On March 16, 2017, the President Trump Administration released his first budget outline for the 2018 fiscal year (FY 2018). In an effort to “shrink the role of government,” the $1.1 trillion budget proposal calls for a $54 billion increase in defense spending, with a corresponding $54 billion reduction in funding for many federal government programs. In particular, the Department of Health and Human Services (HHS) and the National Institutes of Health (NIH) would absorb double-digit budget cuts, in addition to other consolidation efforts involving those agencies.

President Trump is expected to release a full FY 2018 budget request in May of this year. Although the budget blueprint delivers on President Trump’s campaign promise for increased homeland security and military spending, opposition from both Democratic and Republican lawmakers suggests that the proposed cuts are unlikely to fully survive the congressional appropriations process.


Continue Reading Health-Related Programs Face Deep Cuts In President Trump’s “Budget Blueprint to Make America Great Again”

On February 8th, the U.S. Department of Justice (DOJ) quietly issued new guidance on how the agency evaluates corporate compliance programs during fraud investigations. The guidance, published on the agency’s website as the “Evaluation of Corporate Compliance Programs,” lists 119 “sample questions” that the DOJ’s Fraud Section has frequently found relevant in determining whether to bring charges or negotiate plea and other agreements. The February 8th issuance is the agency’s first formal guidance under the new presidential administration, and the latest effort by the DOJ’s “compliance initiative,” which launched at the hiring of compliance counsel expert Hui Chen in November 2015. The new guidance is particularly valuable for healthcare organizations in light of the agency’s heightened efforts to prosecute Medicare Advantage plans for fraudulent reporting under the False Claims Act.
Continue Reading DOJ Issues New Guidance on the Evaluation of Corporate Compliance Programs in Federal Fraud Investigations

The U.S. Department of Justice (DOJ) has joined a whistleblower lawsuit, United States of America ex rel Benjamin Poehling v. Unitedhealth Group Inc., No. 16-08697 (Cent. Dist. Cal. Sep. 17, 2010), ECF No. 79, against UnitedHealth Group (United) and its subsidiary, UnitedHealthcare Medicare & Retirement—the nation’s largest provider of Medicare Advantage (MA) plans. The suit accuses United of operating an “up-coding” scheme to receive higher payments under MA’s risk adjustment program called the HCC-RAF Program (see below). The complaint alleges that United fraudulently collected “hundreds of millions—and likely billions—of dollars” by claiming patients were sicker than they really were. The suit was originally filed in 2011 by a former United finance director under the False Claims Act (FCA), which allows private citizens to sue those that commit fraud against government programs. Pursuant to the FCA, the case was sealed for five years while the DOJ investigated the claims.
Continue Reading Justice Department Joins Whistleblower Suit Accusing UnitedHealth Group of Overcharging Medicare by “Hundreds of Millions”

On July 25, 2016, the Centers for Medicare & Medicaid Services (CMS) announced a proposed rule that promises to deliver coordinated, high-quality care for Medicare beneficiaries. The proposed rule (effective July 1, 2017) establishes a mandatory bundled payment program for cardiac care and expands the existing hip and knee bundled payment initiative that launched earlier this year.
Continue Reading House Republicans Push Back on Medicare’s New Mandatory Bundled Payment Models

Earlier this month, the Centers for Medicare & Medicaid Services (CMS) issued a final rule (Final Rule) modifying the Hospital Inpatient Prospective Payment System (IPPS) and Long Term Acute Care Hospital (LTCH) Prospective Payment System (PPS) for fiscal year (FY) 2017. CMS pays acute-care hospitals for services provided to Medicare beneficiaries under the IPPS and pays long-term care hospitals (e.g. hospices, nursing homes) under the LTCH PPS. For FY 2017, CMS projects that the Final Rule’s provisions will increase total Medicare spending for acute care hospital services by $746 million. In contrast, payments to long-term care hospital services are expected to decrease by $363 million, or 7.1 percent. According to CMS, the adjusted payments demonstrate an ongoing effort to move the Medicare program away from volume-based payments and toward a pay-for performance (value-based) reimbursement methodology as supported by a pay-for-reporting program.

The Final Rule, which goes into effect October 1, 2016, will affect an estimated 3,330 acute care hospitals and 430 LTCHs.


Continue Reading CMS Releases 2017 Medicare Hospital Payment Rates, Penalties for Poor Performers

A new study by Stanford University researchers finds that Medicare Advantage plans pay lower prices than traditional fee-for-service (FFS) Medicare for most types of hospital admissions. According to the study—published earlier this month in Health Affairs—Medicare Advantage plans pay hospitals about 8% less than FFS Medicare for the same services. These findings may come as a surprise to policy experts, as commercial insurers for the non-elderly generally pay far higher prices than FFS Medicare.
Continue Reading New Study Finds Medicare Advantage Plans Pay Lower Prices Than Traditional Medicare

This past May, the Department of Health and Human Services (HHS) issued a final rule implementing Section 1557 of the Affordable Care Act (ACA), which prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in the healthcare system. While Section 1557 has been in effect since 2010, the final rule extends additional protections to transgender individuals seeking transition-related health services, which can include gender reassignment surgery. The rule went into effect July 18th, although provisions affecting health insurance plan benefit design will become effective January 2017.
Continue Reading HHS Final Rule Extends Anti-Discrimination Protection to Transgender Patients

Childbirth is the leading indication for hospital admission in California, with roughly 500,000 deliveries in the state each year. This is particularly challenging for health plans serving Northern California, the most expensive region in the country to give birth. New research suggests that increased health system consolidation may be a factor contributing to high prices, and sheds light on considerable regional differences in costs of delivery across the US. Furthermore, rising rates of Caesarian Section (C-section) deliveries statewide may be driving costs despite evidence of increased risks to mother and baby.
Continue Reading New N. Calif. Report Suggests High Cost of Giving Birth Linked to Increased Health System Consolidation

The Medicare Board of Trustees is calling for urgent legislative action to address the impending financial insolvency of the Medicare hospital benefit program. The Board’s 2016 report reveals the trust fund that pays for hospital services under Medicare Part A will be depleted by year 2028. At that time, the report indicates Medicare revenue will cover only 87% of payments for anticipated hospital benefits. Although the Trustees have projected inadequate Medicare financing in the past, this year’s insolvency projection comes in two years earlier than last year’s report.
Continue Reading Medicare Board of Trustees Releases 2016 Annual Report: Hospital Trust Fund Insolvency Projected by 2028

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