia, and tracks a number of telehealth trends. The report offers a revealing glimpse into the scope and complexity of state laws and policies governing telehealth. The authors conclude, however, that despite the fact that state laws and Medicaid policies “differ significantly” certain trends are coming into relief. Here are some highlights of the report:

• 48 states and the District of Columbia provide reimbursement for live video consults in their Medicaid fee-for service programs.
• States alternate between the terms “telemedicine” and “telehealth,” and in some states, both terms are explicitly defined in statute or regulation.
• 15 state Medicaid programs reimburse for store-and-forward services.
• 21 Medicaid programs reimburse for remote patient monitoring.
• 36 states and the District of Columbia have laws governing coverage by private payers of telehealth services.
• In the 2017 legislative session, 44 states introduced over 200 telehealth-related pieces of legislation addressing issues such as reimbursement and the standard of care.
• 30 jurisdictions have telehealth informed consent requirements (depending on the state, may apply to Medicaid only, certain specialties, or to all telehealth transactions in the state).
• 22 states are now part of the Federation of State Medical Boards’ Interstate Medical Licensure Compact facilitating multi-state licensure for physicians in those states.
• 32 states reimburse a transmission fee, facility fee, or both.
• 9 state medical/osteopathic medical boards issue special licenses/certificates related to telehealth.

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