Just Added

When things go wrong with software and IT providers, it is often almost impossible to find relief because of the way their contracts are written, Amazingly, a New Jersey health-care provider was allowed to proceed with its lawsuit against two health-care information technology firms that represented they could convert patient files from NextGen to Allscripts, computer software programs physicians use to track all aspects of patient care. Nearly 200,000 patient charts were corrupted when the conversion attempt failed. The plaintiff sued under the New Jersey Consumer Fraud Act and the defendants argued the Act didn’t apply. The court had none of it. They found the defendants apparently offered a guarantee of results, and professed to have expertise in the conversions when they had never done it before. The court found the risk of harm was obvious, the nature of the data was of public significance and that the case could proceed. It offers tantalizing possibilities in contracting with IT and software vendors.

The Medicare enrollment system represents an ongoing, high-stakes administrative headache for Medicare Part-B providers. Keeping enrollment data current is a complex, detail-oriented process, but the price for failure is the potential loss of Medicare billing privileges. In his article, “The Medicare Part-B Enrollment Obstacle Course: It Hasn’t Gotten Any Easier,” Daniel Shay revisits the complexities of the Medicare enrollment system, looking at what has and hasn’t changed in the past eight years. He examines real-world examples of Part-B providers running afoul of Medicare’s enrollment requirements, and their largely unsuccessful attempts to challenge their subsequent loss of billing privileges. Finally, he offers practical strategies for maintaining accurate enrollment data to avoid problems in the first place.

Medicare has the right to recoup Medicare overpayments, pending a provider’s appeal through the byzantine appeals process. Here we address two cases on recoupment: one refusing relief from recoupment pending review – the traditional response to these complaints – and, one forestalling recoupment by issuing a TRO. Since the paralysis of the Administrative Law Judge review process, which has stalled appeals for two years and more despite Federal court orders to move things along, the courts have approached the recoupment issue variably. A Federal court in Ohio refused to enjoin the recoupment of almost $11 million dollars from a home health agency based on extrapolation of a review of 30 records after an initial overpayment determined the year before found about $60,000 in overpayment. Accident Injury and Rehabilitation PC et al v. Azar (C/A No4:18-Cv-02173-DCC). Even though the agency argued that it would be irreparably harmed before it could exhaust its appeal rights, the court found the agency’s success on review was unlikely and that the agency could not show it was deprived of a due process right. By contrast, a SC Federal Court found that a chiropractic practice, from which Palmetto GBA had withheld $1.8 million in response to an AdvanceMed ZPIC audit, was entitled to a temporary restraining order against the recoupment, PHHC, LLC v. Azar, No1:18CV1824 (ND Ohio) since exhaustion of administrative remedies would harm the practice in a way that could not be recompensed, despite what the traditional law requires. The court found that the ALJ process was the most important step in the appeals gauntlet, since new evidence can be introduced there. Since ALJ’s overturn lower decisions 60% of the time (!), this court found the likelihood of success on appeal was great. The TRO was issued. These decisions highlight the types of arguments that can succeed when the government’s appeal process is broken. It has been virtually impossible in the past to get any relief from recoupment pending appeal. There is some light now in this tunnel of process.

In the big focus on the opioid crisis, kickbacks that occur in the drug treatment arena have become the target of a little discussed Federal law enacted in February of 2018. The Eliminating Kickbacks in Recovery Act (EKRA) has provided stiff penalties (up to $200,000 and up to 10 years in jail or both) for paying or soliciting kickbacks in the recovery area to provide or refer for provision of care by a recovery home, clinical treatment facility or laboratory. There are a few exceptions for properly disclosed discounts, employment relationships, management contracts and other safe harbors similar to those under the Anti-kickback statute; and, this new law also applies to any federal health care benefit program. Although the targeted facilities are a narrow range of entities providing care in the drug treatment space, the definition of “laboratory” is as broad as that under the Public Health Service Act, which reaches most clinical laboratories in America. While treatment facilities and recovery centers have reason to pay attention, the implications for all laboratories are broader and the penalties twice as harsh as those under AKS.

Although there is nowhere near as much substance to the 2019 MPFS Stark issues, the regulators have confirmed that they will permit a lease arrangement or personal service arrangement to continue indefinitely beyond the stated expiration of the written documentation under certain circumstances as set forth in existing regulatory provisions. With regard to compensation arrangements, the concept of the relationship being documented in writing is reconfirmed to allow a collection of documents, including contemporaneous documents evidencing the course of conduct between the parties. Both of these issues were supported by subsequent statutory language. Similarly, with regard to the non-compliance of a transaction with the regulatory exceptions, with respect to missing signatures, not later than 90 days following the date on which the arrangement became non-compliant the parties must obtain the signatures. Because of statutory requirements, the applicable signature requirement is not limited to specific exceptions and entities nor is it any longer limited to being used only once every three years with respect to the same referring physician.

Although physicians have long thought that the E/M codes might better be referred to as the S/M codes, in the 2019 Medicare Fee Schedule, new codes which will pay for non-face-to-face services, and some minor liberalizations in documentation requirements have been adopted. We address these in our new AGG Note "Time Becomes Money, And Yet", along with a review of the policies which will go into effect in 2020 for advanced diagnostic imaging and in 2021(!) for new E/M codes, although they are adopted now. Unlike most commentators who have merely reported on the content of these new codes and approaches, we think the fact that they are largely not in published regulations or even Manuals will have major significance for how the government can use them in enforcement or False Claims actions. We highly recommend a review of the Note, which is crisp and to the point.

A recent 11th Circuit Court of Appeals case has finally put to rest any remaining controversy over whether employers may incentivize and pay bona fide employees for referrals. In that case, an AIDS foundation paid its employees to refer additional patients to it. The court had no difficulty finding that the payment was legal under the antikickback statute.

Physicians have for years complained about the burdens payors impose on them. None of these burdens is decreasing; and physician dissatisfaction with private payors as well as Medicare has been increasing. In response, physicians are finding new ways to avoid or blunt the effect of these burdens through different pathways, including direct contracting with employers, direct contracting with patients, concierge care, and opting out of Medicare. All of these options and the contracts which support them are addressed by Alice in her article "End Running The Payers." She also considers the extent to which these programs do lower physician burden. While the numbers of physicians choosing these pathways is small, all physicians should understand what these programs are, what they offer and the risks and benefits of adopting any of them.