Texas Physicians are Starting to Level the Playing Field in Their Dealings with the Texas Medical Board.

(June 21, 2011):  Last week, Texas Governor Rick Perry signed legislation aimed at bringing modest medical reform to the rules governing investigations of physicians by the Texas Medical Board (“TMB” and / or the “Board”). The Board is the state’s regulatory body that licenses and disciplines physicians and other health care professionals. House Bill 680 (HB 680), which takes effect on September 1, 2011, is seen as a hard-fought victory by Texas physicians. To their credit, the Association of American Physicians and Surgeons (AAPS), a professional association of physicians in all types of practices and specialties, has reportedly been one of the strongest advocates for reform measures such as this in Texas and across the country.

I.          Important provisions of HB 680:

The primary purpose behind HB 680 concerned reforming the complaint process filed with the Board. Among other provisions, several of the most important changes to the Board’s rules included the following:

• The Board may no longer accept “anonymous” complaints. An “anonymous”  complaint is one which lacks sufficient information to identify the source or the name of the person who filed the complaint. Sec. 154.0535 of the Texas Occupations Code.
• Requires the names and addresses of insurance companies and their agents, third party administrators and pharmaceutical companies who file complaints to be given to the physician subject to the complaint. Furthermore, unless the notice would jeopardize the investigation, the Board must notify the physician of those complaining parties no later than the 15th day after the date the complaint is filed. Sec. 154.0535
• Establishes a seven (7) year statute of limitations on complaints, unless the complaint dealt with care provided to a minor. In that case, the Board may not review or proceed on a complaint after the later of either:
  • The date the minor is 21 years of age; or
  • The seventh anniversary of the date of the care. Sec. 154.051
• Allows the physician to have his Informal Settlement Conference (ISC) hearing with Board officials to be recorded, thereby reducing any potential abuse of power. These recordings become part of the physician’s investigative file and may not be released to third parties unless authorized under other provisions of the Occupations Code. Sec. 164.003.
• Requires that the Board dispose of a contested case by issuing a final order based on an administrative judge’s (ALJ) findings of fact and conclusions of law.  Importantly, the Board may not change an ALJ’s “Findings of Fact” or “Conclusions of Law” or vacate or modify the ALJ’s order. Nevertheless, the Board still retains its sole authority and discretion to determine the appropriate action or sanction. The ALJ may not make any recommendations regarding these latter decisions. Sec. 164.007(a) and (a-1).
• Extends the timeframes the Board has to complete a preliminary investigation of a complaint and notify a physician of an ISC from 30 to 45 days. Sec. 154.057(b)
• Allows the Board to propose and institute a “remedial plan” to resolve the investigation of a complaint. This plan may not contain a condition that either revokes, suspends, limits or restricts a physician’s license or other authorization to practice medicine. Furthermore, the plan may not contain a provision that assesses an administrative penalty against a physician. However, the Board may assess a fee against a license holder participating in a remedial plan in an amount necessary to recover the costs of administrating the plan. Sec. 164.0015
• Prevents “remedial plans” to be used in certain cases.  For example, “remedial plans” may not be imposed to resolve complaints concerning:
  • A patient’s death;
  • The commission of a felony;
  • A matter where the physician engaged in inappropriate sexual behavior or contact with a patient or became financially or personally involved in an inappropriate manner with a patient; or
  • An appropriate resolution that may involve a medicine. Sec. 164.0015
• Bars the issue of a remedial plan to resolve complaints against a physician if the license holder has previously entered into a remedial plan with the Board for the resolution of a different complaint. Sec. 164.0015
• Allows remedial plans to become public information. Furthermore, in civil litigation matters, these plans constitute a settlement agreement under Rule 408[1], Texas Rules of Evidence. Sec. 164.002(c) and (d).

II.         Several Provisions of Earlier Legislative Efforts Were Not Included in HB 680:

HB 680 is an important step in the right direction for medical board reform. However, the Bill falls short of earlier legislation that had been introduced in the State. Many of the provisions in HB 680 were taken from Texas HB 1013 which had passed the Texas House 147-0 on May 10, 2011. HB 1013 was allegedly drafted to provide legal due process protections for physicians and require for administrative transparency and accountability by the Board.  Important proposed reforms covered by HB 1013 which were not incorporated in HB 680 include:

• Eliminating “confidential” complaints. With a “confidential” complaint, the Board knows the name of the person or group who files the complaint but keeps that name confidential from the physician subject to the complaint. The physician would have received a copy of the complaint containing the name of the person filing the complaint. Only patients and the patients’ relatives would have been exempted from disclosure.
• Prohibiting conflicts of interests by Board members. The provision stems from instances where Board members served as witnesses to medical malpractice cases while serving simultaneously serving on the Board, without disclosure to the public or to the physicians subjected to the Board’s review/discipline.
• Allowing the Board to only use actively practicing physicians as experts, who would be allowed to review the accused physician’s record, but without knowing the particular name of that physician.
• Assigning ISC panel members randomly.
• Entitling physicians, like attorneys, to a right to a jury trial if their license would be revoked.
• Making the Board annually disclose a list of those individuals who participated on its ISC panels, as well as how often.

Despite having 87 sponsors to the bill, HB 1013 was reportedly blocked from being heard in the Texas Senate.

III.        Conclusion:

As previously discussed, when the Board is unable to resolve a case, the case is then referred to an ALJ at the State Office of Administrative Hearings. Like many States, prior to the passage of HB 680, the Board did not have to accept the “Findings of Fact” or “Conclusions of Law” issued by an ALJ assigned to hear a case.  HB 680 now requires the Board to accept the ALJ’s decisions on whether a physician has committed a violation.  This single change is a huge “win” for Texas physicians. 

While Texas physicians are far better off today than they were prior to enactment of HB 680, it is important that they familiarize themselves with their obligations under the Texas Medical Practice Act.  The TMB remains strong and is known for the stringent positions it takes. 

Liles Parker attorneys have extensive experience representing physicians and other health care professionals in investigations and disciplinary actions taken by State Medical Boards.  Need assistance?  Call us for a complimentary initial consultation.  We can be reached at:  1 (800) 475-1006 

 

Under Health Care Reform Legislation, Stark’s Whole Hospital and Rural Provider Exceptions are Changing

(October 22, 2010):  It’s not exactly breaking news to anyone in the hospital industry that the U.S. Congress and the regulators at the Center for Medicare and Medicaid Services seem bent on preventing or eliminating physician referrals to hospitals in which they invest. With the passage of health reform legislation in March of this year, Congress approved yet another round of sweeping measures designed to eliminate or prevent the growth of physician investment in hospitals to which they refer by drastically changing both the rural provider and whole hospital ownership exceptions to the Stark Law.

Here are a few key points to be aware of if you invest or work in a physician-owned hospital and you rely on the Stark Law rural provider or whole hospital exceptions to protect physician-investor referrals to the facility:

1. No new physician-owned hospitals after December 31, 2010 – The new law imposes a total moratorium on Medicare certification of new physician-owned hospitals that would rely on either of these exceptions to protect investor referrals unless they have a provider agreement in place as of December 31, 2010.

 2. Cap on Total Physician Ownership Percentage – Health reform legislation capped total physician investment in existing Medicare-certified facilities at whatever total percentage physician ownership a facility had on March 23, 2010, the date the law was passed.  Physician owners can still buy and sell their interests, but total physician ownership may not exceed the capped amount.  If your physician investors have increased their total ownership percentage since March 23, 2010, they will have 18 months from that date to take action to comply with the new law.

3. No Bed Increases Without An Exception from CMS – The legislation also froze the number of beds a physician owned, Medicare-certified hospital may have unless it is granted an exception by CMS to increase its capacity.  The new law defines the basic criteria for an exception, but CMS has until December 31, 2012 to promulgate regulations implementing the exception process.  You may not put new beds into service and continue to have physician investors refer to your facility until your hospital has been granted an exception.

4. New Disclosure and Reporting Requirements – There were a host of new disclosure and reporting requirements added by the legislation, including mandatory disclosures to patients referred or treated by an investor, public disclosures on hospital websites and in public advertising about physician ownership, and an annual report to the Secretary of the Dept. of Health & Human Services that identifies all physician and non-physician owners or investors in a hospital, as well as the nature and extent of their ownership and investment interests.  Also, the law includes a mandate for the Secretary of HHS to post on its website all investment information reported pursuant to these new requirements. 

5. New Patient Safety Requirements – Finally, there are new patient safety requirements that mandate a disclosure to, and written acknowledgement from, all patients regarding whether a physician is available on-site, 24-hours a day,  as well as a requirement that the hospital provide assessment and initial treatment for all patients and the capacity to refer and transfer patients to hospitals with the capability to treat the needs of each patient that can’t be appropriately treated on-site.

 CMS recently proposed regulations implementing most of the above described legislative changes. 

Jennifer Papapanagiotou, Counsel to LilesParker, PLLC, is a health care attorney with 10+ years experience assisting providers with structuring or re-structuring their businesses and contractual relationships to comply with Federal and State health care fraud and abuse laws, including the Stark Law.

Should you have questions regarding the Stark Law, the Anti-Kickback Statute, or the myriad other health care fraud and abuse laws and regulations, please give us a call at 1 (800) 475-1906. 

 

 

Is More Medicare Fraud Legislation on the Way?

(September 15, 2010): Notably, on September 14th, members of the House Ways and Means Health Subcommittee introduced legislation cited as “Strengthening Medicare Anti-Fraud Measures Act of 2010″  which would expand current permissive exclusion provisions to permit HHS-OIG to exclude owners, officers and managers of companies that are convicted of health care fraud.  The proposed legislation appears to be quite broad and arguably could result in an officer being excluded from participation in Federal Health Benefits programs even if he was no longer working at the company when it convicted of the crime, as long as the officer was at the company when the wrongful conduct occurred.   It could also be used to go after parent companies of subordinate enterprises that are convicted of health care fraud.

Liles Parker attorneys represent health care providers in a wide variety of health law matters.  Please feel free to contact us at 1 (800) 475-1906 for a free consultation.

 

 

States Are Taking Aim at Home Health Providers – Florida’s MFCU Will Expand Their Review and Investigation of Home Health Providers Billing Medicaid – Your State May be Next

(July 19, 2010): Home health care providers are in the crosshairs again.  On July 15, HHS granted Florida a waiver of the anti-data mining provisions of federal Medicaid program regulations that will allow its Medicaid Fraud Control Unit (MFCU) to begin seeking out reasons to investigate home health and other providers for fraud.  While Florida is the first and currently the only state to obtain a waiver of this type, if Florida’s pilot program “succeeds”, the other 49 MFCUs could soon be doing the same thing.

MFCU “strike forces” are designed to investigate referred cases of fraud.  They are prohibited by 42 CFR §1007.19(e)(2) from receiving federal funding for conducting analysis to independently identify Medicaid fraud.  In their formal July 7^th request, the Florida Attorney General and Florida Agency for Health Care Administration Secretary requested an expedited waiver of those protections. 

The pilot program, intended to be effective January 1, 2011, will allow the state MFCU to use data mining to “identify situations in which a question of fraud may exist, including the screening of claims, analyses of patterns of practice, or routine verification with recipients of whether services billed by providers were actually received.”  The Florida officials’ request makes a point of calling out home health providers in justifying this expansion of the MFCU’s powers, declaring that:

“[S]ome services such as durable medical equipment and home health are frequent targets of fraudulent activity…” and

“areas of particular concern that the demonstration would address include …home and community based waivers, payments to assisted living facilities, and home health services.” (Emphasis added).

We are greatly concerned by the continued targeting of home health providers by state and Federal officials.  Given the explicit program goals of increasing the number of leads and cases, the number of arrests and convictions, the number of overpayment and abuse referrals, and the recovery of funds and then serving as a model for other states, this program warrants close monitoring.

Should you have any questions regarding these issues, don’t hesitate to contact us.  For a complementary consultation, you may call Robert W. Liles or one of our other attorneys at 1 (800) 475-1906.

HHS / CMS Issues Final “Meaningful Use” Objectives for Electronic Health Records (EHRs). Providers Should Exercise Extreme Caution Before Converting to an EHR System.

(July 14, 2010): Yesterday, the Department of Health and Human Services (HHS) issued its final regulations concerning what it means for eligible Medicare and Medicaid providers to be “meaningful users” of certified electronic health record (EHRs) technology in 2011 and 2012.  We are cautiously optimistic that HHS’ approach will allow small providers the flexibility they need to participate in the program if they choose but, as detailed below, are not convinced that CMS contractors are ready for the technology.

The rules support the Health Information Technology for Economic and Clinical Health Aid Act (HITECH), which authorized incentive payments through Medicare and Medicaid to clinicians and hospitals when they use EHRs privately and securely to achieve specified improvements in care delivery.  According to HHS, the incentives could be as much as $44,000 (through Medicare) and $63,750 (through Medicaid) per clinician. Subsequent rules will govern later phases of the ten year program. 

The meaningful use objectives for 2011-12 are categorized in two tiers – core and menu objectives.  The first set of “core” objectives comprises basic items essential to creating any medical record, such as:

• Recording patient demographics;
• Maintaining active medication list; and
• Generating and transmitting permissible prescriptions electronically.

The second “menu” set is comprised of 10 additional important activities from which providers will choose any 5 to implement in the first two years.  They include:

• Implementing drug formularies;
• Incorporating clinical laboratory test results into EHRs as structured data; and
• Sending reminders to patients (per patient preference) for preventative and follow-up care.

For most of the core and menu items, the regulations also specify rates at which providers must use the functions to be considered meaningful users and how to report clinical quality measures.

HHS is establishing a nationwide network of Regional Extension Centers to assist providers in adopting and using certified EHR technology.  The full 864 page rule is available at http://www.ofr.gov/OFRUpload/OFRData/2010-17207_PI.pdf

While the concept of EHR and electronic medical records (EMR) may sound great, a number of our clients have already experienced the dark side of EHR / EMR.  Unfortunately, the Centers for Medicare and Medicaid Services (CMS) have completely disregarded (or remained completely ignorant of) the fact that a number of early adopters of this technology have found that Medicare Administrative Contractors (MACs) and Program SafeGuard Contractors (PSCs) (now being replaced by Zone Program Integrity Contractors (ZPICs)) appear to be inexperienced in their review of medical records that have been generated with the assistance of EMR / EHR software programs. 

In some cases, the Medicare contractors have mistakenly alleged that the records documenting the care provided are overly similar – erroneously concluding that the records were “copied” or “cloned.”  Every software program is different.  Nevertheless, many of the programs utilize “drop-down” menus that offer providers a number of different options for documenting their observations, the patient’s symptoms, or clinical findings.  While such an approach may facilitate the completion of an evaluation, progress notes, or other clinical service, it also inadvertently leads to “similar” wording or phrases among classes of documents generated.  When a significantly number of these clinical documents are reviewed by a Medicare contractor, in some cases the contractor has incorrectly concluded that instead of documenting individualized observations, these EMR / EHR-generated medical records are mere “copies” or “clones” of other medical records.  In reaching such a conclusion, PSCs / ZPICs have denied claims and then extrapolated the alleged damages to the universe of claims at issue.

Thus, providers should exercise extreme care before transitioning over to an EMR / EHR system.  Every effort should be made to ensure that your observations are individualized to the greatest extent possible.  Prior to choosing a software program, a provider should test the program with a significant number of claims to ensure that the end product generated by the program does not leave a third party reviewer with an incorrect picture of the care provided.

Should you have any questions regarding these issues, don’t hesitate to contact us.  For a complementary consultation, you may call Robert W. Liles or one of our other attorneys at 1 (800) 475-1906.

PPACA Creates a Minefield for Medicare Providers Who Fail to Promptly Return a Medicare Overpayment

(July 9, 2010):  Does the failure to promptly return a Medicare overpayment warrant liability under the False Claims Act (FCA)?  Congress thinks so.  The Patient Protection and Affordable Care Act (PPACA) creates new obligations under the FCA whereby a Medicare provider who fails to timely report and refund an overpayment may be subject to substantial penalties and damages.

Section 6402 of the PPACA requires Medicare providers, including physicians and partial hospitalization providers, among others, to a) return and report any overpayment, and b) explain, in writing, the reason for the overpayment.

This law creates a minefield for physicians and other Medicare providers.  First, providers have only 60 days to comply with the reporting and refund requirement from the date on which the overpayment was identified or, if applicable, the date any corresponding cost report is due, whichever is later.  Of course, the PPACA does not actually explain what it means to “identify” an overpayment.

Nonetheless, the PPACA makes this reporting and repayment requirement an “obligation” under the FCA.  Pursuant to the Fraud Enforcement and Recovery Act of 2009 (FERA) amendments to the FCA, an individual or entity may be liable if he or it “knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government.”  Thus, providers who fail to meet their 60 day “obligation” may be subject to monetary penalities of up to $11,000 per claim, and treble damages.

Should you have any questions regarding these issues, don’t hesitate to contact us.  For a complementary consultation, you may call Robert W. Liles or one of our other attorneys at 1 (800) 475-1906.

Identity Theft “Red Flags” Rule Treating Doctors Like Banks Is Delayed Once Again

(July 5, 2010): The Federal Trade Commission (FTC) has agreed to once again delay enforcement of its illogical and onerous “Red Flags” rule with respect to physicians. 

The “Red Flags” rule arises under the Fair and Accurate Credit Transactions Act of 2003 and requires “financial institutions” and “other creditors” to develop written plans to detect identify theft in their day-to-day operations.  Under the FTC’s interpretation of the rule, physicians who permit patients to pay after they have rendered medical service are transformed into “creditors.”

Extension of the rule to physicians has been delayed several times as the extent of the burden on health care providers has become clear.  As recently as May 28, the FTC made note of the concerns:

“At the request of several Members of Congress, the [FTC] is further delaying enforcement of the ‘Red Flags’ Rule through December 21, 2010, while Congress considers legislation that would affect the scope of entities covered by the Rule….The Commission urges Congress to act quickly to pass legislation that will resolve any questions as to which entities are covered by the Rule and obviate the need for further enforcement delays.”

The June 25^th agreement arises in connection with a suit filed against the FTC last month by the American Medical Association (AMA) and others seeking to prevent enforcement of the “Red Flags” rule and alleging that the FTC overreached its bounds in seeking to enforce the rule against physicians.   A similar complaint by the American Bar Association (ABA) is currently making its way through the appeals process after the U.S. District Court for the District of Columbia enjoined enforcement of the rule against lawyers.  Until a ruling is issued in the ABA case, the AMA case will be held in abeyance and physicians will be safe from the “Red Flags” rule.

Should you have any questions regarding these issues, don’t hesitate to contact us.  For a complementary consultation, you may call Robert W. Liles or one of our other attorneys at 1 (800) 475-1906.

Enactment of “Doc Fix” Bill Offers Another Temporary Reprieve for Medicare Physicians

(June 28, 2010):  On Friday, June 25, 2010, President Obama signed the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010 (H.R. 3962), which provides yet another band-aid for our broken Medicare physician pay system.  The bill replaces the 21% Medicare physician payment cut that took effect at the beginning of this month with a retroactive 2.2% payment increase for the period from June 1 to November 30. 

What this increase means, of course, is that after November 30, 2010 physicians’ pay is expected to tumble 23%, instead of 21%.  This bill is just the latest in a series of Congress’ short-term “doc fix” budget maneuvers, designed to stave off the deleterious impacts of the fundamentally flawed Sustainable Growth Rate (SGR).  The fact is that the constant cycle of SGR-mandated pay cuts and uncertain legislative patches punishes doctors and patients.  

 Upon signing the bill, the President issued a statement, noting that, “A 21-percent pay cut to physicians’ payments would have forced some doctors to [stop] seeing Medicare patients – an outcome we can all agree is unacceptable.”  We imagine that a 23% drop in December will be similarly unacceptable but, at this point, Medicare physicians (and patients) will be forced to continue operating without any certainty of a long-term solution.

The Centers for Medicare and Medicaid Services (CMS) have been processing claims at the lower rate since June 18 but will reprocess these and begin processing future claims at the increased pay rate by July 1.  Physicians should carefully monitor their claims for this period and ensure that CMS contractors make the necessary adjustments.

Should you have any questions regarding these issues, don’t hesitate to contact us.  For a complementary consultation, you may call Robert W. Liles or one of our other attorneys at 1 (800) 475-1906.