Representative Corcoran's HB 1329 Signage and Balanced Billing

Bill Tracking Spyglass

Imagine this: the Florida Legislature believes that consumers need to be protected from unscrupulous business practices by physicians and facilities (including physicians, hospitals and surgery centers) and will require things like (1) publishing charges with huge signage, and (2) informing consumers how charges compare to hospital imaging center charges. Failure to do so will subject the physicians and the centers to civil fines of $1,000/day is grounds for professional discipline. The Bill also holds insurers responsible for paying for medical services, but not where the provider doesn’t have a contract with the insurer. This leaves out of network providers out in the cold and will mean significant notice requirements being imposed on all providers.

View the bill in it’s entirety HERE


Fraud & Abuse Enforcement Soars Sky High

Investigations and successful prosecutions for violation of laws like the Anti Kickback Statute (“AKS”), the Stark Law and the False Claims Act were dramatically up in 2011 and are expected to climb still higher in 2012. For instance 13 doctors were charged in December, 2011 with violating the AKS by receiving payment for referring patients to an MRI center. Physicians and other healthcare business people MUST have any suspect arrangement closely scrutinized by highly qualified counsel. A “suspect arrangement” is any arrangement between providers of healthcare services that involve, to any degree, the exchange or payment of anything of value, including money. The AKS is a criminal statute; and the risks of enforcement are now huge.
Business and arrangements which are designed at all to lock in physician referrals carry particularly large risks and require close scrutiny. For instance, surgery centers that received referrals from non-owner physicians viewed that as a great thing. Now, referrals from unaffiliated physicians are viewed as inherently suspect. “What,” the regulator thinks, “is driving this referral? What wrongful conduct is being engaged in here?” This is especially so with any marketing arrangement as well.

Physicians and other healthcare business people would do well to recall that if even “one purpose” of the arrangement is to compensate (cash or anything of value) someone for a patient referral, the AKS is triggered. Moreover, where Safe Harbor Act compliance was recommended, many now find it necessary.


Senate OKs Two-Month Freeze on Doc Pay

Wrapping up legislative business before the Christmas recess, the Senate on Saturday approved legislation that freezes Medicare payments to physicians until Feb. 29.

In a vote of 89-10, the Senate passed an amended version of the House payroll tax bill that the lower chamber approved earlier this week. The legislation from Senate Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.) (PDF)—which extends a payroll tax holiday for two months—provides no payment update in Medicare reimbursement levels for the nation’s doctors in January and February 2012, which prevents a 27.4% cut that was scheduled to tax effect on Jan. 1.

Meanwhile, the bill also extends for two months a host of Medicare and health-related provisions that would otherwise have expired by year’s end. These measures include reimbursement raises for ambulance services, mental health reimbursements, the Qualifying Individual (QI) program, the outpatient “hold harmless” provision, and transitional medical assistance, which provides Medicaid benefits for low-income families who are transitioning from welfare to work.

In a statement, American Medical Association President Dr. Peter Carmel said waiting until the final week of the legislative session to address an issue Congress knew about all year is no way to conduct business for the country.

Read more: Senate OKs two-month freeze on doc pay – Healthcare business news and research | Modern Healthcare http://www.modernhealthcare.com/article/20111217/NEWS/312179947#ixzz1gzkQmEcy
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State Appellate Court Allows Burdensome Discovery Request

On August 10, 2011, the Fourth District Court of Appeals supported one litigant’s huge discovery request on the treating physician. The case (Katzman v. Rediron, No. 4D11-1290, August 10, 2011) arose with the following facts:

1.The doctor agreed to treat the patient under a letter of protection (LOP), which means the doctor would be paid out of the recovery of a lawsuit, not from health insurance proceeds;

2.The doctor allegedly performed a “controversial” surgical procedure, so Rediron’s lawyers wanted to know all sorts of information about how often he has ordered discectomies over the past four years and what he charged in litigation and non-litigation cases;

3.The doctor’s lawyer tried to block Rediron’s discovery request on the grounds that it would be a huge undertaking;

4.The trial court supported the discovery request, which was upheld on appeal.

The court’s analysis is interesting and instructive. The court found the treating physician to be BOTH a fact witness (because he treated the patient) and an expert witness (because he gives opinion testimony re the patient’s condition and injury). The court used their characterization of the doctor as a “hybrid” witness in order to support the trial court’s decision, which granted broad discovery on the issue of the reasonableness of the procedure’s cost and its necessity.

Discovery is something that can be used to harass and press someone into settlement. Hence, there are guidelines directed to ensuring that discovery requests are reasonable. That said, physicians who treat patients in lawsuits have a unique role that may expose them to greater than normal discovery requests.

Moreover, with this opinion, the old argument in bodily injury cases “What does reasonableness and necessity matter. It’s a BI lawsuit” will likely hold less water as all payers (including those who pay in BI lawsuits) are looking to reduce costs.


Path Lab Proposal Shot Down by OIG

The Office of Inspector General of the Department of Health and Human Services recently (October 11, 2011) shook its head at a proposal involving a pathology lab management services business that was to be owned by physicians. The proposed arrangement had the following features:

1.A path lab management business (“Manager”) would be formed and the business would be owned by doctors;
2.The Manager would provide a list of management services to a path lab;
3.The path lab (“Lab”) would not be owned by the doctors that own the Manager;
4.The Manager would provide a fixed amount of hours of services each year and would receive a percentage of the Lab’s income (fixed percentage in advance) and that fee would approximate the Lab’s use of the Manager’s services for the year;
5.The physician Manager investors would be in a position to refer to the Lab;
6.The ownership interests of the physician investors in the Manager would exceed forty percent (40%);
7.More than forty percent (40%) of the Lab’s revenues would come from the physician investors.

The OIG decided that the proposed arrangement posed more than a minimal risk of violating the Anti Kickback statute. The OIG also said the manager cannot refer its own patients or generate business in connection with the proposed arrangement. The OIG focused on the following points in its advisory opinion:

1.The Manager’s “usage fees” to the Lab are percentage based and not flat and set in advance;
2.The ownership interests of the doctor investors in the Manager would exceed what is specified in the so called “small entity” Safe Harbor;
3.The physician owners of the Manager have no experience in managing a lab, but are in a position to generate referrals to it.

Though the regulatory Safe Harbors (to the Anti Kickback Statute) are illustrative of permissible arrangements, the OIG is clearly sticking very close to them. where federal or state healthcare program dollars are involved, physician investors would do well to make sure they are Safe Harbor compliant.


CMS Delivers Final ACO Rules

Via Modern Healthcare

Final rules for Medicare’s accountable care organizations, released today by the CMS, made significant changes to proposals widely rejected by hospitals and physician groups.

Accountable care under Medicare offers financial incentives to providers that achieve quality and cost-saving targets. The Patient Protection and Affordable Care Act calls for Medicare to offer accountable-care agreements starting in 2012. The agency released draft rules in March for three-year agreements that providers sharply criticized as too risky and burdensome. More than 1,200 comments were submitted, according to CMS.

Final rules reduced quality measures to 33 (PDF) from the 65 originally proposed. CMS officials said in regulations released today the agency sought to reduce the administrative burden and eliminate potentially redundant measures. CMS also eliminated a potential penalty for the final year under one of two proposed accountable-care payment models. Previously, one payment proposal required ACOs to accept risk during the last year of a three-year agreement. The other model requires ACOs to accept risk for all three years.


Pain Management Regulations Affect More Than Pain Management Specialists

female professional

The recently passed House Bill 7095 affects more than just pain management specialists.  Practitioners who prescribe controlled substances for individuals with “chronic nonmalignant pain” also are required to comply with new state regulations, including designation “as a controlled substance prescribing practitioner on the physician’s practitioner profile”“with the state Board of Medicine by January 1, 2012. What follows is a bulleted summary of the new regulations.

Prescription s for controlled substances must be either written or electronic.  Telephone prescriptions no longer are allowed.

Written Prescriptions for Controlled Substances

  • Must have quantity in textual and numerical format
  • Must be dated with the abbreviated month written out
  • Must be written on a standardized counterfeit-proof prescription pad produced by a DOH approved vendor

Physicians who prescribe any controlled substance for the treatment of “chronic nonmalignant pain” must designate him or herself as a controlled substance prescribing physician on the physician’s practitioner profile and must comply with statutory requirements and applicable board rulesContinue reading

Medical Staffs and Conflicts of Interest

PHI Breach

Medical staffs are increasingly frustrated with the financial relationships their medical executive committee (MEC) members have with the hospitals where they work.  These financial relationships can be the cause of troubling conflicts of interest (COI).  Medical staffs need to be proactive about the issue.

A hospital based physician’s livelihood (and the economic welfare of his/her family) depends in part on having a good relationship with the administration of the hospital where he or she works.  It is easy, therefore, to see how the physician would be hard pressed to go against the hospital on controversial matters.  The same goes for a full time employed physician of a hospital and even a medical director who may derive significant compensation from his or her relationship with the hospital.

Looked at another way, what about a physician who staffs a hospital based department at hospital #1 who wants to get on staff of competing hospital #2?  What about the physician who is employed by hospital #1 becoming a member of hospital #2 and who wants to become president of hospital 2’s medical staff?

Intertwined financial relationships between hospitals and physician are on the rise.  The complexity of an ever evolving business model brings hospitals and physicians closer and closer, which creates significant COIs.  MECs must take a good look at what circumstances constitute a COI and develop methods to counteract them.

A COI basically exists for an MEC member when the member has a relationship with a party which causes the member to place his or her personal interests before those interests of the medical staff as a whole.  A classic COI is a financial relationship with the hospital.  If an MEC member receives money from a hospital for providing a service to or on behalf of a hospital, a COI exists.  But the inquiry does not stop there.  Simply having a COI is not dispositive.  The question is what to do about it.

There is essentially a two step process involved for an MEC member with a COI.  First, the COI must be disclosed.  This ought to be done annually and at each MEC meeting.  Second, on any matter where the COI is implicated, the MEC member ought to recuse himself or herself from a vote on the matter.  They can participate in the MEC consideration, but should leave the room when the vote is taken.

There is a third option, a poison pill of sorts.  If an MEC member find that the COI has him or her bouncing in and out of the MEC meeting room regularly, there ought to be consideration given to the person’s resignation.

At the very least, medical staffs must develop policies and procedures regarding COIs.  COIs ought to be defined and handled on a predetermined basis.  Moreover, medical staffs should give serious consideration to ensuring that at least a majority of the MEC members do not have a COI that would prevent them from doing their job, which is to ensure the integrity and proper functioning of the medical staff.