Med Law Blog

Collection Notices Must Interpreted From The Point Of View Of The "Least Sophisticated Debtor"

The U.S. District Court for the Middle District of Pennsylvania has reinforced that collection notices must be interpreted from the point of view of the "least sophisticated debtor."

Under the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 (FDPCA), the initial written notice to the consumer regarding a debt owned must contain certain information. At issue in this case was 15 U.S.C. § 1692g(a)(3), which states there must be "a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector." (emphasis added).

The court in Galuska v. Collectors Training Institute of Illinois, Inc., found that the language used in the collection notice at issue ("Unless you notify this office within thirty (30) day after the receipt of this notice that you dispute the validity of the debt, or any portion thereof, this debt will be assumed to be valid.") was not in compliance with the requirements of the FDPCA.

It must be made clear to the consumer who would assume the debt to be valid. Use of the words "we" "our" "us" or "this office" were not specific enough to specify to the least sophisticated debtor who exactly would assume the debt to be valid.

The court found that the failure to include "by the debt collector" or its equivalent (i.e. the name of the company or individual, or other specifically identifying information) is sufficient to allege a claim for which relief may be granted.

Danielle Hodnicki
412-594-5605
dhodnicki@tuckerlaw.com

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The April 30, 2008 Press Release, Executive Summary and 2007 Annual Report are available at the link below.

 http://www.psa.state.pa.us/psa/lib/psa/annual_reports/annual_report_pr_2007_043008.pdf

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Prior to legislation adopted in 2001, the Pennsylvania State Board of Physical Therapy regulated athletic trainers. Under Acts 92 and 93, the regulations promulgated pursuant to the Pennsylvania Physical Therapy Practice Act were to continue to govern the activities of athletic trainers until the State Boards of Medicine and Osteopathic Medicine adopted Final-Form Regulations. These Final-Form Regulations were adopted July 14, 2007 and are available at http://www.pabulletin.com/secure/data/vol37/37-28/1232.html Thereafter, the regulations of the State Board of Physical Therapy governing athletic trainers were rescinded effective April 19, 2008. The order rescinding the regulations is available at http://www.pabulletin.com/secure/data/vol38/38-16/727.html   

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Form 990 Redesign for Tax Year 2008

The IRS currently requires every charitable organization, and every similar tax-exempt organization, with gross receipts of at least $100,000 or assets of at least $250,000 to file an annual return on Form 990. On December 20, 2007, the IRS published major changes to its Form 990. Certain of the changes are intended to encourage charities and other tax-exempt organizations to improve their internal governance. Because of these changes, tax-exempt organizations should review their written internal governance procedures and make changes where necessary. 

Perhaps the most significant change made by the IRS to Form 990 is the addition of an entirely new section entitled "Governance Management and Disclosure". The new section contains questions about the internal governance of the organization. The IRS added these questions to encourage tax-exempt organizations to re-examine their internal governance structure. Also, since the Form 990 is a publicly available document, the IRS hopes to use public pressure to improve the corporate governance of tax-exempt organizations. Many tax-exempt organizations obtain much of their funds from the public. Unlike personal tax returns, a charity's annual return on Form 990 is normally available to the public. Any hint that a public charity does not have adequate internal governance could hurt its ability to obtain contributions.

Here is a summary of the most important questions included in the new "Governance Management and Disclosure" section of the new Form 990:

1. Does the organization have a written conflict-of-interest policy? Does it monitor the policy by soliciting information from officers and directors annually?

2. Does the organization have a whistleblower policy?

3. Does it have a document retention and destruction policy?

4. Does the process for review of officers' compensation involve an independent director or directors? Is there a set procedure for reviewing and approving officers' compensation?

5. Does the organization make its financial statements, conflict of interest policy and governing documents available to the public?

6. How many members of the organization's board of directors are independent?

7. Does any director or officer have a family or business relationship with any other officer or director?

8. Does the organization have members? If so, what appointments and decisions must the members approve?

9. Does the organization keep minutes of its board meetings and its committee meetings?

10. If the organization has local chapters, does it have written policies governing its local chapters?

In order to answer these questions, each organization must make a thorough review of its internal governance documents and procedures, and make changes where appropriate. The answers to the Form 990 questions must be precise. An authorized officer signing a Form 990 states that all of the information on the return is accurate, under penalties of perjury.

Our attorneys can help you evaluate your internal documents and make the necessary changes to assure that your answers to the above questions put your organization in the best possible public light.

The revised form must be used by large tax-exempt organizations (with gross receipts over $1,000,000 or total assets over $2,500,000) for the 2008 year and beyond. It must be used by tax-exempt organizations with gross receipts over $500,000 or total assets over $1,250,000 for the 2009 tax year and beyond. All organizations having at least $200,000 in gross receipts or $500,000 in assets must file the new From 990 for years beginning in 2010.

Following is a link to the IRS website "Form 990 Redesign for Tax Year 2008" containing much of the IRS Guidance in this issue: 

http://www.irs.gov/charities/article/0,,id=176613,00.html

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Gainsharing is generally defined as an arrangement between physicians and hospitals to share cost reductions, which can be narrowly targeted projects such as standardization of hospital equipment and supplies or broadly targeted projects such as average cost per case. Gainsharing is an attempt to align financial incentives in an environment where the existing incentives are actually opposite, i.e. physicians are typically paid on a fee for service basis and hospitals generally have DRG or case rate restrictions.

The alignment strategies are complicated by the statutes prohibiting certain financial arrangements, as follows:

1.          The Stark Act prohibits referrals by physicians to financial entities with which those physicians have financial relationships, and a gainsharing arrangement can easily be a financial relationship triggering the application of the Act;

2.          The Civil Money Penalty Act, i.e. Sections 1128A(b)(1) and (b)(2) prohibit hospital payments to physicians to reduce care; and

3.          The pervasive Anti-Kickback Statute (AKS). i.e. Social Security Act Section 1128, prohibits any type of payments in exchange for referrals of covered services. 

Although the OIG has a history of being wary of gainsharing arrangements, there is also a stream of OIG advisory opinions allowing gainsharing arrangements that typically require safeguards in the following areas:

1.          Transparent arrangements providing accountability for the parties;

2.          Adequate quality control;

3.          Control and monitoring of any payments that can be received as a payments for  referrals.

MedPac recommended in a 2005 report that gainsharing be permitted. CMS has also established a number of demonstration projects regarding gainsharing arrangements.

CMS recognizes the potential effectiveness of gainsharing arrangements in the healthcare reimbursement environment and is soliciting comments on a proposal to establish guidelines for gainsharing arrangements. CMS stated in the recent proposed Inpatient Prospective Payment System Rules, issued on April 14, 2008, as follows:

"Notwithstanding our general concern with arrangements that involve the use of a percentage based compensation formula (other than payment to a physician for work personally performed by the physician), we recognize the value to the Medicare program and its beneficiaries where the alignment of hospital and physician incentives result in improvements in quality of care. Therefore, we are considering whether to issue an exception specific to gainsharing

arrangements. . . At this time, we decline to issue a specific proposal concerning an exception for gainsharing arrangements, but rather are soliciting comments as to whether we should establish an exception to gainsharing arrangements, and, if so, what safeguards should be included in the exceptions. Specifically, we are interested in receiving comments on:

(1)        What types of requirements and safeguards should be included in any exception for gainsharing arrangements; and

(2)        Whether certain services, clinical protocols, or other arrangements should not qualify for the exception."

The text of the regulations are posted in the Healthcare Links section of the Blog.

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The NPI is here.  The NPI is now.  Are you using it?

Industry-Wide Enforcement of the NPI Compliance Date

 The compliance date for the NPI for all HIPAA covered entities except small health plans was May 23, 2007.  (Small health plans have until May 23, 2008 to comply.)  In guidance provided on April 2, 2007, CMS announced that, through May 23, 2008, it would not impose penalties on covered entities that deploy contingency plans to facilitate the compliance of their trading partners.   On May 24, 2008, CMS will lift its enforcement-leniency policy.  Complaints will be investigated as they are today, but penalties will be a legitimate resolution if the entity does not demonstrate compliance or corrective action.  CMS will continue to employ a complaint-driven approach to enforcement.   For example, if a complaint is received alleging a failure to comply with the NPI requirements, CMS will contact the entity to secure evidence of compliance and the contingency plan that had been in place.  If violations are identified, enforcement actions will take place.

This notice does not prohibit covered entities from lifting contingency plans prior to May 24, 2008.

In sum, no later than May 24, 2008, all covered entities are expected to be using the NPI in a compliant manner, and all contingency plans should be lifted.

NPPES and the NPI Enumerator: Misconceptions & Facts

In conversations and correspondence with health care providers, health plans, and others within the health care industry, it is very clear that there are misconceptions concerning the National Plan and Provider Enumeration System (NPPES) and the NPI Enumerator.  Below we have listed some common misconceptions and the facts that correct those misconceptions.

CMS has posted information that lists the specific duties and responsibilities of the NPI Enumerator in a recent MLN Matters article located at http://www.cms.hhs.gov/MLNMattersArticles/downloads/SE0751.pdf on the CMS website.   An article that further clarifies the functions of NPPES and the NPI Enumerator is in development; this article will be announced once available. 

Important Information for Medicare Providers

Medicare’s Key Dates

There are two key dates remaining for 2008 in Medicare's NPI implementation plan.  There is also some confusion as to the difference between the implementation steps for March 1^st and May 23^rd.  The chart below indicates the implementation steps for each date; as well a new column to help further clarify the difference between these two dates. 

Only 4 Months Until May 23rd - Test NPI-only claims NOW

While Medicare is receiving well over 90% of claims containing an NPI in primary provider fields, there is a very small percent of claims submitted with NPI- only.  Until you submit claims with an NPI-only, you will not have a preview of what your experience will be on May 23rd.  The time for correcting problems, should there be any, is getting short.  CMS urges that ALL Medicare providers test NOW so that problems can be resolved prior to May 23^rd. For example, if there is a problem that requires a change in your Medicare enrollment information, you will need to act immediately.

 How to test - After Medicare providers have submitted claims containing both NPIs and legacy identifiers and those claims have been paid, Medicare urges these providers to send a small batch of claims now with only the NPI in the primary provider fields.  If the results are positive, begin increasing the number of claims in the batch. 

(Reminder:  For institutional claims, the primary provider fields are the Billing and Pay-to Provider fields.  For professional claims, the primary provider fields are the Billing, Pay-to, and Rendering Provider fields.  If the Pay-to Provider is the same as the Billing Provider, the Pay-to Provider does not need to be identified.)

Remember, if you test and your claims are processed successfully, you can approach the May 23rd date with confidence. If you do not, you may face unanticipated cash flow problems.

Medicare DMEPOS Suppliers: If Your Claims Are Rejecting!

Medicare DMEPOS suppliers may be experiencing claims rejections if they did not obtain their NPIs properly, if they are not properly enrolled in Medicare, or both.  For example, if a DMEPOS supplier who is a sole proprietorship enrolled with the National Supplier Clearinghouse (NSC) as an organization and furnished an Employer Identification Number (EIN) instead of a Social Security Number (SSN), but obtained a National Provider Identifier (NPI) as an Entity type 1 - Individual, the Medicare NPI Crosswalk will be unable to link that DMEPOS supplier's Medicare legacy identifier (the NSC number) to its NPI.  This is because the NSC number and the NPI identify different entity types--one identifies an organization and the other an individual.  When a linkage between a Medicare legacy identifier and an NPI used in a claim does not exist in the Medicare NPI Crosswalk, the claim will reject.  DMEPOS suppliers should contact the DME MAC if they do not understand the error message they received.

If the rejection was due to the inability of the Medicare NPI Crosswalk to link the NPI to the NSC number, the DMEPOS supplier should  check the NPPES record to ensure the appropriate Entity type (1 = Individual; or 2 = Organization) is reflected in that record.  Individuals (including sole proprietorships) obtain NPIs as Entity type 1.  Organizations obtain NPIs as Entity type 2.  If the NPPES record shows the appropriate Entity type, the DMEPOS supplier should contact the NSC to ensure the enrollment record is correct.  If the NPPES record does not show the appropriate Entity type, the DMEPOS supplier needs to take action to ensure the appropriate Entity type is selected.  If assistance is necessary, the NPI Enumerator (1-800-465-3203) can explain to the DMEPOS supplier how this is done. 

Once the NPPES record is correct, the DMEPOS supplier needs to ensure that it is properly enrolled in Medicare.  The NSC, once contacted, will ask appropriate questions to determine if the DMEPOS supplier is, in fact, a sole proprietorship, and if so, properly reflected as such in the enrollment record.  The NSC will assist the DMEPOS suppliers in correcting their enrollment records.

DMEPOS suppliers who are sole proprietorships should be aware of the following:

• A DMEPOS supplier who is a sole proprietorship obtains an Entity type 1 (Individual) NPI. 
• When enrolling in Medicare (form CMS-855S) with the NSC, a DMEPOS supplier who is a sole proprietorship furnishes his/her SSN as the Taxpayer Identification Number (TIN). 
• The Legal Name of the sole proprietorship business is the sole proprietor’s name. 
• It is possible for the sole proprietorship to have a “doing business as” (dba) name.  The dba name can be reported on the CMS-855S and in the NPI application (in the “Other Name” field).  A dba name, however, is not a Legal Name.
• It is possible that the sole proprietorship requested and received an Employer Identification Number (EIN) from the IRS if the sole proprietorship has employees.  This EIN will protect the sole proprietor’s SSN from appearing in claims and on W-2s. 
• Medicare will treat the EIN as the TIN for purposes of claims processing, but the SSN must still be reported on the CMS-855S. 
• When Medicare reports tax information to the IRS for that EIN, the IRS will link that EIN to the sole proprietor’s SSN.

Additional Information on Reporting a National Provider Identifier (NPI) for Ordering/Referring and Attending/Operating/Other/Service facility for Medicare Claims

Visit http://www.cms.hhs.gov/MLNMattersArticles/downloads/MM5890.pdf for a recently released MLN Matters Article on the topic of reporting NPIs for order/referring and attending/operating/other/service facility for Medicare claims. 

CMS to Host National NPI Roundtable on 2/6/2008

CMS will host a national NPI Roundtable on Wednesday, February 6^th from 2:30 – 4PM ET.  This call will focus on the status of the Medicare implementation and a related question and answer session.  Registration details are available at http://www.cms.hhs.gov/NationalProvIdentStand/Downloads/listservwording2-6-08npicall.pdf on the CMS website.  

WEDI to Host NPI Audiocast

The Workgroup for Electronic Data Interchange (WEDI) will host an audiocast to discuss NPI implementation from an industry-wide standpoint.  The audiocast will be held on February 21, 2008.  Visit http://www.wedi.org/npioi/index.shtml for registration details.  Please note there is a charge to participate in WEDI events. 

Need More Information?

Not sure what an NPI is and how you can get it, share it and use it?  As always, more information and education on the NPI can be found through the CMS NPI page www.cms.hhs.gov/NationalProvIdentStand on the CMS website.  Providers can apply for an NPI online at https://nppes.cms.hhs.gov or can call the NPI enumerator to request a paper application at 1-800-465-3203.  Having trouble viewing any of the URLs in this message?  If so, try to cut and paste any URL in this message into your web browser to view the intended information. 

Note: All current and past CMS NPI communications are available by clicking "CMS Communications" in the left column of the www.cms.hhs.gov/NationalProvIdentStand  CMS webpage.

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On December 6, 2007 HealthLeaders News reported that the Federal government has established a one year contract with PriceWaterhouseCoopers to conduct security audits on covered entities to verify compliance with the HIPAA security rule. 

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During the period of October 2005 through September 2006, doctors' offices received 156 citations for bloodborne pathogen violations resulting in $51,064 in fines. (http://www.osha.gov). Additionally, during that same period general medical and surgical hospitals received 118 citations while nursing care facilities received 344 citations (http://www.osha.gov). 

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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 Internal Revenue Service issued a directive on May 11, 2007 confirming that the provision of hardware and software components of electronic health records (EHR) will not constitute private inurement jeopardizing the tax exempt status of non-profit hospitals. This directive is another step forward in facilitating hospital subsidized EHR for private practice physicians.

The Centers for Medicare and Medicaid Services (CMS) and the Office of Inspector General (OIG) previously issued safe harbor regulations and Stark exceptions stating that a hospital’s provision of EHR would not be considered remuneration for fraud and abuse purposes, providing the EHR program satisfied the conditions of their rules, which included a requirement that a physician pay at least 15% of the cost of that benefit.

However, CMS and OIG rules left open the issue of whether the value of that benefit would be prohibited private inurement, i.e., benefits provided by tax exempt entities to private individuals, or excess benefits that would be subject to the intermediate sanction rules of Internal Revenue Code Section 4958, both of which are IRS issues.

The IRS directive makes it clear that the program would not jeopardize the tax exempt status of non-profit hospitals. The directive does not resolve the question of whether the value of the EHR benefit provided to private practice physicians would constitute income taxation. While commentators are making few predictions with respect to whether that value would be taxable, one can see how making that benefit taxable would raise the host of additional issues, such as the value of hospital equipment, OR space, etc., provided to private practice physicians, which would jeopardize the entire structure of private practice medical staffs.

The text of the IRS directive can be obtained as the following link:

http://op.bna.com/hl.nsf/r?Open=psts-734nqv.

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CMS has issued interpretive guidelines regarding informed consent relating to the conditions of participation requirements for patient rights, informed consent for surgical services, and the appropriate contents of medical records. The guidelines were released on April 13, 2007 and can be found at the following link:

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HHS Launches New Web site on HIPAA Privacy Compliance and Enforcement

To coincide with the fourth anniversary of the enforcement of the HIPAA Privacy Rule, the Department of Health and Human Services (HHS) announced today the launch of an enhanced Web site that will make it easier for consumers, health care providers and others to get information about how the Department enforces health information privacy rights and standards. In launching the website, Winston Wilkinson, the Director of the HHS Office for Civil Rights, noted: "HHS has obtained significant change in the privacy practices of covered entities through its enforcement program. Corrective actions obtained by HHS from these entities have resulted in change that is systemic and affects all the individuals they serve."

The Health Information Privacy Web site provides comprehensive information about the Privacy Rule, which creates important federal rights and requirements to protect the privacy of personal health information. The enhanced Web site, http://www.hhs.gov/ocr/privacy/enforcement provides information for consumers, health care providers, health plans and others in the health care industry about HHS’s compliance and enforcement efforts. The new information describes HHS activities in enforcing the Privacy Rule, the results of those enforcement activities, and statistics showing which types of complaints are received most frequently and the types of entities most often required to take corrective as a result of consumer complaints. The other information on the Web site covers consumers’ rights to access their health information and significantly control how their personal health information is used and disclosed, as well as guidance about how to submit complaints about possible violations of the law and extensive guidance for entities who must comply with the rule.

HHS issued the patient privacy protections pursuant to the Health Insurance Portability and Accountability Act of 1996 (HIPAA). The first and only comprehensive federal privacy standards to protect patients' medical records and other health information provided to health plans, doctors, hospitals and other health care providers took effect on April 14, 2003. Developed by HHS, these standards provide patients with access to their medical records and more control over how their personal health information is used and disclosed. The regulation covers health plans, health care clearinghouses, and those health care providers who conduct certain financial and administrative transactions (e.g., enrollment, billing and eligibility verification) electronically. HHS has conducted extensive outreach and provided guidance and technical assistance to providers and businesses to help them to implement the new privacy protections. These materials are available at http://www.hhs.gov/ocr/hipaa.

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The first criminal HIPAA verdict was entered in January of 2007, and HIPAA privacy rule enforcement statistics were reported at the 14^th National HIPPA Summit.

In U.S. v. Ferrer, in the Cleveland Clinic case, a Florida jury found the Defendant, Mr. Fernando Ferrer, Jr. guilty of one count of wrongful disclosure of individually identifiable health information, five counts of aggravated identity theft, one count of computer fraud and one count of conspiring to defraud the United States. Mr. Ferrer was the owner of a healthcare claims administration company at the time and misappropriated the personal data of more than 1,100 patients of the Cleveland Clinic, using a cousin who was an employee of Cleveland Clinic to assist him in this effort. The misappropriated information was used to submit more than $7,000,000 of fraudulent Medicare claims, which netted about $2,500,000 in payments to providers and suppliers.

The following is a summary of the enforcement activities reported at the National HIPAA Summit, listing total complaints, closed cases and cases in which corrective action was taken or which were referred to the Department of Justice for prosecution.

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There has been an explosion in the Qui Tam litigation in the healthcare industry, as well as other industries dependent upon government payment. Qui Tam litigation allows private parties, frequently disgruntled employees (and more frequently disgruntled ex-employees) or competitors to file suit to recover damages on behalf of the government. The complaints are filed under seal and disclosed to the government with the hope that the government will assume the investigation and prosecution of the suit. Under the False Claims Act, private citizens may qualify for a portion of the eventual recovery if the following conditions exist:

1.   The private citizens (known as "relators") made a pre-filing disclosure of the allegations to the government; and

2.   The relator is the original source of the allegations in the event the allegations through transactions are ultimately publicly disclosed, with the purpose of this requirement being that the relator be the initial reason that the suit is being pursued. 

Unfortunately, these rules and procedures were often used by private citizens to present "kitchen sink" charges or allegations for government review, with the hope that something would stick.

In Rockwell International Corp. v. United States (a non-healthcare but nevertheless a government contracting case) the US Supreme Court clarified these rules and limits the "kitchen sink" technique by holding that the relators not the original source simply because the relator might have been the original source as to some claims which were investigated but not pursued by the government.

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Coincidentally, just a few days after the Office of Inspector General announced the $3 million settlement of the credit balance case with the Tennessee cardiology practice, Highmark Medicare Services issued a bulletin reminding providers of their obligation to file the Medicare Credit Balance Detail Report 838. Let me remind you that part of the basis for the Tennessee settlement was that the provider groups maintain their records to conceal the credit balances. Hopefully, your internal records will agree with the Medicare Credit Balance Detail Report. The Highmark Medicare Services reminder can be accessed at:

http://www.highmarkmedicareservices.com/bulletins/parta/news/credit-balance-qe-123106.

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Pennsylvania allows health care facilities or health care providers to charge fees for the reproduction of medical records. Below is the exact text of the announcement in the

December 2, 2006 Pennsylvania Bulletin (Vol. 36, No. 48, pages 7345 and 7346) announcing the approved fees for 2007:

Under 42 Pa. C.S. § § 6152 and 6155 (relating to subpoena of records; and rights of patients), the Secretary of Health (Secretary) is directed to adjust annually the amounts which may be charged by a health care facility or health care provider upon receipt of a request or subpoena for production of medical charts or records. These charges apply to any request for a copy of a medical chart or record except as follows:

(1) Flat fees (as listed in this notice) apply to amounts that may be charged by a health care facility or health care provider when copying medical charges or records either: a) for the purpose of supporting any claim or appeal under the Social Security Act or any Federal or State financial needs based program; or b) for a district attorney.

(2) An insurer shall not be required to pay for copies of medical records required to validate medical services for which reimbursement is sought under an insurance contract, except as provided in: (a) the Worker’s Compensation Act (77 P.S. § 1 et seq.) and the regulations promulgated thereunder; (b) 75 Pa. C.S. Chapter 17 (relating to financial responsibility) and the regulations promulgated thereunder; or (c) a contract between an insurer and any other party.

The charges listed in this notice do not apply to an x-ray film or any other portion of a medical record which is not susceptible to photostatic reproduction.

Under 42 Pa. C.S. § 6152.1 (relating to limit on charges), the Secretary is directed to make a similar adjustment to the flat fee which may be charged by a health care facility or health care provider for the expense of reproducing medical charts or records where the request is: (1) for the purpose of supporting a claim or appeal under the Social Security Act or any Federal or State financial needs based benefit program; or (2) made by a district attorney.

The Secretary is directed to base these adjustments on the most recent changes in the consumer price index reported annually by the Bureau of Labor Statistics of the United States Department of Labor. For the annual period of October 31, 2005, through October 31, 2006, the consumer price index was 1.3%.

Accordingly, the Secretary provides notice that, effective January 1, 2007, the following fees may be charged by a health care facility or health care provider for production of records in response to subpoena or request:

                                                                                                                        Not to Exceed

Amount charged per page for pages 1 - 20                                                      $  1.25

Amount charged per page for pages 21 - 60                                                    $    .93

Amount charged per page for pages 61 - END                                                $    .31

Amount charged per page for microfilm copies                                      $ 1.83

Flat fee for production of records to support any

   claim under Social Security                                                                            $23.49

Flat fee for supply records requested by a district attorney                                 $18.54

*Search and retrieval of records

*NOTE: Federal regulations enacted under the Health Insurance Portability and Accountability Act (HIPAA) at 45 CFR Parts 160-164 state that covered entities may charge a reasonable cost based fee that includes only the cost of copying, postage and summarizing the information (if the individual has agreed to receive a summary) when providing individuals access to their medical records. The Department of Health and Human Services has stated that the fees may not include costs associated with searching for and retrieving the requested information. For further clarification on this issue, inquiries should be directed to the Office of Civil Rights, United States Department of Health and Human Services, 200 Independence Avenue, S.W., Room 509F, HHH Building, Washington, DC 20201, (866) 627-7748, www.hhs.gov/ocr/hipaa.

In addition to the amounts listed previously, charges may also be assessed for the actual cost of postage, shipping and delivery of the requested charges.

The Department of Health is not authorized to enforce these charges.

Questions or inquiries concerning this notice should be sent to James T. Steele, Jr., Deputy Chief Counsel, Room 825 Health and Welfare Building, Harrisburg, PA 17120 or for speech and or hearing impaired persons, the Pennsylvania AT&T Relay Services at (800) 654-5984 (TT) or V/TT (717) 783-6514.

                                                            CALVIN B. JOHNSON, M.D., M.P.H.

                                                                                                            Secretary  

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Senator Bill Frist has launched a new healthcare Blog. MedicalMatter.org: a21st Century Discussion of Health Care Issues. According to the inaugural post, the blog is about "healthcare and the politics of healthcare", and will address issues such as electronic health records (EHR), stem cell research, health savings accounts (HSA), and many other topics.

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REGARDING SPECIALTY HOSPITALS

The Secretary of Health and Human Services, Michael O. Leavitt, has submitted an interim report to Congress entitled "Development of a Strategic Plan Regarding Physician Investment and Specialty Hospitals," as required by Deficit Reduction Act of 2005 (DRA). HHS was required to develop and implement a strategic plan concerning whether physician investments in specialty hospitals should continue to be permitted, especially in light of the recently alleged quality of care concerns.

The interim report addresses several issues critical to the process of providing equitable reimbursement to hospitals and specialty hospitals as follows:

1.Addressing hospital DRG payments to adequately reflect severity of illnesses;

2.Increasing the number of procedures that can be performed in ambulatory surgery centers, but adjusting ambulatory surgery centers fees to adequately reflect relative complexity or severity for cases done in both ambulatory surgery centers and the hospitals;

3.Determining whether specialty hospitals are required to provide EMTALA services for cases falling within their specialty; and

4.Obtaining further data regarding physician investment and use of specialty hospitals.

This report is available on the CMS website and at Interim Report.

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The Centers for Medicare and Medicaid Services (CMS) has posted new and revised versions of its provider/suppliers/practitioner Medicare enrollment forms (855s). These new forms were issued immediately after the final regulations defining the requirements of the enrollment process were published on April 21, 2006, as noted April 27, 2006 on the Med Law Blog. The revised forms are effective April 30, 2006. The CMS forms emphasize that the application process should be directed through the appropriate physical intermediary (FI) or carrier, rather than CMS.

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On August 24, 2006, the Office of Inspector General issued an Open Letter to healthcare providers encouraging self-disclosure of violations of the federal healthcare programs.

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We have noticed significantly increased post-payment review audit activities on behalf of Highmark and HGSAdministrators, the Medicare side of Highmark.

When records are requested, it is critical that you do not respond cavalierly. The records you initially supply will be used to determine whether you will be subject to a refund request and further review.

If you have not been involved in this type of audit activity before, you should experienced counsel to assist you with your response. The potential for extrapolated refund requests is a serious threat.

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Robert Wood Johnson Foundation has completed "The Synthesis Project," which is a project summarizing certain research on hospital consolidation over the last decade. Although the report qualifies its conclusion, the Synthesis Project suggests that hospital mergers increase prices, decrease quality and were only anecdotally related to the increase in managed care. The report is available at the Robert Wood Johnson Foundation Synthesis Project.

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The Commonwealth Court of Pennsylvania ruled on December 29, 2005 that a group of policyholders, subscribers, public interest groups and the City of Philadelphia did not have standing to challenge the Pennsylvania Insurance Department's approval of reserves and surpluses for the State's Blues plans, i.e., Capital Blue Cross, Highmark, Blue Cross of Northeastern Pennsylvania and Independence Blue Cross.

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The OSHA regulations applicable to the offices of medical professionals are aimed at creating a safe and healthy practice. Compliance creates a positive work environment and minimizes employee complaints. There are six OSHA general standards that apply to physician offices of all sizes and a seventh requirement that applies only to offices that offer X-ray services. We will discuss each in this article.

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The DHHS had issued guidance entitled "Guidance to Federal Financial Assistance Recipients Regarding Title VI Prohibition Against National Origin Discrimination Affecting Limited English Proficient Persons." Several individual physicians and professional associations sought to enjoin the Guidance, but a federal district court ruled that the Guidance had not cause sufficient damage or injury nor threatened future damage or injury sufficient to make the case ripe for decision. The mere fact that the Guidance Document is not aligned with the organizations advocacy an litigation goals does not constitute a concrete and particularized injury or create a Article III case here. View the guidance on the DHHS Web site.
Colwell v. HHS, S.D. Cal. No. 04CV1748, 3/7/05.

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