Physician Compensation

[For more information on CMS’s new Quality Payment Program and what physicians need to report in 2017, please see our prior blog posts here and here.]

CMS recently issued guidance (accessible here) on the three-part “Prevention of Information Blocking” attestation which physicians and other eligible clinicians will need to submit to CMS in order to qualify for points under the “Advancing Care Information” category of the Merit-based Incentive Payment System (MIPS).

Although making this attestation and reporting to CMS regarding use of certified EHR technology (CEHRT) is not required to avoid a penalty under the MIPS for 2017, many physicians and group practices wish to report as much as they reasonably can to seek a high score under the MIPS and a positive payment adjustment to their Medicare reimbursements in 2019.

The three-part attestation centers on the representation that the physician/group practice will not knowingly and willfully limit or restrict the compatibility or interoperability of its CEHRT.  CMS’s guidance makes clear that physicians and group practices making the attestation must use good faith and reasonable efforts to enable the exchange of electronic health records between appropriate parties.

According to CMS, examples of situations where access to CEHRT could be reasonably restricted include:

  1. System Maintenance — Disabling CEHRT for as long as reasonably necessary to complete system maintenance, provided that requests for access to EHR information during such time period are responded to when practical;
  2. Security Concerns — Blocking access to CEHRT when reasonably necessary to ensure the security of EHR information, provided that the blocking was narrowly tailored to the bona fide threat; and
  3. Patient’s Health and Well-Being — Restricting access to certain information (such as a patient’s sensitive test results), if the clinician reasonably believes that the restriction is necessary to protect the patient’s health or well-being. In the case of sensitive test results, CMS suggests that restricting access to the results could be reasonable until the physician or clinician who ordered the test has reviewed and appropriately communicated the results to the patient.

CMS expects that physicians and group practices making the attestation will ensure that their organizational policies and workflows will not restrict functionality of the CEHRT in any way, and that they will work with their CEHRT vendors to ensure that the CEHRT is fully functional.

If you or your practice will be reporting EHR data to CMS under the MIPS for 2017, a full review of CMS’s guidance on the attestation is recommended (see the five-page guidance here).  All physicians and practices reporting EHR data under the MIPS have until March 31, 2018 to report the data and make the attestation.

Gov. Christie’s Administration recently proposed a regulation to curtail the prescription of unnecessary opioid painkillers.  Christie, who serves as the Chairman of President Trump’s Commission on Combating Drug Addiction and the Opioid Crisis, expressed concern that treatment decisions of all prescribers (including physicians, dentists and advanced practice nurses) are being improperly influenced by pharmaceutical companies.  According to Christie’s press release, four out of every five new heroin users began by misusing prescription painkillers, and, in 2016, $69 million was paid to physicians in New Jersey by drug companies and device manufacturers, two-thirds of which went to just 300 physicians.

The New Jersey regulation would take big steps toward restricting what prescribers may receive from pharmaceutical companies, including limiting the value and frequency of meals that may be provided in educational settings, and prohibiting the giving of a variety of items to prescribers, except in limited circumstances (such as for educational materials, for presenting at continuing education events and for bona fide consulting arrangements).  Annual payments for bona fide services would be limited to $10,000.

The proposed regulation will be published for comment in the New Jersey Register on October 2, 2017.  Stay tuned to Fox Rothschild’s Physician Law Blog for updates.

Under CMS’s new Quality Payment Program, which will adjust Medicare Part B payments starting in 2019 based on data from this year, physicians and other eligible clinicians must qualify for one of two payment “tracks”, either the Merit-Based Incentive System (MIPS) or the Advanced Alternative Payment Model (Advanced APM) track.   A physician who qualifies under the MIPS in 2017 can earn up to a 4% payment adjustment to Medicare Part B payments in 2019.  Physicians who qualify under the Advanced APM track can earn up to a 5% payment adjustment in 2019.  For more information on the Quality Payment Program and the MIPS, please see our prior blog post on the topic here.

Since the Quality Payment Program went into effect on January 1, 2017, it has been unclear whether physicians participating in an Advanced APM in 2017 would be able to meet CMS’ quality and reporting requirements and earn a 5% payment adjustment to their Medicare Part B claims in 2019.

CMS recently provided clarity on this issue by predicting that almost 100% of physicians and other eligible clinicians participating in Advanced APMs in 2017 will qualify for a 5% payment adjustment to their Medicare Part B claims in 2019.  CMS based this prediction on an analysis of Advanced APM claims data submitted from January through August 2016 (before the Quality Payment Program went into effect).

CMS also stated that physicians who participate in an Advanced APM need to meet only one of two criteria to earn the 5% payment adjustment in 2019:  (1) receive 25% of the physician’s Medicare Part B payments through the Advanced APM; or (2) see 20% of the physician’s Medicare patients through the Advanced APM.  [A list of Advanced APMs in which a physician may participate in 2017 can be found at the following link: CMS List of Advanced APMs]

Participating in an Advanced APM can have several benefits (including being exempt from reporting quality data under the MIPS payment track), but also involves taking on some risk.  If you are considering participation in an Advanced APM, please contact an experienced attorney to discuss.

CMS is expected to issue formal determinations regarding the qualification of particular physicians for the Advanced APM track later this year.  Stay tuned to Fox Rothschild’s Physician Law Blog for updates.

We recently issued a Health Law Alert on the Medicare Quality Payment Program, focusing specifically on what physicians and their medical practices need to know to be in compliance with the Program in 2017.  The Alert may be accessed at this link: Fox Rothschild Health Law Alert – Medicare Quality Payment Program

You may also view some of our recent posts on the Physician Law Blog for more information on the Medicare Quality Payment Program.  In short, compliance with the Program in 2017 can earn you and your practice anywhere from a 0%-4% increase in your reimbursements under the Medicare Physician Fee Schedule in 2019.  However, failure to meet at least the minimum level of compliance this year will result in a negative adjustment of 4% to your Medicare reimbursements in 2019.

Stay tuned to Fox Rothschild’s Physician Law Blog for updates on the Medicare Quality Payment Program in 2017 and beyond.

The Medicare incentive programs with which you and your medical practice are familiar will soon be no more.  As of January 1, 2017, these programs (including the Electronic Health Records (EHR) Meaningful Use Incentive Program, the Physician Quality Reporting System (PQRS), and the Physician Value-Based Modifier Program) will morph into the new Medicare Quality Payment Program (QPP).   The QPP will also include a fourth category of incentives entitled “Clinical Practice Improvement Activities”, which we discuss in more detail below.

The purpose of the QPP is to create one central program that will govern Medicare Part B payments to physicians, while incentivizing physicians to increase quality of care and decrease inefficiencies in the cost of care for Medicare patients.  Participation in the QPP will be mandatory beginning January 1, 2017.  The QPP will either reward or penalize physicians and their practices by adjusting their reimbursement rates under the Medicare Physician Fee Schedule two (2) years after the reporting year.  Therefore, physicians/practices will have their reimbursement rates adjusted in 2019 based on their reporting data for the year 2017.

As we noted in our first blog post in the Series, accessible here, physicians will have the option to choose between two payment tracks under the QPP:  (1) the Merit-Based Incentive Payment System (MIPS); and (2) an Advanced Alternative Payment Model (Advanced APM).  This blog post will discuss the basics of the MIPS and how to qualify for the MIPS in 2017, while our next post will touch on the basics of participation in Advanced APMs.

Basics of the MIPS

Each physician or group practice (you may report individually or as a group) participating in the MIPS in 2017 will earn a “composite performance score” based on the physician/group’s scores within the following four (4) categories:

  1. Quality of Care – 60%
    • Explanation: Scored based on the reporting of “quality measures”, which will be published annually by CMS.  Physicians will be able to choose which quality measures they will report each year.
    • Replaces: PQRS and quality component of the Value-Based Modifier.
  2. Advancing Care Information – 25%
    • Explanation: Scored based on the reporting of EHR use-related measures with which you are familiar from the current EHR Meaningful Use Incentive Program.  However, unlike the existing program, the QPP measures will not have “all-or-nothing” targets.
    • Replaces: EHR Meaningful Use Program.
  3. Clinical Practice Improvement Activities – 15%
    • Explanation: Scored based on attestation by the physician/group that the physician/group has performed certain care coordination, beneficiary engagement, population management and patient safety activities.
    • Replaces:   New Program.
  4. Resource Use – 0%
    • Explanation: Scored based on per capita patient costs and episode-based measures.  CMS collects and analyzes the data from your claims submissions.  No additional reporting will be required.
    • Replaces: Cost component of the Value-Based Modifier.

How to Qualify for 2017

CMS has eased the reporting requirements for the first year of the QPP.  No physician/group will be required to begin collecting data in accordance with the QPP’s requirements on January 1, 2017 (but may elect to do so).  To receive a neutral or positive payment adjustment, physicians/groups will need to report data for only a 90-day performance period during the year.  There are also minimum threshold reporting requirements to avoid a negative payment adjustment and full participation requirements which are more likely to result in a guaranteed positive adjustment.  The table below organizes the requirements in an easy-to-read format:

MIPS Measures Chart

Final Thoughts on Qualifying for the MIPS in 2017

  • Get involved sooner rather than later. CMS has kept reporting requirements minimal in 2017 in order to encourage clinicians to participate in the QPP.  Take advantage of that opportunity to ensure your practice has the right software to report the quality and EHR use-related measures.  Since adjustments will be made based on threshold scores, it may be easier in 2017 to earn a positive adjustment, and even an exceptional bonus, than in later years.
  • Ensure that your current EHR technology meets the requirements for the QPP in 2017, including reporting capabilities for quality measures and EHR use-related measures. The easiest way to do this is to contact your EHR vendor.
  • CMS has given providers plenty of time to report 2017 data. The deadline for reporting 2017 data is March 31, 2018.

As always, if you have questions specific to your practice, please contact a knowledgeable and experienced attorney.

Long gone are the days when drug reps enticed physicians with extravagant meals at five-star restaurants and box seats to the Phillies’ playoffs (and sadly, gone are the days when the Phillies actually made the playoffs).

According to a recent study published in the journal, JAMA Internal Medicine, physicians who are provided a meal for less than $20 from drug reps are more inclined to prescribe that rep’s name-brand drug, which is not always covered by insurance, over the less pricy bioequivalent generic.

Researchers from the University of California, San Francisco, the University of Hawaii, and the Pacific Health Research and Education Institute examined data from 280,000 physicians in Medicare’s prescription drug program from August through December 2013.  Four top-selling name-brand drugs were considered: Benicar and Bystolic, both of which are used to treat high blood pressure, Pristiq, used to treat depression, and Crestor, used to treat high cholesterol.

The study revealed that doctors who received a meal linked to Benicar and Bystolic promotion were 70% and 52%, respectively, more likely to choose the name-brand than those doctors who did not receive a free meal.  Those who received a meal linked to Pristiq were 118% more likely to prescribe Pristiq, and Crestor was linked to an 18% prescribing increase over the bioequivalent generic Lipitor.

Further, an alarming $73 billion per year is spent on name-brand drugs for which there is an equally effective generic, with patients themselves spending $24 billion of that amount.

Dr. Adams Dudley, the study’s lead author, remarked, “Doctors are human, and humans respond to gifts.”

Forgive me for being a skeptic, but isn’t it also quite possible that the sales pitch given during the meal was what actually influenced physicians’ prescribing habits? Call it naiveté, but let’s hope it takes more than a measly slice of pizza to buy our healthcare providers’ loyalties.

–Alexandra L. Sobol, Esq.

(Click here to view Ms. Sobol’s biography)

The deadline for providers to file a hardship exception application to the electronic health record (EHR) meaningful use requirements for the 2015 reporting period is July 1, 2016.

If you have any concern that your practice or certain eligible professionals in your practice may have been unable to meet the meaningful use requirements for the 2015 reporting period, it may be appropriate for the applicable provider to file a hardship exception application with CMS to avoid future payment adjustments.  Note also that certain provider types may automatically qualify for a hardship exception for the 2015 reporting period without the need to file an application.

For more information, please see the Health Law Practice Alert recently published by Fox Rothschild LLP on this topic, accessible at this link:  Fox Rothschild LLP Health Law Practice Alert – Hardship Exception (June 17, 2016).

The Affordable Care Act (ACA) requires Medicare providers to return overpayments within 60 days of the date they are identified in order to avoid liability under the False Claims Act.  Four years ago, CMS issued a proposed rule to implement this statutory requirement that would have placed a substantial burden on providers to identify and return overpayments within the 60-day period.  Last week, CMS issued its long-awaited “final rule” on the matter. The final rule is substantially less burdensome than the proposed rule would have been and offers providers a clearer view of their obligations to investigate and report overpayments.

Here are five key aspects of the final 60-Day Overpayment Rule that physicians and medical practices should keep in mind:

  1. What It Means to Identify an Overpayment

CMS clarifies that identifying an overpayment requires reasonable diligence and quantification of the overpayment.  Specifically, a provider has “identified” an overpayment when the provider “has or should have, through the exercise of reasonable diligence, determined that it has received an overpayment and can quantify the amount of the overpayment.”  In contrast, the proposed rule would have held providers to a “deliberate ignorance” or knowledge standard regarding the existence of an overpayment and would have included no leeway for quantification of the overpayment.

  1. The New Timeframe In Which Providers Must Identify Overpayments

One of the biggest questions that arose from the proposed rule was: “When does the 60-day clock to identify overpayments start ticking?”  The proposed rule called for providers to act with “all deliberate speed” to identify overpayments once they became aware of a possible billing error.  In its final rule, CMS provides a clearer answer to the question.  Providers will have up to 6 months to investigate a possible overpayment before the 60-day reporting period begins.

  1. The “Look-Back Period” Is Shortened

Part of a provider’s obligation with respect to overpayments under the ACA is to search through past records for overpayments after a provider identifies that it has received at least one overpayment.  CMS originally proposed a requirement that providers “look back” 10 years in their records for other overpayments in order to comply with this rule.  Acknowledging the unreasonable burden such a time period would impose on providers (both in effort and cost), in the final rule CMS has reduced the duration of the look-back period to 6 years.

  1. Documentation of Reasonable Diligence Is Advisable

In prefatory comments to the rule, CMS stated that it is “certainly advisable” for providers to document their diligence in investigating possible overpayments.  While documenting an investigation may not make a provider’s diligence “reasonable” per se, it may provide strong evidence of the provider’s efforts.

  1. Proactive Compliance

CMS emphasizes in the final rule that “reasonable diligence” requires not only reactive activities, such as a good faith investigation of potential overpayments by qualified individuals, but also “proactive compliance activities conducted in good faith by qualified individuals to monitor for the receipt of overpayments.”

The full text of the final rule may be accessed here:  https://www.federalregister.gov/articles/2016/02/12/2016-02789/medicare-program-reporting-and-returning-of-overpayments.

Be sure to consult experienced legal counsel if you would like further guidance on the Medicare 60-Day Overpayment Rule, including what steps your practice should take to proactively and reactively address potential overpayments.

A new article in the online journal, JAMA Internal Medicine, highlights the importance for physicians of keeping valuable non-public information confidential.  Under insider trading laws, it is illegal for anyone to trade securities based on non-public information and for anyone to supply information to others who trade on such information, if the person sharing the information has an obligation to keep it confidential.  Examples of valuable confidential information to which you might be privy include data and opinions regarding unpublished or ongoing clinical trials or new medical equipment, and information regarding acquisitions involving public health care companies.

Physicians may share their opinions with investors about medical research or other valuable information that is already public knowledge, but the line quickly becomes blurry when it comes to non-public information.  If you are asked to share information with a potential investor that you think may violate insider trading laws, it would be best to consult your legal counsel before disclosing the information.  This includes instances where you are asked to disclose information to, or participate in, “expert consulting networks” and online physician forums.

The line is also blurry for physicians when disclosing non-public information to other physicians and scientists for medical research purposes.  Be careful to disclose such information only  for research purposes.  If you become aware that one of the recipients of the non-public information may be using such information to trade securities, cease disclosing the information immediately and consider seeking legal counsel.

The online JAMA article is accessible in full at this link:  http://archinte.jamanetwork.com/article.aspx?articleid=2457402

Many physicians pay very little attention to their managed care participation agreements.  In fact, some simply sign these agreements without ever reading them.  I think this apathy stems from the fact that managed care plans generally refuse, at least for smaller practices, to “negotiate” their fee schedules.  But, even if a payor won’t negotiate fees, participation agreements typically include other significant legal provisions worthy of review and, in some cases, negotiation.  Here are just a few:

Definitions.  State law may mandate that plans adopt specific definitions for certain key terms such as “medical necessity”, “clean claims”, covered services” and emergency services”.  It is important to review and understand these and other critical terms used in the agreement and make sure they confirm to state law if applicable.

Billing for non-covered services.  If you want to be able to bill patients for non-covered items and services like completing forms or preventive care, knowing how and when this is permissible may be spelled out in the agreement.

Benefit plans and programs.  More and more often managed care companies are contracting out their network to various other benefits plans.  In addition, through mergers and consolidation, plan affiliates and subsidiaries change quite frequently.  In order to know how much you are entitled to be paid and who is responsible for paying you, it is important to know what plans, programs, and affiliates may be covered by the particular agreement.

Policies and procedures.  Many participating agreement reference and incorporate a host of policies and procedures (sometimes referred to as a provider manual).  Because these are usually made legally binding on participating physicians by virtue of incorporation into the agreement, physicians should be sure to obtain and review these.

Overpayments.  Some participation agreements give the payor the unilateral right to recoup overpayments from future payments to a practice.  This can cause significant confusion when it comes to reconciling payments as it is not always clear when a payment has recouped or to which patient the recoupment relates.   Moreover, the practice does not have an advance opportunity to review and challenge the overpayment determination.  When it comes to overpayments, my recommended approach is to require payors to notify the provider an an overpayment and allow the provider a period of time to review and dispute it.  No recoupment should occur until any disputes are resolved.