Tag: Healthcare Legislation
The Florida Supreme Court will hear arguments next month in a medical-malpractice dispute that focuses on whether a family physician provided adequate care before a patient committed suicide.
The court released a schedule Thursday that said arguments in the Sarasota County case will be heard Sept. 2. The case stems from the October 2008 death of Jacqueline Granicz, who was a patient of family physician Joseph Chirillo and had been treated for depression.
Granicz, 55, called the doctor’s office the day before her suicide and complained of issues such as mental strain, according to court documents. After learning about the call from an assistant, Chirillo decided to change Granicz’s medication and refer her to a gastroenterologist for gastrointestinal issues.
Granicz’s husband, Robert, filed the lawsuit alleging that Chirillo was negligent in his handling of the situation, at least in part because the doctor did not see the patient after the call.
A circuit judge granted summary judgment to Chirillo.
But the 2nd District Court of Appeal last year reversed that decision, allowing the lawsuit to move forward — and prompting Chirillo to ask the Supreme Court to hear the case. In a brief filed in February, Chirillo’s attorneys argued, in part, that the suicide could not be foreseeable to Chirillo and that state law treats suicide differently than other types of injuries or death.
“There are sound legal and practical reasons — already explained by Florida courts — for a physician to be held not to owe a legal duty to an outpatient who commits suicide, and thus, for this unique injury to be governed by different rules than those applicable to physical injuries alleged to be caused by medical malpractice,” the brief said.
But in a March brief, Robert Granicz’s attorneys pointed to expert testimony that Chirillo should have seen Jacqueline Granicz and assessed her condition after the call to the doctor’s office.
“Doctors can foresee that failing to treat their patients in a timely and proper fashion puts them in harm’s way,” the Granicz brief said. “Drilling down further, doctors treating patients for depression can foresee that failing to treat them in a timely and competent manner may result in suicide.”
A whistleblower case in Texas accuses a medical consulting firm and more than two dozen health plans for the elderly of ripping off Medicare by conducting in-home patient exams that allegedly overstated how much the plans should be paid.
The Texas litigation, whose details were unsealed by the court in June, is just the latest of at least a half dozen whistleblower cases that have been filed in the past five years alleging billing fraud and lax government oversight of privately run Medicare Advantage plans, which have proven increasingly popular with the elderly.
The latest lawsuit was filed in federal court in Dallas in 2014 by Becky Ramsey-Ledesma, a medical billing coder, against her former employer, CenseoHealth LLC. The Dallas-based firm has contracted with thousands of doctors who visit elderly people in their homes and evaluate their health on behalf of Medicare Advantage plans.
But the health assessments exaggerated how ill patients were, which in turn inflated Medicare payments to the health plans, according to the allegations in the suit. The suit names 30 Medicare Advantage plans in 15 states, including several Blue Cross plans and other industry stalwarts, such as Humana Inc. Humana has more than 3 million Medicare members.
The private insurance plans offer seniors an alternative to standard Medicare, which pays doctors for each service they render. Medicare Advantage plans receive a set fee monthly for each patient, based on a risk score that pays higher rates for sicker people and less for those in good health. Medicare essentially trusts health plans to report these risk scores accurately. The Medicare Advantage plans have grown rapidly in recent years, and now cover almost 17 million people.
The Texas suit was filed last year, but stayed under court seal until mid-June. It is the second whistleblower action to target Medicare Advantage home visits, which account for billions of dollars in annual revenues for health plans.
A 2014 Center for Public Integrity investigation found that home visits skyrocketed, even as federal officials struggled to prevent health plans from overcharging Medicare by tens of billions of dollars every year. Federal officials as early as 2013 were concerned the home visits could be a factor in jacking up risk scores improperly and wasting tax dollars. But when the industry objected, the officials backed off a proposal to limit the use of home visits, the investigation found.
CenseoHealth’s home visits collect data on the health status of patients, which the private health plans then use to bill Medicare. The company had no comment on the lawsuit.
The Centers for Medicare and Medicaid Services press office declined to answer written questions seeking comment on its home visit policy. The agency instead issued a statement that said the home exams can have “significant value.” That opinion is shared by the health insurance industry trade group, America’s Health Insurance Plans. A spokesperson for AHIP called the visits “an important component of disease management activities.”
Medicare Advantage is enjoying robust growth and firm political support in Congress. The industry has beaten back several attempts by the Obama administration to cut its rates as enrollment has grown to include about one in three people on Medicare. In June, the House passed a bill — sponsored by Rep. Vern Buchanan, a Republican from Florida — that appears to prevent federal officials from halting the home health assessments.
At the same time, the Centers for Medicare & Medicaid Services is drawing scrutiny over top manager Andy Slavitt’s former ties to UnitedHealth Group, which runs the nation’s biggest Medicare Advantage plan. Senate Finance Chairman Orrin Hatch criticized Slavitt’s “conflicted history” in a statement issued after President Obama nominated him for the top CMS job in July.
Bringing Back House Calls
CenseoHealth has emerged as a leader in a growing market for in-home health assessments.
Formed in 2009 by two Texans, CenseoHealth grew from four employees to 325 workers by 2013, according to its website. It has built a network of nearly 5,000 doctors who it says are “uniquely qualified to identify and diagnose health conditions.” Doctors affiliated with the company have done more than a million home visits, and in 2013 forecast that revenue would reach $120 million, according to the CenseoHealth website.
CenseoHealth’s investors include private equity firm Health Evolution Partners, headed by David Brailer, a physician and former health information technology czar under President George W. Bush. In March, Brailer was named chairman of CenseoHealth’s board of directors.
Brailer and other leaders at CenseoHealth had no comment on the case.
According to the suit, CenseoHealth used an algorithm to identify patients who might have undetected medical conditions that could raise their risk scores. The company uses marketers to contact patients and schedule doctor visits to their homes.
The lawsuit alleges that the doctors don’t provide any medical treatment. Other than taking vital signs and weight, listening to heart and lungs and checking reflexes, no physical exam in involved and no lab tests are performed, according to the suit. The doctors ask the patient a series of questions on a checklist during the visit, which takes about an hour.
“In other words, the conditions reflected on the evaluation forms are not medical diagnoses derived from a medical examination, but instead, are self-reported conditions captured from the medical history and verbally confirmed” by the patient, according to the suit.
Some of the doctors lacked medical licenses, according to the lawsuit, and others were assigned as many as ten visits a day for a flat fee of $100 each. Some faked results, according to the suit. The suit cited a test for Alzheimer’s disease in which each patient was asked to draw hands on a clock to indicate the correct time of day. “In some cases it was obvious that the same person had drawn the clock on multiple forms,” according to the suit.
Some of the diagnoses could not be made reliably through a home visit, according to the suit. Others were based on medications patients took, even when those medications could be taken for more than one condition, according to the suit.
These practices inflated risk scores, according to the suit, triggering “substantial overpayments” to the health plans.
Ramsey-Ledesma claims she was fired in August 2013, the day after she objected to the practices. According to the lawsuit, her manager told her, “we can no longer trust you.”
The other whistleblower case that targeted home visits was unsealed in 2014. It was filed by Anita Silingo, a former compliance officer for Mobile Medical Examination Services Inc., or MedXM. The company, based in Santa Ana, Calif., has denied the allegations. That case is pending.
The Department of Justice declined to join either case, which may make it more difficult for the whistleblowers to proceed with their cases and collect a large award. However, lawyers who handle these cases say more of them are moving ahead without the government.
Other whistleblower cases involving Medicare Advantage have been filed in the past five years in California, Florida and South Carolina, among other locales. These cases also allege that Medicare Advantage plans inflated risk scores and as a result were overpaid by Medicare.
Friends In High Places
As early as 2013, CMS officials said they suspected home visits improperly raise risk scores and waste tax dollars. But as the visits became standard procedure for more and more health plans, CMS apparently lost its appetite for tightening oversight.
CMS officials wrote in February 2013 that they were concerned that the primary objective of the visits was to raise risk scores and revenues “without follow up care or treatment being provided.”
In April 2013 though, facing industry pressure the officials backed off their proposal to collect data on the home visits with an eye to excluding their use in setting rates.
The following year, CMS again backed down from a proposal to exclude the visits after meeting with the industry. That decision came even though CMS said “there appears to be little evidence” that the visits led to any improvement in patient care. The insurance industry estimated that cutting out the visits would have cost Medicare Advantage plans nearly $3 billion a year.
Earlier this year, CMS handed the industry a major victory when it ruled out excluding the home visits. Instead, CMS urged the industry to adopt a set of “best practices” for the visits. The new policy “enhances the value of in-home assessments so they are used to support care planning and care coordination and improve enrollee health outcomes.”
The press release quoted then-CMS deputy administrator Slavitt saying the proposals “would reward providers of high quality, consumer-friendly care” for Medicare Advantage.
Slavitt is a former executive of Optum, a subsidiary of UnitedHealth Group. In July, President Obama nominated him to take over CMS permanently.
CMS officials declined to answer questions about Slavitt’s role in the decision making process for home assessments, but said:
“CMS believes that in-home assessments can have significant value as care planning and care coordination tools. In the home setting, the provider has access to more information than is available in a clinical setting.”
As expected, the CMS’ sweeping rule to modernize the regulation of Medicaid managed-care plans is drawing flak from state Medicaid directors and insurers who say it would impose heavy-handed federal control and could hurt patient care.
But some consumer advocacy groups responded favorably to the proposed rules, saying they offer guidance to states and Medicaid plans in developing provider networks that offer better access to beneficiaries.
The 653-page rule released in May would cap how much premium revenue private plans could allocate for administration and profits; require states to more rigorously supervise the adequacy of plans’ provider networks; encourage states to establish quality rating systems for plans; allow more behavioral healthcare in institutional settings; and encourage the growth of managed long-term care.
The proposed rule was considered long overdue because Medicaid managed-care enrollment has soared by 48% to 46 million beneficiaries, according to consulting group Avalere Health. By year-end the firm estimates that 73% of beneficiaries will receive services through managed-care plans.
Currently, 37 states and the District of Columbia contract with Medicaid plans, according to Medicaid Health Plans of America.
States have turned to Medicaid managed-care plans hoping to reduce costs and get more budget predictability. Insurers, however, have faced criticism for offering inadequate provider networks and denying needed care to pad their bottom lines. Because of the wide variation in how states run their Medicaid managed-care programs, there have been “inconsistencies” and “less-than-optimal results,” the CMS said when it issued the proposed rule.
Last year, HHS’ Office of Inspector General reported that states were not enforcing their own rules to ensure Medicaid plans had enough providers to care for their patients.
The last federal regulation governing such plans was issued in 2002. The proposed rule received nearly 900 comments by the July 27 comment deadline.
The National Association of Medicaid Directors said in its written comments that the rule would reduce the role of state Medicaid agencies in supervising how Medicaid managed care operates in their states. “The overarching framework of the regulation appears to shift the balance of authority for Medicaid managed care to the federal government, driving a top-down model that runs counter to the goal of a modernized regulatory framework,” the group said.
That approach, the group added, “removes the ability of states to drive innovation in managed-care delivery, to fully leverage the relationship to improve plan performance, or to tailor the approach to reflect the needs and expectations of the local population.”
A CMS representative did not respond to a request for comment for this article.
The Medicaid directors criticized a provision that would require states to offer Medicaid beneficiaries at least 14 days of initial coverage under traditional fee-for-service Medicaid, during which time they could choose a managed-care plan. “This policy fails to recognize that many states no longer have (fee for service) delivery models in their program,” the group complained.
Medicaid plans objected to the CMS’ proposal that they be required to spend 85% of premium revenue on medical care, a threshold known as a medical loss ratio. The Affordable Care Act set minimum medical loss ratios of 80% and 85% for individual and large-group plans in the commercial sector; money spent on administrative costs and profit above those limits must be rebated to consumers or employer purchasers. As of 2015, health plans doing business with Medicaid and the Children’s Health Insurance Program are the only ones that are not subject to such thresholds.
The health insurance industry had lobbied against inclusions of a minimum medical loss ratio, but experts said the proposed Medicaid requirement would not have much effect on large national insurers. About three-quarters of states with Medicaid managed care already require average medical loss ratios of at least 85%, according to the Kaiser Family Foundation.
Still, the Blue Cross and Blue Shield Association argued in its written comments that the benefits and services offered by managed-care organizations do not easily fit into the commercial medical loss ratio calculation. For example, managed-care plans spend significant resources on beneficiary outreach, partnering with local organizations for health promotion activities, and services to enhance patient compliance with treatment plans.
“Accounting for these expenditures in the MLR methodology may be challenging,” the Blues association said. “In addition, federal and state Medicaid reporting requirements require significantly more administrative resources beyond what commercial and Medicare programs require, making meeting an 85% MLR more difficult.”
To ensure that Medicaid beneficiaries have adequate access to care, the CMS is proposing that states establish time and distance standards for enrollees’ access to providers. The agency mostly left the development of these standards to the states.
At a minimum, Medicaid plans’ provider networks must meet such standards for certain types of providers, including hospitals, primary-care physicians and OB-GYNs, according to the proposed rule. The CMS said time and distance more accurately capture whether beneficiaries have adequate access to care than provider-to-enrollee ratios. States must also consider whether plans offer an adequate number of providers who speak languages other than English. In addition, the CMS encouraged states to include pediatric primary, specialty and dental providers in their network rules because of the large number of children covered under Medicaid and CHIP.
But Medicaid plans warned such requirements could hurt care for beneficiaries. “Requiring that states establish access standards based on the travel time and distance to a provider’s office relies on outdated notions of ‘traditional’ models of care delivery and does not take into account the variety of ways in which patients now commonly access healthcare, including via telemedicine,” Kaiser Permanente, which operates Medicaid plans, said in its comments. “Mandating the use of time and distance standards works to preserve the structure of geographically dispersed, disjointed provider networks and would do nothing to improve the quality of care provided to Medicaid beneficiaries.”
Geography-based standards also could discourage integrated delivery systems like ACOs, plans said.
But the National Health Law Program, a consumer advocacy group, praised the network adequacy provisions. “For too long, the Medicaid managed-care program has lacked specific network adequacy standards aimed at ensuring that consumers can access care from their Medicaid plans,” the group said. “These proposed provisions add significant detail to guide states and Medicaid plans in developing their networks to ensure adequacy.”
Medicaid Health Plans of America criticized a proposed provision eliminating the requirement that Medicaid plan enrollees provide written consent for a provider to file an appeal on their behalf following an adverse benefits decision. The CMS said requiring Medicaid enrollees to provide written consent is inconsistent with standards for the Medicare Advantage program.
“The language in the proposed rule may encourage providers to use the appeal process as a way to file claims payment disputes, which is not the intent of the grievance or appeal process,” the health plan group said in its comments.
Anthem wrote that “we believe that the proposed approach could potentially result in providers operating in furtherance of their own self-interest.”
Legislative pressure to delay Meaningful Use Stage 3 appears to be gaining momentum in the U.S. Senate. Sen. Lamar Alexander (R-Tenn.), chairman of the Senate health committee, had breakfast yesterday morning with Health and Human Services Secretary Sylvia Burwell in which he broached the issue.
“There’s been some discussion about delaying Meaningful Use Stage 3, about whether it’s a good idea, whether it’s a bad idea, whether to delay part of it or all of it,” said Alexander, who made the comments during the committee’s Thursday hearing on electronic health records and information blocking. “My instinct is to say to Secretary Burwell ‘let’s not go backwards on electronic healthcare records.’”
He told the committee that the consensus among providers is that MU Stage 1 helped to encourage EHR adoption, Stage 2 has been a mixed bag, and that Stage 3 is a “whole other kettle of fish.” According to Alexander, he spoke to one respected hospital executive who opined that Stage 1 and 2 “worked okay” but that they were “terrified” by Stage 3.
“We might want to slow down the implementation of Stage 3, not with the idea of backing up on it, but with the idea of saying ‘let’s get this right,’” he urged. “Let’s get this right before 500 employees and a billion dollars at the Mayo Clinic is put to work implementing a system that’s not right and then has to be changed in two, three or four years.”
In March, the Centers for Medicare and Medicaid Services released a notice for proposed rulemaking that outlined the third and final stage of the Meaningful Use program slated to begin in 2018.
Testifying on behalf of the American College of Cardiology (ACC), Michael Mirro, M.D., chief academic research officer for the Parkview Mirro Center for Research and Innovation in Fort Wayne, Ind., told the committee that Stage 3 should be delayed in its entirety. Delaying only certain parts of Stage 3 would just cause further confusion around the program, according to a letter ACC sent to Alexander last month.
“Although the Meaningful Use program has brought favorable results within the context of data transfer, many of the requirements set forth in the program are unattainable,” said Mirro, who commented that only 11 percent of physicians have so far attested to Stage 2. “We definitely need to delay Stage 3. We really have to digest the impact of Stage 2 Meaningful Use and continue to strive to simplify the requirements.”
Likewise, David Kibbe, M.D., president and CEO of DirectTrust, recommended to the committee “an immediate moratorium on Stage 3 until Stage 2 is fixed.” According to Kibbe, there are parts of Stage 2 that must be improved so that more eligible professionals and hospitals can participate in the program.
The Medical Group Management Association is supporting another effort in Congress to enable ICD-9 or ICD-10 coding for six months following the ICD-10 compliance date on October 1.
Reps. Marsha Blackburn (R-Tenn.) and Tom Price, M.D. (R-Ga.) introduced H.R. 3018, which was referred to the House Ways & Means and Energy & Commerce Committees.
Under the bill, the Department of Health and Human Services would implement a transition period during which claims and related transactions “otherwise payable (or processed) by public and private payers shall continue to be processed and paid, as applicable, if submitted with ICD-9 codes.” The bill also would require within 90 days of enactment that HHS submit a report to Congress assessing the impact of ICD-10 on providers and individuals.
Several bills that would impose a transition period for ICD-10 have been introduced and not enacted, and time is short for action on this legislation with only 17 session days left before the compliance data. However, bills sometimes don’t have to be enacted to change policy as lawmakers and stakeholders put pressure on regulators to be more flexible, notes Robert Tennant, director of HIT policy at MGMA. “There’s various ways to get to the end zone.”
The Centers for Medicare and Medicaid Services, for instance, recently made several ICD-10 policy concessions in a deal with the American Medical Association that cover the Medicare program. Now, the lawmakers and MGMA seek more flexibility.
MGMA’s big worry is that large numbers of physicians through no fault of their own won’t be ready for ICD-10 because they have not received software upgrades in a timely manner and may have no way come October to submit ICD-10 claims, or they have been unable to adequately test with insurers.
In addition, a survey with close to 600 respondent practices and weighed to MGMA members found that found that 20 percent of the practices still submit 4010 formatted claims, three years after the ICD-10-supporting 5010 format was introduced. If larger practices never made the change, it is likely that many smaller ones also did not. The 4010 format cannot accommodate an ICD-10 claim, Tennant said.
Further, Tennant notes, compliance with the 5010 transactions set included a 6-month transition period.
Insurance premium subsidies will continue to flow to Americans in all states under the Affordable Care Act, the U.S. Supreme Court decided 6-3 in King v. Burwell on Thursday.
The justices sided with the Obama administration in the historic decision, saying the healthcare law allows Americans in all states—not just those that established their own exchanges—to receive the subsidies.
Chief Justice John Roberts and Justice Anthony Kennedy were the swing votes in the case, siding with the more liberal justices.
“Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them,” Roberts wrote in the opinion. “If at all possible, we must interpret the act in a way that is consistent with the former, and avoids the latter.”
An estimated 6.4 million Americans receive the subsidies in the 34 states that don’t have their own exchanges, in many cases relying on them to afford their health insurance, according to HHS.
Many had worried a decision in the opposite direction would lead to a dramatic spike in the nation’s uninsured and the disintegration of the healthcare law itself.
The challengers in the case pointed to one part of the law that says subsidies are available only to those who enroll through an “exchange established by the state.” The federal government, however, argued that the law’s purpose is clear in allowing Americans in every state to be eligible for subsidies and that other parts of the law indicate that.
In siding with the Obama administration Thursday, the justices refused to consider the phrase “exchange established by the state” in isolation. Instead, they looked at the broader context and structure of the law.
“In this instance, the context and structure of the act compel us to depart from what would otherwise be the most natural reading of the pertinent statutory phrase,” Roberts wrote in the opinion.
He wrote the subsidies “are necessary for the federal exchanges to function like their state exchange counterparts, and to avoid the type of calamitous result that Congress plainly meant to avoid.”
The Internal Revenue Service has interpreted the law to allow subsidies in all states, but the four individual plaintiffs in the case said that interpretation was wrong. The Supreme Court, however, refused to entertain that idea in their opinion.
The justices declined to apply what’s known as the Chevron doctrine, an oft-cited precedent that says federal agencies must follow the letter of the law where the law is clear. Under the doctrine, if a law is ambiguous, courts must defer to a government agency’s reasonable interpretation of it.
The justices said in their opinion it’s extremely unlikely Congress would have delegated interpretation of the law to the IRS, so the Chevron doctrine wasn’t appropriate for this case.
“Had Congress wished to assign that question to an agency, it surely would have done so expressly … It is especially unlikely that Congress would have delegated this decision to the IRS, which has no expertise in crafting health insurance policy of this sort,” Roberts wrote in the opinion.
Some had speculated that if the court had used the Chevron doctrine to decide the case—finding the language of the law ambiguous and allowing the IRS’ interpretation—future presidential administrations could have re-interpreted the statute and pulled the plug on subsidies.
Roberts didn’t seem to want to expose the law to that type of uncertainty by applying the Chevron doctrine, said Ankur Goel, a partner with McDermott Will & Emery who co-authored an amicus brief siding with the government on behalf of the American Public Health Association.
“Here, it’s really because of the magnitude of the issue, the magnitude of the dollars that are being expended,” Goel said. “To say different administrations could change the ruling didn’t seem to Justice Roberts like the right answer.”
Last summer, a 4th U.S. Circuit Court of Appeals panel in Virginia unanimously ruled in favor of the administration in King v. Burwell, saying subsidies should be allowed in all 50 states.
Dissenting on the decision were Justices Antonin Scalia, Samuel Alito and Clarence Thomas.
Chip Kahn, CEO of the Federation of American Hospitals, called the decision “welcome news” in a statement Thursday.
“The decision secures healthcare coverage for millions of Americans,” Kahn wrote. “Protecting patient coverage provides peace of mind to so many and helps ensure their access to the needed care at the right time.”
Rich Umbdenstock, CEO of the American Hospital Association, called the decision a “significant victory.”
“In the short time the subsidies have been available, hardworking people who are sick, need care for chronic conditions or want preventive care have been able to seek care more easily,” Umbdenstock said in the statement. “Most significantly, providing access to primary and preventive care helps improve the health and well-being of individuals, family and communities.”
The three dissenting justices, however, criticized the majority for performing “somersaults of statutory interpretation” in their dissent, written by Scalia.
Scalia said King v. Burwell, along with the last Supreme Court opinion over the ACA in 2012, “will publish forever the discouraging truth that the Supreme Court of the United States favors some laws over others, and is prepared to do whatever it takes to uphold and assist its favorites.”
Scalia argued that the phrase “established by the state” is clear. Context matters, he said, but should be used as a tool for understanding laws, “not an excuse for rewriting them.” He added that the context of the ACA actually undermines the majority’s reading.
“Words no longer have meaning if an exchange that is not established by a state is ‘established by the state,’ ” Scalia wrote. “It is hard to come up with a clearer way to limit tax credits to state exchanges than to use the words ‘established by the state.’ ”
But Tim Jost, law professor at Washington and Lee University and a prominent ACA proponent, countered that the majority made the only logical decision.
“It was obvious from the beginning that Congress intended the federally facilitated as well as state exchanges to grant premium tax credits, and if the court was willing to read the statute as a whole and not just focus on four words, it could not avoid that conclusion,” Jost said.
Others, however, agreed with Scalia.
“In the end, the court once again had to rewrite the plain text of Obamacare, in the words of Justice Scalia, to save the Affordable Care Act,” said Josh Blackman, an assistant professor at South Texas College of Law who filed an amicus brief in the case on behalf of the Cato Institute siding with the challengers.
Blackman added that it was curious that Roberts pointed out in his opinion that key parts of the law were written behind closed doors rather than through the traditional legislative process. Roberts also noted that much of the act was passed using a complex budgetary procedure known as reconciliation, which limited chances for debate and amendment.
“Basically this law was not passed in the manner that was appropriate for such a significant piece of legislation,” Blackman said. “The court said we’re not going to hold them to it.”