Med Law Blog : Pennsylvania Health Care Lawyers & Attorneys : Tucker Arensberg Law Firm : Employee Benefits, HIPAA & HIT in Pittsburgh, PA

The Office of Inspector General (OIG) has issued advisory opinion number 07-05 concluding that a proposal by a group of physicians owning an ambulatory surgery center to sell 40% of the ambulatory surgery center to a hospital has the potential to generate unlawful remuneration and is therefore not eligible for a safe harbor advisory opinion. The ASC is owned by a group of physicians consisting of the following:

·        3 Orthopedic Surgeons own 94%

·        2 Gastroenologists and 2 Anesthologistscollectively own an additional 6%

The Orthopedic Surgeons propose to personally sell sufficient units in the LLC to give the hospital a 40% interest at a price higher than the Orthopedic Surgeons' initial investment, thereby guaranteeing an additional personal return on their investment. 

The OIG concluded that the potential for unlawful remuneration exists for the following reasons: 

1.      Since the investment return to all of the owners, including the hospital, following the transaction would be based upon ownership, the selling physicians would effectively receive a higher return on their investment than the other investors because of the profit built into this transaction;

2.      units in the LLC were not offered to any other third party investor, raising the spectre that the purchases, remuneration and exchange for referrals to the hospital;  

3.      only the Orthopedic Surgeons shares were proposed to be sold and not the other physician investors. 

The text of the advisory opinion is available at the following link:

http://oig.hhs.gov/fraud/docs/advisoryopinions/2007/AdvOpn07-05C.pdf

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Following is the text of a post from Alan Goldberg  identifying the CMS hospital report card. My thanks to Alan.

List Sponsor: FTI Healthcare/FTI Cambio – One of the nation's leading experts in healthcare consulting – Operations & Strategy, Turnaround Solutions, Regulatory & Disputes, Restructurings. Visit http://www.ftihealthcare.com to learn more.
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The Illinois Attorney General has filed price fixing charges against the two largest physician groups in Champaign County, Illinois, charging them with boycotting Medicaid patients in order to raise prices. Carle Clinic Associates, P.C. has 300 physicians, 200 of which are in Champaign County, Illinois, representing a 60% market share. Christie Clinic, P.C. has 100 physicians, all which are in the Champaign County, representing a 30% market share.

The Attorney General alleges that the clinics agreed to boycott new Medicaid patients in order to increase effective Medicaid reimbursement rates and to accelerate reimbursement payments.

The case raises interesting legal and factual questions. From a factual standpoint, the Attorney General is alleging the existence of an agreement arising out of alleged continual contacts since early 2003 resulting in the clinics implementing similar policies regarding new Medicaid patients. It remains to be seen whether this is an agreement, conscious parallelism or coincidental independent action.

The Illinois Antitrust Act prohibits concerted action to fix, control or maintain prices and concerted action to fix, control or maintain the supply of a commodity or service. Since the prices, i.e., reimbursement rates, are established by the state government, the price fixing argument has weaknesses. On the other hand, if true, the physician groups are apparently limiting the supply of physician services to new Medicaid patients.

The case presents interesting legal issues:

1.         Can the government compel private businesses to provide services to government programs at unacceptable rates, since this is not a tax-exempt situation where the clinics have charitable mission obligations required to qualify for tax exempt status, nor is it a situation similar to Hill-Burton funds, where hospital’s are required to participate in federal programs in order to receive federal funding?

2.         Can the government compel private businesses to provide services to people in a certain economic status in the same manner they compel private businesses with whom meet certain jurisdictional requirements to comply with Americans With Disabilities Act?

Note that neither of these underlying issues is an issue in the case, which just alleges a group boycott on conspiracy that violates the statute.

The press release of the Illinois Attorney General and a copy of the Complaint are available at the link below:

http://www.illinoisattorneygeneral.gov/pressroom/2007_06/20070614b.html

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The Oklahoma Supreme Court has decided  the Oklahoma Peer Review statute (Professional Review Bodies - Protection From Liability Act) does not provide blanket immunity to peer review bodies in Oklahoma. The statute is only a defense to liability if the peer review body meets all of the requirements of the Act. In Smith v. Deaconess Hospital, a copy of which is attached at the link below, the Oklahoma Supreme Court overruled a trial court decision granting the hospital’s motion to dismiss and remanded the case for further proceedings. Among the significant shortcomings described by the Court, was the inability of Dr. Smith to cross examine the author of a peer review report of Dr. Smith’s cases and the failure to follow the bylaw procedures. The Oklahoma statute is reproduced in the text of the opinion, and it follows the structure of the requirements of the Health Care Quality Improvement Act, i.e., it establishes four similar conditions for qualified immunity and provides for specific procedural rights.

http://op.bna.com/hl.nsf/id/thyd-73qrnv/$File/Smith%20v%20Deaconess%20Hospital.htm

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KEY FACTS: PHYSICIAN QUALITY REPORTING INITIATIVE (PQRI)

PQRI is a precursor to Medicare pay for performance (P4P) or quality incentives established by the Tax Relief and Healthcare Act of 2006 (TRHCA). The first quality reporting period will be July 1, 2007 through December 31, 2007.

Payment Amount: Congress budgeted $1.35 billion but the payment amount per provider is;

(1)        Subject to the number of participating/reporting physicians;

(2)        Limited to no more than 1.5% of the total allowed charges for covered services provided during the reporting period, i.e., 7/1/07 - 12/31/07;

(3)        Will be paid in a single consolidated payment in “mid 2008.”

Eligible Providers: Doctors, Dentists, Chiropractors, Podiatrists, Optometrists, PT, OT, PA, CRNA, CNS, NM, Psychologist, Dietician.  

Eligible Services: CMS has identified 74 measures for 2007 PQRI; eligible services for 2008 are being developed.

Procedure and Reporting Thresholds: Providers should select services applicable to their patient panels. In order to “successfully report” and receive the bonus payments, certain reporting thresholds must be met:

(1)        When 3 or fewer measures are selected, providers must report in at least 80% of the potential cases.

(2)        When more than 3 measures are selected, the 80% threshold must be satisfied for at least 3 measures.

Sample instructions for 4 measures follows:

2007 Physician Quality Reporting Initiative (PQRI)Measure Specifications

DESCRIPTION:

Percentage of patients aged 18 through 75 years with diabetes (type 1 or type 2) who had most recent hemoglobin Al c greater than 9.0%

INSTRUCTIONS:

This measure is to be reported a minimum of once per reporting period for patients seen during the reporting period. The performance period for this measure is 12 months. The most recent quality code submitted will be used for performance calculation. It is anticipated that clinicians who provide services for the primary management of diabetes mellitus will submit this measure.

This measure can be reported using CPT Category II codes:

ICD-9 diagnosis codes, CPT E/M service codes, G-codes, and patient demographics (age, gender, etc..) are used to identify patients who are included in the measure's denominator. CPT Category II codes are used to report the numerator of the measure.

When reporting the measure, submit the listed ICD-9 diagnosis codes, CPT E/M service codes or G-codes, and the appropriate CPT Category II code OR the CPT Category II code with the modifier. The reporting modifier allowed for this measure is: 8P- reasons not otherwise specified. There are no allowable performance exclusions for this measure.

NUMERATOR:

Patients with most recent hemoglobin Alc level > 9.0%

Numerator Instructions: This is a poor control measure. A lower rate indicates better performance (e.g., low rates of poor control indicate better care)

Numerator Coding:

Most Recent Hemoglobin Al c Performed

CPT II 3046F: Most recent hemoglobin Alc level > 9.0% OR

CPT II 3044F: Most recent hemoglobin Alc level < 7.0% OR

CPT II 3045F: Most recent hemoglobin Alc level 7.0% to 9.0%

OR

Hemoglobin Al c not Performed, Reason Not Specified

Append a reporting modifier (8P) to CPT Category II code 3046F to report circumstances when the action described in the numerator is not performed and the reason is not otherwise specified.

• 8P: Hemoglobin Alc level was not performed during the performance period (12 months), reason not otherwise specified

DENOMINATOR:

Patients aged 18-75 years with the diagnosis of diabetes

Denominator Coding:

An ICD-9 diagnosis code for diabetes and a CPT E/M service code or G-code are required to identify patients for denominator inclusion.

ICD-9 diagnosis codes: 250.00, 250.01, 250.02, 250.03, 250.10, 250.11, 250.12, 250.13, 250.20, 250.21, 250.22, 250.23, 250.30, 250.31, 250.32, 250.33, 250.40, 250.41, 250.42, 250.43, 250.50, 250.51, 250.52, 250.53, 250.60, 250.61, 250.62, 250.63, 250.70, 250.71, 250.72, 250.73, 250.80, 250.81, 250.82, 250.83, 250.90, 250.91, 250.92, 250.93, 648.00, 648.01, 648.02, 648.03, 648.04

AND

CPT ERA service codes or G-codes: 97802, 97803, 97804, 99201, 99202, 99203, 99204, 99205, 99211,99212, 99213, 99214, 99215, 99304, 99305, 99306, 99307, 99308, 99309, 99310, 99343, 99324, 99344, 99325, 99345, 99326, 99347, 99327, 99348, 99328, 99349, 99334, 99350, 99335, G0270, 99336, G0271, 99337, 99341, 99342,

RATIONALE:

Intensive therapy of glycosylated hemoglobin (Al c) reduces the risk of microvascular complications.

CLINICAL RECOMMENDATION STATEMENTS:

A glycosylated hemoglobin should be performed during an initial assessment and during follow-up assessments, which should occur at no longer than three-month intervals. (AACE/ACE)

The Al c should be universally adopted as the primary method of assessment of glycemic control. On the basis of data from multiple interventional trials, the target for attainment of glycemic control should be Al c values 6.5%. (AACE/ACE)

Obtain a glycosylated hemoglobin during an initial assessment and then routinely as part of continuing care. In the absence of well-controlled studies that suggest a definite testing protocol, expert opinion recommends glycosylated hemoglobin be obtained at least twice a year in patients who are meeting treatment goals and who have stable glycemic control and more frequently (quarterly assessment) in patients whose therapy was changed or who are not meeting glycemic goals. (Level of evidence: E) (ADA)

Because different assays can give varying glycated hemoglobin values, the ADA recommends that laboratories only use assay methods that are certified as traceable to the Diabetes Control and Complications Trial Al c reference method. The ADA's goal for glycemic control is Al c <7%. (Level of evidence: B) (ADA)

Monitor and treat hyperglycemia, with a target Al C of 7%, but less stringent goals for therapy may be appropriate once patient preferences, diabetes severity, life expectancy and functional status have been considered. (AGS)

DESCRIPTION:

Percentage of patients aged 18 through 75 years with diabetes (type 1 or type 2) who had most recent LDL-C level in control (less than 100 mg/dl)

INSTRUCTIONS:

This measure is to be reported a minimum of once per reporting period for patients seen during the reporting period. The performance period for this measure is 12 months. The most recent quality code submitted will be used for performance calculation. It is anticipated that clinicians who provide services for the primary management of diabetes mellitus will submit this measure.

This measure can be reported using CPT Category II codes:

ICD-9 diagnosis codes, CPT E/M service codes, G-codes, and patient demographics (age, gender, etc.) are used to identify patients who are included in the measure's denominator. CPT Category II codes are used to report the numerator of the measure.

When reporting the measure, submit the listed ICD-9 diagnosis codes, CPT E/M service codes or G-codes, and the appropriate CPT Category II code OR the CPT Category II code with the modifier. The reporting modifier allowed for this measure is: 8P- reasons not otherwise specified. There are no allowable performance exclusions for this measure.

NUMERATOR:

Patients with most recent LDL-C < 100 mg/dL

Numerator Coding:

Most Recent LDL-C Performed

CPT II 3048F: Most recent LDL-C < 100 mg/dL

OR

CPT II 3049F: Most recent LDL-C 100-129 mg/dL

OR

CPT II 3050F: Most recent LDL-C 130 mg/dL

OR

LDL-C Level not Performed, Reason Not Specified

Append a reporting modifier (8P) to CPT Category II code 3048F to report circumstances when the action described in the numerator is not performed and the reason is not otherwise specified.

• 8P: LDL-C was not performed during the performance period (12 months), reason not otherwise specified

DENOMINATOR:

Patients aged 18-75 years with the diagnosis of diabetes

Denominator Coding:

An ICD-9 diagnosis code for diabetes and a CPT E/M service code or G-code are required to identify patients for denominator inclusion.

ICD-9 diagnosis codes: 250.00, 250.01, 250.02, 250.03, 250.10, 250.11, 250.12, 250.13, 250.20, 250.21, 250.22, 250.23, 250.30, 250.31, 250.32, 250.33, 250.40, 250.41, 250.42, 250.43, 250.50, 250.51, 250.52, 250.53, 250.60, 250.61, 250.62, 250.63, 250.70, 250.71, 250.72, 250.73, 250.80, 250.81, 250.82, 250.83, 250.90, 250.91, 250.92, 250.93, 648.00, 648.01, 648.02, 648.03, 648.04

AND

CPT EIM service codes or G-codes: 97802, 97803, 97804, 99201, 99202, 99203, 99204, 99205, 99211, 99212, 99213, 99214, 99215, 99304, 99305, 99306, 99307, 99308, 99309, 99310, 99343, 99324, 99344, 99325, 99345, 99326, 99347, 99327, 99348, 99328, 99349, 99334, 99350, 99335, G0270, 99336, G0271, 99337, 99341, 99342

RATIONALE:

Persons with diabetes are at increased risk for coronary heart disease (CHD). Lowering serum cholesterol levels can reduce the risk for CHD events.

CLINICAL RECOMMENDATION STATEMENTS:

A fasting lipid profile should be obtained during an initial assessment, each follow-up assessment, and annually as part of the cardiac-cerebrovascular-peripheral vascular module. (AACE/ACE)

A fasting lipid profile should be obtained as part of an initial assessment. Adult patients with diabetes should be tested annually for lipid disorders with fasting serum cholesterol, triglycerides, HDL cholesterol, and calculated LDL cholesterol measurements. If values fall in lower-risk levels, assessments may be repeated every two years. (Level of evidence: E) (ADA)

Patients who do not achieve lipid goals with lifestyle modifications require pharmacological therapy. Lowering LDL cholesterol with a statin is associated with a reduction in cardiovascular events. (Level of evidence: A)

Lipid-lowering therapy should be used for secondary prevention of cardiovascular mortality and morbidity for all patients with known coronary artery disease and type 2 diabetes. (ACP)

Statins should be used for primary prevention against macrovascular complications in patients with type 2 diabetes and other cardiovascular risk factors.

Once lipid-lowering therapy is initiated, patients with type 2 diabetes mellitus should be taking at least moderate doses of a statin.

Older persons with diabetes are likely to benefit greatly from cardiovascular risk reduction, therefore monitor and treat hypertension and dyslipidemias. (AGS)

DESCRIPTION:

Percentage of patients aged 18 through 75 years with diabetes (type 1 or type 2) who had most recent blood pressure in control (less than 140/80 mm Hg)

INSTRUCTIONS:

This measure is to be reported a minimum of once per reporting period for patients seen during the reporting period. The performance period for this measure is 12 months. The most recent quality code submitted will be used for performance calculation. It is anticipated that clinicians who provide services for the primary management of diabetes mellitus will submit this measure.

This measure can be reported using either CPT Category II codes:

ICD-9 diagnosis codes, CPT E/M service codes, G-codes, and patient demographics (age, gender, etc.) are used to identify patients who are included in the measure's denominator. CPT Category II codes are used to report the numerator of the measure.

When reporting the measure, submit the listed ICD-9 diagnosis codes, CPT E/M service codes or G-codes, and the appropriate CPT Category II codes OR the CPT Category II code with the modifier. The reporting modifier allowed for this measure is: 8P- reasons not otherwise specified. There are no allowable performance exclusions for this measure.

NUMERATOR:

Patients whose most recent blood pressure < 140/80 mm Hg

Numerator Instructions: To describe both systolic and diastolic values, two codes must be reported for this measure. For the systolic blood pressure value, report one of the systolic codes; for the diastolic blood pressure value, report one of the diastolic codes. If there are multiple blood pressures on the same date of service, use the lowest systolic and lowest diastolic blood pressure on that date as the representative blood pressure.

Numerator Coding:

Most Recent Blood Pressure Measurement Performed

Systolic codes

CPT II 3074F: Most recent systolic blood pressure < 130 mm Hg

OR

CPT II 3075F: Most recent systolic blood pressure 130 to 139 mm Hg

OR

CPT II 3077F: Most recent systolic blood pressure > 140 mm Hg

AND

Diastolic codes

CPT II 3078F: Most recent diastolic blood pressure < 80 mm Hg OR

CPT II 3079F: Most recent diastolic blood pressure 80-89 mm Hg

OR

CPT II 3080F: Most recent diastolic blood pressure > 90 mm Hg

OR

Blood Pressure Measurement not Performed, Reason Not Specified

Append a reporting modifier (8P) to CPT Category II code 2000F to report circumstances when the action described in the numerator is not performed and the reason is not otherwise specified.

• 8P: No documentation of blood pressure measurement, reason not otherwise specified

DENOMINATOR:

Patients aged 18-75 years with the diagnosis of diabetes

Denominator Coding:

An ICD-9 diagnosis code for diabetes and a CPT E/M service code are required to identify patients for denominator inclusion.

ICD-9 diagnosis codes: 250.00, 250.01, 250.02, 250.03, 250.10, 250.11, 250.12, 250.13, 250.20, 250.21, 250.22, 250.23, 250.30, 250.31, 250.32, 250.33, 250.40, 250.41, 250.42, 250.43, 250.50, 250.51, 250.52, 250.53, 250.60, 250.61, 250.62, 250.63, 250.70, 250.71, 250.72, 250.73, 250.80, 250.81, 250.82, 250.83, 250.90, 250.91, 250.92, 250.93, 648.00, 648.01, 648.02, 648.03, 648.04

AND

CPT UM service codes: 97802, 97803, 97804, 99201, 99202, 99203, 99204, 99205, 99211, 99212, 99213, 99214, 99215, 99304, 99305, 99306, 99307, 99308, 99309, 99310, 99324, 99344, 99325, 99345, 99326, 99347, 99327, 99348, 99328, 99349, 99334, 99350, 99335, G0270, 99336, G0271, 99337, 99341, 99342, 99343

RATIONALE:

Intensive control of blood pressure in patients with diabetes reduces diabetes complications, diabetes-related deaths, strokes, heart failure, and microvascular complications.

CLINICAL RECOMMENDATION STATEMENTS:

Recommends that a blood pressure determination during the initial evaluation, including orthostatic evaluation, be included in the initial and every interim physical examination. (AACE/ACE)

Blood pressure control must be a priority in the management of persons with hypertension and type 2 diabetes. (ACP)

Blood pressure should be measured at every routine diabetes visit. Patients found to have systolic blood pressure >130 mmHg or diastolic >80 mmHg should have blood pressure confirmed on a separate day. Orthostatic measurement of blood pressure should be performed to assess for the presence of autonomic neuropathy. (Level of Evidence: E) (ADA)

Older persons with diabetes are likely to benefit greatly from cardiovascular risk reduction, therefore monitor and treat hypertension and dyslipidemias. (AGS)

Measurement of blood pressure in the standing position is indicated periodically, especially in those at risk for postural hypotension. At least two measurements should be made and the average

recorded. After BP is at goal and stable, follow-up visits can usually be at 3- to 6-month intervals. Comorbidities such as heart failure, associated diseases such as diabetes, and the need for laboratory tests influence the frequency of visits. (JNC)

All individuals should be evaluated during health encounters to determine whether they are at increased risk of having or of developing chronic kidney disease. This evaluation of risk factors should include blood pressure measurement. (NKF)

Additional information is available as follows:

(1)        CMS PQRI Link: http://www.cms.hhs.gov/PQRI/

(2)        Three National Provider teleconferences; see:

parta-education@highmarkmedicarservices.com

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Dr. John C. Perry and his practice, Teddy Bear Obstetrics & Gynecology, P.S., sued Kadlec Medical Center (which you may recall is the hospital that obtained a negligent credentialing judgment against Lakeview Medical Center in Louisiana for failing to provide credentialing information) and several members of the medical staff alleging that his credentials at Kadlec were improperly revoked as a result of a conspiracy by the defendants in restraint of trade in violation of Section 1 of the Sherman Act. 

The defendants filed a Motion to Dismiss under Federal Rule 12(b)(6), arguing that Dr. Perry failed to state a cause of action. The court reviewed the requirements for satisfactorily pleading an antitrust action in federal court and the general antitrust requirements, which are basically that the plaintiff adequately plead  facts indicating the existence of a conspiracy to restrain trade, or an attempted conspiracy, and harm to competition.

The element of harming competition has been a problem for many physicians alleging antitrust violations,  because the general rule is that the antitrust laws are intended to protect competition and not competitors. In order to proceed, the court indicated that Dr. Perry had to reasonably plead some actual harm to competition, such as price increase or at least the absence of price decreases in the OB-GYN field, a decrease in the availability of sufficient OB-GYNs in the market adversely impacting  patient access, or a decrease in quality. The court concluded that Dr. Perry had not adequately plead any of those facts and that the presence of other physicians in the market ,and in fact other physicians within Dr. Perry's practice,  belied any market impact or injury. 

The court concluded that "Factual allegations which plaintiffs say they could plea in an amended complaint are not enough to raise the right to relief above the speculative level. Not enough factual matter is alleged which, if taken as true, suggests there was any injury to competition beyond the impact on Dr. Perry. The plaintiffs have not plead enough facts in their complaint, nor have they proposed to plead enough facts in an amended complaint to reach a reasonable expectation that discovery will reveal evidence of injury to competition". The opinion in the case of John C. Perry, M.D. and Teddy Bear Obstetrics & Gynecology, P.S. v. Thomas M. Rado, M.D., et al., is available at the following link:

http://www.healthlawyers.org/email/pg/070529antitrust/Perry_v_Rado.pdf

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PITTSBURGH, PA - The law firm Tucker Arensberg, PC is proud to announce that Michael A. Cassidy has been named to the list of Pennsylvania Super Lawyers for 2007 by Philadelphia Magazine and Pennsylvania Super Lawyers Magazine. Selection for the honor is determined through the independent research of Law & Politics magazine. Over 36,000 Pennsylvania attorneys were contacted as part of a peer selection process. According to Law & Politics, the organization which publishes Pennsylvania Super Lawyers magazine, only five percent of Pennsylvania attorneys are included in the "Super Lawyers" directory.

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View David Harlow's HealthBlawg for an update onn CMS PQRI.

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