OIG Releases 2017 Work Plan

On November 10, 2016, the Office of Inspector General (“the OIG”) of the U.S. Department of Health and Human Services (“DHHS”) released its 2017 Work Plan.  Published annually and updated throughout the year, the Work Plan identifies the OIG’s key areas of focus as it carries out its mission of protecting the integrity of programs within DHHS.  The OIG is charged with ensuring the integrity of more than 100 programs administered by DHHS, including those within the Centers for Medicare and Medicaid Services, Center for Disease Control and Prevention, the Food and Drug Administration, and the National Institute of Health. The OIG Work Plan summarizes the OIG’s current activities – comprised of both new and revised activities — along with information regarding previously identified activities that have been completed, postponed, or cancelled.

The Work Plan highlights new and continuing priorities applicable to various provider types, including hospitals, nursing homes, hospices, home health, clinical laboratories, physicians and other health professionals, medical equipment suppliers and manufacturers, pharmaceutical manufacturers and other providers and suppliers.

The 2017 Work Plan is available here.

The following is a sampling of some of the new and ongoing efforts highlighted in the Work Plan:

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Amanda Hayes

Amanda Hayes

Amanda Hayes counsels clients in connection with mergers and acquisitions, divestitures and other business matters, with a particular focus on the health care industry. She regularly serves as lead counsel on acquisitions and divestitures, guiding the client through deal structuring, due diligence, drafting, negotiation and closing. In addition to health care, Ms. Hayes’ mergers and acquisition experience includes a variety of industries, such as manufacturing, retail, automotive, contract research, environmental remediation, engineering and construction supply.

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How Medicaid Providers Can Challenge Rate Cuts in the Wake of Armstrong v. Exceptional Children’s Center

The Federal Lawyer, a national magazine by the Federal Bar Association, just published an article by one of Parker Poe’s health care attorneys.   The article looks at the implications of a recent Supreme Court decision and explores how Medicaid providers can still challenge rate cuts.

The article is available here.

Matt Wolfe

Matt Wolfe

Matt Wolfe concentrates his practice in the areas of administrative litigation, government relations, and other regulatory matters. Matt formulates comprehensive political and public relations strategies on a broad range of federal and state policies. He drafts and monitors legislation, intervenes directly with legislative, executive, and local officials, and appears before state and federal executive agencies. Within his administrative litigation practice, Matt advises and counsels health care providers subject to federal and state regulatory actions.

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Supreme Court Holds that Medicaid Providers Do Not Have Right to Challenge Medicaid Reimbursement Rates under Supremacy Clause

Yesterday, the United States Supreme Court issued an opinion that denies providers the right to challenge low Medicaid reimbursement rates by suing state agencies in federal court.

In Armstrong v. Exceptional Child Center (No. 14-15), several residential care providers in Idaho sued on the grounds that its Medicaid program failed to pay providers increased Medicaid rates that had been approved by the federal government.  The providers were initially successful in convincing the district court and Court of Appeals for the Ninth Circuit that the State should be forced to pay the higher rates because federal Medicaid law requires states to pay rates that are sufficient to ensure access to care.  The providers contended that they had the right to sue Idaho in federal court under the United States Constitution’s Supremacy Clause—which provides that federal law trumps State law.

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Matt Wolfe

Matt Wolfe

Matt Wolfe concentrates his practice in the areas of administrative litigation, government relations, and other regulatory matters. Matt formulates comprehensive political and public relations strategies on a broad range of federal and state policies. He drafts and monitors legislation, intervenes directly with legislative, executive, and local officials, and appears before state and federal executive agencies. Within his administrative litigation practice, Matt advises and counsels health care providers subject to federal and state regulatory actions.

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Is Sunlight the Best Disinfectant?

Earlier today, CMS released data revealing financial ties between physicians and other sectors of the healthcare industry.  This August—December 2013 data is now available to the public on CMS’ website and includes 4.4 million transactions amounting to $3.5 billion in payments, involving 546,000 doctors and 1,360 teaching hospitals.  The payments disclosed on the website include:  consulting fees, speaking fees, research payments, gifts, meals, entertainment, travel, educational items, royalties, honoraria, and charitable contributions.

The release of this data was mandated by the Physician Payment Sunshine Act, part of the Patient Protection and Affordable Care Act, which aims to improve transparency of financial relationships and expose conflicts of interest between physicians and the health care industry.  Rules were promulgated requiring manufacturers to disclose certain payments and items of value given to physicians and teaching hospitals.

Starting August 1, 2013, drug and device manufacturers have been required to track all of the following: any “transfer of value” of $10 or more to physicians; transfers of value under $10 that add up to more than $100 a year; and physicians’ ownership stakes in drug and device companies.  Once reported to CMS, physicians have the opportunity to review and challenge these disclosures.

Industry and physician groups have criticized this first data release, stating that it raises more questions than answers.  Before the data was released, life science trade associations sent a letter to CMS Administrator Marilyn Tavenner expressing concern that the data will be misleading since the public will not understand the context of payments.   In August, the American Medical Association requested a delay in the release, stating that physicians were not provided adequate time to confirm the accuracy of the reported payments.  CMS ultimately decided to withhold about one-third of reported payments due to suspected inaccuracies.

The press has also been critical of CMS’ data.  Although the goal of the release is increased transparency, the website is not user-friendly.  The Wall Street Journal summarizes the problems: there is no search box; there are multiple databases; there are no bottom-line numbers; the chart has numerous columns, making it difficult to peruse.  In spite of these shortcomings, various news outlets and organizations, including Policy & Medicine, have analyzed and aggregated the data for the public.

The next release of data covering the 2014 calendar year will occur in the summer of 2015.  In the meantime, we will be watching to see if this new transparency leads to any changes in the relationships between physicians and drug and device manufacturers.

Varsha Gadani

Varsha Gadani

Varsha Gadani focuses her practice on the health care industry. Her clients include hospitals, physicians, behavioral health care providers, long-term care facilities, and other providers. Prior to joining Parker Poe, Ms. Gadani served as Assistant Counsel at the North Carolina Medical Society (NCMS). In this role, she performed a variety of legal functions for the NCMS. She monitored and analyzed emerging state and federal health law issues and advised physicians on health policy matters.

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How Much Does this Procedure Cost? North Carolina Proposes Temporary Rules on Cost Reporting Requirements for Hospitals and Ambulatory Surgery Centers

The recently adopted North Carolina Health Care Cost Reduction and Transparency Act aims to improve transparency in healthcare costs by providing information to the public.  By January 1, 2015, the Medical Care Commission (MCC) is required to adopt rules establishing reporting requirements for hospitals and ambulatory surgical facilities.  This information will then be available to the public on the North Carolina Department of Health and Human Services’ (Department) website.  The MCC has submitted proposed temporary rules and is accepting public comments through October 17, 2014.  The public hearing on these rules will be on October 15, 2014.  The reporting requirements of these proposed rules are summarized below.

Reporting Requirements for Hospitals
The Department will determine the 100 most frequently reported diagnosis related groups (“DRGs”), the 20 most common outpatient imaging procedures, and the 20 most common outpatient surgical procedures performed in hospitals statewide.  Hospitals will be required to provide the following:

  1. The average gross charge for each DRG or procedure if paid in full without any portion paid by a public or private third party;
  2. The average negotiated settlement for patients not covered by a public or private third party;
  3. The amount of Medicaid reimbursement for each DRG or procedure;
  4. The amount of Medicare reimbursement for each DRG or procedure; and
  5. For the top five largest health insurers (meaning Department of Justice (“DOJ”)-licensed third parties and the State Health Plan):
  • Identify the top five largest health insurers by dollar volume of payments;
  • List the lowest payment from each insurer for each DRG or procedure;
  • List the average of each of the five insurer payment amounts;
  • List the highest payment from each insurer for each DRG or procedure; and
  • Redact names of top five health insurers prior to submission.

Reporting Requirements for Ambulatory Surgical Facilities
The Department will determine the 20 most common outpatient imaging procedures and the 20 most common outpatient surgical procedures performed in ambulatory surgical facilities statewide.  Ambulatory surgical facilities will be required to provide the following:

  1.  The average gross charge for each DRG or procedure if paid in full without any portion paid by a public or private third party;
  2. The average negotiated settlement for patients not covered by a public or private third party;
  3. The amount of Medicaid reimbursement for each DRG or procedure;
  4. The amount of Medicare reimbursement for each DRG or procedure; and
  5. For the top five largest health insurers (meaning DOI-licensed third parties and the State Health Plan):
  • Identify the top five largest health insurers by dollar volume of payments;
  • List the lowest payment from each insurer for each DRG or procedure;
  • List the average of each of the five insurer payment amounts;
  • List the highest payment from each insurer for each DRG or procedure; and
  • Redact names of top five health insurers prior to submission.

Each quarter, hospitals and ambulatory surgical facilities must report on the quarter ending three months previous to the date of reporting.

 

Comments to these proposed temporary rules can be submitted by:

Email: DHSR.RulesCoordinator@dhhs.nc.gov;
Fax: 919-733- 7021;
Mail: Megan Lamphere, Division of Health Service Regulation, 2701 Mail Service Center, Raleigh, NC 27699-2701.

The Public Hearing on October 15, 2014 at 10:00 a.m. will be held at 801 Biggs Drive, Raleigh, NC 27603, Brown Building, Room 104.

Varsha Gadani

Varsha Gadani

Varsha Gadani focuses her practice on the health care industry. Her clients include hospitals, physicians, behavioral health care providers, long-term care facilities, and other providers. Prior to joining Parker Poe, Ms. Gadani served as Assistant Counsel at the North Carolina Medical Society (NCMS). In this role, she performed a variety of legal functions for the NCMS. She monitored and analyzed emerging state and federal health law issues and advised physicians on health policy matters.

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