PPACA Impact and Opportunities : Health Care Lawyer & Attorney : Epstein Becker Green Law Firm : Insurance & Costs : Health Reform Musings Blog

by George B. Breen and Amy F. Lerman

According to a new report released in December 2011 by the Office of Inspector General (“OIG”), more than 25 percent of all durable medical equipment (“DME”) suppliers faced enforcement actions by the Centers for Medicare & Medicaid Services during their first year of participation in the Medicare program. In its report, the OIG reviewed a sample of 229 newly enrolled suppliers and examined multiple data sources in order to assess the extent, if any, that the suppliers in the sample had program integrity issues. According to the report, during the first year of participation in the Medicare program, 26 percent of those suppliers classified as medium or high risk by the National Supplier Clearinghouse (“NSC”) for committing fraud, and 2 percent of those deemed low-risk by the NSC, had their Medicare billing privileges revoked or were subjected to prepayment claims review. This Alert addresses why DME suppliers, being among those that are subject to the highest levels of screening and scrutiny, need to be aware of these finding and offers thoughts on what suppliers need to do now to prevent and detect potential fraud, avoid prepayment review, and/or revocation of Medicare billing privileges.

Read the full alert here

Expansion of the DMEPOS Competitive Bidding Program; Legislative Inquiry Related to Fraud and Abuse Enforcement Actions; and Automated Pre-Enrollment Provider Screening

by George B. Breen, Amy F. Lerman, Emily E. Bajcsi, Deepa B. Selvam

In order to be prepared for upcoming changes and to respond to new initiatives, providers and suppliers participating in Medicare must be aware of recent Congressional activity that would hold the federal government accountable for its intended enforcement efforts designed to curb health care fraud, waste, and abuse, as well as an effort by the Centers for Medicare & Medicaid Services (“CMS”) to implement automated pre-enrollment provider and supplier screening in January 2012. One example of the pressures that providers and suppliers face in this enhanced regulatory and enforcement climate is the upcoming expansion of the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (“DMEPOS”) Competitive Bidding Program, which is targeted to launch in July 2013 and for which the Round 2 bidding timeline was announced on November 30, 2011.

Read the full alert here

As the health care world awaits the Medicare Shared Savings Program regulations expected to be issued soon by CMS, below is a wish list for key attributes that I hope the regulations evidence:

1. Flexibility. 

 "Transforming health care everywhere starts with transforming it somewhere." I hope that CMS takes Atul Gawande's advice and avoids being too proscriptive in launching the Share Savings Program. To me, the biggest risk to the program is being deemed a failure for having gone down too narrow a path that turns out to be unsuccessful.

Useful approaches have been suggested for tiering ACOs and providing for related payment methodologies based on levels of ACO capability. If some form of risk sharing model is going to be included along with simple share savings, let's not at the outset go so far along the risk axis that many start-up but promising ACOs would be excluded. Flexibility will encourage positive experimentation and inclusiveness in the interest of learning over time.

2. Discipline.

 At the same time, the ACO regulations need to have teeth. Despite the ongoing policy debates about how to measure quality and value, we know enough now for CMS to provide strong minimum requirements that will separate ACOs that show real promise from those that do not. In order to qualify for bonus or risk-based payments, ACOs will need to demonstrate both the current capability and the future capacity to further the triple aim goals of accountable care--improved patient outcomes, patient satisfaction and cost efficiency.

Such evidence will then justify appropriate recognition and protection under the fraud and abuse laws and antitrust laws, among others. And the discipline must be ongoing and progressive--continued qualification and continued improvement. Failure to maintain such qualification must have consequences--both financial and legal.

3. Simplicity.

One of the risk factors in the success of the Medicare Shared Savings Program is that it will be too complicated to implement effectively. There are a million ideas out there about ACOs--regarding structure and governance, assigning beneficiaries, what measures to use, how to allocate savings, etc.

Failure to construct a manageable pathway and an understandable set of rules at the outset--for diverse providers to follow and for consumers to understand and embrace--will severely threaten the ultimate success of the program. It would be easy to try to do too much too fast due to the pressure to "bend the cost curve," among others. I hope that CMS keeps it simple, straightforward and understandable with achievable program goals.

4. Patience.

Even if the regulations evidence flexibility, discipline and simplicity, we will need to be patient. "We" means CMS, Congress, private payers, providers and consumers. This program is one component of a broader set of ideas relating to health care payment and delivery reform in both public and commercial settings. The overall goal is to achieve the triple aim stated above--or as CMS Administrator Berwick often puts it, "better care, better health and lower costs"--through a variety of means and over time.

The Affordable Care Act in its entirety encompasses new quality reporting requirements, value-based purchasing programs, bundling pilots, gainsharing demonstrations, readmissions penalties and other methods of "testing, testing." Not to mention the efforts of the new Center for Medicare and Medicaid Innovation. If the Medicare Shared Savings Program tries to do too much too quickly on its own and the goals are not measured and paced, it inevitably will be judged unfairly and will not make as helpful a contribution as it otherwise might.

5. Harmony.

Another word I might have chosen here is coordination, but coordination is a means to harmonizing the activities and impact of the relevant federal agencies involved in ACO implementation, the various payment and delivery reform components of the Affordable Care Act and the public and private sector initiatives in this arena. Is such harmony too much to hope for? Perhaps, but it should be a goal and it should be achievable over time.

CMS, OIG, FTC and DOJ already have evidenced coordination in the days before and following their October 5, 2010 public workshop on the antitrust issues and fraud and abuse issues related to ACOs. Coordinated guidance is reasonable to expect. The ACA explicitly allows for the coordination of ideas and best practices in accountable care efforts in connection with both governmental and commercial health care payment practices. It certainly is within the power of Secretary Sebelius and Administrator Berwick to harmonize the implementation of Sections 3021, 3022 and 3023 of the ACA, along with the many other provisions that relate to achieving accountable care.

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The ACO regulations should be out soon. They of course will constitute a start, not a finish. There will be much more work to be done. But my wish--and I am hopeful--is that they lay out a constructive and manageable pathway that fits with others in helping to advance the triple aim.

Doug Hastings

Much of the work of the Commonwealth Fund and others seems to presume that payors are a necessary intermediary and should be the entities doling out population prepayment (aka capitation before it was a nasty word). However, it need not work out that way – particularly with House Dems’ concern that Medicare Advantage was profiteering.

It would be a small step for the new public plan likely to be created to make “population prepayments” directly to integrated health systems particularly because the covered lives under such a plan are likely to have the benefit of public reinsurance. Also, since that coverage will not be employer based it will be easier for those integrated systems to assume risk for that plan’s lives (no need for national networks).

Through such direct health system participation those systems would be incented to create the high performance integration these studies suggest is desirable. The Commonwealth Fund is about to release its new blue print . It will be interesting to see if such an evolution is being thought about.