Court Temporarily Enjoins CMS from Withholding Medicare Payments from Home Health Agency

Posted by Robert A. Chu on June 19, 2018
Medicare / No Comments

medicareA 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…

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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Court of Appeals Finds Jurisdiction in Medicare Appeals Backlog Case

Posted by Robert A. Chu on April 25, 2018
Medicare / No Comments

medicareThe 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…

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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CMS Approves Medicaid Waiver Requiring “Community Engagement”

Posted by Robert A. Chu on January 25, 2018
CMS, Medicaid / No Comments

Medicaid, health concept. Stethoscope, syringe and pills on grey backgroundAs a first in the history of the Medicaid program, the Centers for Medicare & Medicaid Services (CMS) approved, on January 12, 2018, Kentucky’s section 1115 waiver application that imposes on many beneficiaries a “community engagement” requirement as a condition of Medicaid eligibility.  This is commonly referred to as a “work” requirement, given that it can be satisfied through employment.  The prior administration had rejected similar work requirements proposed under an Arkansas waiver requirement as falling outside the boundaries of the Secretary’s statutory authority under Title XIX of the Social Security Act to provide “medical assistance” to designated indigent populations.

The following are some takeaways from the Kentucky HEALTH approved demonstration project.

What must affected beneficiaries do?  Beneficiaries subject to the requirement must demonstrate completion of 80 hours (each month) of community engagement activities.  Otherwise, they will lose Medicaid coverage.  Beneficiaries can fulfill the requirement through a combination of employment, education, job skills training, or community service. Continue reading…

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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CMS Waives Medicaid Retroactive Eligibility for Iowa: Is Your State Next?

Posted by Robert A. Chu on December 01, 2017
Medicaid / No Comments

Medicaid, health concept. Stethoscope, syringe and pills on grey backgroundSince 1973, the Social Security Act has mandated that states provide retroactive Medicaid benefits for three months prior to the individual’s application.  SSA § 1902(a)(34).  Congress enacted this provision to provide coverage to those lacking knowledge about their Medicaid eligibility and to those whose sudden illness prevented them from applying.  Senate Report No. 92-1230, at 209 (Sept. 26, 1972).  Providers benefit from retroactive eligibility through the ability to enroll uninsured patients in Medicaid retroactively, including after discharge, to avoid uncompensated care costs.

Seeking to trim Medicaid expenditures, Iowa’s Governor this year signed a law requiring the State to seek a CMS waiver from the retroactive eligibility requirement.  When the State agency asked the public for comments on its waiver proposal, only one commenter expressed support.  The vast majority expressed concern that many patients—especially trauma patients who might lack the ability to promptly file Medicaid applications—would face new coverage gaps.  The State itself projected that the waiver would shed 3,000 members (monthly) and would slash Medicaid expenditures by $36.8 million (annually).  Providers unsurprisingly voiced concern that the waiver would increase uncompensated care costs. Continue reading…

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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The White House’s One-Two Punch to Obamacare: A Knockout Blow to the ACA?

Posted by Robert A. Chu on October 16, 2017
ACA, Affordable Care Act / No Comments

Health insurance application form with money and stethoscopeIn moves that stunned and alarmed insurers, providers, and consumers alike, on October 12, the White House issued an announcement and an Executive Order that appear to be purposefully designed to decimate the Exchanges under the ACA:

  1. The White House announced that the government will stop making cost-sharing reduction payments to insurance companies under Obamacare.  According to the White House, there is no appropriation for such payments.  As the Exchange plans will still be obligated to bear the costs of the cost-sharing reductions, premiums for Exchange plans that remain in the market would be expected to rise dramatically.  Many Exchange plans have termination provisions which allow them to terminate their 2018 contracts if the cost-sharing subsidies stop.  On October 13, eighteen states and the District of Columbia sued the administration to restore the funding.
  2. The President also issued an Executive Order requiring the relevant agencies to consider regulations or guidance (1) allowing more employers to form association health plans (AHPs) and (2) expanding the availability of short-term, limited-duration insurance (STLDI).  If the regulations come to fruition, younger and healthier people are expected to be siphoned from Exchange products and into cheaper AHPs and STLDI plans (that potentially offer skimpier coverage), creating adverse selection.  Premiums will rise for those left in the Exchanges.

Is the ultimate goal of these moves the total destruction of the Exchanges?  Are they bargaining chips designed to bring Congress back to the table to fix the “problems” with the ACA?  If the latter, will Medicaid spending cuts sought by many Republicans be part of that discussion?  Stay tuned.

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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Third Circuit Invalidates HHS’ Medicare Wage Index Reclassification Rule

Posted by Robert A. Chu on August 04, 2015
HHS, Hospital, Medicare / No Comments

shutterstock_182426978On July 23, 2015, the Third Circuit invalidated, as being contrary to the Medicare statute, the U.S. Department of Health and Human Services’ (HHS) Medicare wage index “reclassification rule,” 42 C.F.R. § 412.230(a)(5)(iii). That rule was designed to prevent (and did prevent) urban hospitals that had strategically reclassified as being rural from being reclassified again (based on their newly acquired rural status) to a particular urban area, to benefit from a higher Medicare standardized amount and wage index.

In Geisinger Community Medical Center v. Secretary United States Department of Health and Human Services, the hospital first reclassified, successfully, as a Section 401 hospital (i.e., an urban hospital that elects to be treated as rural). It then sought to reclassify, based on its newly acquired rural status, to the Allentown urban wage index area. The hospital estimated that such a reclassification would increase its Medicare reimbursements by approximately $2.6 million per year. The Allentown urban area is 27 miles from the hospital. To be reclassified to that area, the hospital had to rely on the relaxed 35 mile maximum distance applicable to rural hospitals; it would not qualify under the maximum 15 mile distance applicable to urban hospitals. The reclassification rule, however, prohibited Section 401 hospitals from reclassifying based on their acquired rural status.

The Third Circuit panel majority, under a Chevron Step One analysis, agreed with the hospital that HHS’ reclassification rule is unlawful. It specifically held that the statutory text of Section 401 unambiguously requires HHS, through broad and mandatory language, to treat Section 401 hospitals like hospitals that are actually located in rural areas. The reclassification rule, therefore, unlawfully prevented the Section 401 hospital from being considered as a rural hospital in its application to reclassify to a different wage index area.

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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Owners of Tax Exempt Properties in Philadelphia Required to Certify Tax Exemption Status

Posted by Robert A. Chu on February 25, 2015
Exempt, Hospital, Non-profit / No Comments

hospital picNon-profit hospitals, and other owners of tax exempt properties in Philadelphia, must certify as to their eligibility for continued property tax exemption with Philadelphia’s Office of Property Assessment (OPA) by March 31, 2015.  Click here to view a Tax Alert on this issue.  With its deep experience in state and local tax issues, Cozen O’Connor is ready to help affected organizations navigate the complexities of the certification process.

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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With a New Year Rolls in a New OIG Work Plan

Posted by Robert A. Chu on December 12, 2014
ACA, HHS, HIPAA, Medicaid, Medicare, OIG / No Comments

Recently, the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) released its Work Plan for Fiscal Year 2015 (“Work Plan”).  The OIG protects the integrity of HHS programs by identifying fraud and abuse and by suggesting improvements to HHS programs.  The Work Plan informs the public of new and ongoing reviews that OIG plans to pursue during the current fiscal year.

For Fiscal Year 2015 and beyond, OIG intends to focus on emerging payment, eligibility, management, and IT systems security vulnerabilities in the ACA programs, such as the health insurance marketplace.  OIG stated that it would also focus on the efficiency and effectiveness of payment policies in inpatient and outpatient settings, for prescription drugs, and in managed care.

Some specific new items of note include: (1) identifying clinical laboratories that routinely submit improper Medicare claims, (2) reviewing the rate of and reasons for transfers from group homes or nursing facilities to emergency departments as a potential indicator of poor quality, (3) identifying Medicaid MCO payments made on behalf of deceased or ineligible beneficiaries, and (4) assessing the extent to which hospitals comply with the contingency planning requirements of HIPAA.

The Work Plan is a valuable resource annually published by the OIG for providers to identify potential compliance risk areas.

Cozen O’Connor recently published another blog of the Work Plan with the Work Plan’s specific focus on HIPAA and/or information technology that the OIG will examine and address during Fiscal Year 2015.

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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Highlights of the Omnibus HIPAA/HITECH Final Rule

Posted by Robert A. Chu on March 12, 2013
Affordable Care Act, HIPAA, HITECH / No Comments

On January 25, 2013, the Office of Civil Rights (OCR) of the Department of Health & Human Services (HHS) published the long-awaited omnibus final regulation governing health data privacy, security and enforcement (Omnibus Rule).[i]  The Omnibus Rule is a group of regulations that finalizes four sets of proposed or interim final rules, including changes to the Health Insurance Portability and Accountability Act (HIPAA) Privacy and Security Rules mandated by the Health Information Technology for Economic and Clinical Health (HITECH) Act[ii] and proposed in 2010;[iii] changes to the interim final breach notification rule;[iv] modifications to the interim final enforcement rule; and implementation of changes to the Genetic Information Nondiscrimination Act of 2008 (GINA).  The Omnibus Rule goes into effect on March 26, 2013, and compliance is required by September 23, 2013.  As expected, the Omnibus Rule did not finalize the May 31, 2011 proposed regulation regarding accounting for disclosures. Continue reading…

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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Shedding Some Light on the ACA’s Sunshine Provisions

Posted by Robert A. Chu on October 01, 2012
Affordable Care Act, Fraud and Abuse / No Comments

On September 12, 2012, the Senate Special Committee on Aging held a roundtable hearing on the Sunshine Provisions in Section 6002 of the Patient Protection and Affordable Care Act (the “Sunshine Provisions”).  Under the Sunshine Provisions, certain drug and device manufacturers must annually report to the government many payments and other transfers of value they make to physicians and teaching hospitals.  Certain drug and device manufacturers and group purchasing organizations (“GPOs”) must also report ownership and investment interests in them held by physicians and their immediate family members.  In this post, we will report on the roundtable hearing, provide an overview of a Proposed Rule regarding the Sunshine Provisions, and discuss their implementation. Continue reading…

Robert A. Chu

Robert A. Chu

Rob is a member in the Health Law Practice Group. He primarily represents health care clients in Medicare, Medicaid, and third-party payor reimbursement disputes. Rob also counsels health care clients on regulatory and compliance issues. He was selected as a Super Lawyers Rising Star (Health Care) for 2016-2018.

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