New Tools to Fight Health Care Fraud

CMS has taken their fight against health care fraud to a new level, announcing the start of a partnership with companies that provide predictive modeling to anticipate and prevent potentially wasteful, abusive or fraudulent payments before they occur.

Soon, every Medicare claim will be subject to a computerized analysis that reveals all claims paid to that provider.  By tracking billing patterns and other statistical information, real-time aberrant trends can be spotted that will alert CMS to locating fraudulent providers before they begin receiving Medicare funds. 

Predictive modeling tools are already used by banks and credit card companies to identify potential fraud before it occurs. CMS has used the tool in pilot projects, and has used those results to begin administrative actions against "false fronts" in several states.  

Historically, CMS relied on the "pay and chase" method to track down potential violators and then tried to recover the funds.  In 2010, the Department of Justice obtained settlements and judgements of more than $2.5 billion in False Claims Act matters alleging health care fraud.  Thanks to funding from a portion of the Affordable Care Act, CMS will be purchasing new tools and resources to track provider specific trends and quickly catch anyone attempting to steal taxpayer dollars.

AANEM calls on CMS to distribute overdue reimbursements

Two hundred million dollars has been included in the recently passed Medicare & Medicaid Extenders Act to address overdue Medicare reimbursements that should have been received by physicians under the Affordable Care Act (ACA ) of 2010.

ACA called on CMS to reimburse physicians retroactively to January 1, 2010 for calculation errors in the geographic practice cost index (GPCI) for work and practice expenses.   Additionally, miscalculations in professional liability insurance and practice expenses associated with some high risk procedures forced many physicians to accept payments 40% lower than they should have been.  

The short-term stop-gap measures enacted throughout 2010 caused payment uncertainties, delays and disruptions for many of our members.  Recognizing the need for relief, AANEM has joined with the American Medical Association to request CMS immediately announce how it intends to act to ensure all retroactive payment increases are distributed to physicians in a timely manner. 

Sales of neurostimulation devices under scrutiny

A Midwest maker of neurostimulation devices disclosed that it has received a subpoena from the US Attorney's office for the Western District of New York related to the sales of it's devices and reimbursement to physicians who use the products.  The subpoena is seeking information regarding sales, marketing and reimbursement and is related to the Health Insurance Portability and Accounting Act of 1996. 

The company, Medtronic, says it received the subpoena in October and is fully cooperating with the investigation. 

FDA Extends Review of Multiple Sclerosis Pill

The Food and Drug Administration has extended Merck's priority review of the drug cladribine, a sphingosine 1-phosphate receptor modulator, by three months to examine additional information on the product.  The FDA's decision puts Merck further behind in the race to provide MS patients in the United States with a first-line oral treatment for relapsing forms of multiple sclerosis.

In MS, the immune system damages the covering that protects nerve fibers in the central nervous system (CNS), which includes the brain and spinal cord. Sphingosine 1-phosphate receptor (S1PR) modulators  reduce the immune system's attack on the CNS by retaining certain white blood cells (lymphocytes) in the lymph nodes. This prevents the white blood cells from reaching the CNS, where they could potentially attack the protective covering around the nerve fibers, resulting in less inflammatory damage to the nerve cells. The white blood cell retention is reversible if treatment is stopped.


European regulators rejected cladribine in September, saying the drug's benefits didn't outweigh the risks.  U.S. regulators didn't request more clinical trials, and  Merck representatives declined to elaborate on what additional information the FDA is reviewing.   The FDA had originally granted cladribine a priority review in July, shortening the standard 10 month review period to six months.  Based on this request for additional information, the FDA review is expected to now end on February 28, 2011.

Health insurers will soon be required to spend a specific amount of premium dollars on health care

Insurance has traditionally been regulated at the state level. When health insurers sell policies, they charge premiums. The share of premiums NOT paid out on health care claims goes towards administrative expenses, marketing costs and profits. The share of premiums paid out is termed "medical loss ratio." 

State imposed medical loss ratios vary widely. North Dakota currently requires a 55% medical loss ratio, New Jersey requires an 80% ratio. Medicare maintains a loss ratio of 97-98%.

Beginning in 2011, the Affordable Care Act will require health insurance companies to spend a minimum percentage of the premiums they collect on services and quality improvement activities for the people they insure and the Act creates a federal minimum medical loss ratio for all insurers.

Health insurers predict this new mandate will drive insurers out of business.  The argue overly stringent ratios will stifle innovation and eliminate quality measures.  Proponents believe the legislation will improve quality of care & keep premiums low by limiting administrative spending and improving transparency.

Beginning in 2011, insurers will have to report their 2010 ratio & adjust internal practices accordingly. By 2012, if a medical loss ratio exceeds the federal standard, insurers will be required to rebate policyholders.  If an insurer fails to meet the ratio for three consecutive years, they could be banned from signing up new customers. If the problem continues for 5 years, HHS could terminate the contract for the health plan in question.

HHS Secretary Sebelius recognizes the potential for "unintended consequences" arising from the new rules but assures both sides that her office will work to ensure a smooth transition to 2014, when state exchanges will guarantee insurance coverage.  

Study Finds Health IT Adoption Growing

A new study released by the Computing Technology Industry Association (CompTIA) shows that up to 50% of healthcare provides have either adopted electronic health records are are partially using them.

The study, which included 300 US healthcare providers, found that 34% are now using a "comprehensive" electronic health record system and 16% say they are using a "partial" system.

About 29% said they are evaluating their options, while another 20% indicated they have not yet looked at the issue.

Of those who have adopted EHRs, 59% said they were completely or mostly satisfied with their EHR and 36% indicated they were partly satisfied or partly dissatisfied.  The survey would seem to indicate dentists are the most satisfied  user of EHRs (70%) compared to medical doctors (57% satisfied).

OIG Work Plan for Fiscal Year 2011

A quick review of the Office of Inspector General's work plan indicates 2011 reviews will continue to focus on ensuring providers can justify the appropriateness of what they are doing, either from a clincial perspective or a documentation perspective.

 

Evaluation & Management (E&M) claims will be evaluated to ensure:

•  Documentation supports the level of service reported - specifically that there is not identical documenation used to record the patient encounter for each & every patient. 
• Coding patterns, by provider, accurately reflect the service provided.  Specifically, that billing for E&M services reflect the individual type, setting and complexity of services provided to each patient.    

For services performed in hospital outpatient departments or ambulatory surgical centers (ASC), the OIG will audit to determine whether physicains properly coded the place of service on claims.  To review the current list of location codes used for billing go to: https://www.cms.gov/MedHCPCSGenInfo/Downloads/Place_of_Service.pdf

 

 

 

Meaningful Use - What's Next?

The Health IT Policy Committee, a federal advisory group, has begun work on developing the meaningful use requirements for stages 2 and 3 of the federal Medicare and Medicaid healthcare IT adoption incentive program. 

Stage 1 incentives begin in January, 2011 and CMS and the Office of the National Coordinator for Health Information Technology will begin monitoring data submitted to help fomulate some aspects of the stage 2 and 3 requirements.  Currently, interoperability appears to be a big focus of the stage 2 requirements, however a meaningful use workgroup is expected to present recommendations to the HIT policy committee today (October 20th), with opportunities for additional public input beginning in November. 

If all goes well, providers and vendors should have a good idea of what will be expcted in the Stage 2 and 3 incentives by mid-year 2011.