Articles Tagged with “health care reform”

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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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HHS this week announced that it would again delay publishing rules implementing the Physician Payments Sunshine Act (“PPSA”), established in last year’s Patient Protection and Affordable Care Act (“PPACA” or “health reform”). PPSA requires drug and medical device manufacturers to publicly report gifts and payments made to physicians and teaching hospitals. While the law requires public disclosure on an annual basis, it does not limit financial relationships between drug and device manufacturers and physicians.

The penalties for non-compliance with this law are fines up to $10,000 per occurrence, not to exceed $150,000 per year, and for each knowing failure to report, the fines are increased to up to $100,000 per occurrence and $1 million aggregate per year.

Beginning January 1, 2012 all drug and device manufacturers must record all gifts and payments to physicians and teaching hospitals. Manufactures must report this information to HHS by March 31, 2013, for HHS publication beginning September 30, 2013.

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The U.S. District Court for the Eastern District of Virginia ruled that Section 1501 of the Patient Protection and Affordable Care Act (PPACA) is unconstitutional.  Shortly after PPACA was passed in March 2010, Virginia passed a state statute that conflicted with the individual mandate found in Section 1501 of PPACA which requires that by 2014 every United States citizen, with a few exceptions, must maintain a minimum level of health insurance coverage subject to penalty.  Following the passage of its state law, Virginia filed its lawsuit alleging that the individual mandate of PPACA violated the Commerce, Necessary and Proper and General Welfare Clauses of the United States Constitution.  The U.S. Department of Health and Human Services contended that the provision was Constitutional because individuals’ decisions to not purchase health care insurance combine to have a collectively serious effect on interstate commerce.  Thus, the Commerce Clause and the Necessary and Proper Clause support the provision. 

In his opinion, Judge Henry E. Hudson of the U.S. District Court for the Eastern District of Virginia disagreed with the U.S. Department of Health and Human Services’ analysis.  The court held that the individual mandate in PPACA violates the Commerce Clause because the provision “compels” an individual to engage in commerce.  Further, since the provision violates the Commerce Clause, the Necessary and Proper Clause does not protect the provision because that clause requires that legislation be in furtherance of Congress’ constitutionally enumerated powers.  

For more information on health care reform and its impact on health care providers, please visit www.wachler.com or contact a Wachler & Associates attorney at 248-544-0888.  

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The United States Supreme Court refused to hear a legal challenge to the healthcare reform law, the Patient Protection and Affordable Care Act (PPACA).  The Court declined without comment to hear the case originally filed in federal court in California by Steve Baldwin and the Pacific Justice Institute.  The plaintiffs challenged the constitutionality of the mandate that every American purchase health insurance by 2014.  Because a federal appeals court in California is still considering its decision, it would have been highly unusual for the Supreme Court to hear the challenge at this time. 

The California challenge to PPACA is only one of multiple challenges in courts around the country.  For instance, in Michigan a legal challenge was brought by the Thomas More Law Center.  In addition, there is another lawsuit filed by several states, the National Federation of Independent Business and two individuals. 

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

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On October 4, 2010 the Centers for Medicare and Medicaid Services (CMS) published a letter that was sent to state Medicaid directors as part of a series of letters that will provide guidance for the implementation of provisions of the Patient Protection and Affordable Care Act (PPACA), including the expansion of the Recovery Audit Contractor (RAC) program to Medicaid.  States are required to contract with Medicaid RACs consistent with state law and the RACs will be paid through contingency fees.  States will submit a State Plan Amendment (SPA) to CMS through which the State will either attest that it will establish a Medicaid RAC program by December 31, 2010 or indicate that it is seeking an exemption from the requirements.  CMS will permit states to maintain flexibility in the design of the state’s Medicaid RAC program and the number of entities the state will enter into contracts with, so long as the states act within the parameters of the statutory requirements. 

States that seeks to request variances or exceptions from the Medicaid RAC program must submit to CMS a written request from the state’s Medicaid Director to the CMS/Medicaid Integrity Group.  CMS has expressed that it will grant complete Medicaid RAC program exceptions rarely and only under the most compelling of circumstances.

Another important component of the Medicaid RAC program is the contingency fee payment to the contractors.  PPACA requires that Medicaid RACs be paid only from amounts “recovered” on a contingent basis for collecting overpayments and in amounts specified by the State for identifying underpayments.  Although CMS will not dictate the contingency fee rates, the maximum rate will be established.  CMS will publish a notice in the Federal Register, no later than December 31, 2010, to announce the highest Medicare RAC contingency fee rate and this rate will apply to Medicaid RAC contracts with a performance period beginning on or after July 1, 2014.  The contingency fee rates should be reasonable and take into account several factors, including: the level of the effort performed by the RAC, the size of the state’s Medicaid population, the nature of the state’s Medicaid health care delivery system and the number of Medicaid RACs engaged.  The fees paid to Medicaid RACs must include amounts associated with (1) identifying and recovering overpayments and (2) identifying underpayments.  States must maintain an accounting of amounts recovered and paid, and ensure that the total Medicaid RAC fees paid are not more than the total amount of overpayments collected.

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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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The Centers for Medicare and Medicaid Services (CMS) published a proposed rule implementing provisions of the Patient Protection and Affordable Care Act (PPACA) that help tackle Medicare and Medicaid fraud.  According to Peter Budetti, the Director of the new anti-fraud office at CMS, the proposed rules will provide federal authorities the power to identify fraud and reduce improper payments by an estimated $55 billion.

According to CMS, the proposed rule is essential to the implementation of healthcare reform since the expansion of healthcare coverage relies upon saving money on fraud and abuse in the healthcare systems.  Specifically, the rules will provide increased scrutiny to $900 billion in annual spending in federal Medicare, and the state-federal Medicaid and Children’s Health Insurance Program (CHIP), but it is unknown how much money the proposed rules will actually save.

Increased scrutiny over Medicare and Medicaid Programs will include the following measures:

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U.S. District Judge Roger Vinson indicated last Tuesday that he will likely allow a lawsuit to proceed that challenges the Constitutionality of the Healthcare Reform law.  The lawsuit, filed by 20 states, the National Federation of Independent Business and two individuals, challenges whether the Constitution permits the federal government to mandate Americans to purchase health insurance.  Earlier this summer the Obama Administration requested Judge Vinson to dismiss the lawsuit, arguing that the challenge requests the court to overturn precedent enforcing the federal government’s power to regulate interstate commerce.

After a two-hour hearing with the parties, Judge Vinson indicated that he would likely deny the federal government’s motion to dismiss on at least the count addressing whether Congress can require most citizens to purchase health insurance.

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

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Physicians Health Plan will be the insurer to offer subsidized health coverage for chronically-ill Michigan residents.  The insurer, based in Lansing, will offer health coverage through the health insurance pool that was created to provide an avenue for the uninsured chronically ill to buy coverage until state exchanges are active in 2014 as set forth in the health care reform legislation.  To qualify for the pool individuals must provide proof of U.S. citizenship and Michigan residency, certification by a physician that the individual is chronically ill and evidence that an insurer has refused, for health reasons, to cover the individual within the previous six months.  Physicians Health Plan will start enrolling members August 31 for coverage that becomes effective October 15. 

For more information on Michigan health care news or health care reform, please visit www.wachler.com or contact a Wachler & Associates attorney 248-544-0888. 

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As part of the Patient Protection and Affordable Care Act (PPACA), i.e., health care reform, states received more than $46 million in grants from the U.S. Department of Health and Human Services (HHS).  Crain’s Detroit Business reported that Michigan has received $1 million of grants from HHS to go towards improving oversight and review of proposed health insurance premium increases.  Although the Michigan Office of Financial and Insurance Regulation (OFIR) will ultimately use the grant for this purpose, OFIR first must obtain additional legislative authority to enforce consumer protections in the federal bill.  This will require the Michigan Legislature to amend the Michigan Insurance Code to incorporate the specific consumer protections.  At this time, the OFIR only has the authority to review, investigate, examine and encourage compliance from health insurance companies. 

Crain’s Detroit Business also reported that Michigan plans to use the $1 million grant to:

(1) Contract with consulting actuaries for targeted, in-depth analysis and review of health insurance premium filings made by HMOs and commercial carriers.