Articles Posted in Michigan Healthcare News

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In 2005, the Centers for Medicare & Medicaid started the Medicare Recovery Audit Contractor (RAC) program in three pilot states, where the program recovered over $900 million dollars during the three-year pilot. Due to the success of the pilot program, CMS expanded the program to all states in 2010, and has since recovered over three billion dollars. The success of the Medicare RACs resulted in the expansion of the current RAC program to Medicaid and Medicare Parts C and D through Section 6411 of the Affordable Care Act (ACA).

The ACA requires states to:

  • Contract with a RAC to ensure that overpayments and underpayments by the state Medicaid agency are identified, and that overpayments are recouped;
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A recent study published by Bailit Health Purchasing, has revealed that bundled payment programs are an effective option for organizations interested in an alternative to fee-for-service reimbursement for providers. Bundled payment differs from fee-for-service reimbursement by compensating a provider for all of the services a patient receives during a single hospital stay or during recovery from that stay on the basis of expected costs for an episode of care. Bundled payment initiatives seek to give providers greater incentive to better coordinate care with other providers, thereby reducing unnecessary duplication of services, reducing medical errors, improving patient health, and lowering costs.

Bailit Health Purchasing was commissioned by the Health Care Incentives Improvement Institute to research the viability of 19 active programs that have piloted bundled payment initiatives. Bailit released an initial report in May 2012. Bailit’s most recent study, published on May 30, 2013, provides a status update on the 19 active programs and highlights early adopters that have been successful in making bundled payment part of their permanent reimbursement strategy.

Bailit’s study, shared on Tuesday at the National Bundled Payment Summit in Washington, DC, highlights two successful case studies that have moved a bundled payment program from a pilot stage to a permanent reimbursement strategy: Blue Cross Blue Shield of North Carolina (BCBSNC) and Horizon Healthcare Services, Inc. (Horizon). The case studies reveal factors that have helped carry BCBSNC and Horizon to successful application of bundled payment.

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Blue Cross Blue Shield of Michigan (BCBSM) is auditing physicians who have conducted in-office Drug of Abuse (DOA) screening test. The purpose of these BCBSM audits is to determine whether the services, treatment, devices, and procedures that the physician billed to BCBSM conformed to Current Procedural Terminology (CPT) codes at the time of billing.

In auditing physicians who billed drug screening procedure codes, BCBSM is alleging that those physicians have incorrectly billed under current CPT codes for dates of services prior to the effective date of the current billing policies. In these cases, BCBSM sent notices to physicians enclosing current copies of the Physician Office Laboratory List (POLL) – a list of payable laboratory services allowed to be performed in the physician office setting – instead of the relevant POLL covering the audited time period. The drug screening procedure code at issue is CPT code 80101 [drug screen, qualitative; single drug class method (e.g., immunoassay, enzyme assay), each drug class], which is not listed on the current POLL. Instead, BCBSM states that codes 80104 and G0434 are the proper and payable drug screening tests when performed in the physician’s office. BCBSM is seeking returns of alleged overpayments from these physicians who billed 80101 in the office setting, as opposed to billing the lesser-paying drug screening procedure codes.

BCBSM may not hold physicians retroactively accountable for recent changes in billing. We are currently representing a number of physicians that have been audited by BCBSM. Based upon our review, we believe these audits can be successfully defended and the amount for overpayment substantially reduced. If you have been audited by BCBSM, we believe we can help, as we are currently representing physicians in similar cases and have been successfully defending providers against BCBSM audits since 1980. For further information on BCBSM audits, please contact an experienced Wachler & Associates healthcare attorney at 248-544-0888.

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Nearly a month after the federal government handed down indictments to defendants involved in one of Michigan’s largest prescription drug schemes, the federal government indicted 18 more people allegedly involved in Medicare fraud schemes.  According to a Detroit Free Press article, the U.S. District Court indicted people for their alleged involvement in a number of different health care fraud operations.  One of the charges was handed down to a Troy doctor who allegedly billed for home health services when she was out of the country, as well as for certain services that were physically unable to be completed in a single day.  Another indictment was handed down to an owner of a Detroit company who is being accused of billing Medicare for psychotherapy for numerous beneficiaries who were no longer alive.  Combined, all 18 defendants are accused of billing Medicare for $28 million.

The Medicare Fraud Task Force has no charged 138 people in Detroit with allegations of fraudulent billings totaling nearly $150 million.  According to Maureen Reddy, a Detroit-based FBI special agent, home health fraud is currently the largest type of fraud in the Detroit area.  The recent indictments also establish that Medicare fraud investigations are also expanding to other areas of health care services, such as psychotherapy.

These indictments are another example of the government’s focus on the Detroit area in Medicare and Medicaid investigations.  For more information on Medicare Fraud defense, or assistance with interpreting and understanding Medicare and Medicaid regulations, including the anti-kickback statute, please contact a Wachler & Associates attorney at 248-544-0888.

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Those practices with electronic health record systems (EHR) in place appear to be very happy with the results. A survey conducted by the Medical Group Management Association found that 72% of practices with implemented EHR systems were “satisfied” with the results. Further, those practices which have optimized their EHR systems have reported an 82% level of satisfaction.

If you have any questions or concerns about the compliance or regulatory issues involved with the implementation of a EHR system, please contact an attorney at Wachler & Associates at 248-544-0888.

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The proposed legislation would allow Michigan healthcare providers to apologize to patients without fear that those comments will be used against them in legal proceedings.  The law will not provide total immunity to comments, but allow for greater leeway when it comes to expressing remorse for procedures that did not achieve the desired result.  

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The Detroit Free Press reported that the Detroit Medical Center has agreed to pay $30 million to the federal government to settle claims that involved violations of the Anti-Kickback Statute and Stark from improper financial relationships with referring physicians.  The majority of the relationships at issue in the DMC matter involved office lease agreements and independent contractor relationships that were either not consistent with fair market value or not in writing.  If you are a provider and would like to ensure that your relationships comply with Stark and the Anti-Kickback Statute, please contact Wachler & Associates. 

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The proposed purchase of the Detroit Medical Center by Vanguard Health Systems Inc. has been conditionally approved by the Attorney General of Michigan Mike Cox.  This sale would bring a purported $1.5 billion in funding for the center.  The deal is tentatively set to take place on December 31, 2010 but there are still many issues that need to be worked out for the transaction to be completed.  One of the major issues still needing resolution before the final deal is the transferring of Medicare and Medicaid billing procedures from the nonprofit DMC to the for profit Vanguard.

For information on compliance issues associated with health care transactions please contact a Wachler & Associates attorney at 248-544-0888.

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The U.S. Justice Department filed a lawsuit against Blue Cross Blue Shield of Michigan (BCBSM) on Monday, October 18.  The Justice Department alleges that BCBSM violated antitrust laws by using its strong presence in the market to increase prices for its competitors, which resulted in Michigan residents paying higher health care and health insurance costs.  Specifically, the Justice Department says that BCBSM required hospitals to charge competitors more.  The Detroit Free Press reported that the Michigan attorney general’s office stated, “the investigation showed that Blue Cross increased its payouts to many hospitals to guarantee the hospitals would in turn charge all other insurers up to 40 percent more, pricing them out of the market and raising prices on all Michigan consumers.” 

The Detroit Free Press reported that BCBSM adamantly refuted the allegations.  BCBSM stated that the lawsuit was without merit and that its responsibility in contracting with hospitals is to negotiate on behalf of its members and costumers, not to negotiate against other health care insurers.

For more information on Michigan health care news, please visit the Michigan Healthcare News section on the Wachler Blog. 

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On October 8, U.S. District Judge George Steeh refused to grant an injunction that would prevent the implementation of the federal health reforms enacted through the Affordable Care Act.  Judge Steeh also dismissed several substantive portions of the suit, determining that Congress did not exceed its constitutional authority by requiring most people to buy health insurance.  The lawsuit was brought by the Thomas More Law Center, an Ann Arbor-based Christian legal center and four plaintiffs.  The Detroit Free Press reported that an attorney for the law center, Robert Muise, stated that the plaintiffs will appeal the decision.

The Michigan lawsuit is one of several lawsuits filed challenging provisions of the Affordable Care Act.  Another lawsuit filed by several attorney generals, including Michigan Attorney General Mike Cox, is in the appeals process with oral arguments scheduled for December 16.

For more information on federal healthcare reform, please visit www.wachler.com or contact a Wachler & Associates attorney at 248-544-0888. 

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