Articles - Thompson Coburn LLP - Do Your Contractors Know About Your False Claims Education Policy?

The Deficit Reduction Act of 2005 requires any entity, such as a hospital, that receives greater than $5,000,000 per year in Medicaid funds to implement a False Claims Education Policy. The policy must include detailed information about the False Claims Act and refer to or describe the hospital’s procedures for detecting and preventing waste, fraud and abuse. The policy was required to be in effect on January 1, 2007. On March 22, 2007, the Centers for Medicare and Medicaid Services or “CMS” provided additional guidance in the form of frequently asked questions about the policy requirements.

What many providers may not realize is that the policy applies not only to the provider’s employees, but also to any contractors or agents of the hospital. A contractor or agent is any person who furnishes Medicaid health care items or services, performs billing or coding functions, or is involved in monitoring of health care provided by the hospital on behalf of the hospital. This is a broad definition and could include consultants, vendors, and other entities providing services to or for your hospital.

While hospitals are not required to provide specific training on the policy, all of the hospital’s contractors and agents should be provided with the policy and notified of the obligation to comply with the policy. CMS has advised that the policy may be provided to all contractors electronically.

In certain cases, contractors, such as supply vendors, may receive hundreds of policies from various hospitals, which may pose a practical challenge for the contractors’ compliance. It is hoped that CMS will provide additional compliance guidance to address these challenges.

In case CMS decides to verify the hospital’s compliance, we recommend documenting the hospital’s efforts to notify its contractors of its policy.

Verbal Order Signature Compliance

Obtaining timely physician signatures on verbal orders is a continuing compliance challenge for hospitals. CMS requires verbal orders be used infrequently and signed within 48 hours.

During CMS’ last revisions to the Conditions of Participation, CMS made it much easier to obtain the signatures. Read CMS’ letter explaining the changes.

The Conditions of Participation now permit verbal orders to be signed by the ordering practitioner or another practitioner responsible for the care of the patient and authorized to write orders by hospital policy in accordance with state law. This means that other members of the physician’s group or other physicians responsible for the patient’s care may sign the verbal order.

Hospitals may want to review their medical staff bylaws and hospital policies and procedures to verify their documents permit practitioners other than the ordering physician to sign a verbal order.

New HIPAA Enforcement Web Site

The United States Department of Health and Human Services Office of Civil Rights or “OCR” is the agency responsible for enforcement of the Health Insurance Portability and Accountability Act of 1996 or “HIPAA.” Since 2003, when enforcement of the HIPAA Privacy Rule began, providers have had little information regarding the number of HIPAA complaints received by the OCR and the number of violations found. The OCR has unveiled a new web site that provides information regarding HIPAA enforcement. The development of this web site suggests the OCR will be monitoring the effectiveness of its HIPAA violation investigations and it may foreshadow an increase in enforcement of HIPAA violations.

CMS Revises Informed Consent Interpretive Guidelines

On April 13, 2007, CMS revised its Interpretive Guidelines for documenting informed consent, specifically regarding the participation of practitioners other than the surgeon during the surgery. Read CMS’ letter regarding the changes.

While the Conditions of Participation have not changed, what has changed is CMS’ guidance regarding how it interprets the Conditions of Participation. The Conditions of Participation state that a hospital’s medical records must include properly executed informed consent forms for procedures and treatments specified by the medical staff or by state or federal law.

As you may know, CMS has been tinkering with its Interpretive Guidelines in this area since 2004. One of the more extreme CMS interpretations had been that the hospital identify, in advance of the surgery, the names of practitioners, other than the surgeon, who would participate in the surgery and the specific tasks those practitioners would perform. This requirement was nearly impossible for hospitals to comply with, particularly hospitals with residents or registered nurses first assistant. Often these practitioners are assigned to the case immediately before the surgery and it was impossible to know which specific practitioner would assist the surgeon at the time of obtaining informed consent. It was also impossible to know exactly what the practitioner would do during the surgery in advance of the surgery.

Fortunately, CMS has relaxed this interpretation. The current requirement states that, as a part of the informed consent process, a patient must be informed if any practitioners who are not physicians will perform important parts of the surgery or administer the anesthesia, the types of tasks the practitioner may carry out, and that the practitioner will be performing only tasks within their scope of practice for which they have been granted privileges by the hospital. Hospitals are no longer required to identify a specific practitioner; rather, hospitals may state generally the types of practitioners who will perform important parts of the surgery.

Hospitals may consider revising their standard consent forms to more easily meet CMS’ latest requirements. For example, the forms could include a list of the types of practitioners likely to participate in the surgery and provide a checkbox next to each type of practitioner.

If you have any questions about these recent developments, feel free to contact a member of the Thompson Coburn Health Care Group.

2007 Physician Quality Reporting Initiative Bonus Payments

CMS has unveiled the 2007 Physician Quality Reporting Initiative or “PQRI.” The PQRI is CMS’ voluntary pay for performance financial incentive program for physicians. Like the 2006 program, CMS is using the PQRI to gain experience with linking Medicare physician payments to quality measures. While the 2006 program had 16 quality measures, the 2007 program has over 70 quality measures and greatly expands the physician’s ability to obtain a bonus.

The 2007 PQRI reporting period is July 1, 2007 through December 31, 2007. The PQRI is entirely voluntary, but physicians who participate are eligible for a lump sum bonus payment of up to 1.5% of the Medicare Physicians Fee Schedule. The bonus will apply to allowed charges for all covered professional services, not just those charges associated with the quality measures. The bonus is subject to a cap which applies when the physician rarely reports the quality measures. The lump sum bonus payment will occur in mid-2008. The patient will not receive notice of the bonus.

To participate in the PQRI, physicians should review the 2007 PQRI Quality Measure Specifications. The physicians should select the quality measures appropriate to their patient panels. Once the 2007 PQRI starts in July, the physician must submit the specified quality data codes on the specified claims using the appropriate CPT Category II codes or G codes. The quality data collected by CMS will not be publicly reported. However, physicians will be able to log in to a confidential web site to obtain feedback from CMS. To participate in the PQRI, physicians should review the 2007 PQRI Quality Measure Specifications.

We encourage physicians to review the quality measures to determine the difficulty of reporting the additional codes, including the administrative time required to do so, and the likely frequency of the reporting. This information will determine whether participation in the 2007 PQRI would benefit the physician’s practice.