The Health Care Fraud Enforcement Act of 2009 has been introduced in Congress. This proposed legislation makes straightforward but critical improvements to the federal sentencing guidelines, to health care fraud statutes, and to forfeiture, money laundering, and obstruction statutes, all of which would strengthen prosecutors’ ability to combat this particularly destructive form of fraud. More information on the bill can be found here.
von Briesen Health Law Blog
October 30, 2009
HIPAA Enforcement Beefs Up
Effective November 30, 2009, HIPAA’s enforcement provisions are being greatly enhanced. Maximum penalty per violation is increased from $25,000 per year to $1.5 million. Click here to read the interim final regulations.
Sebelius Releases Report Highlighting How Health Insurance Reform Will Reduce Costs for Small Businesses
HHS Secretary Kathleen Sebelius recently released a report summarizing how small businesses’ premiums for health insurance tend to be 18% more than large firms’ premiums, and highlighting how health insurance reform will lower premiums for small businesses. Sebelius outlined that health insurance reform will lower premiums in four important ways:
- Health insurance exchange. Health insurance reform will create a health insurance exchange. The exchange will pool together millions of Americans with small businesses and their employees. This pooling will increase competition and purchasing power in the insurance market, which will have the effect of lowering premiums. The exchange would also decrease small firms’ administrative costs, as it will be easier to compare health plan prices, benefits, and quality.
- Small business tax credit. Health insurance reform will provide a tax credit to millions of small business nationwide. The credit will save a percentage off a small business’s premium costs.
- No more “hidden tax.” Because health insurance reform will expand health care coverage to all Americans, the “hidden insurance tax” of more than $1,000 added onto family policies to cover the cost of care for those without insurance, will end.
- No more arbitrary premium hikes. Health insurance reform will prevent insurance discrimination based on health status. This reform measure includes preventing coverage denial based on a pre-existing conditions, preventing premium increases when someone falls ill, and prohibiting charging more if someone is a woman. Health insurance reform will also limit the amount insurance companies may spend on administrative costs, and will require transparency among insurance companies so small business owners can see how insurance companies are spending premium dollars.
Read the full report here.
CMS Issues Memo Addressing H1N1 Influenza Emergency
The Centers for Medicare and Medicaid Services (”CMS”) has released a memorandum to its fiscal intermediaries. The memorandum notifies providers and suppliers that the Secretary of Health and Human Services has invoked her waiver authority to provide some flexibility with regard to Medicare, Medicaid and CHIP requirements for HINI influenza emergency purposes. A Survey & Certification (S&C) memo for providers is being developed and will be released within the next few days.
Region B’s RAC Releases Issues List for Additional States
The Recovery Audit Contractor for Region B, CGI Federal (CGI), recently released additional issues for the states in its region. Previously, CGI released a partial issues list for Indiana, Michigan and Minnesota. Unlike CGI’s earlier release, the additional issues will also apply to Illinois, Kentucky, Ohio and Wisconsin.
Lists of the issues and the states to which they apply follow below:
All states in Region B (IL, IN, KY, MI, MN, OH, and WI). The RAC will review outpatient hospital and physician claims for:
- Neulasta;
- Once in a lifetime procedures; and
- Untimed Codes.
Indiana, Michigan and Minnesota. The RAC will also review outpatient hospital and physician claims for:
- Blood Transfusions;
- Bronchoscopy Services; and
- IV-Hydration.
You can review the Region B RAC’s list and additional information at: http://racb.cgi.com/Issues.aspx?st=1
October 29, 2009
DQA Issues Guidance On Palliative Care Programs
On October 26, 2009, the Division of Quality Assurance issued DQA 09-042 (Palliative Care). This memorandum acknowledges the recent increase in health care entities that provide palliative and supportive care and sets out the current standards of practice for these programs. DQA also cautions that surveyors may include palliative and supportive care programs during the course of their review.
HHS Inspector General Details Audit Plans for Health IT Efforts
HHS’ Office of the Inspector General (OIG) plans to audit CMS’ management of the stimulus package’s incentive payment program. The program will provide roughly $30 billion to hospitals and doctors through the year 2016. The OIG also called for CMS to upgrade its IT systems to comply with the ‘meaningful use’ rules, which are due out shortly.
Proposed Rule That Modifies HIPAA
This month we have seen a lot of regulatory activity to implement the Genetic Information Nondiscrimination Act of 2008. The IRS, the EBSA and CMS issued interim final rules that prohibit some health plans from using genetic information when conducting insurance functions such as underwriting. The Department of Health and Human Service’s Office of Civil Rights (OCR) issued a proposed rule that modifies HIPAA relating to the use and disclosure of genetic information by health plans. These final and proposed rules were published in the Federal Register on October 7, 2009, and can be viewed at http://www.access.gpo.gov/su_docs/fedreg/a091007c.html.
New Development in Prescription Drug Pricing
Wisconsin Assembly Bill 482 has passed the Assembly Committee on Health and Healthcare Reform, moving one step closer to ending the state’s drug-price markup rule. Representative Jon Richards (D-Milwaukee) proposed Bill 482 in an effort to allow pharmacies to sell prescription drugs below cost. Although many big chain pharmacies already sell prescription drugs at steeply discounted rates, they currently are constrained under the state’s Unfair Sales Act from being “loss leaders” and selling drugs at a price below cost. Bill 482 proposes to exempt prescription drugs from the Unfair Sales Act, thereby allowing national retailers the opportunity to offer $4.00 month prescription drug plans in Wisconsin.
Fraud-Fighting Reforms Suffer Setback
In a reminder that sweeping legislative reforms need to pass Constitutional as well as Congressional muster, a federal district court in Ohio has just set aside certain recent amendments to the False Claims Act (“FCA”). The case, U.S. ex rel. Sanders v. Allison Engine Co. (decided 10/27/09), holds that the retroactive application of these amendments under the Fraud Enforcement and Recovery Act of 2009 (“FERA”) violated the Ex Post Facto clause of the Constitution.
FERA was enacted on May 20 of this year as part of the new administration’s push to protect massive stimulus funds from abuse. FERA significantly expands the scope of liability under the FCA not only for persons who directly or indirectly receive stimulus dollars, but also for other persons who submit false claims to the government or who use false records to get a claim paid by the government. An earlier U.S. Supreme Court decision in the Allison Engine case had ruled that the words “to get” in the FCA meant that “a person must have the purpose of getting a false or fraudulent claim ‘paid or approved by the Government’ in order to be liable,” and that the government must rely on the statement “as a condition of payment.” FERA removed the “to get” language from the applicable provision in the FCA, so that the FCA now applies to false statements made to almost any recipient of government funds regardless of whether the person making the false statement expected or intended the government to pay the claim based on those statement.
With FERA, Congress not only reversed the Supreme Court decision in Allison Engine but also attempted to completely erase the effects of that decision by applying its change in the law retroactive to June 7, 2008, two days prior to the Supreme Court’s Allison Engine decision. The Ohio district court, in a continuation of the Allison Engine case after it was remanded by the Supreme Court, ruled that Congress acted improperly when it attempted to apply FERA to claims and cases arising between the date of the Supreme Court’s decision and the enactment of FERA. The district court concluded that retroactive application of this amendment would punish behavior that was not illegal prior to the enactment of FERA, in violation of the Ex Post Facto clause. The retroactive application of FERA threatened to resurrect lawsuits decided in that interim period; the new Allison Engine decision should assist in avoiding that result.