CMS Extends Deadline for Electronic Health Records

On October 7, 2014, CMS announced that it is extending the application deadline for the meaningful use program hardship exceptions until November 30, 2014, for eligible hospitals and eligible practitioners. CMS had previously set the deadlines for April 1, 2014, for hospitals and July 1, 2014, for practitioners.

The meaningful use program, established in 2009, distributes to providers incentive payments for showing meaningful use with their electronic health records. The hardship exception submissions will allow health care facilities and providers to avoid Medicare payment penalties in 2015. CMS granted the extension to give more time to physicians after finding glitches in its system.

OIG Proposes Additions to Anti-Kickback Statute Harbors

The United States Department of Health and Human Services Office of Inspector General (“OIG”) published a proposed rule on October 3, 2014, to add new safe harbors to the federal Anti-Kickback Statute and increase the list of exemptions for civil monetary penalties (“CMP”).

The new safe harbor proposals address: i) certain technical revisions; ii) new statutory changes made in the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, the 2010 Affordable Care Act (“ACA”), and the Health Care and Education Reconciliation Act of 2010; and iii) new protections for federal health care program offerings. The new safe harbor provisions include:

  1. Safe Harbor for Referral Services. The OIG proposes making a technical correction to the current language of the Anti-Kickback Statute safe harbors by further explaining the ambiguous statement that a referral fee may not be based on business generated by one party for another party. The amended language prohibits referral fees based on the volume or value of referrals or other business generated among the parties. Further, the rule modifications clarify that referral fees cannot be adjusted for volume-based considerations.
  2. Safe Harbor for Medicare Coverage Gap Discount Program. The provisions call for protection  of manufacturer discounts for drugs under the Medicare Coverage Gap Discount Program if the transaction involves an “applicable drug” and an “applicable beneficiary.” The manufacturer must also be fully compliant in the Medicare Coverage Gap Discount Program.
  3. Cost-Sharing Waivers for Medicare Part D Pharmacies and Emergency Ambulance Services. Any pharmacy waiving cost sharing would be protected by a safe harbor if the waiver is not advertised, not routine, and preceded by a determination of financial need. In regard to ambulance providers owned and operated by a state or federally recognized Indian tribe, such providers may obtain safe harbor protection for their cost-sharing waivers if the waivers are offered uniformly in their fee-for-service model, are not considered free services because they are paid by a government entity, and are borne by the provider.
  4. Local Transportation Safe Harbor. The proposal provides for free or discounted transportation service if the service is local (i.e., the patient and the provider are no more than twenty-five miles apart) and the established patient is seeking medically necessary care. Additionally, the offer may not be related to referrals and must be limited to non-luxury and non-ambulance ground transportation. The offer may not be marketed and the offeror must not be primarily a supplier of health care items associated with the program costs.
  5. Safe Harbor for Medicare Advantage Plan Payments to Federally Qualified Health Centers. A new safe harbor would ensure protection among certain Medicare Advantage plans and federally qualified health centers made in a written agreement pursuant to §42 U.S.C. 1395w-23(a)(4).

The OIG’s new CMP exemptions are targeted at amending the definition of “remuneration” to include: copayment reductions for certain outpatient services; select remuneration that decreases a risk of harm and increases patients’ access to care; remuneration to financially needy individuals; and copayment waivers for primary fills of generic drugs. The OIG also proposed a gainsharing prohibition that would restrict gainsharing by codifying it and adding definitions for “hospital” and “reduce of limit services.” Comments regarding the proposed rule are due by December 2, 2014, at 5:00 p.m. Eastern Standard Time.

OIG Extends Fraud Waivers for ACOs

On October 17, 2014, CMS and the OIG published a joint notice extending the deadlines for fraud and abuse waivers for Accountable Care Organizations (“ACOs”) that participate in the Medicare Shared Savings Program until November 2, 2015.

The interim rule established five fraud and abuse waivers: i) the ACO Pre-Participation Waiver; ii) the ACO Participation Waiver; iii) the Shared Savings Distribution Waiver; iv) compliance with the Stark Law for the Anti-Kickback Statute and Gainsharing Civil Monetary Penalties; and v) the Waiver for Patient Incentives. The current extension was made by CMS and OIG to reduce the disruption to ACOs participating in the Medicare Shared Savings Program.

National Physician Rating Site Released

On October 20, 2014, launched a new version of its website that allows consumers to research comprehensive and comparative reports of physicians. The new release of the website uses approximately 500 million claims to analyze physician quality by the number of complications and hospital and patient reviews.

CMS Supports Quality Physician Care with $840 Million Pilot

On October 23, 2014, CMS launched an $840 million initiative aimed at promoting collaboration and quality among physicians. This pilot is authorized by the ACA and funded by CMS’s Center for Medicare and Medicaid Innovation investment. The four-year Transforming Clinical Practice Initiative is one of the largest federal investments uniquely designed to support clinicians through nationwide, collaborative networks. The initiative aims to help over 150,000 physicians and their teams adapt to the ACA’s goal of moving  away from volume-based payment systems to more quality-based health care systems, support care coordination among providers and suppliers, and establish community-based health teams.

The deputy administrator for CMS made a statement that the initiative is anticipated to save between $1 billion and $4 billion in health care costs, while preventing up to five million hospitalizations during the pilot’s four-year run.

Funding will be available through two systems: Practice Transformation Networks, and Support and Alignment Networks. The Practice Transformation Network will be awarded to peer-based learning networks aimed at coaching, mentoring, and assisting clinicians in developing skills for practice transformation. Support and Alignment Networks will provide resources for public-private partnerships that are currently working toward practice transformation. Applications for participation are due January 6, 2015. CMS anticipates announcing the award winners in spring 2015.