Department of Labor Expands Whistleblower Protection Under Affordable Care Act
February 26, 2013
Posted by Frank Ciesla
Below is a link to the Department of Labor’s website in regard to its proposed regulations expanding whistleblower protection to individuals who complain about the actions taken under the Affordable Care Act.
The difficulty for the employers in this situation is the fact that they are looking at an Act that covers almost 2,000 pages and has thousands of pages of implementing regulations. There is no question that this is and will continue to be a complex area of the law, particularly as the various government agencies continue to issue implementing regulations. Employers, insurers, and health care providers all have to pay attention to both the statute and its implementing regulations so as not to cause an inadvertent violation that can form the basis of a whistleblower suit.
Below is the summary of the new rule. The DOL’s Occupational Safety and Health Administration requested comments on the rule, which will become effective when it is published in the Federal Register on Feb. 27. The comment period runs for 60 days after publication.
Interim final rule: Procedures for the Handling of Retaliation Complaints Under Section 1558 of the Affordable Care Act
http://www.dol.gov/find/20130222/OSHA2013.pdf
DOL News Release: http://www.dol.gov/opa/media/press/osha/OSHA20130327.htm
A fact sheet about filing whistleblower complaints under the ACA: http://www.osha.gov/Publications/whistleblower/OSHAFS-3641.pdf.
SUMMARY: This document provides the interim final regulations governing the employee protection (whistleblower) provision of section 1558 of the Affordable Care Act, which added section 18C of the Fair Labor Standards Act, to provide protections to employees of health insurance issuers or other employers who may have been subject to retaliation for reporting potential violations of the law’s consumer protections (e.g., the prohibition on denials of insurance due to pre-existing conditions) or affordability assistance provisions (e.g., access to health insurance premium tax credits).
The protections provided by section 18C will extend in 2014 to cover retaliation with respect to an employee’s compensation, terms, conditions or other privileges of employment by health insurance issuers offering group or individual health insurance coverage regardless of whether those issuers are the employer of the person retaliated against.
Since the enactment of the Affordable Care Act, a health insurance issuer is prohibited from retaliating against its own employees who engage in activity protected by section 18C. Beginning in 2014, those issuers will also be prohibited from retaliating against persons who are not their employees with respect to those persons’ compensation, terms, conditions or other privileges of employment, including their employer-sponsored health insurance. An employee will be protected from retaliation (e.g., having that issuer limit or end health insurance coverage), not only by her employer, but also by the insurance issuer that provides employer-sponsored health insurance coverage to the employee.
Section 18C of the FLSA provides protection for an employee from retaliation because the employee has received a credit under section 36B of the Internal Revenue Code of 1986, 26 U.S.C. 36B, or a cost-sharing reduction (referred to as a “subsidy” in section 18C) under the Affordable Care Act section 1402, 42 U.S.C. 18071, or because the employee has engaged in protected activity pertaining to title I of the Affordable Care Act or any amendment made by title I of the Affordable Care Act.
New Jersey Department of Health Unveils Its New POLST Form
February 22, 2013
Posted by Beth Christian
The New Jersey Department of Health and Senior Services unveiled a new health care treatment planning tool which is intended to better facilitate implementation of a patient’s treatment goals and wishes. Known as the POLST form (shorthand for Physician/Practitioner Orders for Life Sustaining Treatment), it is designed to be completed concurrently by the patient and their treating physician/advanced practice nurse. The POLST form is designed to serve as a medical order which will follow the patient across the continuum of care. It outlines the patient’s goals of care. It also outlines the patient’s choices regarding potential medical interventions, and can be used to specify whether or not the patient desires to receive artificially administered fluids and nutrition, as well as CPR/intubation/artificial ventilation.
A patient who executes a POLST form may modify or revoke the POLST form at any time. The patient may also designate a surrogate decision maker, who can modify or revoke the patient’s previously executed POLST orders in consultation with the patient’s treating practitioner if the patient loses their decision-making capacity. The form allows individual to specify whether or not they wish to make an anatomical gift. Properly executed POLST forms are valid medical orders which can be transferred with the patient and are valid in all treatment settings in New Jersey.
The New Jersey POLST form care be found here: http://www.njha.com/media/84188/NJPOLSTFORM.pdf
The New Jersey Hospital Association has published a resource for patients and family members concerning POLST that can be found here: http://www.njha.com/media/84162/polstconsumerbrochure.pdf
OIG ISSUES DETAILED CO-MANAGEMENT AGREEMENT ADVISORY OPINION
January 16, 2013
Posted by Beth Christian
On the eve of the New Year, the Office of Inspector General (“OIG”) issued Advisory Opinion 12-22, which reviewed a cardiac catheterization co-management agreement between a hospital and a cardiology group. The Advisory Opinion is notable for its detail, and may be instructive for hospitals and physician practices wishing to establish similar arrangements.
The hospital and the cardiology group were located in a rural, medically underserved area. The hospital operated the only cardiac catheterization labs within a fifty (50) mile radius. The cardiology practice was the only cardiology group on the hospital’s medical staff. Read more
OIG Provides Guidance Regarding Provision of Electronic Interface to Physicians
January 7, 2013
Posted by Beth Christian
The provision of free access to an electronic interface designed to transmit orders to and from a hospital by physicians was the subject of OIG Advisory Opinion 12-20. Under the facts reviewed in the Advisory Opinion, the hospital would provide free access to an electronic interface to community physicians and physician practices. The physicians could use the interface to transmit to the hospital orders for laboratory and diagnostic services to be performed by the hospital and could also receive the results of these services. The hospital would provide the support services necessary to maintain the interface, including software updates. Physicians who chose to participate would remain responsible for all aspects of their own electronic health records system, including all necessary hardware and connectivity services that would allow them to communicate with the hospital through the interface. The hospital certified that the interface would serve no purpose other than to transmit the orders and results.
The OIG found that the proposed arrangement would not implicate the antikickback statute. The OIG found that the hospital would provide free access to the interface to all physicians who requested it; would provide support services necessary to maintain the interface; would limit use of the interface only for the purpose of transmitting orders for laboratory and diagnostic services to and from the hospital and for receiving test results; and would provide services that are integrally related to the hospital’s services. The free access would have no independent value to the physicians apart from the electronic interface services that the hospital provided.
In approving the provision of the electronic interface to physicians, the OIG acknowledged the importance of facilitating electronic communications between hospitals and physician practices in the community. We will undoubtedly see the OIG review additional factual scenarios in the future that address the changing nature of the relationship between hospitals and physicians.
RESOLUTION OF THE FISCAL CLIFF: THE PHYSICIANS’ SUSTAINABLE GROWTH RATE ISSUE HAS BEEN RESOLVED FOR ONE MORE YEAR
January 4, 2013
Posted by Frank Ciesla
In addition to all the other issues that will be coming back in 2013, the doctors will be confronted again in December 2013 with the fact that there could be a substantial reimbursement reduction in the Medicare payments starting January 1, 2014. As pointed out in our prior blogs, because of the way the Congressional Budget Office does its scoring for budgetary purposes, it is highly doubtful that there will be a permanent resolution of the sustainable growth rate issue; and therefore every year physicians will be confronted with the reduction.
As you can see from various articles ((1) http://www.modernphysician.com/article/20130103/MODERNPHYSICIAN/301039973?AllowView=VW8xUmo5Q21TcWJOb1gzb0tNN3RLZ0h0MWg5SVgra3NZRzROR3l0WWRMWGJWZjBDRWxYek9UYktwUGZUamg5b1g4WFFERmhzbHhKSnNUYk9XNkU9&utm_source=link-20130103-MODERNPHYSICIAN-301039973&utm_medium=email&utm_campaign=mpdaily; (2) http://www.philly.com/philly/business/20130103_Hospitals_to_eat_Medicare_budget_s__doc_fix.html), the funding for this year’s resolution comes from a reduction in payments to other Medicare providers, spread over a number of years. Therefore, in resolving next year’s, 2014, physician reduction, this source of funding will not be available.
This approach is consistent with our prior blog of December 31st, which pointed out that Woodward in his book, states that the only acceptable Medicare adjustment to the Democratic party leadership are reductions in reimbursement to health care providers, not adjustments to either payments made by Medicare beneficiaries or services rendered to Medicare beneficiaries.
Regrettably, the additional reductions to both physicians and other health providers will be on the table for both the debt ceiling debate in two months and the sequester debate around March.
This continued uncertainty must play a role in any future planning by physicians in expanding, acquiring or selling their practices, since the value of those practices clearly depends, to a large extent, on the reimbursement that they will receive for providing services to the Medicare population.
OIG Offers Additional Guidance on Hospital Relationships with Physicians
January 4, 2013
Posted by Beth Christian
In two recently published Advisory Opinions, the HHS Office of Inspector General provided guidance concerning financial relationships between hospitals and members of their medical staffs. Advisory Opinion No. 12-15 involved per diem fees paid by a hospital to physicians to provide on-call coverage for the hospital’s emergency department. Advisory Opinion No. 12-20 involved a proposal by a hospital to provide free access to an electronic interface to community physicians. The electronic interface would allow those physicians and their practices to transfer orders for certain services to, and receive the results of those services from, the hospital. The Advisory Opinions are evidence of recognition on the part of the OIG of the changing nature of hospital-physician on-call relationships, as well as the increased use of electronic communications between hospitals and medical practices. Today, we’ll outline the OIG’s conclusions regarding the on-call arrangement. Next week we will continue tomorrow with a discussion of the OIG’s findings regarding the electronic interface.
Under the arrangement considered by the OIG in Advisory Opinion No. 12-15, the hospital paid a per diem fee to specialist physicians to provide unrestricted call coverage for the emergency department. The opportunity to participate in the arrangement was offered to all specialists on the medical staff who were subject to unrestricted call. The on-call arrangements were memorialized in one-year, written agreements, which contained automatic renewal provisions, and which required participating physicians to be available to respond to the emergency department within the hospital’s required response times. Participating physicians who admitted emergency department patients were required to provide care to the patients during their inpatient stays, and were also required to see the patients for follow-up care in their office practices regardless of the patients’ insurance status or ability to pay.
Each year, the Hospital allocated an aggregate annual payment amount per specialty for on-call coverage payments based on: (1) the likely number of days per month that physicians in that specialty would be called; (2) the likely number of patients a participating physician would see per on-call day; and (3) the likely number of patients requiring inpatient care and post-discharge follow-up care in a participating physician’s office. The aggregate dollar amount per specialty would be divided by 365 days per year to create the per diem fee for on-call coverage in a particular specialty. Participating physicians received the per diem fee for each day of coverage provided under the arrangement, irrespective of whether or not they were contacted by the emergency department to treat patients.
The per diem rates were evaluated by an independent consultant and were compared to national survey data. The hospital certified that based upon the independent valuation, the per diem rates paid under the arrangement would be commercially reasonable and fair market value for the services provided, and would not take into account in any way the volume or value of referrals or business generated between the parties. The hospital further certified that the per diem payments would be administered uniformly for all doctors in a given specialty without regard to the individual participating physician’s referrals to, or other business generated for, the hospital. The hospital used a uniform methodology to ensure that call was distributed evenly among all participating physicians, and monitored performance by participating physicians through medical staff peer review processes.
In analyzing the proposed arrangement, the OIG acknowledged that “depending on market conditions, it may be difficult for hospitals to sustain necessary on-call physician services without providing compensation for on-call coverage.” The OIG noted that notwithstanding legitimate reasons for such arrangements, on-call coverage compensation potentially creates considerable risk that physicians may demand such compensation as a condition of doing business at a hospital. The OIG also noted that there is a substantial risk that improperly structured payments for on-call coverage could be used to disguise unlawful remuneration to physicians. Notwithstanding these findings, the OIG concluded that even though the arrangement did not fit squarely within the terms of the safe harbor for personal services and management contracts, the arrangement appeared to contain safeguards sufficient to reduce the risk that the remuneration was intended to generate referrals of federal health care program business.
The OIG found the following factors to be indicative of a low risk of fraud and abuse:
- The hospital certified that, based on an independent valuation, the per diem payment amounts were commercially reasonable, and within the range of fair market value for actual and necessary services provided without regard to referrals or other business generated between the parties. The OIG expressly stated that it had relied on the certification in issuing the opinion. The OIG also noted that the per diem rate appeared tailored to reflect the burden on participating physicians and the likelihood that physicians of a particular specialty would actually be required to respond while on call; the likelihood that they would have to provide uncompensated treatment; and the likely extent of that treatment. The OIG also noted that the per diem payments were tailored to cover substantial quantifiable services, a portion of which would be furnished to uninsured patients in the emergency department and afterwards.
- The hospital allocated funds for call coverage for each participating specialty and calculated the per diem annually, in advance. The hospital also uniformly administered the per diem payments to physicians in a given specialty without regard to individual physician referrals. The OIG found that these factors mitigated the risk that the payments were determined in order to selectively reward high volume referrers or incentivize low volume referrers to generate business.
- Participating physicians provided actual and necessary services, for which they were not otherwise compensated. While the OIG noted that in some cases a participating physician could collect a per diem payment and receive separate reimbursement from the patient or an insurer, the arrangement required participating physicians to provide a significant amount of care for which they receive no compensation (other than the per diem payment), due to the percentage of uncompensated care provided to emergency department patients at the hospital.
- The opportunity to participate in the arrangement was offered to all specialists on the medical staff who were required by the hospital’s bylaws to take unrestricted call.
- The arrangement was structured so that the hospital absorbed all costs, and none accrued to federal health care programs.
The OIG’s findings in Advisory Opinion 12-15 are significant because they appear to recognize the need for hospitals to develop alternative means of ensuring that they have sufficient on-call coverage. Traditionally, physicians provided on-call coverage without compensation as a condition of their medical staff membership. However, hospitals are finding it increasingly difficult to obtain such coverage in many markets without providing physicians with compensation. Hospitals that wish to develop similar on-call compensation programs would be well advised to obtain an independent valuation of the proposed on-call compensation, as the use of an independent valuation by the requesting hospital appeared to be an important factor in the OIG’s issuance of a favorable Advisory Opinion.
DENIAL OF AN OPRA REQUEST
January 3, 2013
Posted by Frank Ciesla
Under New Jersey’s Open Public Records Act (OPRA), members of the public may request copies of certain public records. The government agency involved decides whether to grant or deny the request. If the agency denies the request, the requestor may appeal either through an administrative route (through the Government Records Council), or through the courts.
In making the decision whether to appeal a denial of an OPRA request through the courts or through the administrative route, one should consider the case in which I was involved, Frank R. Ciesla o/b/o The Valley Hospital v. New Jersey Department of Health and Senior Services, Division of Health Care and Quality Oversight and Hackensack University Medical Center, and the tortuous path I had to follow through the Government Records Council.
Buried in the decision is the fact that I filed the appeal in February 2010 with the Government Records Council, which did not make a decision in regard to that request until May 24, 2011. Most, if not all, of the delay was due to the fact that the Government Records Council could not gather a quorum to hold a meeting to discuss and decide this appeal or the many other appeals that were pending. At their May 24, 2011 meeting, the Government Records Council adopted the Executive Director’s findings not only in this case but in numerous cases that were pending before the Council.
Unlike a court, no oral argument is permitted before the Council and the Council’s decision is based on the briefs filed by the parties. The Council “reviews the briefs” and votes to either adopt, modify or reject the recommendation of the Executive Director.
My case became even more convoluted when I appealed the Council’s decision to the Appellate Division. The record of the case before the Council was filed by the Attorney General’s Office, I filed a motion to supplement the record, it was opposed by the Attorney General’s Office, and the court issued a decision on that motion. At that point in time, the Attorney General’s Office determined that it did not have authority to represent the Government Records Council and it withdrew the record. I then withdrew my motion and it withdrew its response, and obviously the decision of the Court was then moot. An outside independent law firm then appeared on behalf of the Government Records Council and we started the whole process over.
In addition to the fact that the Government Records Council’s jurisdiction is limited, as set forth in the opinion, and it does not make a decision on the common law rights of access to public records, in deciding how to appeal the denial of an OPRA request, one must consider the track record of the Government Records Council in its untimely resolution of appeals.
December 31, 2012 – Fiscal Cliff
December 31, 2012
Posted by Frank Ciesla
This blog is not intended to address all the issues surrounding the fiscal cliff but just to comment that as of today, December 31, 2012, there is not a resolution of the problem. As set forth in a recent AP article, this creates potential reduction in payments to health care providers in various ways. In addition to the fiscal cliff issues, the sustainable growth rate, which we have commented on in many previous blog posts, continues to confront the medical profession. As of January 1, 2013 (tomorrow), unless resolved (or more likely, kicked down the road for a year), certain health care providers will confront an approximate 27% reduction in reimbursement from the Medicare Program.
If this issue is not quickly resolved, it is likely that many health care providers will terminate their relationships with their patients. For New Jersey physicians, this means they will need to comply with the regulations of the New Jersey Board of Medical Examiners regarding termination of physician-patient relationships. N.J.A.C. 13:35 -6.22.
As to hospitals in New Jersey, they must provide care irrespective of the payor and obviously the reimbursement received from that payor.
In an interesting book by Bob Woodward of Watergate fame, “The Price of Politics,” in discussing the last fiscal crisis, he clearly sets forth that the position of the democratic party is not to reduce the benefits to Medicare beneficiaries, and not to increase the cost to Medicare beneficiaries, but to reduce the payment to providers for services provided to Medicare beneficiaries. If this approach results in the withdrawal of providers from Medicare, it is difficult to predict the magnitude of the ultimate impact on Medicare beneficiaries.
Sustainable Growth Rate: Here We Go Again!
December 21, 2012
Posted by Frank Ciesla
As you can see from CMS’ notice CMS intends to process bills after January 1, 2013 at the lower Medicare reimbursement rate if the issue is not resolved prior to that date. Does this mean administration expects that a resolution of the issue will not be retroactive?
Regrettably, resolving the Sustainable Growth Rate issue for physicians has become entwined with the fiscal cliff and the provision of benefits under the Medicare program. It is clear, based upon the trustee report {http://www.njhealthcareblog.com/2012/04/medicare-solvency-a-continuing-challenge-update/; http://www.njhealthcareblog.com/2011/08/impacts-of-the-debt-ceiling-agreement-on-medicare-providers/; http://www.njhealthcareblog.com/2011/05/medicare-solvency-a-continuing-challenge/; http://www.njhealthcareblog.com/2010/10/blog-%e2%80%93-medicare-trust-fund-solvent-thru-2029-maybe/}, that the Medicare program is in serious financial trouble.
There are only a couple of avenues or a combination of avenues to resolve the issue. These include: (1) reducing benefits, which clearly is a position that does not appear to be politically acceptable; (2) raising Part B fee premiums (Part B premiums for those making a certain level of income are already higher than the Part B premiums for the regular Medicare beneficiaries); (3) raising the Medicare tax rate (under the Affordable Care Act, there are significant increases in the Medicare tax for those making over $200,000 as individuals, or $250,000 as joint filers, in addition to various other taxes that are in the Affordable Care Act on things like the medical device tax, etc.); (4) raising the age under which people would be eligible for Medicare (also subject to a significant amount of debate as well as questions regarding whether or not the age increase would cost the government more or less money); and (5) reducing payments to both the nonphysician providers as well as the physician providers.
Attached is an article which is the beginning of the discussion in reducing the payment to the physician providers, and as we are also aware, payments under the Affordable Care Act to the nonphysician providers are being reduced under the Affordable Care Act.
At this point, it is not clear what solution will be adopted. However, to take an approximately 30% reduction in reimbursement will be untenable for most physicians.
Physician Payment Rates
December 13, 2012
Posted by Frank Ciesla
As we discussed in many prior blogs [(1) http://www.njhealthcareblog.com/2012/11/post-election-update-regarding-the-affordable-care-act/; (2) http://www.njhealthcareblog.com/2012/08/update-on-sustainable-growth-rate/; (3) http://www.njhealthcareblog.com/2012/02/no-valentine-to-physicians-from-congress-as-sgr-issue-remains-unresolved/; (4) http://www.njhealthcareblog.com/2011/12/imminent-withholding-of-medicare-physician-payments-appears-likely/; (5) http://www.njhealthcareblog.com/2011/12/still-no-action-on-sustainable-growth-rate-fix/; (6) http://www.njhealthcareblog.com/2011/11/update-of-sustainable-growth-rate/; (7) http://www.njhealthcareblog.com/2011/10/healthcare-reform-developments/; (8) http://www.njhealthcareblog.com/2011/10/sustainable-growth-rate-sgr/; (9) http://www.njhealthcareblog.com/2011/07/another-round-of-potential-physician-reimbursement-redutions/; (10) http://www.njhealthcareblog.com/2011/05/sustainable-growth-rate/; (11) http://www.njhealthcareblog.com/2011/05/medicare-balance-billing/; (12) http://www.njhealthcareblog.com/2011/04/the-confluence-of-the-sustainable-growth-rate-and-the-deficit/; and (13) http://www.njhealthcareblog.com/2010/10/blog-%E2%80%93-medicare-trust-fund-solvent-thru-2029-maybe/], if it is not addressed, the Sustainable Growth Rate will result in physician compensation being substantially reduced on January 1, 2013. Physicians have faced this crisis every year and the reduction has been kicked down the road for one year. There has been no permanent solution enacted. Therefore, physicians will continue to face this crisis on a yearly basis.
Because of the way the Congressional Budget Office does its analysis, it assumes that the physician reimbursement cut will take place when the annual fix expires. It, therefore includes in the calculation the savings to be realized as a result of such a reduction in reimbursement.
At the same time that physicians are confronted with a reduction in their reimbursement, the country is confronted with the “fiscal cliff”. What appears to be clear at this point in time is that the physician reimbursement issue is not going to be solved separately from and before the fiscal cliff issues are resolved. There is much discussion that the fiscal cliff will not cause great difficulty even if it is not resolved before December 31st, if it is resolved within a reasonable period of time thereafter. In contrast, the failure to resolve the reduction in physician reimbursement will initially result in a “moratorium” in the payment of physicians for services rendered after January 1, 2013. After that “short” moratorium, if the issue is not resolved, with the actual calculation of the physician reimbursement being implemented, physicians will receive lower reimbursement until the reimbursement issue is resolved. Such a result would obviously have a negative effect on a practice’s cash flow.
While there are various proposals to “permanently” resolve the physician reimbursement issue caused by the Sustainable Growth Rate, based upon the past, it is likely that the resolution will only be made until January 1, 2014.
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