The U.S. Department of Justice (DOJ) announced yesterday that GE Healthcare Inc. will pay $30 million plus interest in order to settle allegations that its subsidiary, Amersham Health Inc., violated the False Claims Act (FCA). According to the DOJ, Amersham Health violated the FCA by causing Medicare to overpay for a radiopharmaceutical used in cardiac diagnostic imaging procedures.
The radiopharmaceutical, Myoview, is used to detect heart disease and see blood flow in images of hearts. The drug is distributed in multi-dose vials, and the number of doses available from the vials is part of the formula used to determine Medicare payment rates for the drug. The DOJ claims that Amersham Health provided false or misleading information regarding the number of doses available from vials, which, in turn, caused the federal government to pay artificially inflated Medicare rates for the drug.
The settlement arises from a 2006 qui tam whistleblower lawsuit filed under the FCA. The whistleblower sold a drug called Cardiolite, a competitor of Myoview. The whistleblower will recover $5.1 million from the DOJ’s $30 million recovery.
Many articles have been written about the legal and business risks associated with the use of social media and web-based email services. However, the risk of using social media is heightened in the health care industry in light of a health care entity’s legal and regulatory obligations to protect the privacy and security of health care information. Health care entities need to be particularly familiar with the risks of using social media in the health care industry and methods for reducing those risks.
The DQA October 24, 2011 Memorandum
On October 24, 2011, the Wisconsin Division of Quality Assurance (“DQA”) issued numbered memorandum 11-026 entitled, “Using Social Media Platforms, such as Twitter, Facebook, MySpace and LinkedIn”. The Memo is available at www.dhs.wisconsin.gov/rl_DSL/Publications/11-026.htm.
The DQA definition of “Social Media” includes what one would normally consider social media, as well as “free and unencrypted web-based email services” such as Yahoo and Gmail, and web-based calendars. The purpose of the Memo is to “provide guidance to providers on the fast-changing landscape of the internet and the impact of using social networking and social media as a communications tool”.
DQA released the Memo to address concerns raised about (1) health care entities and their staff using web-based email accounts (e.g., Gmail) or web-based calendars (e.g., Yahoo Calendars) to convey patient or resident care information; and (2) health care entity staff members sharing protected health information on FaceBook.
The DQA notes that inappropriate use of Social Media or use of Social Media without adequate security protections may violate a patient’s or resident’s privacy rights. Moreover, DQA emphasizes that Social Media sites are now major targets of the hacker underground, creating further risk of a network security breach. DQA also warns health care entities of the potential for criminal and civil risks of using Social Media, (including criminal prosecution or civil actions under HIPAA) because it is the United States Department of Health and Human Services Office of Civil Rights—and not the Division of Quality Assurance—which has jurisdiction over such violations.
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Earlier today, both the U.S. House of Representatives and Senate passed a two-month extension to the doc-fix. If Congress had not approved the extension, Medicare reimbursement would have been reduced by 27.4% as of January 1, 2012. The bill also includes a two-month extension of the payroll tax cut and federal unemployment benefits.
A recent case, U.S. v. Chavez, underscores the fact that federal criminal prosecution is not limited to Medicare and Medicaid fraud. A physician was recently sentenced to approximately six years in prison after he plead guilty to defrauding private insurance companies through false and fraudulent billing practices.
Earlier this year, Armando Chavez, M.D. was indicted on multiple counts of mail fraud and conspiracy in the Southern District of Texas. Prosecutors based the charges on the following fraudulent billing practices: waiving or reducing co-payments as an incentive for patients to seek treatment from Dr. Chavez; overbilling; unbundling billing codes; and billing insurance companies for services that were never performed. In addition to jail time, Dr. Chavez must also pay almost $4 million in restitution.
The Supreme Court announced today the oral argument calendar for the Affordable Care Act (ACA) challenge. The entire week of March 26 has been scheduled for the 5 ½ hours of ACA oral arguments.
On Monday, March 26, the Supreme Court will focus on whether the challenges to the individual mandate are barred by the federal Anti-Injunction Act. On Tuesday, March 27, oral arguments will center on the constitutionality of the insurance mandate in the ACA. Finally, on Wednesday, March 28, the oral arguments will address both whether the ACA can survive if the individual mandate is found unconstitutional as well as the constitutionality of the ACA Medicaid expansion.
A review of the ACA challenges is available here. The Health Law team at von Briesen will continue to monitor and report on the progress of the ACA challenge, including the Supreme Court’s decision, which is expected by July 2012.
The U.S. Department of Health and Human Services (HHS) announced today that 32 health care organizations will participate in the Pioneer Accountable Care Organization (ACO) Program.
The Pioneer ACO model was designed specifically for groups of providers with experience working together to coordinate care for patients. According to HHS, Pioneer ACOs will test innovative payment models to help experienced organizations provide better care for beneficiaries, work in coordination with private payers, and reduce Medicare cost growth. Distinct from the Medicare Shared Savings Program and the Advance Payment ACO model, the Pioneer ACO program was designed to allow provider groups to move more rapidly from a shared savings payment model to a population-based payment model.
HHS received 80 applications for the Pioneer ACO model initiative. The selected ACOs represent 18 states and a variety of health care organizations, including physician-led organization and health systems as well as urban and rural organizations. The first performance period for Pioneer ACOs begins January 1, 2012.
For more information about the Pioneer ACO program, please see the HHS fact sheet. A list of selected Pioneer ACOs is available here.
The Centers for Medicare & Medicaid Services (CMS) announced yesterday a proposed rule that implements the Affordable Care Act “sunshine” provisions. According to CMS, the proposed rule will increase public awareness of financial relationships between drug and device manufactures and certain health care providers. CMS intends that the increased transparency under the proposed rule will help reduce the potential for conflicts of interest that physicians at teaching hospitals might face as a result of their relationships with manufactures.
The proposed rule would require manufactures of drugs, devices, biological, or medical supplies covered by federal health care programs to report annually regarding certain payments or transfers of value provided to physicians or teaching hospitals. The proposed rule also requires certain manufactures and group purchasing organizations to report annually regarding certain physician ownership or investment interests.
The reported payment and ownership information will be published by the Secretary of Health and Human services on a public website. Violators of the reporting requirement will be subject to civil monetary penalties up to $150,000 annually for failing to report and $1,000,000 for knowingly failing to report.
Under the proposed rule, data collection need not begin until final regulations are released. However, CMS suggests that a required partial year data submission may be due March 31, 2013.
Comments on the proposed rule may be submitted to CMS until February 17, 2012. You may submit an electronic comment here. For more information on the proposed sunshine rule, including a description of the covered recipients, please review the CMS press release and fact sheet.
The U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) has begun to release videos from the Health Care Fraud Prevention and Enforcement Action Team (HEAT) Provider Compliance Training initiative. In Spring 2011, OIG, HHS, and the Department of Justice provided trainings in six cities across the county. The trainings focused on the realities of Medicare and Medicaid fraud and the importance of implementing effective compliance programs.
Videos from these HEAT trainings are now being made available via the OIG’s website. The videos include guidance on:
- Fraud and abuse laws;
- Program exclusion authorities and effects;
- Documentation;
- OIG subpoenas, audits, and surveys; and
- OIG self-disclosure protocol.
The OIG videos also include various fraud enforcement panels with the fraud control unit, OIG Special Agent, CMS Deputy Administrator, and Assistant U.S. Attorney. Additional OIG training videos will be made available each week over the next three months.
The Centers for Medicare & Medicaid Services (CMS) recently issued a final rule giving consumers and employers access to Medicare claims data for provider performance reports. The final rule implements provisions of the Affordable Care Act intended to promote transparency and ensure that consumers have access to relevant information in order to make informed decisions. Eligible qualified entities will have access to Medicare claims data, which must be combined with private sector claims in order to assess provider and supplier performance.
To be eligible to participate, an entity must be a “qualified entity” with experience in tasks related to calculating and reporting performance measures, including ensuring the privacy and security of data, combining claims data from multiple payors, designing and publicizing performance reports, and error correction requests. Under the final rule, a qualified entity need not be a single organization, and entities that can demonstrate the required experience through activities with contracted entities may be eligible.
Before receiving any Medicare data, qualified entities must sign a Data Use Agreement with CMS, which requires submission of documentation of any inappropriate use or disclosure of individually identifiable data to CMS and to inform each individual whose information has been inappropriately accessed.
According to CMS, the final rule includes significant modifications from the proposed rule released in June, including modifications regarding the cost and timeliness of data, flexibility and innovation in measure calculation, and timeframes for provider’s and supplier’s review and appeal of draft reports.
The final rule is effective January 6, 2012. Additional information on the final rule is available via CMS’ fact sheet and press release.
The Centers for Medicare & Medicaid Services (CMS) issued its final medical loss ratio (MLR) rule on December 2. The MLR provision (Section 2718 of the ACA) requires health insurers to spend 80% or 85% of all premium dollars on medical care or activities that improve health care quality. Insurers that fail to meet the MLR targets must provide their customers with rebates for the difference between actual expenditures and the target.
The final rule addresses the following notable provisions:
- MLR notice – The final rule includes a new notice requirement. Insurers must provide information on the amount of their rebate or MLR, regardless of whether there is a rebate.
- MLR calculation – Under the final rule, MLR calculation includes the following changes:
- ICD-10 conversion expenses – ICD-10 conversion costs up to 0.3% of an insurer’s earned premium are considered quality improvement activities for the 2012 and 2013 reporting years.
- Community benefit expenditures – The definition of community benefit expenditures was not expanded in the final rule. However, an insurer may deduct either the amount it paid in state premium taxes or the amount of its community benefit expenditures up to a maximum of the highest state premium tax rate, whichever is greater.
- Fraud reduction expenses – Fraud prevention activities continue to be excluded from the definition of quality improvement activities.
- Distribution of rebates in group markets – The final rule establishes separate standards for ERISA-covered group health plans and plans that are neither covered by ERISA nor are governmental plans. The final rule also directs insurers to provide rebates to the group policyholder (usually the employer) through lower premiums or other non-taxable methods.
- Mini-med and expatriate policies – The final rule reduces the adjustment and applies a graduated adjustment for mini-med plans – 1.75 in 2012, 1.5 in 2013, and 1.25 in 2014. A multiplier of 2 will be applied to expatriate policies.
The final rule is effective January 1, 2012. For more information, the CMS Center for Consumer Information & Oversight Fact Sheet is available here.
