[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.

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.

On June 20, 2017, The Centers for Medicare & Medicaid Services (“CMS”) released a proposed rule which would exempt a greater number of small practices from complying with the  Medicare Access and CHIP Reauthorization Act of 2015 (“MACRA”).

CMS’s Administrator, Seema Verma has been quoted as saying that CMS has “heard the concerns that too many quality programs, technology requirements and measures get between the doctor and the patient. . . That’s why we’re taking a hard look at reducing burdens. ”

In order to accomplish this goal, CMS proposes to now exempt physician practices with less than $90,000 in Medicare revenue or physicians with fewer than 200 unique Medicare patients.  The current rule only exempts physician practices that have less than $30,000 in Medicare revenue or fewer than 100 unique Medicare patients.  This proposed rule could mean another 834,000 clinicians could be exempt from the quality reporting under MACRA.

While this seems like a large increase in the number of physicians that are exempt, a recent Modern Healthcare article notes that “65% of Medicare payments would still be reported under methods that adhere to MACRA even if this draft rule were finalized.”

If you are interested in commenting on the proposed rule you may do so through August 30, 2017.  The proposed rule can be found at the following website: Proposed Rule.

If you would like more information about MACRA please see the Fox Rothschild Health Law Alert – Medicare Quality Payment Program from January 2017.

As many people are discussing methods to improve healthcare, the Centers for Medicare & Medicaid Services (CMS) is giving stakeholders an opportunity to send in their thoughts on this topic.  In CMS’s April 14, 2017 proposed rule, CMS issued a “Request for Information” (“RFI”), where they described their desire to have a “national conversation” about improving the health care delivery system.

CMS would like to know, amongst other ideas: (1) How CMS can help make its healthcare delivery system (Medicare) less bureaucratic and complex; and (2) How CMS can reduce the burden on clinicians, providers and patients in a manner that increases quality of care and decreases costs.  “CMS is soliciting ideas for regulatory, sub-regulatory, policy, practice and procedural changes to better accomplish these goals.”

Per CMS, some ideas could include recommendations regarding payment system re-designs; elimination or streamlining of reporting; monitoring and documentation requirements; and operational flexibility; amongst others.  CMS is also looking for ideas on how CMS issues regulations and policies, and how these could be simplified.

In a separate RFI in the same proposed rule, CMS also seeks information on how the scope and restrictions imposed on “Physician-Owned Hospitals” affect the delivery system, particularly with regards to Medicare beneficiaries.

To the extent respondents have data and specific examples, CMS requests such information be included in the submission.  If a proposal involves novel legal questions, CMS is also welcoming analysis regarding CMS’ authority.

If you wish to submit your comments to CMS, you have until June 13, 2017 to do so.

For more information please see the CMS Fact Sheet for Fiscal Year (FY) 2018 Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long Term Acute Care Hospital (LTCH) Prospective Payment System Proposed Rule, and Request for Information CMS-1677-P.

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.

There are big changes coming to the Medicare incentive programs as we know them.  Beginning on January 1, 2017, the new Quality Payment Program (the “Program”) will replace all existing Medicare incentive programs with a comprehensive incentive model.  The Program will involve a modified set of EHR Meaningful Use requirements, new quality of care metrics, new cost efficiency goals and “clinical practice improvement activities” (for which physicians will be rewarded for care coordination, beneficiary engagement and patient safety).  The Program will also have a separate track for incentive payments associated with participation in Advanced Alternative Payment Models (such as Accountable Care Organizations) (“APMs“).

Congress provided for the development of the Program in the 2015 Medicare Access and CHIP Reauthorization Act (the “MACRA”).  Under the MACRA, the Program must be “budget-neutral” each year.  In other words, the rewards paid by Medicare to well-performing physicians and practices must be equally offset by the penalties levied against poor-performing providers.  The rewards will continue to take the form of payment adjustments to the Medicare Physician Fee Schedule.  The first year of payment adjustments will be 2019, based on data from the 2017 reporting year.  For 2019, the reward paid to (or penalty levied against) any provider may not exceed a 4% adjustment to the Medicare Physician Fee Schedule.  However, in subsequent years, the limits are set to increase, reaching a maximum of 9% in 2022.

The potential for substantial penalties under the Program has led to concerns that the Program will make it difficult for smaller practices with higher numbers of Medicare patients to be financially viable.  Foreseeing these economic issues, Congress earmarked $100 million over five years to help small practices successfully participate in the Program.

In June, the U.S. Department of Health and Human Services (“HHS”) announced that the first $20 million of these earmarked funds will be awarded by the end of 2016.  The recipients of the funding will be organizations that provide education, training and consultation on the Program to small practices.  In particular, these organizations will assist small practices in understanding what quality measures, EHR options and clinical practice improvement activities are most appropriate for their practices.  The organizations will also help small practices evaluate their options for joining an APM.  HHS has not announced when the organizations will begin training and educating small practices.

While the intention behind such training and education is laudable, it does not lay to rest the concern that small practices serving substantial Medicare populations will be under greater pressure and financial strain to continue to operate independently.  After all, the Program itself must remain budget-neutral.  If practices improve their compliance and quality of care metrics, payment adjustments will have to be reduced or compliance standards raised.  In the long-term, this may lead to small practices being forced to join an APM in order to continue to serve Medicare patients.

Stay tuned for updates on the Program from CMS, including details on the final regulations for the Program.  If you have specific questions about how the Program may affect your practice, be sure to contact a knowledgeable healthcare attorney.

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.

Commercial payors are actively looking for ways to reduce payments to out-of-network providers.  One area of focus is discounts and waivers of patient copayments and deductibles by out-of-network providers.  In the eyes of these payors, coinsurance/copayments are essential to incentivizing patients to use in-network providers, and discounts on (or waivers of) coinsurance/copayments by out-of-network providers often result in higher costs to payors.

To challenge these discounts, some payors have denied reimbursement on claims where the patient’s copayment/coinsurance has been waived by an out-of-network provider.  Others have taken legal action, bringing cases for fraud and other claims, and arguing that they are not required to pay for items or services for which the patient is not billed.  There has been a special focus by some payors on instances where the provider “overstates” its charges in order to recoup the discounts or waivers of coinsurance/copayments it offers to patients.

The legal landscape is evolving on this issue; however, there are cases on the docket that may address certain aspects of this issue sooner rather than later.  Stay tuned to Fox Rothschild’s Physician Law Blog for updates.

In the interim, here are a few tips to keep in mind when considering whether to offer discounts on (or waivers of) coinsurance/copayments with respect to out-of-network plans:

  1. Consider offering the discounts solely in return for prompt payment by the patient. Under the federal Anti-Kickback Statute and other state anti-kickback laws, discounts could be considered remuneration to patients in exchange for purchasing of health care services.  However, the U.S. Office of Inspector General (OIG) has acknowledged that discounts for prompt payments of coinsurance/copayments may be permissible if they are not intended to induce purchases of services.  Note that the amount of such discounts should correspond to the savings in collection and billing costs of the Practice.
  1. Consider disclosing to payors your intent to offer the discounts to patients.  Based on recent case law, if a payor is aware of the out-of-network provider’s intent to offer discounts to patients, the payor is less likely to have a case for fraud against the provider.  See North Cypress Medical Center Operating Co. v. Cigna Healthcare, 781 F.3d 182, 205 (5th 2015) (available online here: http://www.ca5.uscourts.gov/opinions/pub/12/12-20695-CV0.pdf).  However, simply notifying payors of your intent to offer a discount would not address the risk of violating the federal anti-kickback statute and other state anti-kickback laws.  In addition, payors could deny your future claims based on the theory that the payor has no obligation to pay where the patient incurred no liability.  Therefore, payors should be notified only after discussing all options with your legal counsel.
  1. Avoid overstating charges for services provided.  If you offer discounts or waivers of coinsurance/copayments for services provided to patients of payors with which you are out-of-network, avoid charging the payors for the full cost of the services.  In addition, ensure that the charges reported to the payor reflect both the amount of coinsurance/copayment paid by the patient and any discount or waiver which you provide to the patient. Overcharging payors may be illegal under your state’s insurance laws, and, with respect to federal government payors, may lead to liability under the federal False Claims Act.
  1. Beware of “most-favored nation” clauses in your in-network provider contracts.   A most-favored nation clause requires a provider to charge a payor the lowest price it charges to any payor for a service.  If you charge payors with which you are out-of-network less to avoid overstating charges, you could also be required by your in-network payor contracts to charge the same rates for services billed in-network.

Finally, offering discounts or waivers of coinsurance/copayments is a complicated and unresolved legal issue.  You should consult a knowledgeable attorney to discuss the latest developments before taking any actions.

A new study in the BMJ suggests that the more services a physician provides to his or her patients, the less likely the physician is to be sued for malpractice.  The study examined the use of resources by attending physicians in several Florida acute care hospitals during a ten-year period from 2000-2009, in relation to the number of malpractice claims brought against the physicians in the year following care.  Researchers found that physicians who billed higher than average hospital charges were sued less often than lower-billing physicians.

The study builds on evidence that most physicians in the United States report practicing “defensive medicine”, commonly understood to be “medical care provided to patients solely to reduce the threat of malpractice liability rather than to further diagnosis or treatment.”  Prior to this study, no research had been published on whether greater resource use by physicians is associated with reduced claims for malpractice.

The researchers focused on physicians from seven specialties, including obstetrics, which tends to have a higher rate of malpractice claims than other specialties.   The evidence clearly showed that a physician’s risk of being sued for malpractice was reduced among those who performed and billed for more services.  However, the authors noted that the data only show a correlation.  Further research is necessary to understand why higher spending is linked to a lower risk of malpractice claims.

Perhaps the greatest value from this study is that the results corroborate the belief that defensive medicine reduces the likelihood of claims for malpractice.  Interestingly, the authors note that the effectiveness of defensive medicine could be a reason why efforts to reduce physician spending have been difficult.

The full study is available online at:  http://www.bmj.com/content/351/bmj.h5516-0.