Pennsylvania Expands Allowable Procedures for Ambulatory Surgery Center

Pennsylvania Act 70 of 2017, a copy of which is attached, changes the definition of an ambulatory surgical facility by redefining the duration of the “services” to be 24 hours, rather than a 4 hour procedure and 4 hours of supervised recovery imposed by 28 Pa. Code Section 551.21, a copy of which is also attached.

It takes effect in 60 days.  Since it was passed on December 22, 2017, it is effective now.

Click here to read Pennsylvania Act 70 of 2017

Click here to read 28 Pa. Code Section 551.21

OIG Gainsharing Opinion Facilitates P4P

Although it has been almost a decade since the OIG has issued a gainsharing opinion, OIG Advisory Opinion No. 17-09 confirms the federal government’s support of the pay for performance concept.

OIG 17-09 is the first gainsharing opinion issued since the 2015 amendment of the Civil Money Penalty statute (42 U.S.C. § 1328-7a(b)(1)).  As you may recall, the CMP previously prohibited payments to induce a reward withholding medical care, but the 2015 amendment changed that to specifically limit the statute to “medically unnecessary” care.  Obviously, that is a judgment call, but the intent is clearly to encourage gain sharing/pay for performance/value based purchasing.

OIG 17-09 provides a current guideline for how to implement this concept.

In a recent presentation I made at the AHLA Hospital and Physician Institute with a colleague, Robert Harrison, we noted this type of payment arrangement could well benefit from being included in the peer review process in order to maintain the confidentiality of what we might describe as the low outliers on the pay for performance spectrum.  You should think twice about processes that identify deficient performance, if you define deficient performers as those that don’t quality for any performance payments or incentives.

CMS Announces Bundled Payments Care Improvement Model

On January 11, 2018, CMS announced a new voluntary episode payment model (bundled payments for care improvement advanced–BPCI Advanced) that will test a new iteration of bundled payment for the following thirty-two (32) clinical episodes:

29 Inpatient Clinical Episodes

Acute myocardial infarction

Back & neck except spinal fusion

Cardiac arrhythmia

Cardiac defibrillator

Cardiac valve


Cervical spinal fusion

COPD, bronchitis, asthma

Combined anterior posterior spinal fusion

Congestive heart failure

Coronary artery bypass graft

Disorders of the liver excluding malignancy, cirrhosis, alcoholic hepatitis *
*(New episode added to BPCI Advanced)

Double joint replacement of the lower extremity

Fractures of the femur and hip or pelvis

Gastrointestinal hemorrhage

Gastrointestinal obstruction

Hip & femur procedures except major joint

Lower extremity/humerus procedure except hip, foot, femur

Major bowel procedure

Major joint replacement of the lower extremity

Major joint replacement of the upper extremity


Percutaneous coronary intervention

Renal failure


Simple pneumonia and respiratory infections

Spinal fusion (non-cervical)


Urinary tract infection

3 Outpatient Clinical Episodes

Percutaneous Coronary Intervention (PCI)

Cardiac Defibrillator

Back & Neck except Spinal Fusion

A further explanation of the program can be accessed at the attached link:

CMS Issues Billing Guidance for Major Joint Replacement (Hip or Knee)

In the January 11, 2018 issue of MLN Connects, CMS has now widely publicized that it issued billing guidance for major joint replacements (hip or knee) in May 2017 at ICN909065.

CMS reports that major joint replacement is one of Medicare’s top volume DRGs and, that due to the high volume of these claims, CMS has had multiple auditing entities (RAC, CERT, and other recovery auditors) review claims for these DRGs.  That guidance is attached or available as follows:


CMS Major Joint Replacement (Hip or Knee)

Telehealth, Net Neutrality and the Tipping Point

Telehealth is apparently reaching a critical mass where people are starting to review the potential problems of telehealth, rather than the potential opportunities.

In a MedLaw Blog post on December 6, 2017 and my related LinkedIn post, I referenced and included the link to the OIG’s audit plan, indicating OIG will begin to audit telehealth claims.  I mentioned this was a tipping point, because now obviously OIG is concerned that telehealth is being utilized too often and inappropriately.

In the December 11, 2017 edition of Modern Healthcare, Rachel Arndt mentioned that the pending repeal by FCC of the Net Neutrality Rules could generate considerable uncertainty about the telehealth industry, because throttling internet speeds with telehealth content would “deteriorate the overall quality of care, particularly in rural health areas”.

Conversely, the American Telemedicine Association recently stated:  “The truth is, nobody knows what the future will hold in the post net-neutrality world.”

Finally, I am attaching a link to an article I did for the Allegheny County Medical Society on the evolution of telehealth law, to provide some historical perspective regarding the growth of telehealth in the last 20 years.

Click this link to read the article on the Evolution of Telehealth Law.

Telehealth Reaches Tipping Point – Now Included in OIG Audit Plan

Telehealth has apparently reached the tipping point in its significance to the Medicare budget, because OIG has now announced that it will “review Medicare claims for telehealth services provided at distant sites that do not have corresponding claims from originating sites to determine whether those services met Medicare requirements.”

The expected issue date of the report is 2018, but you would expect the report to describe the impact or volume that Medicare payments for telehealth now have in the system.

Click this link to read the attachment.

West Virginia Doctor Secures Temporary Restraining Order Against Medicare Exclusion

In Robie v. Price, Dr. Robie successfully obtained a temporary restraining order prohibiting CMS from terminating his Medicare billing privileges prior to the exhaustion of his administrative remedies by the U.S. District Court for the Sothern District of West Virginia.

As most realize, exhaustion of administrative remedies is usually a prerequisite to further litigation for damages.  In this case, Dr. Robie had clearly not completed the administrative appeals process provided by the Medicare rules, but successfully, albeit temporarily, prevented his exclusion based upon denial of constitutional due process.  There are several key takeaways in this decision:

First, the Court concluded that the constitutional due process argument was entirely collateral to the Medicare administrative process and therefore conferred subject matter jurisdiction on the Court.

Second, although the Medicare program is usually construed as a benefit to Medicare beneficiaries, rather than to providing physicians a source of business or a private interest, the Court concluded that the damage to Dr. Robie’s practice and reputation would be so severe if he was excluded from Medicare, without due process, the TRO was appropriate.  As a corollary to this damages holding, the Court also concluded that, due to the medically underserved nature of the geographic area, the patients would also be damaged by this potential denial of care.

Third, the Court concluded that these damages would be potentially irreparable, and that there was a threat of more harm to the physician and the patients than there would be to the government and the Medicare program if the TRO was granted.

It is important to note CMS had not alleged any significant wrong doing on behalf of the physician, certainly not any allegations involving quality of care or threat to patient safety.  The underlying dispute centered around the sufficient production of Medicare records for CMS’ investigation.  Without the allegations of significant potential patient harm, I believe the court was much more willing to grant the injunctive relief.

This is a well reasoned opinion and I commend it to you.

Pennsylvania Supreme Court Rules that Only Physicians – Not Their Staff – Can Obtain Informed Consent

A recent Pennsylvania Supreme Court decision will have a major impact on how physicians across the Commonwealth obtain informed consent from their patients.    In Shinal v. Toms, 2017 WL 2655387 (Pa. June 20, 2017), the 4-3 Court ruled that only physicians, not members of their staff, may obtain informed consent from patients before performing medical procedures.

The plaintiff in this case sued her physician for medical malpractice after a brain surgery went wrong resulting in a stroke, brain injury, and partial blindness.  Before the procedure, the physician’s assistant provided the plaintiff with information about the procedure and obtained a signed informed consent form.  However, the plaintiff claimed she was never informed of the risks associated with the surgery, and, if she had known, she would have chosen a less-risky approach.

During trial, the judge instructed the members of the jury that, in determining whether the physician obtained the plaintiff’s informed consent, it could consider relevant information communicated by the physician’s assistant to the patient.  The jury returned a verdict in favor of the physician, and the plaintiff appealed.

The Pennsylvania Supreme Court reversed and held that the duty to obtain informed consent from a patient belonged solely to a physician who was performing the treatment and was non-delegable. In doing so, the Court explained that “a physician cannot rely upon a subordinate to disclose the information required to obtain informed consent. Without direct dialogue and a two-way exchange between the physician and patient, the physician cannot be confident that the patient comprehends the risks, benefits, likelihood of success, and alternatives.

The Court’s decision is limited to the major medical procedures enumerated in the MCARE Act, which requires physicians to obtain informed consent when performing major medical procedures such as surgery, radiation, a blood transfusion, inserting a surgical device, and administering an experimental medication or device. 40 P.S. § 1303.504.  The Court did not extend its ruling to require physicians, and not staff members, to obtain informed consent for routine or nonsurgical treatments.

This decision is now binding law across the Commonwealth, meaning that physicians who rely on their staff to obtain informed consent from patients for major medical procedures will need to change their practice so that patients are consenting to the physician who is performing the surgery.

Critics to this decision claim that this will place an unnecessary burden on already overworked physicians.  As the three justices who dissented from the majority noted, this “decision will have a far-reaching, negative impact on the manner in which physicians serve their patients. For fear of legal liability, physicians now must be involved with every aspect of informing their patients’ consent, thus delaying seriously ill patients access to physicians and the critical services that they provide.”

For more information, contact Lauren N. Rulli or (412) 594-5510.