Archives: Medicare and Medicaid

Subscribe to Medicare and Medicaid RSS Feed

Medicare Appeals Settlement Program Expanded

The Office of Medicare Hearings and Appeals (OMHA) has announced the expansion of their Settlement Conference Facilitation (SCF) program.  SCF is a dispute resolution process for Medicare appeals that provides for payments as percentage of the Medicare approved amount.  The percentage is negotiated during a telephone settlement conference utilizing a mediation facilitator.  Utilizing dispute resolution processes such as SCF will be very important in helping to reduce a very significant backlog of Medicare appeals, which the government estimates would take OMHA at least eleven years to process.…

DOJ Enters Into Largest-Ever Civil Settlement with Hospital for Drug Diversion

On May 16, 2018, the U.S. Attorney’s Office for the Southern District of Georgia announced that it had entered into the “largest hospital drug diversion civil penalty settlement in U.S. History” in the amount of $4.1 million dollars.  The settlement with a Georgia hospital resolves allegations that the hospital “failed to provide effective controls and procedures to guard against theft and loss of controlled substances” that resulted in tens of thousands of 30mg oxycodone tablets being unaccounted for and believed to have been diverted for illegal uses over a four …

DOJ Intervenes in False Claims Act Case Against Insys Therapeutics

The Department of Justice (DOJ), recently intervened in a civil False Claims Act (FCA) case filed against Insys Therapeutics, Inc. (Insys) in the Central District of California that alleges FCA violations arising from the payment of kickbacks in violation of the Anti-Kickback Statute (AKS) as well as other fraudulent activities. Insys is an embattled Arizona-based pharmaceutical manufacturer of a highly-addictive sublingual opioid spray known as Subsys, and is currently the subject of a number of criminal and civil suits ongoing across the country (certain of which were consolidated into this …

DOJ Announces Criminal Conviction of Physician for HIPAA Violation

On April 30, 2018 a Massachusetts physician was convicted of a criminal violation of the Health Insurance Portability and Accountability Act of 1996 (HIPAA), as well as one count of obstruction of a criminal health care investigation, in a Massachusetts federal court. The convictions relate to the purported sharing of confidential patient information by the physician with pharmaceutical sales representatives that allowed the pharmaceutical company to target patients with specific conditions (and to correspondingly facilitate the receipt of prior authorizations for the company’s drugs from patients’ insurers).…

OIG Reports That CMS Paid Practitioners For Telehealth Services That Failed To Meet Medicare Requirements

On April 5, 2018, the Office of the Inspector General (OIG) announced its findings that the Centers for Medicare and Medicaid Services (CMS) paid practitioners for telehealth services that did not meet Medicare requirements. Certain telehealth services are reimbursable by Medicare as Part B services. According to the OIG, it engaged in a review of telehealth services after finding that Medicare paid a total of $17.6 million in telehealth payments in 2015, compared to just $61,302 in 2001.…

Supreme Court Order Indicates Interest in Reviewing Campie, the False Claims Act Outlier of the Ninth Circuit

In an order issued on April 16, 2018, the U.S. Supreme Court invited the Solicitor General to file a brief “expressing the views of the United States” concerning the 2017 decision of the U.S. Court of Appeals for the Ninth Circuit in the False Claims Act (FCA) case U.S. ex rel. Campie v. Gilead Sciences, Inc. (see our previous analysis of the case here). The Campie case is noteworthy because it created a split among the circuit courts as to the scope of the “government knowledge” defense to materiality …

Private Equity Firm Named as Defendant in False Claims Act Case Targeting A Portfolio Company

A recent complaint filed by the United States Department of Justice against a private equity firms regarding an alleged kickback further illustrates new concerns private equity should be aware of in the healthcare arena and working with counsel to mitigate such concerns.  A February 23, 2018 press release from the DOJ regarding United States ex rel. Medrano and Lopez v. Diabetic Care Rx, LLC dba Patient Care America, et al., No. 15-CV-62617 (S.D. Fla.), available here, describes how the complaint was made against a pharmacy, several of its executives …

Fifth Circuit Reinstates Provider’s Collateral Challenge to the Medicare Appeal Process

On March 27, 2018, the United States Court of Appeals for the Fifth Circuit held that a health care provider can seek an injunction in federal court against recoupment by Medicare of alleged overpayments despite not exhausting its administrative appeal remedies, in part because the current delay in scheduling of hearings before an Administrative Law Judge could cause the provider to go out of business before it has an opportunity to exhaust its administrative challenge of the recoupment. This decision could provide a template for other providers facing significant …

CMS Updates Medicare Advantage and Part D (Prescription Drug Benefit)

On April 2, 2018, the Centers for Medicare & Medicaid Services (CMS) issued a Final Rule, updating Medicare Advantage (MA) and the prescription drug benefit program (Part D).  The Final Rule includes, among other provisions:

  • Preclusion List Requirements for Prescribers in Part D and Individuals and Entities in Medicare Advantage, Cost Plans, and PACE: The Final Rule eliminates the MA and Part D prescriber and provider enrollment requirement.  Instead, CMS is compiling a “Preclusion List” of prescribers, individuals, and entities that: (1) are currently revoked from Medicare, under

State Enforcement Actions Demonstrate Continued Scrutiny of Health Care Fraud

A series of criminal and civil enforcement actions announced in recent weeks demonstrate the continued attention that state regulators throughout the Northeast are placing on health care fraud. These actions, and the significant sanctions imposed by courts and the government, can serve as a reminder that violators of health care fraud laws are subject to scrutiny at both the federal and state levels (often simultaneously), and that such violations can create exposure to significant civil and criminal penalties.…

CMS Issues National Coverage Determination On Next Generation Sequencing For Advanced Cancer

On March 16, 2018, the Centers for Medicare & Medicaid Services (CMS) issued a Decision Memo for Next Generation Sequencing (NGS) for Medicare beneficiaries with advanced cancer (CAG-00450N). In the memo, CMS concluded that NGS as a diagnostic laboratory test is reasonable, necessary and covered nationally when performed in a CLIA-certified laboratory, ordered by a treating physician, and certain additional patient-status and testing requirements are met. The memo outlines these requirements and specifies the criteria that Medicare Administrative Contractors (MACs) must use to determine coverage for NGS as a diagnostic …

Bipartisan Budget Act Revises Stark Law, Increases Penalties for AKS and CMP Law Violations, and Expands Telehealth Coverage

On February 9, 2018, Congress passed the Bipartisan Budget Act of 2018 (the Act), which included a number of important health law provisions..

AKS and CMP Violations

Under the Act, Congress doubled the statutory civil fines for certain violations of the Anti-kickback Statue (AKS) and adjusted certain fines under the Civil Monetary Penalty (CMP) Law. The Act also increased the maximum criminal penalty from $25,000 to $100,000 and increased the maximum incarceration period from five years to ten years.…

Recent Anti-Kickback Cases Emphasize Government Scrutiny of Speaker’s Bureaus and Lavish Meals Funded by Pharmaceutical and Device Manufacturers

The Department of Justice (DOJ) recently resolved two health care fraud cases – one criminal and one civil – that demonstrate the government’s continued scrutiny of lavish meals and “speaker’s bureaus” sponsored by pharmaceutical and device manufacturers as potential avenues for the payment of kickbacks to physicians for referrals of health care items and services. These cases indicate the criminal and civil risk that providing lavish meals or purported speaker’s bureau payment can pose, and the corresponding need to proactively assess the legitimacy of such programs and events.…

CMS Revises National Coverage Determination for Implantable Cardioverter Defibrillators

On February 15, 2018, the Centers for Medicare & Medicaid Services (CMS) issued a Decision Memo outlining revisions to its 2005 National Coverage Determination (NCD) for Implantable Automatic Defibrillators (ICDs) . The updated NCD  includes changes to the covered indications for ICDs, new patient criteria and exceptions to waiting periods for symptomatic patients with certain histories before an ICD will be considered a covered device by Medicare. The final updates follow CMS’ review of comments received following its release of a Proposed Decision Memorandum in November 2017. The Decision Memo …

CMS Extends Hospital and CAH Attestation Deadline

The Centers for Medicare & Medicaid Services (CMS) has extended the eligible hospital and critical access hospital (CAH) attestation deadline from February 28, 2018 to March 16, 2018. The extension provides additional time to submit attestation data and electronic clinical quality measure (eCQM) data. Eligible hospitals and critical access hospitals attesting to the CMS Electronic Health Records (EHR) Incentive Program are required to submit data through the QualityNet Secure Portal (QNet). “Subsection (d) hospitals” that are paid under the Inpatient Prospective Payment System (IPPS), CAHs, and Medicare Advantage hospitals are …

Escobar Compels Florida District Court to Overturn $350 Million Jury Verdict Arising from Claims of Inadequate Documentation

Last month, a U.S. District Court in the Middle District of Florida overturned judgments totaling $347,864,285 returned by a jury under the federal False Claims Act (FCA) and Florida’s state equivalent against the owners and operators of 53 specialized nursing facilities in Florida, determining that the plaintiffs’ allegations failed to satisfy the “demanding” and “rigorous” materiality standard endorsed by the Supreme Court in its 2016 Escobar decision. In an order released January 11, 2018, the District Court reversed the jury’s conclusions and granted the defendants judgment as a matter of …

CMS Announces Change to Student Documentation Requirement Intended to Reduce Burden on Teaching Physicians

On February 2, 2018, the Centers for Medicare & Medicaid Services (CMS) released Transmittal 3971 (Change Request 10412), which revises a section of the Medicare Claims Processing Manual (Manual), that provides guidance regarding billing for Evaluation and Management (E/M) services involving students.  According to CMS, the Change Request is part of a broader goal to reduce the administrative burden on practitioners.…

CMS Considers 7-Day Limit on Initial Opioid Prescriptions under Part D

In a Draft Call Letter issued February 1, 2018, the Centers for Medicare & Medicaid Services (CMS) announced that it is considering a number of new strategies to address opioid overutilization within the Medicare Part D program.  CMS is particularly concerned with chronic overuse among beneficiaries taking high levels of prescription opioids (e.g., beneficiaries prescribed opioids with a 90 morphine milligram equivalent (MME) dose or higher per day), beneficiaries with multiple prescribers, and “opioid naïve” patients (i.e., patients newly prescribed opioids).

CMS’s strategies include consideration of a 7-day supply limit …

CMS Issues Temporary Enrollment Moratorium on Home Health Agencies and Non-Emergency Ambulances in Selected States

On January 29, 2017, the Centers for Medicare and Medicaid Services (CMS) announced a temporary moratorium on enrolling Part B non-emergency ambulance providers/suppliers and home health agencies, subunits and branch locations in Florida, Illinois, Michigan, Texas, Pennsylvania and New Jersey.  CMS is taking this measure “to prevent and combat fraud, waste and abuse.”  The moratorium also extends to the Medicaid and Children’s Health Insurance Programs (CHIP).  According to CMS, the action is taken pursuant to Sections 1866(j)(7), 1902(kk)(4), and 2107(e)(1)(D) of the Social Security Act and CMS regulations at 42 …

OIG Advisory Opinion Allows Medical Center to Share Cost Savings with Neurosurgeons for Curbing Spinal Fusion Surgery Costs

On January 5, 2018, the Health and Human Services Office of Inspector General (OIG) posted a favorable Advisory Opinion, permitting an arrangement involving payment by a Medical Center to a multi-specialty physician Group for cost-reduction measures achieved through the efforts of certain Neurosurgeons, relating to the selection and use of products during spinal fusion surgeries (Program).  Payment under the Program was calculated as a percentage of cost savings realized by the Medical Center over a three-year period.  Though not yet paid at the time of the OIG advisory opinion, …

CMS Announces First Advanced Alternative Payment Model Under MACRA: Bundled Payments for Care Improvement Advanced

On January 9, 2018, the Centers for Medicare & Medicaid (CMS) Center for Medicare and Medicaid Innovation announced a new voluntary bundled payment model called Bundled Payments for Care Improvement Advanced (BPCI Advanced).  BPCI Advanced is the first Advanced Alternative Payment Model (Advanced APM) launched under the Quality Payment Program that was implemented as part of the Medicare Access and Chip Reauthorization Act (MACRA). …

CMS Issues Guidance on Texting Patient Information

On December 28, 2017, the Centers for Medicare and Medicaid Services (CMS) published a memo to state survey agency directors clarifying its position on the use of text messaging among health care providers. In its memo, CMS stated that it does not permit texting of patient orders by health care providers, as texting of patient orders does not comply with the applicable Medicare conditions of participation (COPs), specifically 42 C.F.R. § 489.24. Instead of texting patient orders, CMS states that its preference is for health care providers to either hand-write …

OIG Advisory Opinion Allows Pilot Collaborative Program Proposed by Pharmaceutical Manufacturer for Medication Therapy Management Interventions

On December 11, 2017, the Health and Human Services Office of Inspector General (OIG) posted a favorable Advisory Opinion, permitting a proposed pilot Program involving a collaboration between a pharmaceutical manufacturer (the Requestor), a trade association (Association), a Medicare Advantage Part D plan (MA Plan), a Hospital System, and a Vendor.  As proposed, the program would provide new technology to allow real-time access to patient discharge information for use by MA Plan pharmacists who conduct medication therapy management (MTM) services. …

CMS Approves Laboratory Alerts to Physicians in Rare Stark Law Advisory Opinion

The Centers for Medicare & Medicaid Services (CMS) issued a rare advisory opinion (CMS-AO-2017-1) under the Stark Law (Section 1877 of the Social Security Act, codified at 42 U.S.C. § 1395) earlier this fall, addressing a proposed arrangement under which a web-based diagnostic testing portal sought to provide referring physicians with free alerts related to test results.…

LexBlog