Want to Get Paid for Inpatient Admissions? Follow CMS Certification Requirements.

In its final regulations for the 2014 Inpatient Prospective Patient System, the Centers for Medicare and Medicaid Services emphasized the importance of physician certifications. Under the regulations, Medicare will only pay for an inpatient admission if a physician certifies the medical necessity for the stay. The first piece of such certification is for the physician to complete an inpatient order when he or she expects that the patient will require a stay that crosses at least two midnights.

In addition to the order, physician certification for the inpatient stay also must include the following information:

  • Certification that the inpatient services were ordered in accordance with the Medicare regulations governing the order;
  • The reasons for either: (1) hospitalization of the patient for inpatient medical treatment or medically required inpatient diagnostic study; or (2) special or unusual services for cost outlier cases under the inpatient prospective payment system;
  • The estimated time the beneficiary requires or required in the hospital;
  • The plans for post hospital care, if appropriate, and as provided in the Medicare regulations; and
  • For Critical Access Hospitals (CAHs), the physician must certify that the patient will reasonably be expected to be discharged or transferred to a hospital within 96 hours after admission to the CAH.

Physicians must complete all certification for the inpatient stay prior to patient discharge. In order to help ensure Medicare payment for inpatient admissions, hospitals should educate physicians on the importance of certifications, and provide assistance to physicians in gathering necessary documentation.

CMS has prepared a guidance document about hospital inpatient admission orders and certification. For more information about inpatient admission certification, please contact Casey Moriarty.

Private Payors Attempt to Apply 2% Sequester to Providers – CMS Says “No” (Mostly)

The recent sequester of federal spending triggered automatic, across the board cuts in the federal budget.  Included in these cuts is a 2% reduction in Medicare reimbursement to providers.  The cuts went into effect on April 1, 2013.

In the aftermath of sequestration, many private health insurance companies have attempted to reduce their reimbursement to providers for services provided to non-Medicare patients by the same 2% amount.  These insurers argue that the reimbursement rates in their contracts with providers are based on Medicare payment methodologies; therefore, they are entitled to implement the 2% cuts.  The truth is a bit more complicated.

According to Medicaid Administrative Contractors like Noridian the 2% payment reduction under sequestration is applied to claims only after determining the final  Medicare payment.   All fee schedules, prices, etc., are unchanged by sequestration – it is only the final payment amount that is reduced.

Therefore, if an insurer’s contract with a provider states that the insurer’s reimbursement is based on Medicare fee schedules, the insurer may have a difficult time arguing that it has a contractual right to reduce reimbursement by 2% based on sequestration.

Additionally, in a memo dated May 1, 2013, the Centers for Medicare and Medicaid Services addressed the impact of the sequestration cuts on Medicare Advantage Organizations (“MAOs”) and Medicare Part D sponsors.  According to CMS, the 2% cuts apply to reimbursement received by MAOs and Part D Sponsors, but such organizations can not pass on the cuts to contracted providers.   One exception to this rule is if the contract between the provider and the MAO or Part D sponsor has a specific provision that allows the organization to pass on sequestration cuts to providers.

Providers should carefully track their reimbursement rates to determine if private insurers are improperly taking advantage of sequestration’s Medicare cuts to lower their contractually required payments to providers.  If you would like assistance in protesting any private payor sequester related cuts please contact Casey Moriarty or Don Black.

OIG Launches New Online Submission Process for the Self-Disclosure Protocol

On July 8th, the Office of Inspector General (OIG) launched a new online submission process for the Self-Disclosure Protocol (SDP).  The SDP allows health care providers to voluntarily identify, disclose, and resolve instances of potential fraud involving federal health care programs, including Medicare and Medicaid.   The OIG has stated that individuals and entities that utilize the SDP will pay a lower amount of damages for violations than would normally be required in resolving a government-initiated investigation.

You can access the online submission process here.

The OIG hopes that the online submission tool for the SDP will streamline the process for providers that want to resolve violations without the time and expense of a government-directed investigation.  With that said, we suggest that providers have an attorney analyze any potential SDP issues prior to completing the online form.  As always, the health law attorneys at OMW are happy to help.

For more information about the SDP online submission process please contact Casey Moriarty.

Tacoma Physician Group Pays $14.5 Million To Settle Medicare Over-Billing Allegations

Sound Physicians, a Tacoma-based, national physician group that employs more than 700 hospitalists, paid $14.5 million to settle claims that it over-billed Medicare.  Former Sound Physicians’ employee Craig Thomas filed a whistleblower lawsuit under the qui tam provisions of the False Claims Act.  The lawsuit alleges that the company knowingly submitted inflated claims where documentation did not support the level of service billed.  Qui tam relators are generally entitled to 15 – 30 percent of the government’s recovery; Thomas will receive $2.7 million, or approximately 18.6%, of the $14.5 million settlement.  The settlement represents one of several recent settlements between the government and health care providers under the False Claims Act.

To read the Department of Justice press release click here.

To read qui tam Relator Craig Thomas’ statement click here.

For more information about government investigations, Medicare compliance, or the False Claims Act, please contact Adam Snyder.

Deadline for Avoiding the eRx Payment Adjustment Approaching at End of the Month

The June 30, 2013 deadline to participate in the Electronic Prescribing Incentive Program (“eRx”) and avoid the 2014 eRx payment adjustment is fast approaching.  Eligible Professionals (“EP’) looking to avoid the 2% payment adjustment in 2014 (payment adjustment means that EPs will only receive 98% of his/her Medicare Part B Physician Fee Schedule amount for covered professional services),  must either participate in the eRx program, fall under the exclusion criteria, or file for a hardship exemption by June 30, 2013.  Information regarding participation in the eRx program can be found here.

Exclusions

The following EPs will not be subject to the 2014 eRx payment adjustment if any one of the following applies:

  1. EP successfully participates in the eRx program during the 2012 12-month reporting period (1/1/12 – 12/31/12).
  2. EP is not an MD, DO, podiatrist, Nurse Practitioner or Physician Assistant.
  3. EP does not have at least 100 Medicare Part B PFS cases containing the encounter code in the measure’s denominator between 1/1/2013-6/30/2013.
  4. EP does not have 10% or more of their charges as Medicare Part B PFS allowable charges for encounter codes in the measure’s denominator during between 1/1/2013-6/30/2013.
  5. EP does not have prescribing privileges and reported GT8644 on a payable Medicare Part B service on at least once on a claim between 1/1/2013-6/30/2013.
  6. EP submits at least 10 eRx and reports the G-code G8553 between 1/1/2013-6/30/2013.
  7. EP achieves Meaningful Use under the Medicare or Medicaid EHR Incentive Program during 2012 or between 1/1/2013-6/30/2013 (and attests before 6/30/2013).
  8. EP demonstrates by registration of their intent to participate in the Medicare or Medicaid EHR Incentive Program during the 1/1/13-6/30/13 reporting period.
  9. EP submits one hardship exemption G-code via any payable Medicare Part B PFS claim between 1/1/2013-6/30/2013.
  10. EP request and CMS approves a hardship exemption.

Hardship Exemptions

EPs may be exempted from the payment adjustment if it is determined that compliance would result in a significant hardship.  Hardship exemptions must be submitted by June 30, 2013.  Such exemptions include:

  1. EP’s inability to electronically prescribe due to state, federal or local law or regulation. (Submit using the Communication Support Page)
  2. EP prescribes fewer than 100 prescriptions in a six month payment adjustment reporting period.  (Submit using the Communication Support Page)
  3. EP practices in a rural area without sufficient high speed internet access .  (Submit using the Communication Support Page or use G8642 in at least one claim between 1/1/13-6/30/13)
  4. EP practices in an area without sufficient available pharmacies for eRx.  (Submit using the Communication Support Page or use G8643 in at least one claim between 1/1/13-6/30/13)
  5. EP achieves Meaningful Use under the Medicare or Medicaid EHR Incentive Program.
  6. EP demonstrates their intent to participate in the Medicare or Medicaid EHR Incentive Program during the 1/1/13-6/30/13 reporting period.
  7. EP does not have prescribing privileges between 1/1/2013-6/30/2013.  (File at least one claim with G8644 on a payable Medicare Part B service between 1/1/13-6/30/13)

Requesting a Hardship Exemption

To submit a hardship request, EPs must access the Communication Support Page located here (look at upper-left hand corner once on the site).  CMS suggests that when submitting a hardship, EPs should provide detailed justifications for the hardships.

Those hardships with G-codes may also be submitted by EPs on a claim with a payable Medicare Part B service during the six-month reporting period (1/1/13-6/30/13).

EPs that achieve Meaningful Use under the Medicare or Medicaid EHR Incentive Program or demonstrate their intent to participate in the Medicare or Medicaid EHR Incentive Program during the 1/1/13-6/30/13 reporting period will be determined by CMS through review of the EHR Incentive Program Attestation and Registration system.  CMS will automatically determine if these exemptions apply.

Group practices participating in 2013 eRx GPRO must indicate hardship exemptions during self-nominations/registration or submit an exemption request via the Communication Support Page (listed above).

For more information on eRx or other incentive programs please contact Elana Zana.

 

EHR Incentive Program Meaningful Use Stage 1 Updated

CMS has recently published a tip sheet consolidating for eligible professionals and hospitals the revisions made to the Stage 1 meaningful use measures that are effective in 2013.  These changes modify the following meaningful use objectives:

  • Public Health Reporting Objectives
  • Electronic Exchange of Key Clinical Information
  • Computerized Physician Order Entry (CPOE)
  • Record and Chart Changes in Vital Signs
  • Electronic Prescribing
  • Electronic Copy of and Electronic Access to Health Information (changes only applicable starting in 2014)

Some of the changes in the measures are required, while others are optional for 2013 but become required for 2014.  To view the Stage 1 changes tip sheet click here.

At the same time CMS also revised its Stage 1 Meaningful Use table of contents and tip sheets for each objective/measure for eligible professionals and hospitals/CAH.

If you have questions regarding the Medicare or Medicaid EHR Incentive Programs or meaningful use generally please contact Elana Zana.

Urology Group Challenge to Stark Regulations Is Too Little Too Late

A recent federal district court decision granted summary judgment to the government in a lawsuit by a urology group challenging the 2008 changes in Stark regulations affecting “under arrangement” services for hospital patients.  The decision illustrates the significant barriers to a successful challenge to these regulations.

The challenge focused on the 2008 regulatory changes that swept entities performing DHS into the definition of entities “furnishing” DHS and reversed CMS’ 2001 regulatory approval of “per click” lease agreements.  Several challenges to these changes were dismissed for not being raised within the six year limitation period applicable under the federal Administrative Procedures Act.

The arguments against these changes that survived the timeliness bar failed to convince the court that the changes were contrary to express Congressional intent stated in the legislation or were an impermissible interpretation of the legislation.  The court rejected an argument that the group practice exception for certain compensation arrangements constituted a Congressional expression of intent that the term “entity” was not intended to include entities that furnished DHS.  The court readily concluded that including entities that performed DHS within the definition of entities “furnishing” DHS was a permissible interpretation of the legislation.

As for the revision in the regulations to prohibit the previously permitted “per click” lease arrangements, the court noted that CMS is entitled to change its mind as long as there is a reasonable basis for the change.

“Thus, the agency remains free to reinterpret a statute in a way that varies greatly from its past interpretations so long as the agency provides a reasoned basis for its new interpretation.”

For more information regarding the Stark law or False Claims Act in general please contact Greg Montgomery.

 

OIG Updates its Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs

On May 8, 2013, the OIG issued an updated Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs (the “Updated Special Advisory Bulletin”).  The Updated Special Advisory Bulletin replaces and supersedes the OIG’s 1999 Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs.

The Updated Special Advisory Bulletin advises that the effect of an OIG exclusion is that the provider will receive no Federal Health care program payment for any items or services furnished by an excluded person or at the medical direction or on the prescription of an excluded person.  The prohibition on payment applies to all methods of Federal health care program payment.  It also extends to items or services beyond direct patient care.  Accordingly, OIG says that an excluded person is prohibited from serving in an executive or leadership role (i.e., as the CEO or CFO, general counsel, director of health information management or director of human resources) for a provider that furnishes items or services payable by Federal health care programs and is prohibited from providing other types of administrative and management services (i.e., health IT services and support, strategic planning, billing/accounting, staff training and human resources).

OIG urges providers to review each job category and contractual relationship to determine whether the item or service being provided is directly or indirectly, in whole or in part, payable by a Federal health care program.  If it is, OIG advises the provider to screen everyone that performs under that contract or category.  This would include, for example, screening nurses provided by staffing agencies or physician groups that contract with hospitals to provide ER coverage, and billing or coding contractors.  OIG warns that relying on the screening conducted by the contractor may not always be sufficient to protect the provider from CMP liability.

The Updated Special Advisory Bulletin warns that providers who arrange or contract with an excluded person face potential civil monetary penalties (“CMPs”) of up to $10,000 for each item or service furnished by the excluded person for which payment is sought, in addition to an assessment of up to three times the amount claimed and program exclusion.  OIG states that CMP liability would apply to the furnishing of all of the categories of items or services that are violations of an OIG exclusion, including direct patient care, indirect patient care, administrative and management services, and items or services furnished at the direction or on the prescription of an excluded person when the person furnishing the services either knows or should know of the exclusion.  Exclusion violations may also lead to criminal prosecutions or civil actions (i.e., claims under the False Claims Act).  OIG urges providers to use OIG’s self-disclosure protocol to self-disclose the employment of or contracting with an excluded person.

To best minimize risk of overpayment and CMP liability, OIG suggests that providers check the OIG’s List of Excluded Individuals and Entities (the “LEIE”) monthly.  OIG also recommends that providers use the LEIE as the primary source of information on exclusion.

To access the Updated Special Advisory Bulletin, click here.

If you have questions regarding exclusions from federal health care programs or provider contracting generally please contact Carrie Soli.

A Window into Hospital Charges – Medicare Releases Data on Charges and Reimbursements

On Wednesday, Medicare released on extensive spreadsheet documenting the average hospital charges and associated Medicare payments for 100 most common Medicare inpatient services.  The release of this data is unprecedented and provides consumers a valuable tool in assessing the cost of treatment.  The data provides insight into the cost for these procedures on both a local and national basis; permitting users to download the data and manipulate it by hospital, region, state, or a variety of other means.  To access the Excel file released by Medicare click here.

The data highlights the discrepancies in hospital charges and reimbursements both nationally and locally.  The release of this information is aimed at providing consumers a better understanding of the cost and reimbursements associated with these procedures.  As explained by HHS Secretary Sebelius “Currently, consumers don’t know what a hospital is charging them or their insurance company for a given procedure, like a knee replacement, or how much of a price difference there is at different hospitals, even within the same city.  This data and new data centers will help fill that gap.”  This data is in addition to the hospital comparison tool previously released by Medicare.

The release of this data has made both national and local news headlines: Puget Sound Business JournalNew York TimesUS News and World Report.

Stark Law Really Does Have Teeth

Tuomey Jury Finds Monetary Value of $39 Million for 21,370 Claims Submitted in Violation of False Claims Act

On May 8, 2013, the jury in the False Claims Act lawsuit against Tuomey Healthcare Systems, Inc. returned its verdict.  Based on its finding that Tuomey violated the Stark law, the jury found that Tuomey also violated the False Claims Act by submitting 21,370 false claims with a total value in excess of $39 million.

The court instructed the jury that the government’s case was based on allegations that Tuomey entered into compensation arrangements with certain physicians that violated the Stark law.  The government sought relief under the False Claims Act for these alleged Stark law violations.

The court instructed the jury that damages for Stark based violations of the False Claims Act are to be based on what the Medicare program paid to Tuomey for claims submitted in violation of Stark.  Under the False Claims Act, each false claim is subject to a penalty of between $5,500 and $11,000.  In addition, damages may be tripled.

In what might be considered by some as a substantial understatement, one of the attorneys for Dr. Michael Drakeford, who initiated the lawsuit under the whistleblower provisions of the False Claims Act, was quoted as commenting:

“Perhaps the message to be taken from this verdict is that the Stark law really does have teeth and when a hospital decides to pay physicians for referrals, it risks paying a very high price.”

As part of its on-going quarterly lunch time webinar series, the Ogden Murphy Wallace Healthcare Practice Group will provide a presentation on self-disclosure options and avoidance of state and federal False Claims Act liability in its June 4, 2013 webinar (to register click here).  If you have questions regarding self-disclosure or Stark in general please contact Greg Montgomery.