Breaking News: CMS publishes Final ACO Regulations
October 20, 2011
Posted by Beth Christian
Today was a busy day indeed for CMS. The agency has released the following: (1) the final Shared Savings Program regulations for ACOs; (2) a solicitation for participation in a new Advanced Payment Model designed to provide upfront payments to certain ACOs to assist with upfront infrastructure costs; and (3) a proposed rule implementing reforms to the Medicare Conditions of Participation for Hospitals.
The CMS press release announcing the publication of the Shared Savings Program regulations included the following statement by CMS Administrator Donald Berwick, M.D.:
“We listened very carefully to the more than 1,300 comments we received on the proposed rule released this spring, and this final rule includes a number of improvements suggested by those comments that will strengthen the program…….the final rule will increase the incentives and streamline the Shared Savings Program, extending the benefits of the new program to a broader range of beneficiaries.”
As we pointed out in our May 12, 2011 and May 20, 2011 blog posts, the draft rules published earlier this year had been criticized because they did not appear to contemplate how providers would obtain the capital needed to properly fund up front infrastructure costs for initiating ACO operations. Under the newly announced Advanced Payment ACO Model, participating ACOs will receive three types of payments:
- An upfront, fixed payment.
- An upfront, variable payment based on the number of its historically-assigned beneficiaries.
- A monthly payment of varying amount depending on the size of the ACO.
Note that the upfront, advanced payments will be recovered from future shared savings payments to the ACO.
The new Advanced Payment ACO Model is open only to two types of entities:
- ACOs that do not include any inpatient facilities AND have less than $50 million in total annual revenue.
- ACOs in which the only inpatient facilities are critical access hospitals and/or Medicare low-volume rural hospitals AND have less than $80 million in total annual revenue.
Only those ACOs that enter the Shared Savings Program in April 2012 or July 2012 will be eligible for participation in the Advanced Payment model. ACOs that are co-owned with a health plan will be ineligible. Other parties who do not qualify for the Advanced Payment Model may still form an ACO and participate in the Shared Savings Program, but they will not be eligible for the upfront, fixed payments.
OIG Exclusion List Updated
October 18, 2011
Posted by Sharlene Hunt
Earlier this month, the Office of the Inspector General (“OIG”) of the U.S. Department of Health and Human Services updated its List of Excluded Individuals and Entities (LEIE). This announcement should serve as a reminder to all Medicare providers to check their employees and contractors against the LEIE database to make sure they have not been excluded from the Medicare and Medicaid programs.
Under federal law, if an individual becomes excluded under any federal program, including Medicare and Medicaid, then the federal government will not pay reimbursement to anyone for services provided by the excluded individual. The government has previously indicated that this title applies not only to clinical services but also to administrative services provided by excluded individuals, including billing and claims processing. Since the government will not pay for any services where an excluded individual provided services, and the government has imposed an affirmative duty on providers to check the exclusion status of their employees, it is important to take the steps necessary to confirm that none of your employees or contractors are on the LEIE.
To the extent your employees or contractors are excluded individuals, the federal law authorizes the government to impose civil money penalties against a health care provider. At the annual American Health Lawyers Association meeting in Boston last summer, a representative of the government indicated that 36% of the self-disclosures made to the OIG by health care providers under the OPG Self-Disclosure Protocol are based on health care providers employing excluded individuals. Health care providers can use the Self-Disclosure Protocol to try to avoid some of the penalties that may be imposed if the government discovers wrongdoing that was not self-disclosed.
To the government, these cases are “low lying fruit”, because it is easy to prove that the individual was on the LEIE, and the government does not have to prove an intent to defraud on the part of the provider as it would in a case under the antikickback statute. These cases may be prosecuted under the False Claims Act as an illegal retention of an overpayment the provider should not have received. Thus, there are potential criminal penalties, as well as civil penalties, which may be imposed on the unwary provider who does not check the status of their employees and contractors against the LEIE.
Sustainable Growth Rate (SGR)
October 7, 2011
Posted by Frank Ciesla
Both the American Hospital Association and the American Medical Association (together with numerous physician specialty organizations) , have submitted letters to the Medicare Payment Advisory Commission (MedPAC) in response to a “Proposal” which MedPAC adopted yesterday, on various issues. MedPAC Proposal freezes payments for certain primary care services and reduces reimbursement for all other “specialist services,” whether provided by a primary care physician or specialist, by 5.9 percent for three consecutive years and is thereafter frozen. That means physicians would be looking at approximately an 18 percent cut at the end of the three year period in their compensation for many procedures they provide.
In order to maintain the level of reimbursement for certain primary care providers and cut reimbursement for any other procedures by “only” 18 percent, the MedPAC is recommending other cuts to other healthcare providers. Such cuts could end up adversely affecting the ability of other healthcare providers to provide the assets necessary for a physician to provide the appropriate care deemed necessary by that physician for patients.
A major concern is the fact that it is now ninety days before the implementation of the 30 percent cut under the Sustainable Growth Rate provision in existing law, which would become effective January 1, 2012 if Congress does not act, and that issue has not been resolved.
September 20, 2011
Posted by ewoo
“The New Frontier: How Accountable Care Organizations (ACOs) May Impact Your Business,” October 12, 2011
This education program will focus on issues to consider when deciding whether to participate in an
ACO. Medicaid, Medicare and private insurance companies all have different ideas of what
constitutes an ACO.
For more information and to RSVP, please click here.
Impacts of the Debt Ceiling Agreement on Medicare Providers
August 4, 2011
Posted by Sharlene Hunt
While some of the politicians involved in the federal debt ceiling discussions have vowed to protect Medicare beneficiaries from any adverse impact, Medicare providers have been targeted for cuts, which may in the end adversely impact the ability of Medicare beneficiaries to receive treatment. As part of the debt ceiling agreement struck earlier this week, if Congress cannot come to an agreement on budget cuts by the end of this year, there will be an automatic 2% across the board reduction in Medicare payments to providers beginning in 2013. Many providers have already proclaimed that they cannot afford another 2% cut across the board, and will consider withdrawing from the Medicare program as a result. In addition, some politicians have indicated that further cuts to Medicare providers are on the table as part of the negotiations to cut the federal budget deficit by the end of the year. Read more
OIG Issues Advisory Opinion 11-11 Regarding Discounts
August 4, 2011
Posted by Beth Christian
The HHS Office of Inspector General has published Advisory Opinion 11-11, which deals with a financial relationship between an entity furnishing supplies, equipment and other items to a skilled nursing facility. In order to enhance its likelihood of becoming the successful bidder in response to the skilled nursing facility’s RFP, the medical supplier offered to furnish items not covered by Medicare below its costs, while billing the skilled nursing facility the full Medicare Part B rate for Medicare covered services. Read more
Criminalizing Medicare
July 26, 2011
Posted by Frank Ciesla
At a recent meeting of the American Health Lawyers Association in Boston, the representatives of various government agencies, the U.S. Attorney’s office from various states, the Justice Department representatives, the OIG representatives and the Attorneys from CMS all made a similar point. That point was very simple, it is their feeling that recoupment, debarment, and civil monetary penalties have proven to them insufficient to stem the Medicare and Medicaid fraud. Therefore, they intend to shift their focus to using the criminal law to prosecute individuals who commit Medicare fraud.
As you can see in the attached article, the FBI is starting in New Jersey, a public advertizing campaign to encourage the public to report “Healthcare Fraud”.
Diagnostic Testing: Accreditation for Medicare
July 20, 2011
Posted by Beth Christian
Physicians, non-physician practitioners and Independent Diagnostic Testing Facilities that furnish the technical component (TC) of advanced diagnostic imaging services will need to become accredited in order to bill the Medicare program for such services after January 1, 2012.
Advanced diagnostic imaging procedures are defined as including diagnostic magnetic resonance imaging (MRI), computed tomography (CT), and nuclear medicine imaging such as positron emission tomography (PET). The Secretary of HHS is authorized to specify other diagnostic imaging services as needing accreditation in consultation with physician specialty organizations and other stakeholders.
The accreditation requirement specifically excludes x-ray, ultrasound, and fluoroscopy procedures, as well as diagnostic and screening mammography. The American College of Radiology, The Joint Commission, and the Intersocietal Accreditation Commission have been approved by CMS as accreditation agencies. Providers who furnish the technical component of radiology services should make sure that they are on track to become accredited by the applicable deadline.
Another Round of Potential Physician Reimbursement Reductions
July 6, 2011
Posted by Beth Christian
On July 1, 2011, the Centers for Medicare and Medicaid Services (“CMS”) published proposed changes to the Medicare physician fee schedule for calendar year 2012. CMS announced that absent a change in law, Medicare payments to physicians would be reduced by 29.5% effective January 1, 2012 as a result of the application of the sustainable growth rate formula reduction. We have discussed the sustainable growth rate conundrum in several prior blog posts (http://www.njhealthcareblog.com/2011/05/sustainable-growth-rate/). CMS is hoping for a legislative solution to the problem (temporary as it may be), as evidenced by the CMS statement that the “President’s budget submission for fiscal year (FY) 2012 would extend current payment rates through Dec. 31, 2013.”
CMS has also proposed additional modifications to the methodology for payments for certain radiology services in case where a patient receives more than one radiology service per day. Under the proposal, CMS is proposing to extend its multiple procedure payment reduction (MPPR) policy to the professional component (PC) of advanced imaging services – specifically, computed tomography (CT) scans, magnetic resonance imaging (MRI), and ultrasound. Under this proposal, the procedures with the highest PC payment would be paid in full. The PC payment would be reduced by 50 percent for subsequent procedures furnished to the same patient, on the same day, in the same session.
CMS will accept comments on the proposed rule until August 30, 2011.
Government Stepping Up Criminal Enforcement Efforts
July 5, 2011
Posted by Frank Ciesla
At the American Health Lawyers Association (AHLA) conference in Boston last week, the presenters, particularly those from the Justice Department or Centers for Medicare & Medicaid Services (CMS), consistently made the following position clear: there will be more criminal enforcement activity in the healthcare arena.
The government believes that civil monetary penalties, recoupment, and debarment have proven inadequate to prevent fraud and abuse in the Medicare or Medicaid programs. Therefore, the government has now elected to more vigorously utilize the criminal provisions of the various healthcare enforcement statutes (including the numerous changes in the Patient Protection and Affordable Care Act (PPACA)) to attempt to discourage fraudulent activity on behalf of providers. This, of course, ups the ante as to the government’s challenge to healthcare providers and requires more diligence on the part of healthcare providers to avoid confronting the new criminal law enforcement mindset of the federal regulators.
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