medicare

HHS Ups The Ante: Announces Percentages And Time Frames On Goals For Medicare Pay-For-Value Efforts

Posted by Chris Raphaely on January 27, 2015
Accountable Care Organizations, Affordable Care Act, CMS, HHS, Medicaid, Medicare / No Comments

On January 26, 2015, the Secretary of the United States Department of Health and Human Services (“HHS”), Sylvia Mathews Burwell, announced two important goals for the Department:

  1. Increase the percentage of Medicare provider payments that are made through alternative payment models based on how well the providers care for patients, rather than the amount of care provided. The percentage goals for these alternative payment models are 30% by 2016 and 50% by 2018.
  2. Tie virtually all Medicare fee-for-service payments (85% in 2016 and 90% in 2018) to quality and value.

This announcement puts hard numbers on the goal to move away from traditional fee-for-service Medicare payments that has been stated generally since at least 2010 when the Affordable Care Act was enacted. By clearly delineating specific figures for alternative payment models, such as accountable care organizations and bundled payment arrangements, from those figures for payment methods, HHS has made it clear that providers should be thinking not just about different forms of payment but different forms of organizations and relationships with other providers. Alternative payment models generally require coordination among different types of providers who may not otherwise be related to each other.

While the announced goals focus on the Medicare fee-for-service system, it is clear that HHS intends the impact of these goals to be far broader. Ms. Burwell also announced the creation of a Health Care Payment Learning and Action Network to facilitate a public-private sector partnership to “continue to build on our work with state Medicaid agencies, private payers, employers, consumers and other partners,” while welcoming the fact that “our partners in the private sector have the opportunity to be even more aggressive” in establishing alternative payment models and pay-for-value compensation systems. On the same day as Ms. Burwell’s announcement, the Centers for Medicare and Medicaid Services released a fact sheet stating that it is taking action with a goal to spend “our health dollars” more wisely, citing the importance of the goal for patients, families, providers, tax payers, employers, states and insurance companies, and making it clear that HHS and CMS fully intend to have their efforts to transform health care delivery and payment systems to reverberate well beyond the Medicare program.

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CMS Releases Final Rule That Increases Difficulty of Medicare Enrollment

Posted by Health Law Informer Author on December 16, 2014
CMP, HHS, Medicaid, Medicare / No Comments

In early December, CMS released a final rule that implements certain provider (i.e., Hospitals, SNFs, physicians, etc.) and supplier (i.e., DME companies, etc.) enrollment requirements  (“Rule”). The goal of CMS’ implementation of the Rule is two-fold: to (i) “[s]trengthen program integrity;” and (ii) “help ensure that fraudulent entities and individuals do not enroll in or maintain their enrollment in the Medicare program.” The new requirements make obtaining and maintaining Medicare billing privileges for providers and suppliers more cumbersome.

For providers or suppliers treating Medicare patients, enrollment in the Medicare program is required in order to obtain Medicare billing privileges. A provider or supplier may enroll electronically using the Provider Enrollment, Chain, and Ownership System, known as PECOS, or by submitting a paper CMS enrollment form. CMS provides specific enrollment forms for institutional providers (CMS Form-855A: i.e., hospitals, SNFs); other providers (CMS Form 855-B: i.e., clinics/group practices); and physicians and other practitioners (CMS Form 855-I). Further, under Section 6401(a) of the Affordable Care Act, Medicare providers and suppliers that enrolled prior to March 25, 2011 are required to undergo a revalidation process in order to maintain their Medicare billing privileges, wherein the providers or suppliers essentially complete the applicable Medicare enrollment application as if they are a “new” provider or supplier enrollee. However, new enrollee providers and suppliers that submitted their enrollment applications on or after March 25, 2011 are exempt from this revalidation process. MACs are continuing to send out revalidation “requests” on a regular basis to enrollees until March 23, 2015.

The following selected updates to the provider and supplier enrollment requirements in the Rule parallel the recent trend of the federal government expanding its existing authority (i.e., the proposed rule to expand the OIG of the HHS’ exclusion authority) and cracking down on impermissible practices:

  •  “[a]llowing revocation of Medicare billing privileges if the provider or supplier has a pattern or practice of submitting claims that fail to meet Medicare requirements”;
  •  “expanding the instances in which a felony conviction can serve as a basis for denial or revocation of a provider[’s] or supplier’s enrollment”;
  • “if certain criteria are met, enabling [Medicare] to deny enrollment if the enrolling provider, supplier, or owner thereof had an ownership relationship with a previously enrolled provider or supplier that had a Medicare debt”;  and
  • “enabling [Medicare] to revoke Medicare billing privileges if [Medicare] determine[s] that the provider or supplier has a pattern or practice of submitting claims that fail to meet Medicare requirements.”

In addition, CMS clarified in the Rule that any final decision regarding the revocation of a provider’s or supplier’s Medicare billing privileges would come from the “CMS central office” rather than the provider’s or supplier’s MAC. CMS further explained that the re-enrollment bar does not apply to a provider’s or supplier’s failure to timely respond to a revalidation request or request for other information.

The regulations implementing this Rule will be effective February 3, 2015. For additional information regarding the new provider and supplier enrollment requirements under the Rule, contact Cozen O’Connor’s health law team.

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OIG Releases Proposed Gainsharing Regulation

Posted by Chris Raphaely on December 15, 2014
CMP, HHS, Medicaid, Medicare, OIG / No Comments

In early October, the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) released a proposed rule that included, among other provisions, a proposed gainsharing regulation (“Proposed Rule”), and a specific request for comments on a definition of what it means to “reduce or limit services” under the statutory prohibition against certain “gainsharing” arrangements among hospitals and physicians. The OIG’s goal with this Proposed Rule and subsequent final rule is to “interpret the statutory [gainsharing] prohibition broadly enough to protect beneficiaries and the Federal health care programs, but narrowly enough to allow low risk programs that further the goal of delivering high quality health care at a lower cost.” More specifically, the OIG seeks to implement a “narrower interpretation of the phrase “reduce or limit services.” Industry analysts are touting the final regulation as a potential game changer in the battle to deliver “high quality health care at a lower cost.”

The existing gainsharing civil monetary penalty statute (“Gainsharing CMP”) is a law that broadly “prohibits hospitals and critical access hospitals from knowingly paying a physician to induce the physician to reduce or limit services provided to Medicare or Medicaid beneficiaries who are under the physician’s direct care.” Violation of the Gainsharing CMP by a hospital that makes such payment, and a physician that in turn knowingly accepts the payment, results in CMPs that are no greater than $2,000 per each beneficiary for whom such payment is made.

Determining what does and what does not constitute a payment designed to reduce or limit services can be difficult, particularly because, as HHS has taken pains to point out, the statute technically prohibits payments from hospitals to physicians to limit any services, not just medically necessary services. However, as far back as 2005 the Medicare Payment Advisory Commission and the Chief Counsel to the OIG have supported gainsharing when safeguards are in place to evaluate risks posed by such programs, including “measures that promote accountability, adequate quality controls, and controls on payments that may change referral patterns,” and to date, the OIG has approved 16 gainsharing arrangements through the advisory opinion process.

More recently, under Section 3022 of the Affordable Care Act, the secretary of HHS established  waivers under the Medicare Shared Savings Program (MSSP) with respect to the Gainsharing CMP under certain conditions. These waivers have limited applicability as they apply only to accountable care organizations that participate in the MSSP. The final gainsharing regulations presumably will cover all hospitals and could potentially have a much broader impact upon hospital physician compensation arrangements. Overall, the Proposed Rule and the OIG’s request for comments on what should and should not constitute prohibited payments from hospitals to physicians to reduce or limit services is yet another example of how the regulatory  landscape is changing to adapt to a reimbursement model that is evolving from a fee-for-service dominated model to one in which pay-for-performance will play a much larger role.

The comment period closed under the Proposed Rule in early December, and the final rule is expected in 2015.

 

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With a New Year Rolls in a New OIG Work Plan

Posted by Health Law Informer Author 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.

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CMS Releases New Proposed Medicare Shared Savings Program Regulations

Posted by Chris Raphaely on December 03, 2014
Accountable Care Organizations, CMS, Medicare / No Comments

The Centers for Medicare and Medicaid Services (“CMS”) released proposed  regulations for the Medicare Shared Savings Program (“MSSP”) on Monday December 1, 2014.  The proposed regulations are scheduled to be published in the Federal Register on December 8, 2014, and those wishing to submit comments to the agency will have sixty days after their publication in the Federal Register to do so. CMS stated that the regulations will generally be effective sixty days after they are published in final form.

CMS’ discussion and the proposed regulations span over 400 pages and cover many   operational details of the MSSP.  Some selected highlights are noted below:

  • CMS proposes to permit ACOs currently enrolled in the MSSP’s “upside risk only” model to continue to participate in the “upside risk only” model for a second “agreement period” with a reduced shared savings rate.
  • CMS proposes to create a new “track 3” “upside/downside” risk model with higher rates of savings and the prospective attribution of beneficiaries.
  • CMS proposes to place a “greater emphasis on primary care services delivered by nurse practitioners, physician assistants and clinical nurse specialists in the beneficiary assignment process, and to eliminate the exclusivity requirement for certain specialists that were previously required to be exclusive to one ACO on the basis that they render some services that are considered primary care services.
  • CMS proposes to eliminate the requirement that ACOs send out data sharing “opt out” letters to beneficiaries and would require beneficiaries to opt out of data sharing exclusively by contacting CMS as opposed having the option to opt out by contacting the ACOs directly.

The health care industry will be digesting CMS’ voluminous and in some cases highly technical proposed changes to the MSSP over the next 60 days and the Health Law Informer will continue to provide more details regarding these regulations and the industry’s reaction to them.

To read the complete text of the proposed regulations click here.

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CMS Withdraws Proposed Medicare Secondary Payer Rule

Posted by Health Law Informer Author on October 17, 2014
CMS, Medicare / No Comments

On October 8, 2014, the Centers for Medicare & Medicaid Services (“CMS”) withdrew its Notice of Proposed Rule Making (“NPRM”) from the Office of Management and Budget that was to address how Medicare’s future interests should be protected pursuant to the Medicare Secondary Payer (“MSP”) Act (42 U.S.C. § 1395y(b)(2)) in workers’ compensation, liability (including self-insurance), automobile and no-fault insurance cases (see Notice).  While it is expected that CMS will submit another proposed rule, it does not seem likely that an ultimate final rule will be forthcoming anytime soon.

Although CMS has published guidelines for how to address claims in workers’ compensation cases where future medical expenses are claimed or released in a settlement judgment or other award, it has not released much guidance on addressing future medical expenses in liability, self-insurance, automobile and no-fault insurance cases.  The resulting lack of any clear guidance has resulted in many settlements being prolonged or even coming to a grinding halt as the parties differed over how—or whether— to address Medicare’s interest in future medical expenses.  It was hoped this would change after CMS released an Advance Notice of Proposed Rulemaking in June of 2012 addressing the issue of protecting Medicare’s interest in future medical expenses.  Yet, the recent notice that CMS has withdrawn its proposed rule is disappointing to the stakeholders, including claimants, insurers and attorneys looking for clarity and guidance from CMS on this issue.  Even without guidance addressing future medicals, parties to a settlement must still fulfill their MSP obligations, which include addressing Medicare’s interests in future medical expenses.

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We Don’t Need No Intervention: Qui Tam Relator in Omnicare Wins Big Without DOJ

Posted by Health Law Informer Author on July 23, 2014
DOJ, False Claims Act, Whistleblower / No Comments

The United States Department of Justice (DOJ) recently announced the settlement of two qui tam whistleblower lawsuits against Omnicare Inc., the largest nursing home pharmaceutical and pharmacy services vendor in the nation. The suits alleged that Omnicare gave significant discounts to skilled nursing facilities in exchange for lucrative referrals and pharmacy provider contracts. This $124.24 million settlement is the largest ever in a “swapping” case brought under the Anti-Kickback Statute.

In addition to its size, this settlement is noteworthy because DOJ had initially declined to intervene in the underlying suits and relators pursued the claims independently. That go-it-alone decision was so resoundingly vindicated in Omnicare, it is likely that this case will encourage other whistleblowers to follow a similar course of action. Relators have long had the right to continue False Claims Act litigation without governmental participation. DOJ’s decision whether to intervene or not was traditionally (although not explicitly stated) viewed as a reflection of the strength of the whistleblower’s allegations.  With the increase in whistleblower complaints, the limitations on the number of cases that DOJ can put resources on, statutory changes, the rise of a specialized qui tam bar, and big dollar victories like this may significantly increase the number of independent qui tam lawsuits. Continue reading…

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Five Key Proposed Changes to OIG’s CMP Authority

Posted by Health Law Informer Author on June 05, 2014
HHS, OIG / No Comments

In May and within a week of the Office of Inspector General of the Department of Health and Human Services (OIG) releasing a proposed rule to expand its exclusion authority, the agency also released a proposed rule (Rule) expanding its authority to impose civil monetary penalties (CMPs). OIG anticipates that “CMP collections may increase in the future in light of the new CMP authorities and other changes proposed in this [R]ule.” Over the last decade, OIG has collected more than $165 million in CMPs (between $10.2 million to $26.2 million per year).

Health care providers, suppliers and related institutions should pay particular attention to five proposed key changes:

(1) The focus on an expansion in the range of conduct for which OIG could assess CMPs to include: failing to provide OIG timely access to documents, ordering or prescribing medication or services while excluded from participation in federal health care programs, making false statements on enrollment applications to participate in federal health care programs, failing to report and return known overpayments, and making or using a false statement that is material to a false or fraudulent claim.

(2) Interpretation of the penalty as a per day penalty—for example, up to $10,000 for each day a person fails to report and return an overpayment.

(3) Imposition of CMPs on Medicare Advantage and Medicare Part D organizations (if any of their employees or contractors engaged in fraudulent activity). This broadens the general liability of these organizations for misconduct to include contracted providers or suppliers, employees and agents. Medicare Advantage and Part D organizations would also be eligible for CMPs if they enroll an individual (or his or her designee) without consent; transfer an enrollee to another plan without the enrollee’s (or his or her designee’s) consent; transfer an enrollee to make a commission; fail to comply with marketing restrictions; or employ or contract with any person who engages in prohibited conduct.

(4) Revision to the current structure of 42 C.F.R. Part 1003 because it is “cumbersome and potentially confusing for the reader” in order to “add clarity and improve transparency in OIG’s decision-making processes.” The bases for CMP assessments would be grouped into subsections by subject matter. OIG would provide a single list of factors to be considered when determining the amount of a CMP to include: the nature and circumstances of the violation, the degree of culpability of the person, the history of prior offenses, other wrongful conduct, and other matters as justice may require.

(5) An increase of the claims-mitigating factor from $1,000 to $5,000. The claims-mitigating factor acts as a threshold to help OIG determine the severity of a program violation. OIG believes that the $1,000 threshold is “lower than appropriate . . . given the changes in the costs of health care since this regulation was last updated in 2002.”

Other notable proposed changes include: the addition of a mitigating factor for “appropriate and timely corrective action” taken by a person under OIG’s Self-Disclosure Protocol; clarification that a single aggravating circumstance may result in the maximum amount allowed penalty, assessment, or exclusion; and the delegation of authority from the Department of Health and Human Services Secretary to OIG at Part 1003.150.

Comments to the Rule are due by July 11, 2014.

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CMS Solicits Comments on How to Impose Penalties for Failure to Comply with the MSP Act’s Reporting Requirements

Posted by Health Law Informer Author on December 19, 2013
Medicaid, Medicare / No Comments

On December 11, 2013 the Centers for Medicare & Medicaid Services (CMS) published an advance notice of proposed rulemaking concerning the circumstances under which civil money penalties may be imposed for failure to comply with Medicare Secondary Payer Act (the “MSP Act”) Section 111 reporting requirements.  Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 amended the MSP Act by establishing  mandatory reporting requirements for certain group health plans (GHPs) and for liability insurance (including self-insurance) no fault insurance and workers compensation (collectively NGHPs) arrangements.  The Section 111 amendments require GHPs and NGHPs to notify CMS when they pay a claim on behalf of a Medicare beneficiary.  Failure to comply with the reporting requirements resulted in a civil monetary penalty of $1,000 for each day of noncompliance.

The Strengthening Medicare and Repaying Taxpayers Act of 2012 (the “SMART Act”) amended the penalty provision of the Section 111 reporting requirements by stating that applicable plans that fail to comply with the reporting requirements may be subject to a civil monetary penalty of up to $1,000 per day of non-compliance.  Thus, the SMART Act made the penalty discretionary instead of mandatory and allowed for penalties below $1,000.  As a result,  CMS is soliciting public comments and proposals on the practices for which civil monetary penalties may or may not be imposed.  Specifically, CMS is seeking comments on how to define “noncompliance” with reporting requirements; what mechanisms and criteria should be used to evaluate whether a civil money penalty can be imposed; what methods should be used to determine the dollar amount of such a penalty; and what actions on the part of a primary payer would constitute a “good faith effort” to identify a Medicare beneficiary for purposes of reporting under the MSP Act.  Comments can be submitted to CMS until February 10, 2014.

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The SMART Act: A Bipartisan Attempt to Make the MSP Act Workable

Posted by Health Law Informer Author on January 23, 2013
Uncategorized / No Comments

On January 10, 2013, President Obama signed into law H.R. 1845, which includes the Strengthening Medicare and Repaying Taxpayers Act of 2011 (SMART Act).[1] The SMART Act,  amends several portions of the Medicare Secondary Payer (MSP) Act that apply to non-group health plans, including liability (including self-insurance) and no-fault insurance and workers’ compensation plans (together, NGHPs).  Although the SMART Act makes significant substantive and procedural amendments to the MSP Act, many practical issues will continue to bedevil parties who are trying to settle a personal injury claim. Continue reading…

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