Maryland Co-Op Claims Risk Adjustment Formula Discriminates Against Smaller Insurers

Maryland’s Evergreen Health Cooperative has filed for an injunction against the federal government to halt payment by the  Consumer Operated and Oriented Plan (co-op) of the $22 million it owes to CareFirst BlueCross BlueShield based on the Affordable Care Act’s risk adjustment formula.  Of the 23 co-ops that launched in 2014, at least half of them have failed, with nine failures in the Fall of 2015. More recently, the Centers for Medicare & Medicaid Services loosened financing rules for the co-op plans in an effort to allow them to tap the markets for capital.

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Mississippi Advances with Telehealth, Shows Promise for Improved Diabetes Disease Management

Rightly or wrongly, Mississippi is not generally regarded as a leader in health. The state, which opted out of the Affordable Care Act (ACA) Medicaid expansion, consistently ranks in the bottom two states for most health indicators: infant mortality and low birth weight, obesity, cancer deaths, and diabetes outcomes.  Mississippi, however, is making significant efforts to be  a leader in telehealth. In 2014, the state initiated The Diabetes Telehealth Network, the first program of its kind to provide remote diabetes management and specialty care to rural, medically underserved populations in the Mississippi Delta through internet-capable computer tablets. Mississippi’s telehealth model is gaining national attention for its promise of significant cost-savings by preventing complications and hospital admissions while reducing the demand for expensive specialty services.

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Supreme Court Preserves But Significantly Changes “Implied Certification” Theory of False Claims Act Liability

On June 16, 2016, the Supreme Court issued its opinion (“Op.”) in Universal Health Services v. U.S. ex rel. Escobar (“Escobar”), a case testing the viability and scope of the implied certification theory of False Claims Act (“FCA”) liability.  Under the implied certification theory, a defendant may be liable under the FCA based on the its failure to comply with certain statutory, regulatory, or contractual provisions, even if the defendant did not expressly certify compliance..  The circuits have split, both on whether an implied certification theory is viable at all and, if so, when non-compliance can trigger FCA liability.

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U.S. Department of Justice Sues North Carolina Hospital System for Insisting on Anti-Steering Provisions in Insurance Reimbursement Contracts

On June 9, 2016, the Antitrust Division of the United States Department of Justice (“DoJ”) filed a complaint against the Charlotte-Mecklenburg Hospital Authority, d/b/a Carolinas Health Care System (“CHS”) in the United States District Court for the Western District of North Carolina. (United States of America and State of North Carolina v. Charlotte Mecklenburg Hospital Authority). The complaint accuses CHS of using “contract restrictions that prohibit commercial health insurers in the Charlotte area from offering patients financial benefits to use less expensive healthcare services offered by CHS’s competitors.” (Complaint, Preamble) In effect, the complaint is attacking a type of widely used contracting provision in which acute care hospital systems seek to prohibit insurance company payors from using “steering” restrictions, which would otherwise be used to steer their insured patients to lower cost healthcare providers, including lower-cost hospitals, in exchange for lower premiums in so-called “narrow network” insurance plans. The complaint then alleges that CHS has an approximately 50% share of the market for acute inpatient hospital care in the Charlotte metropolitan area, allegedly conferring market power on CHS.

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Healthcare Systems Offer Shared Medical Visits to Address Physician Shortages and Chronic Illnesses

With the advent of an increasing aging population, physicians and other healthcare providers are seeking alternative approaches in offering patients access to quality health care.  Among the innovations in healthcare delivery is the practice of shared medical appointments, where one or more healthcare providers (e.g. physicians and nurses) will see a group of eight to 15 patients with similar medical conditions at the same time.

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RECAP: Highlights from the Sixty-Ninth World Health Assembly in Geneva, May 23rd to 28th

Every year in May, the health ministers from all 194 World Health Organization (WHO) Member States meet at the WHO headquarters in Geneva to attend the World Health Assembly (WHA). As the decision-making body of WHO, the WHA is responsible for reviewing and adopting global health strategies, determining the policies of the organization, and reviewing and approving the program budget. At the 69th WHA — which took place from May 23rd to 28th — Member States approved several highly anticipated and historic resolutions concerning WHO governance reform, emergency response capacity, and priority setting for the 2030 Sustainable Development Agenda.

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Medicare Makes Changes to the Shared Savings Program to Strengthen Incentives for ACO Care Coordination

On June 6th, the Centers for Medicare & Medicaid Services (CMS) released a final rule shifting how Medicare pays Accountable Care Organizations (ACO) in the Medicare Shared Savings Program.  CMS said the final rule aims to help more ACOs participate in the Medicare Shared Savings Program by improving the payment methodology and providing them with a new participation option to move into the more advanced tracks of the program. Under the final rule, Medicare will factor ACOs’ ability to deliver higher-quality care at lower cost relative to other local providers in ACOs’ reimbursements. Prior to the final rule, CMS based payment on the evaluation of an ACO’s past performance.

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CMS Redefines Alternative Payment Models and Offers Option for Merit-Based Incentive Payment System in New Proposed Rule

The Medicare Access and CHIP Reauthorization Act (MACRA) is expected to drastically change how physicians are paid by the Centers for Medicare and Medicaid Services (CMS). Under the proposed rule, physicians will be given the choice between two payment models: alternative payment models (APMs) and the Merit-Based Incentive Payment System (MIPS).  CMS predicts a majority of physicians will elect to follow MIPS when the new payment models go into effect in January 2019.

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California State Assembly Approves Bill on Rural Hospital Physician Employment

A bill that would permit rural hospitals to directly employ physicians has been approved by the California State Assembly.  Assembly Bill 2024, authored by Jim Wood (D-Healdsburg), will be considered next by the Senate Health Committee.  The bill would waive the state’s ban on the corporate practice of medicine for 28 rural health clinics and critical access hospitals allowing them more freedom to hire doctors.  The bill is a response to the difficulties rural areas have had attracting and retaining medical providers.

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What Physicians Need to Know About the New California End of Life Option Act

On October 5, 2015, the California legislature passed the “End of Life Option Act” (the “Act”), which permits physicians to prescribe an aid-in-dying medication to terminally-ill patients.  The Act is set to take effect on June 9, 2016.  While health care providers will be obliged to give terminally-ill patients information about their end of life options, including their right to request aid-in-dying medication, provider participation in the Act is completely voluntary.  Furthermore, healthcare organizations have a limited ability to actively prohibit their employees and independent contractors from participating in certain end of life activities authorized by the Act.

This blog post will provide physicians with a brief overview of their rights and obligations under the Act. The information herein will be of particular import to medical groups as they navigate service agreements with healthcare partners that wish to opt-out of the Act.

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