Pandemic and changes in legal regulations

The healthcare landscape is constantly changing, shaped by the current pandemic and ongoing changes in laws and regulations. We recently hosted a Healthcare Breakfast and Learning to provide an overview of current trends and legal and regulatory issues at state and federal levels affecting the healthcare industry.

Update of the law on certificates of need

The discussion began with an in-depth analysis of changes to the North Carolina Certificate of Need (CON) Act, which prohibits healthcare providers from adding, acquiring, or replacing certain facilities and equipment. health care, and to provide certain medical services without prior authorization from the state Department of Health and Human Services.

When Governor Roy Cooper enacted Senate Bill 462, he updated the North Carolina CON Law. These changes, which took effect on October 1, 2021, include the following:

These are important because there have been no changes to these thresholds for decades, and projects falling below cost thresholds would not require CON.

Strict revisions of the law

In December 2020, the Centers for Medicare and Medicaid Services (CMS) released a number of revisions and clarifications to the Stark regulations, which govern physician referrals for certain Designated Health Services (DHS), such as laboratories, l ‘imaging, physiotherapy and durable medical equipment.

These changes, which come into effect on January 1, 2022, include revisions to three existing Stark exceptions:

  1. Exception for ancillary office services

  2. Exception to office leases

  3. Exception of equipment rental

With respect to the ancillary office services exception, a medical group must meet certain regulatory requirements to meet the exception. These requirements include restrictions on the allocation of DHS profits.

The restrictions do not allow group practices to distribute DHS profits in a manner directly related to who ordered DHS. “To give an example, a group practice cannot attribute the profits from its imaging services to, say, the doctor who ordered the imaging,” I noted. “Often, groups share in the benefits of DHS per capita, and it is allowed.”

It is also permissible to attribute DHS profits based on job productivity, as long as DHS encounters and income from providing DHS are excluded. “These indirect methods of distributing DHS profits have always been and will continue to be permitted.”

Nonetheless, the Stark settlement was unclear in several respects, and the new settlement was touted as an attempt to shed light on a number of issues. Regarding the ancillary office services exception, CMS clarified that group practices should allocate profits, not income. That is, the expenses relating to the generation of DHS income should be taken into account.

Because the Stark regulations did not prohibit the segregation of different DHS service lines, some group firms have chosen to distribute the benefits of a DHS service line using a methodology (and possibly to a subset of physicians in the office who were responsible for ordering these DHS) and distributing the profits from another line of DHS services using a different methodology (and perhaps to a different subset of physicians in the office who were responsible for ordering these DHS). This will no longer be allowed after January 1, 2022.

“Going forward, the same method should be used for all profits from all DHS service lines.” All benefits from all DHS service lines should be aggregated, and an aggregated benefit distribution methodology should be used for group practice (or for any component of the group of at least five physicians).

The regulations also state that attribution of DHS benefits cannot be based on physician ordering of DHS that is provided to patients not covered by Medicare: for example, “if there are three physicians in a group practice and one doctor orders 50% of the imaging services provided to non-Medicare patients in the practice, and two other doctors each order 25 percent of the imaging services for non-Medicare patients, he would not be allowed to use the same percentages to allocate imaging services provided to Medicare patients. “

The regulations also made changes to the Stark exceptions for the rental of office space and medical equipment. In the past, leases had to be exclusive, which meant that multiple tenants were not allowed to share the same space or equipment at the same time. As of January 1, 2022, it will be acceptable for multiple tenants (and subtenants) to use the same space or equipment at the same time.

Anti-bounce update

The safe harbor for personal services and management contracts under the federal anti-bribery law was changed in several ways in December 2020. This reform, which came into effect on January 19, 2021, has was published by the Office of the Inspector General (the OIG) for the Department of Health and Social Services. The OIG now only requires compensation methodology be fixed in advance instead of having the overall amount of compensation determined in advance.

“This new rule better aligns the Safe Harbor with the equivalent Stark exception and will make it easier to draft personal service agreements.”

Another change that I hope will alleviate some of the headaches faced by medical providers is that the OIG has removed the requirement that part-time or recurring contracts specify timing, duration, and fees. specific for the service intervals provided. “This allows greater flexibility in the use of part-time or periodic services as needed”,

Patient records and HIPAA compliance

My colleague Leigh Wilkinson, a healthcare lawyer with over 35 years of experience in a variety of healthcare law issues, began with an overview of how healthcare providers can escape the attention of the Bureau. Civil Rights Office (OCR), which is the government agency that enforces the HIPAA privacy law.

“I don’t think it would be a healthcare webinar without mentioning HIPAA,” said Wilkinson, noting that the OCR announced in late 2019 that it would undertake an initiative to investigate and resolve cases affecting patients who had requested their records and were access denied for any reason.

Under HIPAA privacy rules, an individual or their personal representative has the right to request access or receive a copy of their protected health information. And medical providers who are covered by these rules (“covered entities”) must respond to this request within 30 days of receiving it.

“Now you might think that sounds simple enough, but apparently not, as there have been over 20 regulations released so far,” Wilkinson explained. The fines and penalties ranged from $ 5,000 to over $ 200,000, and it has been applied to everyone from solo physicians and small-group practices to large hospital systems.

In addition to monetary penalties, those found in non-compliance may also be required to enter into a corrective action plan, in which the OCR would monitor their actions for a period of up to two years. “To keep OCR at bay, HIPAA-covered entities must allow individuals or their personal representatives to inspect and obtain a copy of their protected health information on request,” Wilkinson advised. “You have 30 days when someone makes this request to take action, and within those 30 days you must respond by (i) granting the request, (ii) denying the request when HIPAA regulations permit. , or (iii) informing the person that you need more time (up to 30 more days) to comply with the request. “

There are very limited circumstances in which an application can be refused, and some grounds for refusal can be appealed by the individual. While there are various barriers that could prevent a health care provider from providing a patient with their records within the initial 30 day timeframe, advising the requester that you need more time is okay, but not more than 30 additional days, and you must document the reason why you needed the additional time. A major red flag for OCR is when patients request their records and receive no response within the 30-day time frame.

If contacted by the OCR about a complaint, HIPAA-covered entities must provide a prompt response and rectify the situation immediately. Responsiveness is key, Wilkinson says: “More than half of the covered entities that have been sanctioned have been contacted by the OCR more than once about the same complaint. “

Wilkinson added that patients should receive a copy of their records in the format they requested and that providers are not allowed to charge more than the actual costs incurred to provide the copies.

Fraud and abuse

In September 2020, the US Department of Justice announced it would continue its biggest healthcare anti-fraud action in history. As a result, 345 people were charged with submitting more than $ 6 billion in false statements that the government paid for.

“There are criminals who try to take advantage of the health care payment system, but they will seek the help of medical providers to make their plans work,” Wilkinson commented. The withdrawal focused on healthcare professionals who had issued fraudulent orders for medical equipment and diagnostic tests.

Identity theft also continues to be a problem. Wilkinson has brought to light a compelling case in which a criminal gang infiltrated a Covid-19 testing site to steal personal and biological information, then used it to create and submit new claims for more expensive services.

“The takeaway is that opportunities for fraudulent activity are everywhere,” Wilkinson notes, “so make sure your employees who are going to work with billing and patient information are fully vetted before you hire them, and then regularly for the next year. employment. “

© 2021 Ward and Smith, Pennsylvania. All rights reserved.Revue nationale de droit, volume XI, number 351

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