BME Revokes Physician License for Unlawful Prescribing Practices

On April 7, the New Jersey Board of Medical Examiners (BME) announced that it had revoked the medical license of a Passaic County physician for a minimum of three years following an investigation that revealed he had prescribed painkillers to patients without having examined them. Dr. Mohamed Kawam Jabakji of Prospect Park, who initially had his license suspended in April 2015, was found to have prescribed oxycodone, Percocet and codeine to six patients without having assessed their medical condition. According to a Star Ledger article on the incident, Jabakji must pay a $110,000 civil penalty to the state in addition to a $57,702 fine to reimburse the investigative and legal costs associated with the state’s investigation. While Jabakji may apply for reinstatement of his medical license after three years, the Star Ledger noted that his prescription privileges have been permanently revoked. Alluding to the state’s prescription drug epidemic in an announcement regarding BME’s revocation action, the acting attorney general noted, “It is appalling that a member of the medical profession would help fuel New Jersey’s prescription drug abuse epidemic by prescribing highly addictive pain pills indiscriminately.”

Minimum Wage Debate to Impact Health Care

As the minimum wage debate rages in the New Jersey legislature and in the state’s media outlets, the issue could have a significant impact on a vital cog in the state’s health care delivery system. While the issue typically brings to mind fast food workers and retail employees, the proposed raise to $15 an hour would have a serious impact on the state’s home health care agencies. According to the state’s Department of Labor, the minimum wage in New Jersey is currently $8.38 an hour. In an industry where the bottom line is tied so closely to reimbursements from private insurers and government programs such as Medicare and Medicaid, a small raise can have a major impact on the finances of industry actors, and a raise such as the one currently being proposed could have serious consequences for the home health care industry in the state.

A recent article in the Courier Post noted the potential pitfalls and opportunities for home health agencies facing the prospect of a minimum wage hike to $15 per hour. Noting that the chairman of the Partnership for Medicaid Home-Based Care said that the increase of “the states’ minimum wage to $15 an hour could simultaneously be the best and worst thing to happen to the home health care industry,” the article goes on to quote the president of the New Jersey Association of Health Plans, who noted that a raise of the minimum wage to $15 per hour would “trigger both a need for a Medicaid MCO to review rates paid to its provider partners and for the state to review the rates paid to MCOs to ensure continued access to quality care.” While the raise could be a daunting proposition for many home health care providers, it nonetheless provides an opportunity to discuss a raise in Medicaid reimbursement rates, which the article notes range from $13.80 to $15.50 an hour. However, without a raise in reimbursement commensurate with the wage increase, industry insiders fear a future with fewer hours with home health aides and higher out-of-pocket costs for patients.

State Legislators Drop Bills to Address Horizon’s OMNIA Plan

Responding to a backlash against Horizon Blue Cross Blue Shield of New Jersey’s multi-tiered OMNIA plans, New Jersey state legislators reviewed and approved a series of four bills during the first week of April. The bills, which were approved by the Assembly Regulatory Oversight Committee, would force insurers to reveal how physicians and hospitals are placed into tiered networks. One of the bills would require state regulators to ensure that those hospitals serving low-income populations are included in the networks, which provide consumers with the opportunity to pay less if they use providers in tier 1, the preferred tier.

The Star Ledger notes that OMNIA, under which the insurer created a tier 1 of 32 hospitals where co-payments and deductibles were lower than the remaining tier 2 hospitals, generated outrage from those hospitals relegated to tier 2. Due to Horizon’s role as the largest insurer in the state, covering 3.8 million people, a hospital executive from a tier 2 hospital was quoted by the paper as saying that tier 2 facilities would cease to exist in three to five years because they would be forced to merge or close as a result of the lost business that is anticipated from the OMNIA tiered structure. Seventeen hospitals have filed an appeal seeking to overturn the State Department of Banking and Insurance’s decision to approve the OMNIA plans last September. The overriding concern with the program noted by Assemblyman Reed Gusciora, who sponsored the legislation, is Horizon’s ability to pick “winners and losers” in the hospital marketplace. Meanwhile, some business owners have extolled the virtues of the program, with one quoted in the Star Ledger as saying of OMNIA, “I could not be more pleased with the results. Our employees are offered remarkably low co-pays when they go to the doctor and no co-insurance.” The future of the OMNIA structure, and the decision by Horizon as to which providers will be included in which tiers, will have a significant impact on health care in New Jersey in the years to come.

New Jersey State Senate President Demands Insurers and Hospitals Disclose Profits

State Senate President Steven Sweeney ordered in a letter dated March 11 that New Jersey hospitals report the amount of “pure profit” they earn, echoing a similar demand made to insurance companies days earlier. In connection with his purported focus on controlling health care costs, Sweeney directed that hospitals and insurance companies disclose 10 years’ worth of “balance sheets and net profit” for their New Jersey operations. Sweeney indicated in his letter that the Senate is “engaged in this process to examine whether our existing statutory framework is fostering an environment which produces high-quality care at a fair cost to New Jersey consumers.”

Sweeney announced his demand during a committee hearing on legislation that would more strictly regulate tiered network insurance plans, such as Horizon Blue Cross Blue Shield’s OMNIA plans, which offer consumers significant discounts if they elect to use a limited subset of “tier 1” hospitals and doctors.

Sweeney has vowed to oppose any legislation that restricts the availability of such tiered insurance products, which he regards as “positive alternatives to high-deductible plans for consumers.”