Ruling Halts Washington State’s Medicaid Emergency Room Visit Limit

November 18, 2011 By

A recent judicial decision has prevented the State’s implementation of a controversial policy that would limit payment for Medicaid patients to three “non-emergency” visits to emergency departments each year.  The State asserted that implementation of the rule would result in significant cost savings for the State by better directing non-emergent uses to primary care providers.  Opponents of the rule are concerned that the policy will endanger Medicaid enrollees.  The rule included in the definition of “non-emergency” visits many truly emergent conditions such as chest pain, abdominal pain, miscarriage, and breathing problems.

Washington physicians and hospitals, including the Washington Chapter of the American College of Emergency Physicians (WA/ACEP), the Washington State Medical Association (WSMA), the Washington State Hospital Association (WSHA), and Seattle Children’s Hospital, filed the lawsuit to prevent implementation of the State’s policy.  On November 10, 2011, a superior court judge halted the State’s implementation of the policy and found that the State failed to follow proper rulemaking procedures.  Under the ruling, the policy may not be implemented until formal rulemaking is complete.  The formal rulemaking process will include public hearings and public comments before implementing the new policy.  The judge did not make a ruling regarding the content of the policy.

To read the Washington State Hospital Association’s article on this topic click here.

Filed Under: Washington

New OIG Advisory Opinion – Pediatric Hospital May Provide Housing, Meals, etc.

November 16, 2011 By

Yesterday, the OIG issued Advisory Opinion No. 11-16 regarding the provision by a pediatric hospital of housing, transportation, meals and other miscellaneous items to patients participating in clinical research protocols.  The OIG determined that while the arrangement could potentially generate prohibited remuneration under the anti-kickback statute, the OIG would not impose civil monetary penalties.

The decision noted that the hospital’s provision of these services was not intended to induce referrals of federal health care program business.  The purpose behind these services was to  enable the patients and families to seek treatment at the hospital.  The OIG identified factors that protected the provision of these services from the risk of fraud and abuse:

1.  The hospital was a not-for-profit institution which relied primarily on donations, and is reimbursed less than a quarter of its costs from federal health care programs.

2.  The nature of the services provided are not likely to induce self referral to the hospital considering that the hospital focuses on treatment for catastrophic diseases of children.

3.  The purpose of the services is to enable compliance with the research protocols and allow the hospital to more closely monitor its patients.

4. The lodging facilities are designed for infection control.

5.  The provision of meal assistance ensures that the patients and families are able to satisfy basic nutritional requirements.

6.  These services are not marketed to prospective patients, their families or referring physicians.

7.  There is a substantial public benefit from the specialized care and the research.

As with all of its opinions, the OIG clarifies that the opinion only applies to the requestor of the opinion.  If you have questions regarding this advisory opinion please contact Elana Zana.

Filed Under: Anti-Kickback/Stark, OIG

CMS Releases Final Rule on Accountable Care Organizations

November 7, 2011 By

On October 20, 2011, the Centers for Medicare and Medicaid Services (CMS) released its final rule on Accountable Care Organizations (ACOs), also known as the Medicare Shared Savings Program (the “Program”), enacted as a part of the Patient Protection and Affordable Care Act of 2010 (aka Health Reform).  The Program is designed to encourage providers and hospitals to create networks that deliver efficient and collaborative care, and allows ACOs to receive a portion of the savings that they produce.

The proposed rule was met with criticism from many providers, hospitals, and trade groups.  In response, CMS adopted a relaxed version of the proposed requirements for ACOs.  Some key changes, include:

  • One-Sided Risk Model:  Under the proposed rule, all ACOs would have operated under a “two-sided” risk model where ACOs had the chance of losing money if they did not produce sufficient savings.  In the final rule, ACOs are allowed to participate in a “one-side” risk model, which will allow providers to participate in the program without risking a loss in the event that their ACO does not produce savings.  The final rule also allows ACOs to opt into a “two-sided” risk model in exchange for the opportunity to receive a greater share of savings.
  • Shared Savings:  The proposed rule originally required that the ACO provide a savings of at least 2% to receive the shared savings payments.  Under the final rule, ACO’s are eligible beginning with the first savings they create.
  • Prospective Beneficiary Assignment:  Originally, CMS intended to assign Medicare beneficiaries retrospectively based on where the beneficiaries received care during the previous year.  In the final rule, CMS sought to provide ACOs more certainty about their beneficiary population and thus implemented a “preliminary perspective assignment” of Medicare beneficiaries.  CMS will modify the beneficiary assignment lists at the end of each contract year in order to determine final assignments.
  • Reduction in Quality Measures:  The proposed rules required ACOs to track 65 performance measures; whereas the final rule requires ACOs to track only 33 measures.
  • Eliminating the Savings Threshold:  The proposed rule required ACOs to produce savings of at least two percent in order to be eligible for shared savings.  The final rule allows ACOs to share in savings beginning with the first savings that they produce.
  • Changes to ACO Organization and Governance: The final rules allows for more flexible ACO organization and governance requirements.  Under the final rule, ACOs are still required to be a legal entity, as recognized under state, federal, or tribal law.  ACOs must meet requirements for governance, leadership, and management. However, the final rule also allows CMS to consider an innovative ACO with a management or governance structure that does not meet the regulatory requirements.
  • Advanced Payment Model:  In attempt to remove some funding hurdles faced by small ACOs, CMS introduced an Advance Payment program that will allow a select number of rural and small physician-owned ACOs to receive up-front payments that the agency will later recoup from the savings that the ACOs produce.
  • Expanded Participation:  The final rule broadens participation to include RHCs and FQHC, as well as practices/organizations in which specialists provide primary care.
  • Relaxed EHR Requirements:  The final rule eases EHR burdens by no longer requiring EHR meaningful use compliance for participation in the Program.  Under the final rule, EHR is retained as a quality measure, but weighted higher than measures for quality scoring purposes.

CMS will begin to accept applications for the Program on January 1, 2012, with start dates on April 1, 2012 and July 1, 2012.

Filed Under: Accountable Care Organizations, Health Reform, Medicare

CMS Issues Stage 1 Info Sheets on Meaningful Use (updated July 2013)

August 12, 2011 By

CMS has issued information sheets on the meaningful use requirements.  Releasing one sheet for eligible professionals and another for eligible hospitals, these sheets are designed to explain each meaningful use objective and its respective measure.  The sheets provide links to each meaningful use objective and then explains the numerator and denominator requirements, attestation requirements and relevant additional information.  To access the information sheets click on the links below:

Stage 1 EHR Meaningful Use Specification Sheets for Eligible Professionals or view the table of contents.

Stage 1 EHR Meaningful Use Specification Sheets for Eligible Hospitals

CMS is also offering a National Provider call regarding meaningful use on August 18th.  To register for the call click here.

Understanding the meaningful use measures and objectives is sometimes complicated.  For assistance with meaningful use or the EHR Incentive Programs in general contact Elana Zana.

Filed Under: HITECH, Incentive Payments, Meaningful Use, Medicare

Washington Makes Changes To Patient Volume Calculation for Medicaid EHR Incentive Payments

August 7, 2011 By

Washington State recently announced a change to the Medicaid patient volume calculation related to the Medicaid EHR Incentive Program.  Previously, Washington announced that it would provide all eligible professionals and hospitals with ProviderOne data on their respective Medicaid encounters for the time period chosen by the provider.  Pursuant to the Medicaid EHR Incentive Program eligible professionals must show that they have at least a 30% Medicaid patient volume to qualify for the incentive payments (pediatricians can show 20% Medicaid patient volume), hospitals must show that they  have a 10% Medicaid patient volume.  The primary equation for calculating patient volume for eligible professionals is as follows (there is a second equation regarding managed care patients that is not discussed by this blog post, nor is the calculation for hospitals):

Total Medicaid Patient Encounters x 100 ≥ 30%
Total Patient Encounters

Washington, rather than providing the exact number of Medicaid encounters, is allowing the eligible professional to perform the calculation itself.  Due to the eligible professional’s inability to differentiate between Medicaid, State Only payments, and CHIP, the state is providing a multiplier to calculate these ineligible encounters (note that rural health clinics and FQHCs may include CHIP patients in their patient volume calculations).  Based on its analysis of  ProviderOne historical paid fee for service claims and managed care encounter data for 2010 the average proportion of CHIP encounters equals 1% and State Only encounters equals 4%.  Accordingly, the revised formula for eligible professionals will look as follows:

Total Medicaid Patient Encounters * .95 x 100 ≥ 30%
Total Patient Encounters

This new formula will reduce the percentage of Medicaid encounters and may make those eligible professionals who are on the cusp of meeting the 30% requirement ineligible.  In response the state has offered an alternative, which allows any provider to request assistance from the state staff to analyze and report their actual data from ProviderOne.  In addition, those eligible professionals who are audited and who use the multiplier will only be assesed as to whether the total Washington Medicaid encounters were accurately represented, and will not evaluate whether the CHIP and State Only encounters were correctly excluded.

Washington has since modified its State Medicaid Health Information Technology Plan to reflect this change.  In addition, the state has offered an updated webinar on registration and calculation of patient volume, which can be accessed here.

Calculating patient volume can be complicated, especially when attempting to qualify for the incentive payments  using the group practice calculation.  For more information regarding the patient volume calculations or the Medicaid/Medicare EHR Incentive Program in general please contact Elana Zana.

Filed Under: HITECH, Incentive Payments, Washington

CMS Issues Medicare EHR Incentive Checks

May 20, 2011 By

Beginning this week, CMS will begin issuing Medicare EHR Incentive Payments to those providers who have successfully attested to meeting meaningful use.  Eligible Professionals who have met the meaningful use requirements can expect payment of $18,000.  (Note, Eligible Professionals that have not yet met the $24,000 Medicare allowed charges threshold will not receive a check until that threshold is met).  Eligible Hospitals that have attested to meaningful use can also begin to expect their incentive payments.

CMS will issue incentive payments in the same manner as providers receive payments for Medicare services, via electronic funds transfer or check. Payments will be made to the TIN selected during registration for the Medicare EHR Incentive Program.

For those providers who have not yet registered for the EHR Incentive Program there is still plenty of time in 2011 to do so.  The Medicaid EHR Incentive Programs have launched in some states, with other expecting to launch later this Summer.

For assistance with registering for the Medicare EHR Incentive Program or understanding meaningful use please contact Elana Zana.

Filed Under: HITECH, Incentive Payments, Medicare

Washington Announces Medicaid EHR Incentive Program Training Webinars

March 18, 2011 By

Yesterday, Washington State announced upcoming training webinars for the Medicaid EHR Incentive Programs.  These webinars are designed to help hospitals and eligible professionals prepare for their participation in the Medicaid EHR Incentive Programs.  Washington anticipates rolling out the Medicaid EHR Incentive Program in June. 

Program Planning & Implementation Update (WSHA specific)

Wed., March 23

10-11 AM

https://www2.gotomeeting.com/register/638732130

Program Planning & Implementation Update

Wed., April 13th

10-11 AM

https://www2.gotomeeting.com/register/727138786

Qualifying For Incentives & Meeting Required Patient Volume Thresholds  

Wed., April 27th

10-11 AM

https://www2.gotomeeting.com/register/212646515

Overview Of Adopting, Implementing & Upgrading EHR Systems (AIU) & Meaningful Use

Wed., May 11th

10-11 AM

https://www2.gotomeeting.com/register/183445538

Registering for the Medicaid EHR Incentive Program

Wed., May 25th

10-11 AM

https://www2.gotomeeting.com/register/332772211 

Incentive Payments & Reassignment Process

Wed., June 8th

10-11 AM

https://www2.gotomeeting.com/register/518246379 

Attestation & the Audit Trail

Wed., June 22nd

10-11 AM

https://www2.gotomeeting.com/register/592783331

For more information regarding the Washington Medicaid EHR Incentive Program click here.

Medicaid providers are eligible for up to $63,750 in Incentive Payments over the six years of the program.  If you would like more information about determining your hospital’s or practice’s eligibility, meaningful use, or calculating your estimated incentive payments please contact Elana Zana.

Filed Under: HITECH, Incentive Payments, Washington

Red Flags Rule No Longer Applicable to Healthcare Providers

March 9, 2011 By

In the first case to discuss the Red Flag Program Clarification Act of 2010 (“Clarification Act”), the Court of Appeals for the DC Circuit dismissed the American Bar Association’s (ABA) lawsuit against the Federal Trade Commission (FTC) as moot. This dismissal is significant to healthcare providers as the reasoning behind the dismissal is directly analogous to the application of the Red Flags Rule to healthcare providers.

The ABA’s suit followed the issuance of the FTC of an Extended Enforcement Policy which explained that “professionals, such as lawyers or health care providers, who bill their clients after services are rendered,” would be considered “creditors” under the statute and, therefore, subject to the Rule’s requirements. The Court determined that the Clarification Act mooted the case because “the Clarification Act . . . clarifies that, to be a ‘creditor’ subject to the Red Flags Rule requirements, one must not only regularly extend, renew, or continue credit . . . , but must also ‘regularly and in the ordinary course of business,’ (i) obtain or use consumer reports, (ii) furnish information to consumer reporting agencies, or (iii) advance funds with an obligation of future repayment.” The Court determined that the Clarification Act “made it clear that a creditor’s allowance of deferred payments alone could not trigger the identity theft protection requirements.”

The Court clarified that the ability to defer payment “is no longer enough to make a person or firm subject to the FTC’s Red Flags Rule – there must now be an explicit advancement of funds. In other words, the FTC’s assertion that the term ‘creditor,’ as used in the Red Flags Rule and the FACT Act, includes ‘all entities that regularly permit deferred payments for goods or services,…is no longer viable.” The Court’s decision echoes the legislative history of the Clarification Act, in which Senator Dodd commented that the design of the Clarification Act “makes clear that lawyers, doctors…and other service providers will no longer be classified as ‘creditors’ for the purposes of the Red Flags Rule…”

Although the case involved the application of the Red Flags Rule to lawyers, the Court’s analysis should be equally applicable to healthcare providers, which were previously subject to the Red Flags Rule because of deferred payment for medical services. The Court’s ruling makes it clear that healthcare providers will no longer be deemed creditors under the Red Flags Rule based on their payment method of providing services and billing for those services later.

However, the Court also noted that it would not prematurely comment on any new rules the FTC may promulgate. The FTC has the authority to engage in rulemaking to include entities within the coverage of the Red Flags Rule that maintain accounts subject to a reasonably foreseeable risk of identity theft.

If you have any questions regarding the Red Flags Rule and its application to healthcare entities please contact Elana Zana.

Filed Under: Red Flags

Modification in Medicaid EHR Incentive Program Calculation – Net Average Allowable Cost

February 14, 2011 By

In December 2010, Congress passed the Medicare and Medicaid Extenders Act of 2010.  Along with a variety of other changes, Congress modified one of the inputs in calculating the incentive amount under the Medicaid EHR Incentive Program, specifically the Net Average Allowable Cost calculation.

In the original enactment of the ARRA, the Medicaid EHR Incentive Payments were based on a formula which required that the Secretary of HHS determine the average allowable cost for certified EHR technology, and allow eligible professionals to collect incentive payments in an amount not to exceed 85% of the net average allowable cost, or $21,250 (in the first year or $8,500 in subsequent years) whichever amount is smaller.  Determining the net average allowable cost, per the HHS Final Rule, was not an easy feat.  HHS determined that the average allowable cost for certified EHR technology for the first year was $54,000 and therefore a provider was allowed to collect up to $29,000 of cash gifts towards the certified EHR technology without seeing a reduction in their EHR Incentive Payment.  The Net Average Allowable Cost was calculated as follows:

 1st Year Incentive = ($54,000 – cash gift for EHR) * 85% or $21,250 (whichever is smaller)

2nd-6th Year Incentive = ($20,610 – cash gift for EHR) * 85% or $8,500 (whichever is smaller)

Providers were also responsible for showing that they have contributed at least 15% of the net average allowable cost to the purchase or utilization of certified EHR technology.  The Final Rule created a detailed description of what items may be included and excluded from the 15% calculation, as well as any gifts for EHR technology. 

 Congress has since changed these complicated calculations, making it easier on eligible professionals. 

The new change recently passed by Congress relating to the incentive calculation is the assumption that the provider has expended at least 15% of the net average allowable cost provided that the EHR Incentive Payment to the provider is not in excess of the 85% of the net average allowable cost.  In other words, Congress will now assume that as long as the Medicaid EHR Incentive Payment does not exceed $21,250 in the first year and $8,500 thereafter, the eligible professional is assumed to have paid the remaining 15% and is therefore eligible for the entire Medicaid EHR Incentive amount.

These changes are still subject to HHS releasing new rules interpreting Congress’s enactment and accordingly modifying the Final Rule issued this summer.  However, in light of Congress’s intent it appears that the change will ease the confusion on how to compute the net average allowable cost and to determine whether a Medicaid provider has adequately paid for certified EHR technology.

Filed Under: HITECH, Incentive Payments

Registration for Medicare EHR Incentive Payments Starts January 3rd

December 28, 2010 By

Starting on January 3rd, 2011, registration for the HITECH Electronic Health Record Medicare Incentive Payments will open.  This registration is available for both eligible professionals and eligible hospitals, including Critical Access Hospitals.  The registration link will be available starting on January 3rd and can be accessed here.  Registration for the Medicaid EHR Incentive Payments will be available for the following states:  Alaska, Iowa, Kentucky, Louisiana, Oklahoma, Michigan, Mississippi, North Carolina, South Carolina, Tennessee, and Texas.  In February, registration will likely open in California, Missouri, and North Dakota.  It is anticipated that other states, including Washington, will  launch their Medicaid EHR Incentive Programs during the spring and summer of 2011.

For mor information regarding the Medicare Incentive Payments see the CMS press release.  For a general overview of the HITECH incentive payments please read our previous blog posts for physicians and hospitals.  As a disclaimer, these blog posts were written prior to the issuance of the Final Rules but provide a good overview of the statutory requirements.

CMS has also issued tip sheet regarding Stage 1 Meaningful Use for hospitals, and Critical Access Hospitals, click here to access the tip sheet.  The tip sheet for eligible professionals can be accessed here.  Additional information may be obtained by contacting CMS or your State directly (CMS and State Medicaid Contact List & Information).

If you would like further information regarding achieving Meaningful Use, registering for the Medicare Incentive Payments, or assistance calculating the Medicare or Medicaid incentive payments please contact Dave Schoolcraft or Elana Zana.

Filed Under: Critical Access Hospital, HITECH, Incentive Payments, Medicare
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