November 2019 - Page 2 of 2 - Medical Association of the State of Alabama

Changes Coming to AKS, Stark and CMP Laws

Posted by Mallory Camerio on November 5, 2019

On October 9, 2019, the Office of Inspector General (“OIG”) and the Centers for Medicare and Medicaid Services (“CMS”) published proposed rules to revise the Stark Law, Anti-Kickback Statute and Civil Monetary Penalty Statute. These statutes create criminal and civil penalties for certain financial arrangements involving providers. According to OIG and CMS, the goal of the proposed rules is to address barriers created by the rules that interfere with care coordination. The additional safe harbors were necessary to allow for coordination of patient care among providers because of the increased focus on value-based care. Value-based programs reward healthcare providers with incentive payments for quality of care. Examples of these programs include Hospital Value-Based Purchasing, Hospital Readmission Reduction Program and Hospital Acquired Conditions Reduction Program.

Anti-Kickback

The proposed changes in the published rule include three new safe harbors for certain remuneration exchanged between or among participants in a value-based arrangement intended to foster better coordinated patient care. These include:

Care Coordination Arrangements to Improve Quality Health Outcomes and Efficiency,
Value-Based Arrangements with Substantial Downside Financial Risk, and
Value-Based Arrangements with Full Financial Risk.

The proposed rule also offers a new safe harbor for certain tools and support furnished to patients to improve health quality outcomes and efficiency, such as health-related technology or patient health-related monitoring tools. Additionally, a new safe harbor is proposed for remuneration provided in connection with a CMS sponsored innovation model, which is intended to reduce the need for separate and distinct fraud and abuse waivers.

There is a proposed safe harbor for donations of cybersecurity technology and services as well as modifications to the existing safe harbor for electronic health records and services to add protections for certain related cybersecurity technology, to update provisions regarding intra-operability, and to remove the sunset date that previously existed.

The rule proposes a positive change to the Personal Services and Management Contracts safe harbor, by eliminating the requirement that periodic or part-time services be on a specific schedule or interval. Additionally, the safe harbor adds a provision for “outcome-based payments.” Outcome-based payments are those payments that reward the provider for improving patient or population health by achieving one or more outcome measures or that reduce payor costs while improving or maintaining the improved quality of care for patients.

Another existing provision related to warranties is updated to revise the definition of warranty and provide protection for bundled warranties for one or more items of related services. Local transportation is covered by an existing safe harbor, but the proposed change expands and modifies mileage limits for rural areas and for transportation for patients discharged from inpatient facilities.

Lastly, the Accountable Care Organization Incentive Program is added to the exception of the definition of “remuneration.”

Stark Law

The physician self-referral law, known as the Stark Law, has not been significantly updated since its enactment in 1989. The proposed changes seek to reduce the burden on physicians and allow for coordination of care.

Like the new safe harbors under the AKS, the proposed changes to the Stark Law include value-based arrangements. A value-based arrangement is defined as an arrangement for the provision of at least one value-based activity for a target patient population between or among the value-based enterprise (“VBE”) and one or more VBE participants or VBE participants in the same value-based activity.

Another update to the Stark Law includes a proposed change clarifying the existing provision that allows a physician in a group practice to be paid a share of the overall profits of the group that is indirectly related to the volume or value of the physician’s referrals. Additionally, there are changes to how the law treats productivity bonuses for physicians.

According to CMS, the intent of the proposed changes is to alleviate the fear physicians may have in entering into legitimate relationships to coordinate and improve care of patients.

CMP

There is only one proposed change for the Civil Monetary Penalty statute, and it adds a new statutory exception to the prohibition on beneficiary inducements for telehealth technologies furnished to certain in-home dialysis patients.

For all the proposed rules, OIG and CMS are seeking public comments, which are due December 31, 2019. For more information on the proposed rules visit https://oig.hhs.gov/compliance/safe-harbor-regulations/index.asp and https://www.cms.gov/newsroom/fact-sheets/modernizing-and-clarifying-physician-self-referral-regulations-proposed-rule.

Article contributed by Angie C. Smith, Esq. with Burr Forman.

Posted in: Legal Watch, Medicaid, Medicare

Closing Your Medical Practice – Calling it Quits!

Posted by Mallory Camerio on November 1, 2019

There is a lot of media attention to “Baby Boomers” retiring with more than 10,000 leaving the workplace every day. Anyone closing a business has a list of items to address before selling the business or closing the doors, but there is a unique set of considerations when a physician practice owner elects to retire or stop providing service. A medical practice provides a needed service to patients and a community unlike other businesses. The Board of Medical Examiners in each state has rules, in which the physicians should notify the patients and transfer care timely without restricting the medical records needed to continue care.

I recently worked with a practice that was receiving calls from patients who were trying to find a new physician. A physician had left town and his patient records were in an electronic medical record, in which the patients had no access. These patients were suffering from chronic disease and receiving biologic treatment; the new practice trying to assist these patients would need the patient record to care for them.

If a physician plans to retire, leave town or sell his practice, he should contact an accountant or legal representative to assist in a plan. It is important to notify your local medical society of your plan to sell or close so they can assist you. If there is value in the practice, a valuation may be performed to facilitate a sale to the hospital or another physician or group. The value of a practice is determined by fair market value of accounts receivable, assets and other considerations. If a physician owner has fallen ill, the plan or timeline to work through a checklist could be limited.

Once a physician has chosen an advisor, a plan is prepared to sell or close the practice. A timeline of no less than six months should be set to notify patients and staff, transfer records and value the building and assets for sale. The practice should no longer accept new patients to the practice if it is closing. The patients must be notified in writing at least thirty days before closure and the practice must facilitate the transfer of medical records to a physician of the patient’s choosing. If another physician will “take over” the practice, a custodianship of medical record arrangement can release the physician owner of the responsibility of maintaining the paper or electronic charts. The patient must be notified who is responsible for the medical record should the patient decide to change providers after the physician is retired.

A checklist will provide guidance regarding the many notifications that must take place after the last date of service to patients. The accounts receivable are generally finalized in 60-90 days; insurance companies should be given a forwarding address for residual payments. Vendor contracts should be reviewed for “out clauses.” Insurance agents who cover the business should be notified along with state agencies. Business records, such as payroll records, tax records, etc. have retention guidelines you should follow.

Calling it quits is easier in other industries than healthcare. Physicians provide a service that includes a relationship and a valuable record to a patient; it is not to be taken lightly. If you are planning a change in ownership or retirement, reach out to an advisor for assistance.

Article contributed by Tammie Lunceford, Healthcare and Dental Consultant, Warren Averett Healthcare Consulting Group. Warren Averett is an official Gold Partner with the Medical Association.

Posted in: Members