Medicare To Publish Data On Doctors

The Wall Street Journal: Federal officials plan to release reimbursement information on April 9 or soon after that would show billing data for 880,000 health-care providers treating patients in the government-run insurance program for elderly and disabled people. It will include how many times the providers carried out a particular service or procedure, whether they carried it out in a medical facility or an office setting, the average amount they charged Medicare for it, the average amount they were paid for it, and the total number of people they treated (Radnofsky, 4/2).



Hospice Medicare Fraud

The Medicare News Group warned about a new medicare fraud strategy involving hospice.  Hospice is a palliative care program that gives patients with life-ending illnesses a choice to forgo intensive treatment at the end and focus instead on dying more comfortably.  Up until a decade ago, hospice was primarily used by patients diagnosed with cancer whose stay in the program was relatively short, given the terminal nature of their illness.  Hospice services have grown dramatically in recent years, becoming well-known and widely used.  Over the past decade, Medicare spending on hospice has increased at a staggering average rate of 17 percent per year, totaling $13 billion for just 1.2 million patients in 2010, up from the 513,000 patients it served and $2.9 billion it cost in 2000. Furthermore, Medicare payments to hospice providers are growing disproportionately: since 2000, beneficiaries’ use of hospice services has nearly doubled, while payments to hospice agencies have more than quadrupled, the Medicare Payment Advisory Commission’s (MedPAC) 2012 report found. The impact of hospice’s changing demographic is already visible in Medicare’s payments to agencies. Since 2000, the average hospice payment per beneficiary has increased by 7 percent per year, from $5,653 in 2000 to $11,217 in 2010.

The current structure encourages agencies to push hospice care onto those whom they expect to continue to live in the program for a significant amount of the allowable six months, ensuring a continuous and steady stream of payments to for-profit hospice providers at taxpayers’ expense. Nursing homes may be particularly attractive to hospice workers, because often times the full-time nursing home staff does the bulk of the care-giving work, while hospice receives payment for what are oftentimes very brief care visits.  In 2012, a hospice agency could receive a maximum payment of $25,377 per patient. MedPAC reported that in 2009, more than 12.5 percent of hospices exceeded Medicare’s annual payment cap.




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Medicare and Maintenance Therapy

A settlement of a federal lawsuit in Jimmo v Sebelius will increase the amount of days of care for which an older person could expect to receive Medicare payment for therapy provided in a skilled nursing facility. Maintenance therapy is allowed as a service Medicare will pay for in nursing homes. This means that many older persons who have been discharged from a hospital to a nursing home should expect to get more days of Medicare coverage than before this clarification was made. Typically a minimum of 20 and a maximum of 100 days of Medicare coverage in a nursing home are available.

According to statements by the U.S. Health and Human Services Secretary Kathleen Sebelius at the time of last year’s Jimmo settlement, improvement during therapy has never been necessary to receive Medicare payment for therapy.  On Dec. 13, CMS published revisions to the Medicare Benefit Policy Manual clearly stating such, which became effective Jan. 7.

The CMS written standards now clarify that maintenance, not improvement, can be enough to justify Medicare payment. Section 20.1.2 of the CMS manual now states: “Coverage of skilled nursing care or therapy to perform a maintenance program does not turn on the presence or absence of a patient’s potential for improvement from the nursing care or therapy, but rather on the patient’s need for skilled care.”

CMS has basic requirements for getting Medicare in a nursing home, beginning with the need for a doctor’s order and facility’s certification. The patient generally must be admitted to the nursing home within 30 days, following having spent three midnights being admitted in a hospital.

Because Medicare payment for the provided care has been denied by insurance companies, nursing homes have been reluctant to continue providing therapy with no assurance of payment being available for services.  The insurance companies are the true  villains because of their ongoing denial of Medicare coverage for claims that Sebelius said should have been covered according to federal policy. Families who advocate for the care of their family members need to have higher expectations and be prepared to use the new language of the CMS policy manual to appeal therapy claims that seem to have been wrongfully denied.



Medicare Payments in SC

Kaiser Health News had an interesting article about Medicare spending.  One out of every five dollars Medicare spends goes to nursing homes, home health services or other post-acute facilities and services. The spending varies greatly between states.

The article contains a chart that breaks down Medicare’s 2011 spending into five broad categories.   Spending has been adjusted for the different wage scales Medicare pays as well as special payments such as for hospitals that teach residents. The spending per Medicare beneficiary has been adjusted to take into account different illness levels among states’ Medicare beneficiaries. The figures include only traditional “fee for service” Medicare spending on beneficiaries age 65 and older. Spending on Medicare managed care plans, also known as Medicare Advantage, is not included.

In South Carolina, 17.25% of Medicare money went to long term care with $9,506.41 spending per capita with 525,501 Medicare beneficiaries.


MedPAC's Recommendations on Profit Margins

Senior Housing News reported that Medicare Payment Advisory Commission (MedPAC) is recommending Congress to cut Medicare reimbursements to the nursing home industry in the coming years. The total profit margin for the nursing home industry was 1.8% last year, according to MedPAC.  But looking at freestanding skilled nursing facility Medicare margins, nursing homes had a 13.8% margin in 2012, marking the 13th year of profits above 10%, according to a MedPAC presentation during a Dec. 12-13 Meeting Brief.

MedPAC has long held that Medicare reimbursements should not be used to offset Medicaid underpayments, adding in the December 2013 presentation that “subsidizing Medicaid through Medicare payments is poor policy.”   MedPAC has previously called for rebasing Medicare‘s prospective payment system (PPS) for skilled nursing facilities and reducing reimbursements by 4% in 2016 with additional reductions in subsequent years, and is now renewing that recommendation.




Medicare's Sustainable Growth Rate

The Congressional Budget Office (CBO) projected earlier this year that replacing Medicare’s sustainable growth rate (SGR) payment formula would cost $138 billion. This projection was $100 billion less than prior estimations, but Congress’s first bill to repeal and replace the SGR is estimated to add much more to that baseline. The SGR is already controversial because it’s so costly, and with this proposal from Congress, the hope that this could be cost effective was shattered. The bill included incentive programs which add budgetary expense. Because of this, no one working on the proposal could accurately estimate how much the program would cost within ten years. The uncertainty around the cost of replacing the SGR is the top obstacle to the proposal’s implementation. The bill doesn’t have a built in plan to pay for the program, and as of now, no one has a concrete idea how to fund it. See article at Medpage.


Tenet Accussed of Kickback Scheme

Tenet Healthcare, the parent company of Hilton Head Hospital, is denying allegations that the hospital was involved in a kickback scheme involving the Medicaid program.  The lawsuit says the hospitals fraudulently billed Medicaid for tens of thousands of ineligible claims, and asks that the hospitals pay damages and penalties. A federal whistle-blower accuses the Hilton Head Hospital and others in Georgia of paying kickbacks to clinics that directed expectant mothers in the country illegally to their hospitals and filed fraudulent Medicaid claims on those patients.

Federal law prohibits hospitals from paying to get patient referrals.  Also, people living in the country illegally are not eligible for Medicaid coverage except in emergencies. Medicaid does consider childbirth an emergency condition.



Avoidable Hospitalizations

A new study finds that three-fifths of hospitalizations from nursing home patients could be avoided. Nursing home patients have a number of risk factors against them including diabetes, renal disease, and multiple medications. However, the study found that staffing, quality and reimbursement were risk factors as well. The most avoidable hospitalizations are infection, injury and congestive heart failure. See the article at McKnights.


Settlement in False Claims Act

A few weeks ago, we posted a blog about the connection between doctors and prescription sales. In that article, financial data was used to show that doctors who worked with a pharmaceutical company, giving presentations and speeches, were more likely to prescribe a drug that the company had marketed.

In a similar tale of big pharma influence, one St. Louis company has been entangled in a lawsuit under the False Claims Act. John Prieve, the whistleblower who brought forth the suit, worked at Mallinckrodt LLC. In his suit, he claims that Mallinckrodt defrauded the government because they used financial incentives to increase the number of doctor prescriptions their drug got. In doing so, many of the prescriptions were paid by Medicare and Medicaid, essentially placing the added cost on the government. The suit alleges that the company ‘targeted doctors’ who prescribed similar drugs in an attempt to increase sales of the less effective and more expensive antidepressants and sleep aids that Mallinckrodt made. The company is settling the suit for $3.5 million.

Another Kickback Scheme

Philip and Morris Esformes have been accused of taking over a million dollars in kickbacks from Omnicare Inc. during its purchase of Total Pharmacy. The whistleblower, Maureen Nehls, filed the suit under the False Claims Act. The Esformes, as operators of nursing homes, are accused of switching their facilities to Total Pharmacy, which Philip had a 40% stake in, and receiving donations from the company, which may or may not be considered a kickback.

The trial will start today in Chicago. Omnicare Inc., the company accused of ‘donating’ to the Esformes had previously settled with the government for $17.2 million. See article at McKnight's.