Many Hospitals Concerned about Final CMS Payment Rules

The Centers for Medicare and Medicaid Services (CMS) announced a final rule for hospital outpatient services, or the Outpatient Prospective Payment System (OPPS), this November. The CMS estimates that the rule will increase payments for hospital outpatient departments by 1.7 percent. The new rule will be effective January 1, 2014; however, CMS will delay implementation and final configuration of the new 29 comprehensive APCs until 2015.

The rule will create 29 comprehensive Ambulatory Payment Classifications (APCs) to handle payment for device-dependent services and will require direct supervision for a range of outpatient services in critical access hospitals (CAHs). 

This rule combines five payment codes into a single payment code that covers all outpatient clinic visits. The outpatient clinic visits code will include drugs, biologicals, and radiopharmaceuticals used in a diagnostic test or surgical procedure, lab services and device removal procedures. The American Hospital Association believes that the payments will be well below the cost of treatment for complex patients.

The Access to Medical Imaging Coalition is concerned that the rule will dramatically reduce the outpatient payments to hospitals for CT scans and MRI services. The group is concerned because the rule will establish similar reimbursement rates for a CT scan and x-ray image of the same body part even though a CT scan requires more expensive equipment and is more expensive to adminster. 

Many hospitals are concerned about being able to implement the changes required by the rule by January 1, 2014, the date the rule becomes effective. 

Enrolling for Coverage in Health Insurance Marketplaces: Tax Credits, Fraud, and the IRS

Many individuals will qualify for tax credits to purchase the required health insurance from the health insurance marketplace in 2014. The Internal Revenue Service is responsible for calculating the tax credits accurately. 

The IRS will use a software program to verify tax credit calculations and assess penalties prior to issuing them to health insurers. However, there is concern about fraud because the agency has not completed a fraud mitigation strategy to prevent people that underestimate their incomes from fraudulently collecting health subsidies. As currently established, the IRS would issue the tax credits prior to verifying income.


The IRS has outlined tax provisions related to the Affordable Care Act here.

The report from the Treasury Inspector General for Tax Administration is available here. 

Public Health Experts on High Alert with Recent Rise in Spread of Infectious Diseases

A significant decline in immunization rates in the past few years has resulted in a dramatic increase in the number of documented cases of infectious diseases previously thought to be virtually eliminated in the United States has risen considerably. Falling immunization rates are attributed to fears that vaccinations can cause autism that are based on flawed studies that have been discredited.

Public health officials are seeing a rise in diseases such as measles and pertussis, commonly known as whooping cough. Measles was declared "eliminated" in the United States in 2000. This year alone there were 161 cases of measles reported across 16 states. While this increase does not suggest a widespread outbreak throughout the nation, it does present local and state public health systems with the new challenge of identifying and responding to a disease outbreak with shrinking budgets. 

Experts explain that the spread of measles in the US is generally traced to individuals who contract the disease outside the United States and then infects people exposed to the disease who were not vaccinated. For example, in Tuscon, Arizona a Swiss woman who had been traveling in Mexico arrived in an emergency room with measles. It took two days for her to be diagnosed and placed in isolation. During the two-day period before her isolation she infected an unvaccinated hospital staffer and an 11-month-old child who was too young to be vaccinated. The final count of infected individuals was 14 confirmed cases and 363 suspected cases that were a result of exposure to the Swiss traveler's measles. Seven of the 14 confirmed cases were contracted while the individuals were in the care of hospitals for other medical conditions. 

Preventing the Spread of Infectious Disease

• Early Detection Systems 
• The Department of Homeland Security recently announced plans to create a real-time disease outbreak alert system that would conduct hourly searches for reports of infectious diseases worldwide and send early warnings to at risk communities with low immunization rates. 
• Biosurveillance automated monitoring systems could help with the early detection of natural disease outbreaks with modifications such as integrating primary-care physician data with emergency room data.

• Establish Vaccination Policies
• To reduce the risk of spreading contagious diseases and limit the numbers of isolations required, health systems should require all staff to be up-to-date with vaccinations of contagious diseases. 

• Identification and Response
• Early identification of infectious diseases should be a goal of all health systems. 
• Once a case is discovered the health system should immediately alert public health officials and other community health systems to aid in rapid identification and limit exposure.
• Employees should be familiar with the protocols for reporting the infectious disease to local public health officials and health systems. 

Keeping Your Healthcare Plan: Complications and Updates

The Obama Administration repeatedly stated “If you like your healthcare plan, you can keep it,” once the Affordable Care Act is enacted. However, millions of people received cancellation notices from their insurance companies because their policies did not meet the minimum requirements of basic coverage mandated by the Affordable Care Act.

The minimum requirements include coverage for preexisting conditions, hospitalization, prescription drugs, emergency services, maternity and newborn care, mental health and substance abuse services, laboratory services, rehabilitative  services and devices, pediatric services including oral and vision, ambulatory patient services and preventative and wellness services and chronic disease management. The plans that were canceled do not offer coverage for one or many of these conditions. All of the plans on the healthcare exchanges will cover these basic conditions.

On November 14^th President Obama held a news conference announcing the decision to allow insurance companies to keep individuals on health insurance plans that do not meet the law’s requirements for an additional year.  The directive does not require insurance companies to allow customers that were already notified of cancellations to come back. It does give insurance companies the discretion to take back customers to offer the non-compliant insurance plans for one more year.

The ‘fix’ caught state insurance regulators by surprise and was not well-received by representatives of some states.  Many states require insurance commissioners to approve policy changes before the insurers will be allowed to reissue the plans. Regulators in six states will not allow consumers with noncompliant insurance plans to renew their coverage for next year. These regulators based their refusal on concerns about the effects on the state health exchanges, the weak benefits the canceled plans offer, and the increased premiums insurance companies were charging individuals that wanted to keep or reenroll in their canceled plans.  

Like many parts of the Health Care Exchange roll out, this aspect is more complicated than advertised. However, the Obama Administration stated that the individuals that lost their plans had ‘subpar’ health insurance and that their coverage would eventually be upgraded to a health insurance plan that includes many more benefits as required under the Affordable Care Act. 

Protecting Patients' Privacy: Data Security Mishaps

Patient privacy is a top priority for the medical community. Patient data should be virtually secured. It is critical that staff understands what security measures are required and how to implement and utilize those methods. 

Last Tuesday the Redwood Memorial Hospital announced that it lost a thumb drive that may have contained information on more than 1,000 patients. This information contained data that could lead to identifying individual patients. The thumb drive was not encrypted.  The hospital notified patients that are potentially affected and set up a hotline to answer questions related to the situation.

There were multiple factors leading to the security failure in this situation. The first, and most obvious breach is that all patient data should be encrypted. The second mistake leading to the leak is identifiable patient data should not travel offsite unless necessary to transfer information.

There are multiple ways to encrypt patient data. Facilities should have network security measures, two-factor authentications for individual computers, and encrypted portable devices.

For an article with more details on this breach visit this site: http://www.times-standard.com/localnews/ci_24560866/redwood-memorial-thumb-drive-patient-data-missing-eureka

Important Tips

• Encrypt any device that is contains identifiable information on patients.
• Make email passwords unique from any other password protected site or device.
• Use available products on the market to secure information stored on hard drives and flash drives.
•  Disk and flash drive encryption is available with products such as YubiKey. (http://www.yubico.com/applications/disk-encryption/)YubiKey can increase the security of the data on a hard drive by using a two-factor authentication or in conjunction with open source software such as Truecrypt.
• TrueCrypt is a free open-source software that improves security. More information on the software can be found here: http://www.truecrypt.org/
•  Use two-factor authentication to reduce the chances of unauthorized eyes viewing or using the private patient data.  More information on two-factor authentication can be found here: http://rippleit.com/understanding-two-factor-authentication/
• Ensure that all mobile devices with patient information, portals to access patient information or email accounts are protected. For more information on protecting your mobile device visit this site: http://rippleit.com/secure-your-phone-or-mobile-device/
• Improve network security with these steps for small businesses: http://rippleit.com/top-ways-to-improve-network-security-for-small-businesses/

Subsidizing Indigent Patients on Exchanges: Fraud and Abuse Concerns

Qualified Health Plans Are Not Considered "Federal Health Care Programs"

Many questions surround the implementation of the Affordable Care Act and how it interacts with existing laws. In an effort to gain clarity, Rep. Jim McDermott wrote to the Department of Health and Human Services to inquire about the status of qualified health plans sold on the healthcare.gov exchanges under Section 112B of the Social Security Act. Specifically the inquiry was whether the qualified health plans fell under the definition for "federal health care programs." 

The guidance was requested  to determine how the interaction of qualified health plans and other benefits known as beneficiary inducements offered with other federal programs. Rep. McDermott's concern centered around individuals receiving duplicative benefits, and the solvency of the federally-funded programs if individuals were allowed to receive benefits from multiple government healthcare programs. Rep. McDermott argued that receiving all of these benefits would generally be forbidden by the Anti-Kickback Statute or the Civil Monetary Penalty Statute. 

The Department of Health and Human Services (HHS) stated qualified health programs are not considered federal health care programs and the Anti-Kickback Statute is not applicable. HHS addressed Rep. McDermott's concerns regarding the solvency of of the federally-funded program by outlining regulation and provisions that establish oversight procedures and authority of the federal exchange marketplace for health insurance. These procedures, the Affordable Care Act, and the False Claim Act allow HHS and the Office of Inspector General to investigate and issue appropriate civil or criminal penalties to those wishing to cheat the federally-funded program. 

In practice this means that healthcare providers that assist indigent patients by subsidizing their premiums on health exchanges may be able to do so without concern about being prosecuted under the Anti-Kickback Statute. The HHS letter suggests that this extends even if the parties receive a tax subsidy. 


A link to Rep. McDermott's letter to HHS can be found here: 
http://mcdermott.house.gov/images/Letter%20August%206%202013.pdf

A link to the response letter from HHS can be found here:
http://mcdermott.house.gov/images/The%20Honorable%20Jim%20McDermott.pdf

Changes to Medical Billing and Coding Requirements

Big changes are coming to the world of medical billing and coding. The introduction of Electronic Medical Record and the 10^th edition of the International Classification of Diseases, Clinical Modification and Procedure Coding System (ICD-10) are creating a flurry of activity to ensure a smooth transition. These new developments will affect all medical practitioners’ medical billing and coding and submission of claims. The developers of ICD-10 claim that the new code sets will provide more accuracy in medical coding, which will result in quicker reimbursements and fewer denials.  This will result in better patient care all around.

By October 2014 all ICD-9 code sets used to report medical diagnoses and inpatient procedures must be replaced with ICD-10 code sets. This means that all electronic transactions must use Version 5010 standards to accommodate the ICD-10 codes. Previous versions, Version 4010 and Version 4010 A standards will not accommodate the ICD-10 codes. This should not be a problem for the majority of medical billers because Version 5010 has been required since January 1, 2012.

It is important to note that any claim with ICD-9 codes for services provided on or after the compliance deadline cannot be paid.

The Basics of Preparation

It is important to take several steps before the deadline to make sure the medical billing and coding for each practitioner is up to date. All practitioners that are covered by the Health Insurance Portability Accountability Act are required to transition to ICD-10 code sets.

The software used for EMR and medical billing should be upgraded to a version that incorporates ICD-10. In some cases, hardware upgrades will be necessary. Reaching out to software vendors is an important part of the implementation plan. Ideally the software will be updated and installed with enough time to test it before the compliance deadline.

This is the first in a series of blogs explaining the ICD-10 requirements and ways to have a seamless implementation.