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Law Firm Unveils Recommendations for Health Providers in Response to Controversial Draft ACO Regulations Print E-mail
Written by FHI Staff Writer   
Wednesday, 15 June 2011 00:00

McDermott Will & Emery recently released a detailed white paper entitled:

"The Controversial Draft Medicare ACO Regulations: Analysis, Comments, and Recommended Action." 

McDermott health lawyers have prepared this publication to help make sense of the proposed ACO regulations, and provide specific action steps.

ACOs, which create incentives for health care providers to work together to treat individual patients across multiple care settings, are at the core of the federal health care reform legislation enacted last year.  On April 7th, the Centers for Medicare and Medicaid Services (CMS) finally published 400+ pages of draft ACO regulations that many in the health care industry view as excessively burdensome and biased against providers. On May 17th, the Center for Medicare and Medicaid Innovation announced a parallel track ACO initiative called 'Pioneer ACO' that may have been intended to overcome such objections and stimulate interest in ACO participation.

"Reaction to the proposed rules issued by CMS to implement the Medicare Shared Savings Program ("MSSP") has reportedly been harsh and critical," observed Gary Scott Davis, a partner at McDermott Will & Emery who focuses his practice on managed care, hospital-physician alignment and health system strategic transactions, restructurings and reorganizations.  "While it remains to be seen how the Federal Government will ultimately implement ACOs, providers today are looking for much-needed guidance as they consider ACO participation," added Davis.  "Regardless of whether a hospital, health system, physician group or other provider presently intends to participate in the MSSP, understanding the regulations are important to any ACO formation, whether with Medicare or a private insurer. We believe that ultimately many of the concepts being vetted and developed - metrics and mechanics to measure and assess quality as a means for reimbursement -- will end up being incorporated into private market ACOs." 

Private sector efforts toward accountable care are well under way, and will continue whether or not the final regulations are implemented.  "The private sector will not wait for the government to figure this out," adds Davis. "There is a major paradigm shift already under way that is making the need for accountable care ever more urgent.  And, because there are elements in the proposed regulations that provide important  foundational concepts for achieving accountable care in the private sector, our white paper should prove uniquely valuable. This document should be particularly helpful to industry participants seeking to accomplish two critical goals of accountable care:  tying quality to payment and capturing and using the critical data needed to get paid on this basis."

Last Updated on Wednesday, 29 June 2011 16:56
 
Court Decision Opens Opportunity to Recover Payments Print E-mail
Written by C. Glen Ged, Esq   
Wednesday, 01 June 2011 15:19

PIP MONEY ON THE TABLE?

In the face of declining reimbursements and rising costs, Personal Injury Protection (PIP)   payments offer a predictable revenue source. Florida's No Fault Insurance law provides reimbursement at a higher level than Medicare or third-party insurance's contracted rates -- and a Florida appellate court decision in May makes PIP revenue recovery an even more compelling opportunity.

Yet many hospitals and other medical providers don't take advantage of their rights to recover payment for treating automobile accident victims.  They too often accept and write off an insurer's underpayment or denial of benefits, even though by law, the insurer is responsible for all attorney fees and costs in cases where PIP benefits have been denied or underpaid.

Insured motorists in Florida must carry PIP coverage that will pay up to $10,000 in benefits per person injured in an automobile-related accident. With PIP benefits limited and claims paid on a "first in time, first in right" basis, hospitals and other providers will benefit by quickly identifying and pursuing all underpaid claims through a PIP audit.   

This Spring's Crucial Court Decision

On May 18, Florida's Fourth District Court of Appeal issued an important decision upholding providers' rights.  In Kingsway Amigo Insurance Company v. Ocean Health, Inc., the appeals court held that when an individual insurance policy provides for higher payment than the minimum required by Florida's PIP law, the terms of the policy will dictate payment. 

That decision set statewide precedent, giving hospitals and other medical providers stronger legal footing to collect the balance of PIP benefits due them for treatment dating back to January 1, 2008, when Florida's PIP law was re-enacted.   

Florida's PIP law includes a mandatory payment method of 80% of reasonable and necessary medical expenses, but lets insurers choose a Safe Harbor option that limits their payment obligation based on a fee schedule.  In its May decision, the appellate court upheld a previous ruling in the medical provider's favor. The court's reason:  since the PIP statute contains a choice of payment methods, it is important for the PIP insurer to "clearly and unambiguously choose and identify its selected payment methodology."    

In our firm's experience, many PIP insurers use the lower fee schedule, but few have stated their choice of payment in their policies.  The difference in PIP payment method can have meaningful impact and underpaid cases can add up. 

Using a Cervical MRI billed at $1,600 as an example:

-Payment at 80% of Reasonable Charge due to provider

$1,600 x $80% = $1280 owed by insurer            

-Payment under 2008 Statute Fee Schedule due to provider 

$1,075.38 allowed per 2007 Medicare Part B schedule x 80% = $860.30 owed by insurer

Before the new law was passed, insurers were required to pay claims based on 80% of reasonable and necessary expenses.  Some insurers have also unlawfully applied the new PIP law's lower fee schedule method to pay claims on policies issued prior to 2008.  If a policy was issued in 2007, payment is required under that policy's terms - even if an accident happened after the 2008 law was enacted.  

Significant Revenues at Stake

Overall, Hospitals and other medical providers have five years from the date an insurer denies or underpays a claim to seek an adjustment for overdue benefits. Many hospitals and other medical providers that rigorously pursue claims recovery with a five-year look-back PIP audit find the impact can be significant. One Palm Beach County hospital recently recovered $140,000 in claims and on Florida's west coast, another hospital and its trauma providers, working with attorneys through the PIP dispute resolution process, collected about $700,000 in denied or underpaid claims.

While PIP audits are a powerful tool to pinpoint aggregate revenues due, they do not burden hospitals' and providers' resources. A no-cost PIP audit of EOBs by an experienced legal team may reveal many cases in which insurers have shorted the provider.  With aggressive legal representation - at no cost to the provider -- revenue recovery payments may begin to flow within 60 days.  Once an audit updates claim files, it's prudent to have the legal team keep the provider current by reviewing all new PIP EOBs every month.

ABOUT THE AUTHOR:  C. Glen Ged is founding partner in the law firm of Ellis, Ged & Bodden, P.A., whose PIP team represents hospitals and other medical providers statewide. He can be reached at gged@ellisandged.com, 1-888-EGB-FIRM (342-3476) or (561) 995-1966.

Last Updated on Wednesday, 22 June 2011 09:12
 
What's the ROI on the Medical Malpractice Claim Pending Against You? Print E-mail
Written by Michael Sacopulos, JD   
Thursday, 26 May 2011 16:49

ASK MIKE

Medical Justice Medico-Legal Q&A

Q: I have recently been told there are a number of organizations investing in medical malpractice suits in the State of Florida. As I understand it, these organizations invest large sums of money with plaintiff's attorneys in hopes of a big return. Is this true? If so, is it legal?

A: I am sorry to be the one to tell you, that in fact there are firms putting money into lawsuits against physicians. For a variety of legal reasons, the investment is typically in terms of a loan. A quick Google search will turn up a number of firms willing to loan money to plaintiff's attorneys engaged in medical malpractice litigation. These loans are not for an insignificant amount. For example, LawCash sets its lending parameters of a minimum Ten Thousand Dollars ($10,000) maximum One Million Dollars ($1,000,000.00) per case. LawCash promises to decide whether or not to fund a particular case within forty-eight hours.

Organizations investing in litigation or organizations extending loans to attorneys typically charge two to four percent interest per month, compounded annually. This can result in effective annual interest rate in excess of fifty percent. Often this interest rate is justified on the basis that the loans are "non-recourse loans." This means that if the plaintiff's litigation is unsuccessful, there is no obligation to repay the loan. We will leave it to you to speculate as to the impact of high dollar non-recourse loans upon medical malpractice claims.

As to the second part of your question regarding the legality of these types of loans, there is not a universal answer. It appears that there is a basis under Florida to believe these types of loans are in fact permissible. Certainly firms engaging in making these loans believe that there actions are permissible under Florida law. Other states prohibit this practice. Finally, there are some states, such as Kentucky that currently have legislation pending which would address the issue head on. I am unaware of any legislative efforts in Florida to prohibit the trafficking in medical malpractice litigation, at the present time.

Michael J. Sacopulos is a Partner with Sacopulos, Johnson & Sacopulos, in Terre Haute, Indiana. His core expertise is in medical malpractice defense and third party payment disputes. Sacopulos may be reached at mike_sacopulos@sacopulos.com

Last Updated on Thursday, 09 June 2011 09:01
 
Creating the Ideal ACO Print E-mail
Written by Jeffrey L. Cohen   
Tuesday, 24 May 2011 08:59

The current fixation on Accountable Care Organizations (ACOs) is causing an enormous amount of two things:  (1) talking, and (2) inactivity.  Yes, the concept of delivering care in a manner that reduces or at least controls costs is important and interesting.  Yet, the marketplace is replete with people and businesses that have adopted a wait and see approach, which is really no approach at all.  Businesses and people who will thrive (especially in dynamic times) are those who, as always, take a lesson from sharks:  swim ahead or drown.

            So what about ACOs?  What the best "thing"?  How do you make one?  First, you have to do away with the focus on ACOs, since they are more of a concept than a thing.  Focusing on ACOs as a thing merely paralyzes the viewer because they are, by definition, not subject to such limitations.  What is clear, however, is what they're supposed to do:  reduce costs and improve quality in a demonstrable way.  How do you do that?  Easy...squeeze the toothpaste tube backwards.

            The most expensive end of the toothpaste tube is acute care-hospitals.  Reduce patient admissions and readmissions and reduce costs.  The next most expensive part of the tube is specialist care.  Coordinate care and reduce specialist involvement in the first place and reduce cost.  So where does all this toothpaste get plopped?  Primary care!  Businesses or systems that place more control and focus on primary care and on prevention stand to save the most.  But that's not enough! 

The missing piece in the entire healthcare reform debate and yet the most effective piece in terms of reducing costs and improving quality is (drum roll....) patient accountability!  So (the punch line), healthcare businesses and systems which empower primary care physicians and which create patient accountability are best suited to reduce cost, improve quality and hence to become an ACO, the core part of one or at least remarkably effective.  How do you do it?  A million ways, but as Americans probably the most effective way is...money.  More money for the "right" behavior and less money for the "wrong" behavior.  

            Information technology (e.g. EMR) is the glue for the whole thing.  Without it, one cannot effectively measure or control cost or quality.  Right fit is the key issue with IT.  Hire a consultant who has no product to sell!

            Physician responsibility and leadership is critical.  For change to be effective, we cannot repeat the experience of the 90s with PHOs for instance.  Physicians failed and refused to effectively bring colleague behavior in line.  With the right financial incentives, however, that can be changed.  In fact, the very core of any business which effectively adapts to the call for change is the alignment of financial incentives.  Which is why we are having this discussion and experiment in the first place, right?

            The most effective ACOs are not the ones with the best lawyers or consultants.  They are the ones which have:

1.     A strong primary care core;

2.     Patient incentives for healthy patient behavior and disincentives for unhealthy patient behavior;

3.     Effective IT to track, measure and control cost and quality;

4.     A culture where the physicians and other components (e.g. hospitals) are committed to the best quality with the smartest expenditure of resources; and

5.     Physician leadership to ensure the "right" behavior.

Even if the "answer" isn't ACOs, even if the healthcare reform law is found to be unconstitutional by the US Supreme Court, any organization which does what's described here, in whole or in part, will be better off.  The best and most reliable thing one can say about healthcare reform and ACOs is that it is causing many people to move and improve.  It may not be an ACO, it may not do everything, but any improvement is good and right at this time.

ABOUT THE AUTHOR 

With over 20 years of healthcare law experience following his position as legal counsel for the Florida Medical Association, Mr. Cohen is board certified by The Florida Bar as a specialist in healthcare law. His practice immerses him in regulatory, contract, corporate, compliance and employment related matters.  Mr. Cohen is the founder of The Florida Healthcare Law Firm. www.floridahealthcarelawfirm.com | 888-455-7702

Last Updated on Wednesday, 01 June 2011 15:15
 
MGMA Study Reports Most Physicians Are Satisfied With Their EHR Systems Print E-mail
Written by William Maruca   
Thursday, 05 May 2011 09:10

A study conducted by MGMA indicates most doctors surveyed who have implemented electronic record systems are satisfied or very satisfied, and many report increased productivity and reduced costs as those systems are optimized, according to Modern Healthcare.   The full MGMA study may be downloaded here (registration required).  This report is highly recommended reading.

 The study, funded by PNC Bank, tabulated over 4,500 responses from a variety of organizations representing over 120,000 physicians, over half of them in independent private practice. Of the respondents, 16.3 percent believed they had optimized their EHR.   One surprising finding - independent physicians are farther along in the process than hospital-employed physicians: 

"Finding independent practices further along in EHR optimization than IDS- and hospital-owned practices might seem surprising at first glance. As components of larger systems with greater access to financial and technical resources and expertise, IDS- and hospital-owned practices would seem more likely to lead rather than trail independent practices in EHR adoption. Yet, aspects of hospital and IDS-ownership may slow EHR adoption; it also may slow integration of EHR with other technologies."

The leading barrier to implementation of EHR cited was "Expected loss of productivity during transition to the EHR system", followed closely by "Insufficient capital resources to invest in an EHR."  Most telling is Figure 12 in the report, which shows 85.8% of "optimized" EHR users satisfied or very satisfied with their systems overall; 56.5% of such users satisfied with the ability of the EHR to decrease practice costs; 61% of such users satisfied with the ability of the EHR to increase provider productivity; and 60.8% satisfied with the ability of EHR to increase practice revenue.  MGMA concludes:

"These data indicate that EHR users find reaching full optimization of their system produces benefits, and that they are more likely to perceive these benefits than other users. Efforts to optimize an EHR implementation are likely to produce tangible benefits for a majority of EHR users."

About the author:  Mr. Maruca is a partner with Fox Rothschild.  To learn more, click here.

 
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