3. Economy Indicators
Stock Market Soared 58%
since March 2008
Unemployment rate rose
9.8 to 10.2 %
Leading indicators show
recession 'bottoming
out‘
4. Healthcare Reform
Legislation on March 23, 2010 by President Obama
Estimated cost of $938 billion over 10 years
Key compromise: federal funds are not used for abortion
services.
Adds 16 million people to the Medicaid rolls
Subsidizes private coverage for low- and middle-income
people
States and Attorney general challenges from Alabama,
Florida, Nebraska, North Dakota, Pennsylvania, South
Carolina, South Dakota, Texas, Utah, Washington,
Louisiana and Virginia.
5. Health Care Reform Pros
PROS
Social welfare -- more Americans will have access to health insurance, including
patients with preexisting conditions who could not get coverage previously.
Primary care doctors and pediatricians who currently contract with lower-than-
Medicare-rate insurers can see new Medicaid patients at Medicare
reimbursement rates.
Hospitals and the physicians who work in hospitals may receive more payment
from newly insured patients rather being unpaid for charity care.
Potential new business opportunities exist for primary care doctors to practice in
inner-city areas or locations where previously there were not many insured
patients.
More money will go toward training in medical schools to increase the number of
primary care doctors.
Business expansion is possible for doctors willing to hire more PAs and NPs to
see more patients.
6. Healthcare Reform Cons
CONS
Many say that the new budget cannot ultimately fund the healthcare reform.
Money may have to come from additional taxes or some cuts to physician
payments.
A 3.8% tax will be levied on unearned income (ie, interest income and capital
gains) for individuals earning over $200,000 ($250,000 for married couples).
Many doctors are in that category.
For specialists, reimbursements for the newly insured Medicaid payments will not
be raised to Medicare levels.
There is no tort reform provision, which will keep doctors practicing defensive
medicine.
Cost-containment measures are not included.
There are no incentives for patients to have accountability for their healthcare
improvement or to maintain wellness.
7. Healthcare trends
Delay of primary and preventive care
Increase of high deductible
insurances
People with high deductibles delaying
payments
BC/BS offering high deductible plans to
its employees
Increase in the number of
bankruptcies from medical debt
Increase utilization of ER
Pending Medicare cuts (21.2%)
10. HITECH Act
Purpose Of The HITECH Act
"To improve the quality of our health care while lowering its costs,
we will make the immediate investments necessary to ensure that,
within five years, all of America's medical records are
computerized. This will cut waste, eliminate red tape and reduce
the need to repeat expensive medical tests…But it just won't save
billions of dollars and thousands of jobs; it will save lives by reducing
the deadly but preventable medical errors that pervade our health-
care system."
11. HITECH EMR Incentive
Year Total
2011 $ 18,000 $ 12,000 $ 8,000 $ 4,000 $ 2,000 $ 44,000
2012 $ 18,000 $ 12,000 $ 8,000 $ 4,000 $ 42,000
2013 $ 15,000 $ 12,000 $ 8,000 $ 35,000
2014 $ 15,000 $ 12,000 $ 27,000
2015 $ 15,000 $ 15,000
•Providers must be deemed to be “meaningful users” of EHR systems
•Practices with multiple physicians will be eligible to receive incentive payments
for each provider.
•Payments will be based on 75% of the correlating year’s Medicare and
Medicaid charges.
12. HITECH Act - HIPAA
Introduces patient notification of any unauthorized access,
acquisition, or disclosure
Define steps for breaches of information
Number of patients
Information exposed
Report and retention requirements
Business Associates increase liability and responsibility
Patient Rights
13. HITECH Act - HIPAA
Patient Rights
Accounting of disclosure of PHI (Electronic records)
Up to three years back
Includes release for PTO
Note: HIPAA allows for 6 years excluding PTO
Restrict Access to PHI
Must comply with patient’s request
Allows patients to pay out of pocket for a health care item or
service in full and to request that the claim not be submitted
to the health plan.
Note: Under present law patients can request restrictions but
compliance to request is not required.
14. HITECH Act - Other
Act permanently establishes Office of the National
Coordinator for HIT (ONCHIT)
Reinforces law protecting security and privacy of an
individual’s health information
Requires HHS to investigate complaints and impose fines
where willful neglect exists
Requires HHS to disclose in more detail how it resolves
HIPAA privacy complaints
Extends HIPAA rules to organizations that handle personal
health information
15. HIPAA Changes
HHS responsible for HIPAA Security
Georgina Verdugo, HHS Civil Rights Director
Maximum privacy right raised
Civil fines raised from $25,000 to $1.5 million
Effective Nov 30, 2009
Lack of knowledge not a plausible defense
Enforcement authority granted to state attorneys general
to enforce HIPAA
16. Fines and Penalties
$15,000 per day: failure to provide timely access to the HHS Office of
Inspector General (OIG) for audits, investigations, evaluations, or other
statutory functions;
$50,000 for each false record or statement: knowingly making, using, or
causing to be made or used a false record or statement material to a false
claim;
$50,000 for each false statement, omission, or misrepresentation:
knowingly making a false statement, omission, or misrepresentation on an
enrollment application, bid, or contract;
$50,000 for each order or prescription; ordering or prescribing items or
services (including lab tests, drugs, durable medical equipment, etc.) during
any period when the person ordering or prescribing has been excluded for
participation in the program.
17. HIPAA 5010
Prerequisite for the implementation of ICD 10
Corrects the outdated transaction standard and enhance
administrative data exchanges
Includes four basic kinds of changes; front matter,
technical, structural and data content improvements
Note: HIPAA 5010 transactions go into effect in January 2012, Healthcare
Reform will significantly change those transactions--and add new
transactions--within just a few years.
18. HIPAA 5010 Initiatives to Consider
ICD-10 – short term vs. long term
CORE –Committee on Operating Rules and Efficiency.
Through voluntary rules for payors, clearinghouses and
providers around the exchange of eligibility information,
CORE improves the usefulness of the eligibility
transaction between payor and provider.
Stimulus-Driven Electronic Health Records (EHRs) and
Health Information Exchanges (HIEs)
19. HIPAA 5010 Additional Opportunities
1. Practice Management System Upgrade vs. Replacement
2. Re-examine Clearinghouse Utilization
3. Revenue Cycle Re-engineering. Transactions that once
seemed too challenging to implement should be reconsidered
(real-time eligibility transaction and the electronic remittance
advice).
4. Transaction Exchange Infrastructure
5. Quality Measure Reporting. Automated and widespread
reporting of quality care and performance measures.
6. Process Improvement (i.e. pre-admission, admissions and
registration processes).
20. FERA, S. 386
Fraud Enforcement and Recovery Act of 2009, S. 386,
(FERA)
Signed into law May 20, 2009
Makes material changes to the civil False Claims Act (FCA)
Primary tool used by the federal government to deter and sanction
health care fraud
21. FERA Significant Changes
Conspiracy. Includes Government subcontractors.
Retention of Overpayments. Includes overpayments that may be
knowingly and "improperly" retained/concealed.
Expanded Whistleblower Protection. Extends protection from
retaliation to contractors and agents.
More Investigative Tools. DOJ can subpoena documents and
depose witnesses before filing an FCA action.
Allows the government to recover its costs from the defendant.
Statute of Limitations. May be moved back to time of original third
party (qui tam) complaint.
22. FERA Bottom Line
Risk of Investigation and Liability Has Increased. Also, the cost of
defense and settlement increases because defendants must pay
the government's costs.
Repayment Obligations Have Increased. Improper retention of an
overpayment creates liability.
Retaliation Exposure Has Increased. FERA expanded the non-
retaliation provisions of the FCA to include independent
contractors.
23. HEAT
Health Care Fraud Prevention And Enforcement Action
Team (HEAT)
United States Department of Justice (DOJ) and the U.S.
Department of Health & Human Services (HHS) team
building upon and strengthen existing programs to combat fraud“,
and
"investing new resources and technology to prevent fraud, waste and
abuse before it happens."
24. HEAT Actions
Expansion of the Medicare Fraud Strike Force teams
Improving data sharing between CMS and law
enforcement
Encouraging the American public to get involved
Offering providers increased training and resources
Strengthening program integrity activities related to
Medicare Parts C (Medicare Advantage plans) and D
(prescription drug coverage) compliance and
enforcement
25. Recovery Audit Contractors (RAC)
Medicare Modernization Act of 2003 established the
Medicare Recovery Audit Contractor (RAC)
The Tax Relief and Health Care Act of 2006, Section 302
makes program permanent
By 2010, expansion to 50 state with 4 RACs
New mechanism for detecting improper payments
Duplicate payments
Medical necessity and coding
Fiscal intermediaries mistakes
Payment based on a contingency fee
26. Red Flag Rule
Regulations issued by the FTC
Affects anyone providing services where the consumer
is invoiced monthly or provides the consumer with a
payment plan.
Focuses on identity theft.
Enforcement date to May 1, 2009.
Modified Oct 20, 2009
Extended to Dec 1, 2010
27. Red Flag Requirements
Develop and adopt policies and
procedures
Identify relevant red flags
Develop/Identify procedures to
detect red flags
Define appropriate responses to
red flags
Perform periodic updating of the
Program
Administer the Program
28. The Genetic Information
Nondiscrimination Act of 2008 (GINA)
Applies to plan years beginning December 7, 2009
Prohibits collection of genetic information (i.e. family
history) as part of wellness or health risk assessment
if issues provides rewards
New self-reporting and payment of excise tax if
failure to comply with mandates
29. GINA Excise tax
Amount of Tax. $100/day/per affected individual.
Noncompliance Period. Begins on the day the failure first
occurred and ends on the day the failure is corrected.
If Discovered During Audit.
$2,500 or the regular tax amount if discovered after the
employer has received an IRS Notice of Examination
If the failure is more than de minimis, $15,000 is substituted
for $2,500.
Maximum Tax for Unintentional Failures
$500,000 or 10% of the aggregate amount paid
No maximum on the amount of tax if intentional
30. ICD 10
Deadline October 1st, 2013
Basic reason for change
ICD-9-CM is out of room.
ICD 10 Benefits
More accurately defined patient services
More specific diagnosis and treatment information
More comprehensive reporting of quality data
More accurate payments for new procedures with fewer
rejected claims
31. Comparison ICD9 vs. ICD 10
Issue ICD-9-CM ICD-10-CM
Volume of codes approximately 13,600 approximately 120,000
Composition of codes Mostly numeric, with E and V All codes are alphanumeric,
codes alphanumeric. Valid codes beginning with a letter and with a
of three, four, or five digits. mix of numbers and letters
thereafter. Valid codes may have
three, four, five, six or seven
digits.
Duplication of code sets Currently, only ICD-9-CM codes For a period of up to two years,
are required . No mapping is systems will need to access both
necessary. ICD-9-CM codes and ICD-10-CM
codes as the country transitions
from ICD-9-CM to ICD-10-CM.
Mapping will be necessary so that
equivalent codes can be found for
issues of disease tracking,
medical necessity edits and
outcomes studies.
32. Document, Record, and Data
Management
Organizations have a duty to preserve relevant
evidence when litigation is pending or reasonably
anticipated
This duty can be satisfied by implementing litigation
holds
Demands to discontinue routine data destruction
under an applicable document retention policy
Knowledge of litigation or reasonable likelihood of
litigation triggers the duty
33. Consequences of failing to preserve
documents can be severe
Spoliation
Adverse Inference
Fines
Dismissal of Case
Obstruction of Justice
34. Basic Actions to follow
Documentation is very important
Documentation can and will most likely be used to show that
the organization utilized their policy in good faith, and in a
reasonable, consistent manner
Develop Policies
Follow policies
Designate a responsible person to monitor the changes
and implement as needed
35. Written Policies Not Enough
Create and implement written policies and guidelines
Establish your rights
Policies must include sanctions
Designate official to ensure compliance
Time actions required and documentation
Train employees
Document Training
Copies of lesson plans
Attendance
The stock market may have rallied, but the economy is threatening to erase those gains. This report shows you the three factors choking the U.S. economy - and gives you 3 ways to protect your money until the real recovery sets in. The stock market has soared 58% since its March 2008 low - and the media is proclaiming that the U.S. economic recovery has begun. Not so fast. The unemployment rate rose from 9.8 to 10.2 percent in October, and nonfarm payroll employment continued to decline (-190,000), the U.S. Bureau of Labor Statistics reported today. The largest job losses over the month were in con- struction, manufacturing, and retail trade.
Notably absent was any mention of fixes to the Sustainable Growth Rate (SGR), which determines physician reimbursement. Medicare reimbursements cuts -- whether or not made at the full 21.2% as proposed -- would be disastrous.
Paul Keckley, executive director of the Deloitte Center for Health Solutions, sees three likely impacts from a recession: Primary and preventive care will be delayed, people with high deductibles will delay payments on care received, and there will be an increase in the number of bankruptcies from medical debt. "You can't separate the economy from health care. It's 17% of the [gross domestic product] right now and it will be 20% of GDP in seven years," says Keckley. The industry "had a pretty good run for 25 years, but now there are all these Scud missiles flying at it." http://www.businessweek.com/technology/content/mar2008/tc20080324_828167.htm
EMR Criteria and rules to be out by 2010 Incentives to start by 2011
EMR Criteria and rules to be out by 2010 Incentives to start by 2011
ICD-10 – Many organizations will be focused on the Version 5010 upgrade over ICD-10 given 5010 is required prior to ICD-10. Providers who look only at the short term may find themselves revisiting their 5010 implementation. CORE – Administrative efficiency is the primary goal of the CORE initiative (Committee on Operating Rules and Efficiency, http://www.caqh.org.). In a sense, CORE picks up where 5010 leaves off. Through voluntary rules for payors, clearinghouses and providers around the exchange of eligibility information, CORE vastly improves the usefulness of the 270-271 eligibility transaction between payor and provider. Integrating this real-time transaction with providers practice management/hospital information system has proved to be a significant cost saver for providers. Stimulus-Driven Electronic Health Records (EHRs) and Health Information Exchanges (HIEs) – Immediately following the release of the 5010 and ICD10 final rules, the ARRA allocated an estimated $36 billion for provider adoption of EHRs and support of HIEs. This level of investment is expected to have a huge impact on provider organizations, particularly over the next six years when the incentives are most lucrative. EHRs and HIEs focus on clinical information while 5010 is exclusively administrative data; however, clinical and administrative data should be carefully coordinated to achieve anticipated levels of improved care quality and administrative efficiency. EHR integration with practice management systems can significantly improve the front end of the revenue cycle through enhanced charge capture. EHRs and Version 5010 should become more tightly aligned through implementation of pay–for-performance programs. While Version 5010 and HIEs involve the exchange of different types of transactions, organizations may be best served to develop a single robust infrastructure for handling both.
There are many opportunities that Version 5010 and this constellation of healthcare information initiatives offer providers and the broader healthcare industry. These include: 1. Practice Management System Upgrade vs. Replacement There is no dispute that Version 5010 and ICD-10 implementation will require an upgrade for practice management systems. This will be compounded by the potential of many providers implementing, in the same timeframe, an EHR and/or upgrading to a more richly functional EHR system. Providers must consider if this is the opportunity to only upgrade their system or replace their practice management or hospital system. Additional considerations in making this decision include: Level of satisfaction with the current system Effort expected to upgrade the current system for Version 5010 and ICD-10 Level of integration desired between the financial system and the EHR 2. Re-examine Clearinghouse Utilization Providers should take this time to examine their clearinghouse utilization. Version 5010 standardizes the HIPAA transactions by more clearly defining the data location and data meaning. One of the traditional roles of clearinghouses has been to bridge the gap between what a payor requires and what a provider sends and vice versa. To the extent that Version 5010 bridges this gap, providers may find that 5010 offers the opportunity to more easily exchange data directly with payors or at least provider’s largest payors. Also, some providers may choose to increase their reliance on their clearinghouse to neutralize the impact of Version 5010 in the short term. Most, if not all clearinghouses are expected to provide Version 4010 to Version 5010 conversion services allowing providers to stay with their 4010 compliant practice management system for a longer time period. If faced with both a Version 5010 and a later ICD-10 upgrade, a provider may choose to forgo the 5010 upgrade by using clearinghouse conversion services. Some Version 5010 changes enrich the transaction with additional data. For example, payors are required to provide all coordination of benefits data in the 271 transaction response to an eligibility request. This is potentially valuable information that can accelerate the resubmission of a claim. Increasingly, clearinghouses are leveraging this type of data provided in the transactions to deliver value-added services that go well beyond the traditional role of transaction exchange. 3. Revenue Cycle Re-engineering Version 5010, particularly when combined with CORE, offers the provider the opportunity to re-engineer significant components of the revenue cycle. Transactions that once seemed too challenging to implement should be reconsidered—especially due to their potential return on investment. This particularly is the case with the real-time 270-271 eligibility transaction and the 835 electronic remittance advice. 4. Transaction Exchange Infrastructure Version 5010 implementation offers the opportunity to improve and integrate rather than comply and cross-walk. Trading partners must recognize that Version 5010 development will be easier due to previous 4010 experience, but 5010 deployment and testing will involve more trading partners and transaction types. Providers should begin to communicate now with their trading partners, business partners and software vendors; and they should communicate with them often. A provider should consider identifying those trading partners who are willing to beta test and begin testing as early as possible. Enough time should be allowed to test thoroughly in order to address most problems before implementation. As the move from batch to real-time becomes more realistic, real-time adjudication will also be viewed as a clear possibility due to implementation of Version 5010 ~ especially with outpatient claims. With this shift to real-time processing, testing time for Version 5010 is critical. 5. Quality Measure Reporting ARRA set the stage for increased EHR adoption in physician practices due to financial incentive mandates. Also, this will drive automated and widespread reporting of quality care and performance measures. In the future, administrative data will not only be required for claims, but clinical data may be required for quality measures. This creates the potential opportunity for existing claims-based transaction routes to be evaluated for quality measure reporting to payors and to state health departments. In the future, clinical data requirements may be similar to administrative data for paying claims and performance bonuses. This opportunity will be fruitful only if 1) clinical data becomes uniform in definition and representation and 2) clinical information systems can accept and produce the correct clinical data for these measures. Otherwise, significant manual effort will continue to be needed to support quality reporting activities. 6. Process Improvement Opportunities for process improvement derived from the new design of Version 5010 are many and will need detailed examination to ensure their realization. Providers should look for opportunities in pre-admission, admissions and registration processes as well as in the claim payment processes. For example, Version 5010 requires eligibility responses to include all subscriber/dependent data elements that payors require on subsequent transactions such as date of birth (DOB). Today, many payors require subscriber DOB on the 837 claim, but do not provide it on the eligibility response for the dependent. Some payors require a DOB match for claim processing. The matching of the DOB during the eligibility checking process will allow providers to store the matching information upfront in the process. Currently, lack of this information leads to phone calls, denied claims and appeals. Because this information may now be available in the initial communication with the payor, additional search options including member identification can be leveraged. The improved ability to match a patient to a payor should reduce the number of claims denied because of syntax problems with the name. Another example for process improvement will come from the addition of 45 new “Service Type” codes. This is important in environments where physician and hospital events are covered by different insurers. For example, one carrier may cover physician services and another may cover hospital services. A query to a payor would require a response of both hospital and physician service types if covered. Coordination of Benefits (COB) information will tell providers which payor is primary and which is secondary and facilitates the correct payor to be billed the first time. Other changes such as the definition of “provider,” which will become the Pay-to Address, will enable the direct payments to the correct providers. Changes in the 276/277 Claims Status and Response transaction may help improve adoption of this transaction; therefore, reducing phone calls and staff time with tracking claims. Version 5010 requires multiple claim identifiers be returned when a claim is sent out. This feature of Version 5010 enables the automation of claims status work lists generation and improves claims tracking. Responses will be limited to the claims for which the inquiry is made and a more robust response will be required. These are just a few of the tangible benefits that can be achieved through careful implementation of Version 5010.
RAC Permanent Program: Section 302 of the Tax Relief and Health Care Act of 2006 makes the RAC Program permanent and requires the Secretary to expand the program to all 50 states by no later than 2010. See below for a link to the text of this legislation. This web page describes CMS' strategy for expanding from a 3-state demonstration RAC Program to a 50-state permanent RAC Program. Implementation Strategy: By 2010, CMS plans to have 4 RACs in place. Each RAC will be responsible for identifying overpayment and underpayments in approximately ¼ of the country. The new RAC jurisdictions match the DME MAC jurisdictions. See below for a link to the RAC Jurisdiction Map. The RAC demonstration program has proven to be successful in returning dollars to the Medicare Trust Funds and identifying monies that need to be returned to providers. It has provided CMS with a new mechanism for detecting improper payments made in the past, and has also given CMS a valuable new tool for preventing future payments. The RACs used proprietary software programs to identify potential payment errors in such areas as duplicate payments, fiscal intermediaries' mistakes, medical necessity and coding.
The rule, authorized under the Fair and Accurate Credit Transactions Act, requires any organization that extends credit to its clients, including health care providers, to take specific steps to minimize the potential for identity theft. These include developing and implementing written identity theft prevention programs that help identify, detect and response to patterns, practices or specific activities, known as "red flags," that could indicate identify theft, according to the FTC. The agency agreed to a new delay in response to requests from members of Congress as several industries seek exemptions. The U.S. House on a 400-0 vote on October 20 passed legislation to exempt health care facilities and accounting and legal practices with 20 or fewer employees from provisions of the law. The bill, H.R. 3763, was referred to the Senate Banking, Housing and Urban Affairs Committee.
Prohibition on the collection of genetic information by group health plans and group health insurance issuers. These rules, which apply to plan years beginning on or after December 7, 2009, have an immediate impact on the information that can be requested from individuals prior to or in connection with enrollment or for underwriting purposes, particularly the continued use of health risk assessments and wellness programs. The GINA rules prohibit a group health plan or group health insurance issuer from collecting genetic information (family history information, among other things) as part of a wellness program or health risk assessment if the group health plan or group health insurance issuer provides certain rewards to the individual for providing the information, or if the information is collected prior to or as part of enrollment in the plan. Although it is not entirely clear what rewards are prohibited, it is clear that premium discounts, changes in deductibles, rebates, and other incentives provided under the health plan are not permitted for plan years beginning on or after December 7, 2009. Many group health plans and group health insurance issuers have already collected or are currently collecting such information in connection with enrollments for the upcoming 2010 plan year and also have promised prohibited rewards to the individuals who supplied the information. Those plans and issuers are now trying to determine how to proceed.
Amount of Tax. $100 per day for each day in the "Noncompliance Period" for each affected individual. Noncompliance Period. The Noncompliance Period begins on the day the failure first occurred and ends on the day the failure is corrected. If Discovered During Audit. The tax may not be less than the lesser of $2,500 or the regular tax amount determined above if the failure is discovered after the employer has received a Notice of Examination from the IRS. If the failure is more than de minimis, $15,000 is substituted for $2,500. Maximum Tax for Unintentional Failures. If the failure is due to reasonable cause and not willful neglect, the maximum tax is the lesser of $500,000 or 10 percent of the aggregate amount paid or incurred by the employer during the preceding taxable year for group health plans. If the failure is intentional, however, there is no cap on the amount of tax that is imposed.
In many ways, ICD-10-CM is quite similar to ICD-9-CM. The guidelines, conventions, and rules are very similar. The organization of the codes is very similar. Anyone who is qualified to code ICD-9-CM should be able to easily make the transition to coding ICD-10-CM. Many improvements have been made to coding in ICD-10-CM. For example, a single code can be found to report a disease and its current manifestation (i.e., type II diabetes with diabetic retinopathy). In fracture care, the code differentiates an encounter for an initial fracture; follow-up of fracture healing normally; follow-up with fracture in malunion or nonunion; or follow-up for late effects of a fracture. Likewise, the trimester is designated in obstetrical codes. While much has been said about the huge increase in the number of codes under ICD-10-CM, some of this growth is due to laterality. While an ICD-9-CM code may identify a condition of, for example, the ovary, the parallel ICD-10-CM code identifies four codes: unspecified ovary, right ovary, left ovary, or bilateral condition of the ovaries.