INSIGHTS
Mark Yeh, MD
Insurance Committee Chair
ACR Alternate Councilor at Large
|
|
INSIGHTS
|
|
Mark Yeh, MD |
LARS Insurance Committee Update |
|
A message from LARS President, Richard R. Sullivan, MD "Wrongful Termination," by John C. Carpenter, Esq. CRS Meetings Notes and Comments SCROS Insurance Committee Update |
The first quarter of 2006 has turned out to be quite a roller-coaster ride in the Medicare-Medicaid world. So, if you have gotten a bit lost in all the shuffling around, I hope the following summary will help clear some of the confusion.
Deficit Reduction Act of 2005 Medicare payment freeze As many of you may already know, Congress finally passed the federal budget package, the so-called Deficit Reduction Act of 2005, on February 1, 2006, freezing Medicare physician reimbursement at 2005 rates, reversing the 4.4% cut that went into effect on January 1, 2006. As this action is retroactive to January 1, the Centers for Medicare & Medicaid Services (CMS) will automatically retroactively adjust eligible claims (e.g. claims submitted using the physician’s usual and customary rates) and make appropriate additional payments. Providers should not have to resubmit claims. By report from the California Medical Association (CMA), California’s Medicare carrier (NHIC) has already begun reprocessing those claims paid under the old 2006 fee schedule. However, it may take a few months to reprocess all the claims. It is worthy to note that some fee schedules may still differ from 2005 levels due to adjustments in the RVUs (relative value units) for certain procedures. Flawed sustainable growth rate formula On the downside, the current payment freeze is only a one-year fix. The flawed sustainable growth rate formula (SGR), which sets the payment rate updates, remains in effect and thus the medical community will need to press on to have Congress make the appropriate changes to provide a more permanent, equitable fix to the fee schedule updates. Technical reimbursement impact of budget bill On the negative side of the budget bill, imaging technical reimbursement has taken a particularly hard hit. Beginning in January, 2006, a 25% reduction to the technical component of the second, lesser paid, portion of imaging studies involving contiguous body parts within a particular modality was put into effect. In 2007, this reduction will be increased to 50%. Originally, the reduction for 2006 would have been 50% but this was held off by vigorous action from our very own American College of Radiology (ACR) led by Dr. James Borgstede. Beginning January, 2007, the technical component for imaging services performed in the office setting will be capped to the lesser of the payments found in the Medicare Physician Fee Schedule (MPFS) or the Hospital Outpatient Prospective Payment System (HOPPS). This may result in rather substantial cuts, possibly greater than 50% in some cases. These cuts will impact almost all imaging modalities including possibly medical imaging used by radiation oncologists for treatment planning. Specifically excluded from the bill are any cuts to diagnostic and screening mammography. These second set of cuts are quite drastic accounting for over 38% of the offset for the current physician payment freeze and were done in isolation without consultation with organized medicine. (Source: letter from Dr. James Borgstede, Chair, ACR Board of Chancellors.) This seems an unfair burden placed on the imaging community and could potentially result in reduced quality and access to care for patients. Fortunately, these cuts are still several months away and there are still opportunities to educate Congress to reverse or revise its course. For more details on these cuts and more information on how you may get involved politically, please refer to the ACR website, www.acr.org. At the beginning of this year, a 5% Medi-Cal rate cut went into effect as a result of a law signed by then Governor Gray Davis in 2003. Attempts to block this cut resulted in a court injunction preventing the cut in November, 2003. However, this court injunction was overturned in August, 2005, allowing the cut to take place on January 1, 2006. Recently, a CMA-sponsored bill (SB 912) was passed in the state legislature and signed by Governor Schwarzenegger on February 17, 2006. This bill eliminates the 5% Medi-Cal rate cut effective on March 4, 2006. The bill is not retroactive, however. This is a small victory for our patients who need the services provided by the Medi-Cal program. However, it is worthy to note the following facts: Medi-Cal physician provider rates are among the lowest in the country (48th); more than 60% of Medi-Cal patients have trouble finding physicians; and approximately 50% of the state’s physicians do not accept Medi-Cal patients. (Sources: www.calphys.org and CRS.) Medicare Participation Enrollment As a result of the revised 2006 fee schedule reversing the 4.4% cut, CMS is offering a second 2006 Medicare participation enrollment period giving physicians until March 31, 2006 to reconsider their Medicare participation status. Any changes in participation status made during this second enrollment period will be retroactive to January 1, 2006. (Source: www.calphys.org) National Provider Identification (NPI) Number This is a reminder that the transition from the current PIN and UPINs to the NPI is ongoing. Currently, from now through October 1, 2006, CMS will accept an existing Medicare number OR an NPI number accompanied by an existing legacy Medicare number. From October 2, 2006 through May 22, 2007, CMS will accept an existing legacy Medicare number AND/OR an NPI number. Beginning May 23, 2007, CMS will ONLY accept NPI numbers. A recent article from the California Physician (www.calphys.org) gave the following warnings with regard to the NPI: 1) Physicians are encouraged to submit their own applications for NPI numbers or check to make sure if any of their affiliated groups have not already submitted applications on their behalf. Duplicate applications can delay processing. 2) NPI numbers may pose a challenge to existing billing software systems so be prepared! The following websites may be helpful: http://www.cms.hhs.gov/NationalProvidentStand/ http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0528.pdf http://www.cms.hhs.gov/MedlearnMattersArticles.downloads/SE0555.pdf Per Michele Kelly at the recent Carrier Advisory Committee (CAC) meeting in January, the surrogate UPIN number OTH000 will no longer be valid as of April 1, 2006. Up until now, providers were allowed to bill for services such as diagnostic radiology using the Surrogate UPIN OTH000 for the referring provider. This Surrogate UPIN was intended to be used during the interim period when the UPIN for the referring provider was unknown. As of April 1, all claims for referred services must have a valid referrer UPIN; claims submitted with the Surrogate UPIN number OTH000 will be rejected. (Source: NHIC and LA County Medical Association.) We were reminded at the January CAC meeting that the appeals process consists of the following steps: (1) redetermination, (2) QIC (qualified independent contractor) reconsideration, (3) administrative law judge hearing, (4) departmental review board, and (5) referral to federal courts. The first step, redetermination, must be filed using the new form CMS 20027 which can be obtained online at www.cms.hhs.gov/forms/CMS20027.pdf. No telephone review is allowed. Telephone “reopenings” are used only to correct clerical errors by the provider or carrier. Examples of clerical errors include entering dates incorrectly and other such errors. (Source: Michele Kelly, NHIC) The new Medicare Payment Advisory Commission (MedPAC) recommendation that Medicare payment rates for 2007 be increased by 2.8% based on increasing practice costs was submitted to Congress on March 1. As the current Medicare payment rate freeze at 2005 levels will only last for one year, Medicare payment rates are set to decrease by 4.6% in 2007 if there is no further Congressional action. Does this sound familiar? (Sources: CMA and AMA) The Problem of Self-Referral and Inappropriate/Over-utilization of Imaging Services The issues of self-referral and inappropriate/over-utilization of imaging services have become hot topics in the imaging community. They refer to non-radiologist providers referring patients to be imaged on their own imaging equipment. Current federal and state laws prevent providers from referring patients for health services to an entity in which the provider has a financial interest EXCEPT when the equipment or services exist in their own offices, the so-called in-office exemption. Recent data show that increased utilization of imaging services has become a primary factor in the rising cost of medical care. Additionally, the increase in imaging has come primarily from non-radiologist practitioners who have their own MRI, CT, or PET scanners. The ACR has been leading the effort at the federal level to educate Congress and CMS about the issue of self-referral and the impact of improper utilization of imaging by non-radiologists on rising costs. At the state level, in 2005, the CRS sponsored the introduction of AB 516 by Assemblyman Yee that would have removed the in office exemption for high value imaging equipment such as MRI, CT, and PET. As expected this bill met strong opposition from many in the medical community and has died as of January, 2006. A second bill, AB 2805, introduced by Assemblyman Blakeslee on February 24, 2006 and discussed at the recent CRS meeting on March 6 in Sacramento, aims at closing the legal loopholes that currently allow the egregious practice of the so-called “sham” lease agreements in which a provider can “lease” diagnostic equipment for short periods of time from another provider or vendor who owns and provides the imaging service. In these “sham” leases, the referring provider “leases” equipment from an imaging provider for a specified period of time for a fee and then is able to bill globally for the service at a much higher rate, thus profiting off the agreement. AB 2805, if passed, would stop these lease agreements and thus take a small bite out of the self-referral business. Some private payors across the country (such as Highmark, Inc. in Pennsylvania) have also realized the intrinsic problem of self-referral and inappropriate imaging and have instituted measures in the way of pay for performance programs. (Sources: ACR and CRS) Well, I think that is enough information for now. As I have said in my first article in Insights, I welcome your comments and suggestions especially with regard to topics that you would like to hear about in these reports. Send your comments or questions to lars@larad.org.
New Private Payor Developments
- I recently received the following news tidbits from the Executive Director, Bob Achermann, of the California Radiological Society (CRS) so I though I would pass it on to you. Important Legal Decision on Balance Billing An appellate decision was issued on 2/17/06 that provided a favorable and important ruling on the rights of non-contracted hospital based physicians to balance bill for their portion of the fees that are not paid by a health plan or their delegated medical group. The ruling came in the case of Prospect Medical Group vs. Northridge Emergency Medical Group which was appealed by Prospect Medical Group after a judgment in the favor of the E.R. group at the trial court level. The case involved a suit by Prospect against a non-contracted emergency medical group that provided emergency services to patients for which Prospect was the delegate of the health care service plan and therefore responsible for those services. There were three issues decided by Court of Appeal in the second appellate district that were raised by Prospect in their appeal. Prospect alleged that under California law, section 1379 of the Health and Safety Code, non-contracted physicians are prohibited from balance billing individual patients/subscribers any amount not paid by the plan or its delegated medical group. The Court ruled that section 1379 does not prohibit balance billing when there is no contract between the physician group and the plan or delegated medical group. Section 1379 does protect the enrollee/subscriber of a plan from being billed excess charges by a contracted provider but finding no evidence of a contract the section has no effect. Prospect had argued that there was an “implied contract” not reduced to writing based upon (1) federal law requires E.R. physicians to treat all patients without ability to pay, and (2) as a delegated medical group, Prospect is obligated to pay for these emergency services. The Court ruled that 1379 only applies to voluntarily negotiated agreements and would not include any “implied contracts” Prospect also argued that the E.R physicians must accept 100% of the equivalent Medicare payment for the same services and that any charge in excess of that amount was unreasonable. The Court rejected that argument noting that Prospect cited no authority statutory or otherwise that would allow them to set that rate or any other as the only reasonable rate. The Department of Managed Health Care did publish a regulation setting forth factors that could be used in determining the rate of payment for non-contracted providers using criteria from a prior court decision in the Gould case. Those criteria included prevailing charges in the geographic area, UCR, providers training etc., but the Court was not persuaded that 100% of Medicare was what was intended. The last issue raised by Prospect is whether they could litigate the reasonableness of the fees charged by the E.R. group for their services. The Court concluded that since Prospect is a delegated medical group and responsible to pay for the services of the E.R. physicians that they could litigate whether or not those charges were in fact reasonable. The case was remanded for that purpose. The Court also dismissed a cause of action against the E.R. physicians wherein Prospect claimed that the act of balance billing was prohibited as an unfair business practice under section 17200 of the Business and Professions Code. This is obviously a very important decision for hospital based physicians. This issue is still the subject of potential legislation this year. There is no active bill that negatively impacts balance billing but the proponents of the ban might still seek amendments to other existing legislation. The California Radiological Society has participated in a workgroup assembled by the CMA in an attempt to find an agreeable dispute resolution mechanism between non-contracted HBPs and plans or medical groups. The DMHC has also released a draft plan for resolution. Technology Assessment Forum Reviews Coverage of Digital Mammography Last month the California Technology Assessment Forum (CTAF) considered the clinical efficacy and possible coverage of digital mammography for screening and diagnosis of breast cancer. The CTAF is a program of the Blue Shield of California Foundation. The role of CTAF Panel Members is to review (with the help of clinical experts) medical evidence in support of new and emerging medical technologies, and to determine whether or not those technologies meet criteria for safety and effectiveness. The CRS with the help of Dr. James Brenner presented testimony to recommend that coverage be made available for digital mammography for both screening and diagnosis. The panel’s final recommendation was to approve it only for screening. That recommendation is now being considered by Blue Shield but a decision will not be made until later in April. - from Robert Achermann
|
