Update Re: State to License One Room ORs
January 18, 2012
Posted by Sharlene Hunt
As we reported the other day, last week the New Jersey legislature adopted a bill that would require licensure by the Department of Health and Senior Services of “surgical practices” or single operating rooms within physician private practices. Yesterday, Governor Christie “pocket vetoed” the bill. The ability to “pocket veto” a bill arises out of special rules that apply to bills passed by the Legislature in the last ten days of the two year Legislative session. Ordinarily, if the governor does not sign a bill or actively veto it, it becomes law. Under normal circumstances, if the governor vetoes a bill, it goes back to the Legislature, which may override the veto if there are sufficient votes. Under the special rules that apply to a bill passed in the last ten days of the two year Legislative session, the bill must be signed by the governor within seven days of the expiration of the Legislative session in order to become law. By not signing a bill passed in the last ten days of the session within the seven day timeframe, the governor in effect “pockets” the bill, resulting in a “pocket veto”. Since a new Legislative session will commence following such a pocket veto, the bill cannot go back to the Legislature for an override vote, but must be re-introduced in the new Legislative session in order to move forward again.
The other bill we previously reported on, the bill that would phase out the cosmetic surgery tax, was signed by Governor Christie, and thus will go into effect.
In related news, in yesterday’s New Jersey Register, the Department of Health and Senior Services published final rules governing the registration of surgical practices. The final rules are substantially unchanged from the earlier proposal, however the Department indicated in its responses to comments that it will issue further regulatory changes in the future in order to clarify a couple of issues raised by the rules as adopted. In the same issue of the Register, the Department published final rules governing the obligation of ambulatory surgery centers to report healthcare associated infections under the same rules that apply to hospitals in the State. These latter rules do not apply to surgical practices.
OIG’s Most Wanted List
January 17, 2012
Posted by Sharlene Hunt
The Office of the Inspector General in the United States Department of Health and Human Services has long maintained a website listing their “most wanted” health care fugitives. The individuals contained on this list are wanted on charges related to health care fraud and abuse, ranging from billing the Medicare program for services that were not provided or were not medically necessary, to paying kickbacks to Medicare beneficiaries to induce them to cooperate in submissions of false claims. The most wanted list is one of the tools the government uses in its health care fraud enforcement efforts.
Today, the OIG’s office announced a new “most wanted” list – this one is for “deadbeat parents,” those parents who do not pay court ordered child support payments and fall under federal jurisdiction. While most child support payment issues are handled by the States, the federal government can get involved if the child lives in a different state from the parent who owes the child support, and the parent has been in arrears for over one year or owes more than $5,000. The federal government can also get involved if the parent flees the state or country in order to avoid child support payments. The number one fugitive on this list owes more than a million dollars in child support payments.
State to License One Room ORs
January 16, 2012
Posted by Sharlene Hunt
Last week the legislature adopted S-2780, which amends the law governing surgical practices and will require them to be licensed by the Department of Health & Senior Services. A surgical practice consists of one operating room with one or more post-anesthesia care units or a dedicated recovery area, established by a physician or a physician professional practice solely for the physician’s or practice’s private medical practice. These single ORs within a Read more
Medicare Physician Pay Reduction Averted…Temporarily
December 28, 2011
Posted by Beth Christian
President Obama signed the Temporary Payroll Tax Cut Continuation Act of 2011 into law on December 23rd . Among other things, the legislation will avert the imposition of the 27.4% reduction in the Medicare physician fee schedule that was due to go into effect on January 1, 2012. The reprieve is only temporary, however. The legislation postpones the imposition of the fee schedule reduction only until February 29, 2012. Physicians will need to continue to monitor the situation and its potential impact on their practice revenues.
Imminent Withholding of Medicare Physician Payments Appears Likely
December 22, 2011
Posted by Frank Ciesla
As of today, there still has not been a resolution of the threatened reductions to the Medicare payment rate which are scheduled to go into effect ten (10) days from now . As you are aware, the Medicare Sustainable Growth Rate will require reducing payments by over 27% as of January 1, 2012.
While the news seems to be focused on the deadlock in regard to the payroll tax cut and extension of unemployment benefits, the issue regarding physician compensation is as vital, not only to the physicians, but to the Medicare population, as either of the other two issues. The pending Republican proposal for resolving the physician payment issue is focused on reducing payment to other healthcare providers. This appears to be unacceptable to the Democratic contingent in both the House and the Senate.
As of this point in time, Medicare will withhold all Medicare physician payments for services rendered during the first ten (10) days of 2012, until there is either: (1) a resolution of the issue; or (2) implementation of the reduction because the Sustainable Growth Rate issue has not been resolved. Clearly, the providers of healthcare to the Medicare population are being held hostage in this crisis.
See our prior blog as to steps you can take regarding your continued provision of services to Medicare patients.
POLST Act Signed into Law
December 22, 2011
Posted by Beth Christian
On December 21, 2011, Governor Christie signed the Physician Orders for Life-Sustaining Treatment Act (“POLST Act”). The POLST Act is designed to provide a mechanism for patients who (1) have advanced chronic progressive illness; or (2) a life expectancy of less than five years; or (3) who otherwise wish to further define their preferences for health care, Read more
Still No Action on Sustainable Growth Rate Fix
December 6, 2011
Posted by Beth Christian
In a recent blog post, we have alerted our readers to the fact that the issues surrounding the Medicare Sustainable Growth Rate (SGR) formula remains unresolved. If Congress does not act prior to December 31, 2012, a reduction of approximately 27% in the Medicare fee schedule for physicians will automatically go into effect. In an article published in the Sunday Washington Post, the President-elect of the American Medical Association, Jeremy Lazarus, referred to the continued uncertainty of the sustainable growth rate issue as a “psychological sword of Damocles hanging over our heads.” As we indicated in our November 17th blog post, physicians should monitor the situation closely and be ready to implement any contingency plans they may have (with regard to Medicare participation, the acceptance of new Medicare patients, and the management of cash flow) if the sustainable growth rate cuts go into effect.
UPDATE OF SUSTAINABLE GROWTH RATE
November 17, 2011
Posted by Frank Ciesla
As you are aware, the recent publication of the Medicare fee schedule updating the Sustainable Growth Rate (SGR) formula, which limits the Physician Fee reduction from approximately a 30% reduction to approximately a 27% reduction, is not a permanent solution to the problem.
Physicians need to be considering their options in regard to their Medicare patients. The American Medical Association has issued a “Medicare Participation Kit, advising physicians of the steps to take to change their status with Medicare. Physicians, as well as other healthcare providers, also need to be aware of the various state requirements for terminating the relationship with a patient. The regulations of the New Jersey Board of Medical Examiners contain requirements regarding notice to patients of the termination of the physician-patient relationship. In contrast, hospitals have a clear obligation to continue to provide the services to all patients, irrespective of the payment received (or not received) from the Medicare program.
In the environment of deficit reduction, it is not clear whether there will be a resolution of the SGR issue prior to January 1, 2012 (either a permanent resolution, or delaying the impact until January 1, 2013, after the election). As a result, healthcare providers are being placed in a totally untenable position as to what their expectations should be concerning the revenue they will be receiving for the services that they will be providing. Physicians may be in trouble, since a loss of revenue as a result of a failure to address the SGR issue may adversely impact their ability to maintain their staff and office.
Government Coercion As A Vehicle To Alter Healthcare
October 27, 2011
Posted by Frank Ciesla
The front page of the New York Times on Tuesday, October 18, 2011 stated that the Massachusetts Legislature, which previously mandates health insurance for all, has now moved into its next stage of attempting to contain the cost of healthcare. One way of containing the cost that has been applied around the globe is to regulate the rates charged by insurers, which forces insurers to regulate the rates paid to providers. Another way is to set an overall budget for healthcare as is done in Canada or certain European countries. As the Times describes the Massachusetts plan, the approach being considered there is a flat “global payment” to networks of providers for keeping patients well. All of these approaches alter the way providers are paid and attempt to shift the risks to the insurance companies or the providers. In my opinion, each of these approaches illustrates the use of the governmental power of coercion to alter the healthcare field.
This use of coercion is shown in various ways in the Affordable Care Act (ACA), by penalizing employers for not providing healthcare insurance so that employer provided healthcare is no longer “voluntary,” by penalizing individuals who do not obtain healthcare insurance, and by requiring the expansion by the states of the State Medicaid programs to cover a larger portion of the population.
Coercion is not new to the healthcare field. The federal government has long used its power of coercion to compel individuals and employers to pay the Medicare tax, and while Medicare Part B is voluntary, higher income individuals who select Part B are required to pay a higher premium than the vast majority of individuals participating in Part B. The Medicare and Medicaid programs, while “voluntary” for physicians but not for hospitals in New Jersey, sets the rates they pay.
One of the new approaches to cost control under the ACA is the creation of Accountable Care Organizations (ACO) in which some of the risk of patient outcomes is shifted to the providers.
What is missing so far in the discussion of ACOs and in the Massachusetts debate, is a general obligation on the part of the beneficiaries as to their compliance with medical instructions, as well as their election to live a healthy lifestyle. The government has exercised some coercion in this area, for instance, with significantly higher taxes on cigarettes as well as the numerous bans on smoking in various places. Society’s experience with Prohibition has made it clear that that is not the approach to take again, in the area of cigarettes, or quite frankly, in any other area. It should be noted that we are seeing calls for the legalization of marijuana and the taxation of marijuana rather than continuation of the current prohibition against the use of marijuana. A similar approach is being taken in the area of alcohol with higher taxes on alcohol.
Whether or not this coercive tool, taxation or in the case of smoking, prohibition in certain areas, will be extended to other activities or circumstances, such as obesity, which result in additional healthcare costs is yet to be seen. However, the changing of the paradigm in the healthcare delivery system, from payment to providers for the care they render to patients (whether or not the party is compliant with medical directions or the patients choose an unhealthy lifestyle) to shifting the risk resulting from bad patient conduct to the providers, is a giant step into the unknown. One question that will need to be addressed is what authority will providers have in this new paradigm to require patient compliance with both medical directives and with lifestyle changes.
Healthcare Reform Developments
October 26, 2011
Posted by Frank Ciesla
Over the last several weeks different events have occurred which will have an impact on the new healthcare system under the Affordable Care Act (ACA).
There has been an acknowledgement and recognition by CMS officials that the portion of the ACA known as the CLASS Act is actuarially unsound and cannot be realistically implemented. What is interesting is the continuing debate, as to whether or not, that portion of the ACA law should be repealed or retained as a part of the law without funding. These discussions are summarized below:
The original calculation as to the economic impact of the CLASS Act found that it was projected to save $80 billion. Obviously, that number is incorrect. Of course, not having the CLASS Act implemented will continue to place a significant burden for long-term care upon the Medicaid Program.
In addition, another major development occurred last week with the publication of the final Shared Savings (ACO) Program regulations, as discussed in our blog post of last week.
A third event impacting the Medicaid Program is the appeal to the United States Supreme Court by both the State of California and the Administration regarding the fact that neither beneficiaries nor providers can challenge the adequacy of payments being made by the Medicaid program to providers for care being rendered to the beneficiaries. Should the Supreme Court uphold that position, then a significant portion of the payments for care to be rendered under the Medicaid Program pursuant to the ACA will not be subject to challenge by either the providers or the beneficiaries. In the State of New Jersey, Medicaid’s payments to physicians are already the lowest in the fifty (50) states.
Thus, the Medicaid Program will continue to bear the costs of long-term care that was originally supposed to be shifted away from the Medicaid program by the CLASS Act, and access to physician’s services under Medicaid will continue to be a challenge, since neither individuals nor providers will be able to challenge inadequate payments to the providers.
On the Medicare side, ads are now being run by the American Medical Association in regard to the potential 30% reduction in payments made to physicians under the Sustainable Growth Rate (SGR). The reduction is supposed to take effect January 1, 2012.
It is acknowledged that to correct this problem it will cost $300 billion. This is a significant problem in light of the deficit reduction tasks being reviewed by the super committee.
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