Hot on the heels of the online article in the Wall Street Journal focusing on questionable physician billing practices and Medicare's Carrier Standard Analytic File database, another recent online Wall Street Journal article is now questioning the propriety of physician involvement in setting the relative values used to establish Medicare physician fees. Citing the potential conflict of interest in having physicians decide how much their own services are worth, the article takes aim at the American Medical Association's Relative Value Scale Update Committee or the RUC as it is commonly known -- which the article refers to as a "secretive committee". The article suggests that the RUC's disproportionate specialty representation and reliance on survey data which may in some cases be insufficient results in "out of whack" physician fees.
The recently enacted health reform law has ignited a great deal of public interest in rising health care costs and the underlying reasons for them. Not surprisingly, fraud, waste and abuse in the system is a recurring theme. Although of late the third party insurance companies and "corporate fatcats" have drawn most of the criticism in these cost discussions, at least one recent Wall Street Journal article suggests that abusive billing practices and fraud on the part of the Nation's physicians may be largely to blame. The article states that this information can be gleaned from a Medicare database (The Carrier Standard Analytic File) which shows how much physicians are paid each year by Medicare. The only problem according to the article is that the identies of the physicians in the database are protected from disclosure. This right to privacy has been challenged and upheld in federal court, so there is little reason to believe that the physician information will be made public. Nevertheless, physicians will no doubt be very disturbed by the unflattering light in which this article casts them and should be wary of the direction in which the health care cost discussion appears, at least according to the WSJ article, to be going.
Hospital-owned practices may take an unexpected hit in revenue under a new Medicare rule that bundles certain physician service fees into hospital payments. The so-called “payment window” rule (sometimes referred to as 3-day/1-day window rule) requires a hospital (or an entity that is wholly owned or wholly operated by the hospital) to include on the claim for a beneficiary's inpatient stay, the diagnoses, procedures, and charges for all outpatient diagnostic services and admission-related outpatient nondiagnostic services that are furnished to the beneficiary during the three days before admission to a hospital, or one day preceding admission to a “non-subsection (d) hospital,” (a hospital not paid under the IPPS: psychiatric hospitals and units, inpatient rehabilitation hospitals and units, long-term care hospitals, children's hospitals, and cancer hospitals). Historically, this has only involved technical fees, not professional services.
In a notice to Medicare providers, CMS has clarified that the payment window, as modified by the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010 enacted in June, includes outpatient services that are otherwise billable under Part B, such as physician services, if they are related to the admission. An outpatient service is related to the admission if it is clinically associated with the reason for a patient’s inpatient admission, and is no longer limited to diagnostic services. The rule took effect on June 25, 2010.
A hospital is considered the sole (whole) operator of an entity if the hospital has exclusive responsibility for conducting or overseeing the entity’s routine operations, regardless of whether the hospital also has policymaking authority over the entity. This means practices managed by a hospital may be affected even if they are not technically “owned” by the hospital.
If you believe your services are unrelated to the admission, the hospital can submit an attestation. The general rule is that services rendered during the window period preceding the date of a beneficiary’s inpatient admission are presumed to be related to the admission, and thus, must be billed with the inpatient stay, unless the hospital attests to specific nondiagnostic services as being unrelated to the hospital claim. Such services are covered by Part B, and may be separately billed to Part B.
IMPORTANT: If your practice is hospital-owned or managed and your compensation formula is based on collections, you could lose credit for services that would previously have been separately billable under Part B, such as professional interpretation of diagnostic testing preceding hospitalization. Keep this in mind when renegotiating your contract, and check to see if your contract includes a reopener triggered by changes in reimbursement methods.
Physicians and other Part B providers should be aware that the Office of Inspector General of the Department of Health and Human Services has released its Work Plan for Fiscal year 2011. The Work Plan describes those area the OIG intends to review in the coming fiscal year and is a key tool for determining what “risk areas” to focus on from a compliance standpoint. A partial list of the Part B review areas in the 2011 Work Plan is as follows:
Place‐of‐Service Errors. Will review physician coding of place of service on Medicare Part B claims for services performed in ambulatory surgical centers (ASC) and hospital outpatient departments.
Coding of Evaluation and Management Services. Will review evaluation and management (E&M) claims to identify trends in the coding of E&M services, the extent of potentially inappropriate payments for E&M services and the consistency of E&M medical review determinations, and industry practices related to the number of E&M services provided by physicians and reimbursed as part of the global surgery fee.
Medicare Payments for Part B Imaging Services. Will review Medicare payments for Part B imaging services focusing on the practice expense components to determine whether Medicare payments reflect the expenses incurred and whether the utilization rates reflect industry practices.
Billing of Portable X‐Ray Suppliers. Will review providers of portable x‐ray services with unusual claims patterns and identify Medicare claims that are questionable.
Questionable Billing for Medicare Outpatient Therapy Services. Will review paid claims data for Medicare outpatient therapy services from 2009 and identify questionable billing patterns.
Appropriateness of Medicare Payments for Polysomnography. Will review the appropriateness of Medicare payments for sleep studies.
Excessive Payments for Diagnostic Tests. Will review Medicare payments for high‐cost diagnostic tests to determine whether they were medically necessary.
Independent Diagnostic Testing Facilities’ Compliance With Medicare Standards. Will review selected IDTFs enrolled in Medicare to determine the extent to which they comply with selected Medicare standards.
More information on the Work Plan can be found here.
According to a new report from the Pennsylvania Health Care Cost Containment Counsel (also known as PHC4), 19 new ambulatory surgery centers (ASCs) opened up in Pennsylvania in the past year. This bring the total number of ASCs in Pennsylvania to 262. According to the report, ASCs generally remain profitable.
Although growth of ASCs means more independence for physicians and more choices for patients, acute care hospitals in the state are likely not thrilled with this news. Undoubtedly lobbying pressure to stem the growth of outpatient centers will continue, so physicians who are considering investing in or developing an ASC should move quickly before Certificate of Need or other regulatory hurdles are put in place.
One of the few true payment reform models built into the health care reform law passed earlier this year is the Accountable Care Organization (ACO). Unfortunately, absent final regulations implementing the ACO model, very little guidance exists for physicians who are interested in pursuing this model. To that end, tomorrow, October 5, 2010, the Federal Trade Commission, the Office of Inspector General, and the Centers for Medicare and Medicaid Services are sponsoring a workshop to discuss a number of the legal implications of ACOs. A copy of the meeting agenda can be found here: ACO Workshop Agenda. The agenda includes contact information for the workshop via webcast or teleconference.