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Iowa Healthcare Law Blog

News & Updates on Legal, Policy, & Business Issues Facing the Health Care Industry in Iowa

CMS publishes Final MACRA Rule for MIPS and APM Incentives

Posted in Centers for Medicare and Medicaid Services-CMS, Electronic Health Records, Health and Human Services (HHS), Healthcare costs, Medicaid

On October 14, 2016, the Centers for Medicare & Medicaid Services (CMS) released its final rule implementing the new Quality Payment Program for physicians in lieu of the repealed sustainable growth rate factor (SGR). Rather than facing substantial annual reductions in Medicare payment fees as a result of the SGR, physicians now have two interrelated pathways to earn quality-based, cost efficient incentive payments under Medicare:  the Merit-based Incentive Payment System (MIPS) or Advanced Alternative Payment Models (Advanced APMs). MIPS consolidates three existing quality-based incentives programs – the Physician Quality Reporting System (PQRS), the Physician Value-based Payment Modifier (VM), and the Medicare Electronic Health Record (EHR) Incentive Program – while maintaining an ongoing focus on achieving quality and cost efficiencies through use of certified EHR technology (CEHRT).

CMS indicates that substantial changes have been made in response to stakeholder comments. In particular, CMS has implemented transitional policies throughout the rule, including allowing physicians to “pick their pace of participation” for the first performance period beginning January 1, 2017. CMS notes that eligible clinicians will have three flexible options to submit data to MIPS and a fourth option to join Advanced APMs to promote participation and avoid negative payment adjustments in 2019. CMS also has established a $100 million ($20 million each over a five year period of time) technical assistance program for small independent practices, particularly those in rural and health professional shortage areas.

The details are many. In releasing its final rule, CMS also makes available information regarding the criteria for and operational requirements of each of these programs. Click here to learn more: http://www.hhs.gov/about/news/2016/10/14/hhs-finalizes-streamlined-medicare-payment-system-rewards-clinicians-quality-patient-care.html.

The final rule becomes effective on January 1, 2017. CMS also provides a 60-day opportunity for stakeholder comment on specific issues identified throughout the rule. The final rule has been released in prepublication form at https://qpp.cms.gov/docs/CMS-5517-FC.pdf, with formal publication in the Federal Register slated for a future date.


Posted in Affordable Care Act (ACA), Health and Human Services (HHS)

Physicians subject to the Rule must meet notice and posting obligations by October 16, 2016.

The federal Department of Health and Human Services (HHS), through its Office for Civil Rights (OCR), has published its final Rule implementing Section 1557 of the Affordable Care Act (ACA), 42 U.S.C. 18116, prohibiting discrimination in health care programs and activities. The new Rule, like Section 1557, specifically focuses its prohibitions and requirements on four already existing federal nondiscrimination laws: 1) Title VI of the Civil Rights Act of 1964, prohibiting discrimination based on race, color and national origin; 2) the Age Discrimination Act of 1975; 3) Section 504 of the Rehabilitation Act of 1973; and, 4) the sex discrimination provisions of Title IX of the Education Amendments of 1972 (extended by Section 1557 to health care). Section 1557 is in addition to rights and remedies available under these four laws. While the nondiscrimination prohibitions of Section 1557 have been in effect since passage of the ACA in March of 2010, this final Rule advises health care consumers of their Section 1557 rights and informs affected health care programs and activities of their Section 1557 obligations.

The Nondiscrimination Rule became effective on July 18, 2016, except for extended time periods set forth in the Rule. The Rule can be found either in the May 18, 2016 Federal Register, with the actual Rule found on pp. 31465-31473, or in the Code of Federal Regulations at 45 C.F.R. Part 92. This post addresses 1) physicians who are “covered” by the Nondiscrimination Rule; 2) administrative obligations covered physicians must satisfy; and 3) the general scope of prohibited discriminatory practices regularly impacting covered medical practices.

First steps physicians are encouraged to consider to assure compliance under the Rule include:

  • Determine whether the physician is a covered entity under this Rule. Most are.
  • Develop the practice’s nondiscrimination notice and, for small-sized publications and communications, the practice’s nondiscrimination statement as well as multi-language tagline language assistance statements for posting in office locations, on the physician’s practice website, and in significant publications and communications consistent with the requirements of the Rule prior to October 16, 2016.
  • For physician practices with 15 or more employees, designate an individual to coordinate compliance under the Rule and develop grievance procedures for receipt and investigation of complaints.
  • Become familiar and assure compliance with the Rule’s requirements for language assistance for individuals with limited English proficiency (LEP) and for auxiliary aids and assistance for individuals who are disabled.
  • Be aware that covered entity physicians are prohibited by this Rule from discriminating based on sex, including gender identity, in the provision of medical or other program services.
  • Determine whether the medical practice offers employee health benefit programs subject to the Rule’s Nondiscrimination requirements and assure compliance.

As noted throughout this post, definitions in the Rule are important to understanding the Rule’s prohibitions and requirements.

  1. Physicians as covered entities subject to Section 1557 and the HHS Nondiscrimination Rule

Physicians are subject to Section 1557 enforcement and the compliance requirements of the Nondiscrimination Rule if they are “covered entities.” Being a covered entity under the Nondiscrimination Rule is not the same as being a HIPAA covered entity. A physician is a Section 1557 covered entity if the physician operates a health program or activity, any part of which receives Federal financial assistance.

“Health care programs or activities” subject to the Rule includes the provision or administration of health-related services as well as assistance to individuals in obtaining health-related services. Hospitals,  ambulatory surgical centers, physician practices, Federally qualified health centers, nursing facilities, residential or community-based treatment facilities, laboratories, home health agencies, hospices, group health plans, health insurance issuers, and other similar entities fall within the definition of a health program or activity. State Medicaid, CHIP, and Basic Health programs also come within this definition.

“Federal financial assistance” is broadly defined to include any grant, loan, credit, subsidy, contract (including a contract of insurance but not a procurement contract), or any other arrangement involving the provision of funds, services, or property by the Federal government. In its rulemaking comments, HHS identifies Federal funding situations that either do or do not subject physicians to Section 1557 jurisdiction and the requirements of the Nondiscrimination Rule.

To begin, HHS sticks to the OCR’s long-stated position that receipt of Medicare Part B payments, standing alone, does not constitute Federal financial assistance. Payments to physicians by a health plan issuer which, itself, is a recipient of Federal financial assistance also do not constitute Federal financial assistance, nor does either employment by a hospital which receives Federal financial assistance or receipt of Federal student loan monies through an educational institution, the intended recipient, even when loan monies are passed on to the student who then makes payments to the educational institution.

HHS points to “numerous” other ways, however, in which a physician would be a recipient of Federal financial assistance. Cited examples include Medicare meaningful use and other similar incentive payments; Medicaid payments; grants from the National Health Service Corps (NHSC); National Institute of Health (NIH) funding; Health Resources Service Administration (HRSA)-funded community health centers; Substance Abuse and Mental Health Services Administration (SAMHSA)-funded programming; and CMS gainsharing demonstration projects. Too, HHS notes that many physicians will be obligated to meet the requirements of the Nondiscrimination Rule through contracts they sign with health plans who, themselves, are covered entities obligated to ensure compliance with Federal nondiscrimination requirements by network providers treating their enrollee beneficiaries. Even hospital-employed physicians may become covered entities through outside practice endeavors. Laboratories, whether hospital-based, office-based, or freestanding, receiving Federal monies through Medicare or Medicaid for covered laboratory tests are considered by HHS to be covered entities.

Based on searches of its databases, HHS believes that most physicians receive Federal financial assistance in their own right, making them covered entities subject to Section 1557 and the Nondiscrimination Rule. Physicians are not alone. Health insurers and other health care providers receiving Federal financial assistance also are bound by the Rule.

An additional word of note for covered physicians. Even though self-funded employer benefit plans generally are not covered entities (except to the extent their third party administrators are as covered health plans), employee health benefit programs provided by covered physicians generally are subject to the Rule. “Employee health benefit programs” is defined in the Rule which also establishes conditions under which such programs are covered, including when an employee health benefit program is provided by a covered entity “principally engaged in providing or administering health services. Covered physicians bear liability for Rule violations by their covered employee health benefit programs.

2. Administrative requirements of the Nondiscrimination Rule

The Nondiscrimination Rule imposes technical administrative obligations upon entities covered by it. Three such requirements are: 1) posting of notices; 2) establishing grievance procedures (if applicable); and 3) designating an employee contact person (if applicable). Specifically –

  • A covered entity employing 15 or more persons must designate at least one employee to coordinate its efforts to comply with and carry out the covered entity’s responsibilities under Section 1557 and the Nondiscrimination Rule. This requirement became effective on July 18, 2016, the effective date of the Rule.
  • A covered entity employing 15 or more persons must adopt grievance procedures incorporating due process standards and providing for prompt and equitable resolution of grievances alleging any discriminatory action prohibited by Section 1557 and the Nondiscrimination Rule. Appendix C to the Rule sets out a sample grievance procedure. This requirement became effective on July 18, 2016, the effective date of the Rule.
  • All covered entities, regardless of size, must meet the content and posting requirements of the Rule notifying individuals, among other things, that the covered entity does not discriminate on the basis of race, color, national origin, sex, age, or disability; that the covered entity, free-of-charge, provides auxiliary aids and services, as appropriate, for individuals with disabilities and language assistance for individuals with limited English proficiency (LEP); and how to file a grievance with the covered entity and a discrimination complaint with the OCR. Covered entities also must post taglines, or short statements, written in at least the top 15 languages spoken by LEP individuals in State, indicating the availability of language assistance for LEP individuals at no cost. Required posting points include 1) office locations; 2) the practice’s website; and 3) significant publications and communications of the medical practice, with small-sized publications and communications requiring only a nondiscrimination statement and language assistance taglines in the two most relevant languages spoken by LEP individuals in the State. Specifics regarding notices, taglines and posting requirements are found in the Rule.The notice and posting requirements become effective within 90 days (October 16, 2016) of July 18, 2016, the effective date of the Rule.

What are the 15 most prominent languages spoken by LEP individuals in Iowa? While the OCR does not appear to mandate a resource for answering this question, in its comments it references the U.S. Census Bureau’s 2009-13 American Community Survey which, for Iowa (https://www.census.gov/data/tables/2013/demo/2009-2013-lang-tables.html), shows the following top 15 languages spoken by LEP individuals in our State: 1) Spanish, 2) Chinese, 3) Vietnamese, 4) Serbo-Croatian, 5) German, 6) Arabic, 7) Laotian, 8)Korean, 9) Hindi, 10) French, 11) Pennsylvania Dutch, 12) Thai, 13) Tagalong, 14) Karen, and 15) Russian; the top 2 languages show as Spanish and Chinese.* The OCR has translated language assistance taglines in each of these languages. Consult this OCR site as well as Appendixes A and B of the Rule for sample nondiscrimination notice and nondiscrimination statement language. The OCR also has translated its sample nondiscrimination notice and statement; covered entities are required to post their nondiscrimination notices/statements only in English but are encouraged to post in other languages as well.

3.  Prohibited discriminatory practices and affirmative obligations of covered entities

The Nondiscrimination Rule prohibits discriminatory practices excluding an individual from participation in, or denying benefits for, or otherwise discriminating in a heath program or activity on the basis of race, color, national origin, sex, age or disability. The Rule then provides clarification on certain points. For instance, a covered entity may operate a health program or activity that is restricted to members of one sex if the covered entity can demonstrate an “exceedingly persuasive” justification that such limitation is “substantially related” to the achievement of an important health-related or scientific objective. Both the Rule and HHS’ comments on it provide direction in understanding its reach.

Requirements of particular interest to covered entity medical practices include the following —

  • Language assistance services for LEP persons. Medical practices covered by the Rule must take reasonable steps to provide meaningful access for LEP individuals receiving or likely to receive services from them. While not required, the Rule encourages implementation of a language access plan appropriate to each medical practice’s particular circumstances. LEP language assistance services must be provided free of charge, must be accurate and timely, and must protect the privacy and independence of the LEP individual. The Rule specifically defines “qualified interpreters” for LEP individuals, “qualified translator,” and “qualified bilingual/multilingual staff” and sets forth specific requirements for use of video remote interpreting services. A covered entity is prohibited from requiring an LEP individual to provide his or her own interpreter or from relying upon others (i.e., adult, minor child) accompanying the LEP individual to interpret or facilitate communication except in narrow circumstances permitted by the Rule. A LEP individual cannot be required to accept language assistance services.
  • Physician practices must review the definitions, prohibitions and requirements of the Rule regarding assistance to LEP individuals. Medical practices familiar with guidance statements re: interpreter services for LEP individuals issued by the OCR in 2003 may find they already are in substantial compliance with the Rule’s LEP language assistance requirements. No medical practice, however, should assume compliance absent review of this section of the Nondiscrimination Rule.
  • Accommodations for and effective communication with individuals with disabilities. The Nondiscrimination Rule requires covered entity medical practices to ensure that communications with individuals with disabilities are as effective as communications with others receiving services from them. “Qualified individual with a disability” and “disability” are defined by the Rule. By reference, the Rule imposes upon covered entities nondiscrimination regulatory standards already in place for public entities (28 C.F.R. Part 35) to meet the communication needs of the disabled. The Nondiscrimination Rule and its referenced communications standard also set forth requirements for facility accessibility and signage and accessibility by the disabled to electronic and information technology. Covered entities should be familiar with the “fundamental alteration” and “undue financial and administrative burdens” considerations of the Rule and its referenced standard which, in certain circumstances, may grant relief for medical practices in accommodating specific requests of disabled patients; covered entities bear the burden of showing they meet this standard.
  • Covered entity medical practices familiar with the requirements of the American with Disabilities Act (ADA) and Section 504 of the Rehabilitation Act must, nonetheless, carefully review the requirements of this section of the Nondiscrimination Rule and its referenced communications standard. HHS explained in comments that the Rule imposes a higher ADA standard upon covered entities in meeting the communication needs of the disabled, particularly in requiring covered entities to give priority consideration to auxiliary aids or services requested by the disabled individual. Policies and procedures covered physicians may now have in place for accommodating the needs of the disabled may not be in accord with revised compliance expectations set forth in the Nondiscrimination Rule.
  • Covered entities must furnish appropriate auxiliary aids and services as necessary to afford individuals with disabilities and their companions an equal opportunity to participate in the covered entity’s services, programs and activities; the type of aids or assistive services will vary depending upon several factors set forth in the referenced communications standard. Importantly, the Rule and its reference standard now require that a covered entity, in determining what types of auxiliary aids and services are needed, must give primary consideration to what the disabled individual has requested. A covered entity shall not require a disabled individual to bring another individual along to interpret for him or her and shall not rely upon others (i.e., adult or minor child) accompanying the disabled individual except in narrow circumstances permitted by the referenced standard. The referenced standard also addresses video remote interpreting services, use of telecommunications, and telephone emergency services. “Auxiliary aids and services” and “qualified interpreter for an individual with a disability” are defined by the Nondiscrimination Rule.
  • Gender identity. The Nondiscrimination Rule’s prohibitions and requirements relating to discrimination based on sex give specific address to issues of gender identity. “Gender identity” is defined to mean “an individual’s sense of gender, which may be male, female, neither, or a combination of male and female, and which may be different than an individual’s sex assigned at birth.” A covered entity is required to treat individuals consistent with their gender identity. Services ordinarily or exclusively available to individuals of one sex may not be denied to a transgender individual based on the individual’s sex assigned at birth, gender identity, or recorded gender. Covered entity health insurers may not limit or restrict coverage for sex-specific health care services to a transgender individual based on the fact that the individual’s sex assigned at birth, gender identity, or gender otherwise recorded are different from the one to which such health services are ordinarily or exclusively available. A “transgender” individual is an individual whose gender identity is different from the sex assigned to that individual at birth.  Litigation challenging the gender identity requirements of the Rule has been filed by several parties in federal court.

The Nondiscrimination Rule is not without its complexities. The overview provided by this post has not addressed all of the Rule’s specific requirements. The OCR has developed a web page of resources to assist covered entities with compliance.

This post is informational only and is not meant to be, nor does it provide, legal advice.

*This article was updated on October 12, 2016, with new HHS information re-sequencing the 15 most prominent languages spoken by LEP individuals in Iowa. 


Posted in Centers for Medicare and Medicaid Services-CMS, Electronic Health Records, Healthcare costs, MACRA - Medicare Access and CHIP Reauthorization Act

CMS proposed rule details Medicare’s new physician “Quality Payment Program”

Reporting under new measures slated to begin in 2017

The Centers for Medicare & Medicaid Services (CMS), the federal agency responsible for Medicare payment to physicians, released a proposed rule on April 27, 2016, setting forth key provisions of its Quality Payment Program for physicians, implementing key provisions in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). MACRA repealed the Sustainable Growth Rate (SGR) formula for annually adjusting Medicare payment to the nation’s physicians, replacing the SGR with a value-based payment system to be developed by CMS consistent with MACRA’s directives. The proposed rule has been published in the May 9, 2016 Federal Register. Comments are due by June 27, 2016.

The proposed Quality Payment Program has two payment incentive tracks: 1) a Merit-based Incentive Payment System (MIPS) focused on successfully achieving quality measures, and 2) a payment incentive based on significant participation in an Advanced Alternative Payment Model (APM). Most physicians will be impacted by MIPS. Under the Quality Payment Program, “eligible professionals” now will be “eligible clinicians,” including physicians, physician assistants, nurse practitioners, clinical nurse specialists, and CRNAs as well as practice groups that include these clinicians.

MIPS consolidates components of Medicare’s Physician Quality Reporting System (PQRS), the Physician Value-based Payment Modifier (VM), and the Medicare Electronic Health Record (EHR) Incentive Program while maintaining a strong incentive focus on integrated use of certified EHR technology (CEHRT). Through MIPS, CMS proposes to pay eligible clinicians for providing high quality, efficient care through identified success in four (4) performance categories –

  1. Cost (10% of total score in year 1). Replaces the cost component of the VM, also known as Resource Use. The cost score would be based on Medicare claims, requiring no clinician reporting. This category uses over 40 episode-specific measures to account for differences among specialties. Clinicians must see a sufficient number of patients (generally at least 20) for a cost measure to be scored. If a clinician does not have enough patient volume in any cost measure, then a cost score will not be calculated; CMS will reweight the cost category to zero and adjust other MIPS category scores to make up the difference.
  2. Quality (50% of total score in year 1). Replaces PQRS and the quality component of the VM. Clinicians would select six reporting measures rather than nine (9) as currently required under PQRS. The rule proposes more than 200 measures to select from; more than 80% of the quality measures proposed are tailored to specialists. Clinicians may opt to report a specialty measure set specifically designed around certain conditions and specialty types. Using claims data, CMS also will calculate population measures, two for individual clinicians and small groups of 2-9 clinicians and three for groups of 10 clinicians or more.
  3. Clinical Practice Improvement Activities (15% of total score in year 1). Activities falling within this CPIA category include care coordination, beneficiary engagement, and patient safety. Eligible clinicians select activities that match their practice’s goals from a list of more than 90 options. Clinicians also are eligible to receive credit in this category for participation in APMs and Patient-Centered Medical Homes (PCMHs).
  4. Advancing Care Information (25% of total score in year 1). Replaces the Medicare EHR Meaningful Use program for physicians. Eligible clinicians would choose to report customizable measures that reflect how they use EHR technology in their practices. A clinician’s overall score in this category would be made up of a base score and a performance score. A base score is derived from clinician response to identifiable measures within six objectives: (i) Protect Patient Health Information; (ii) Patient Electronic Access; (iii) Coordination of Care through Patient Engagement; (iv) Electronic Prescribing; (v) Health Information Exchange; and (vi) Public Health and Clinical Data Registry Reporting. A performance score is derived from measures clinicians select from three of these objectives: Patient Electronic Access. Coordination of Care through Patient Engagement, and Health Information Exchange. Clinicians must achieve the Protect Patient Health Information objective, which requires a security risk analysis, to receive a performance score and must engage in immunization registry reporting under the Public Health/Registry reporting objective. Clinical Decision Support and Computerized Provider Order Entry reporting no longer will be required.

Medicare will begin measuring clinician reporting under MIPS in calendar year (CY) 2017, with payments based on those measures beginning in CY 2019. MACRA requires MIPS to be budget neutral. As such, clinicians’ MIPS scores will be used to compute positive, negative, or neutral payment adjustments. In CY 2019, negative adjustments can be no greater than 4% and positive adjustments can be up to 4%. These percentages increase to 5% in CY 2020, 7% in CY 2021, and 9% in CY 2022. MACRA also provides $500 million annually for exceptional performance bonuses in CY 2019-CY 2023, an amount not subject to budget neutrality. Under MACRA, CY 2019 is the last year for a 0.5% physician fee schedule increase.

A second incentive payment option for clinicians is participation in an Advanced APM. Clinicians successfully meeting Advanced APM criteria receive a 5% Medicare payment boost, need not report under MIPS, and cannot receive MIPS payment incentives. An Advanced APM must accept risk, must be a CMS Innovation Center model or a statutorily-required demonstration, must base clinician payment on quality measures, and must require use of certified EHR technology by at least 50% of its clinicians. PCMHs expanded under Innovation Center authority can qualify as APMs without taking on financial risk. Only clinicians who participate “to a significant extent” by receiving enough of their payments or seeing enough of their patients through an Advanced APM are eligible for the 5% payment incentive.

Many more details are set forth in the proposed rule. CMS summaries of the proposed rule are available, as is the proposed rule.

A closing note. CMS has been working in collaboration with America’s Health Insurance Plans (AHIP), major commercial payers, the National Quality Forum (NQF), and other stakeholders to promote multi-payer alignment on core measures for physician quality programs. In February 2016, the collaboration announced seven (7) sets of clinical quality measures in the areas of 1) ACOs, PCMHs, and primary care; 2) cardiology; 3) gastroenterology; 4) HIV and Hepatitis C; 5) medical oncology; 6) obstetrics and gynecology; and 7) orthopedics. Additional information regarding this public/private payer alignment effort can be found at Core Quality Measure Collaborative.


Posted in Medical Records, Mental Health, Release of Information

2016 Amendments Permit Disclosure for Care Coordination Only Under State Law

One of the more challenging aspects of medical records management are federal and state legalities around release of substance abuse and mental health patient information. This year, the Iowa General Assembly passed legislation, Senate File 2144, to permit disclosure of otherwise confidential behavioral health information under Iowa law for care coordination purposes. SF 2144 was signed by Governor Branstad on April 6 and became effective on that day.

SF 2144 first amends Iowa Code section 125.37, confidentiality of substance abuse treatment facility records, to permit disclosure of patient records for care coordination purposes “if not otherwise restricted by federal law or regulation.” In the same way, SF 2144 amends Iowa Code chapter 228, disclosure of mental health and psychological information, to permit disclosure of confidential mental health information for care coordination purposes “if not otherwise restricted by federal law or regulation.” Care coordination is defined by reference to Iowa Code section 135.154* as “the management of all aspects of a patient’s care to improve health care quality.”

Behavioral health providers are encouraged to remain cautious before disclosing sensitive substance abuse and mental health patient information within SF 2144’s broadly defined context of care coordination. To the extent that this new Iowa law conflicts with federal laws and regulations, federal law prevails. Too, permissible disclosures under SF 2144 must satisfy conditions, such as those set forth in section 228.2, governing permissible disclosures.

SF 2144 can be found at this link: https://www.legis.iowa.gov/legislation/BillBook?ga=%24selectedGa.generalAssemblyID&ba=SF2144.

*Note:  Upon transfer of the Iowa Health Information Network (IHIN) from the Iowa Department of Public Health to a nonprofit entity, SF 2144’s definitional references to section 135.154 will change to Iowa Code section 135D.2.

Iowa Supreme Court Crafts An Avenue Of Relief For Employers Who Fail To Notify Injured Workers That Medical Care Is No Longer Authorized

Posted in Workers' Compensation

Even so, employers are best protected in giving statutory notice and medical providers are best protected in assuring that continued care remains authorized.

Notification requirements imposed by Iowa’s workers’ compensation law upon employers authorizing care for an injured employee took center stage in a recent decision of the Iowa Supreme Court. In that case, Ramirez-Trujillo v Quality Egg, L.L.C., et. al. (No. 14-0640, filed April 15, 2016), an employee suffered back injuries from a slip and fall at work. The employer acknowledged the workplace injury and authorized care through a care provider selected by the employer. The employee received treatment for acute low back pain and muscle spasms until the authorized provider released the employee to return to full duty work without restrictions. Weeks later, however, the employee returned to the authorized care provider for additional treatment for acute low back pain and muscle spasms over a period of several months.

The employer claimed that this additional course of treatment was not related to the employee’s work injury and disavowed cost liability. The employee argued, however, that her continued care was causally-related to her workplace injury and, further, the employer remained liable in failing to provide her with notice that care was no longer authorized as required by Iowa’s workers’ compensation law. In particular, Iowa Code section 85.27(4) states in pertinent part:

For purposes of this section, the employer is obliged to furnish reasonable services and supplies to treat an injured employee, and has the right to choose the care. If the employer chooses the care, the employer shall hold the employee harmless for the cost of care until the employer notifies the employee that the employer is no longer authorizing all or any part of the care and the reason for the change in authorization. (All emphases added).

The employer conceded it had not given statutory notice but argued the employee should have known that care received several weeks later was not authorized.

The workers’ compensation commissioner found that the employee’s second round of care was not causally-related to her workplace injury but assigned cost liability to the employer for failing to give statutory notice. On appeal, the district court and the Iowa Court of Appeals agreed that the employee’s continued care was not causally-related to her workplace injury, but disagreed on the employer’s cost liability for failure to give statutory notice. The Supreme Court (“Court”) made no finding on whether the second course of care was related to the employee’s workplace injury, saying that an employee is not required to establish medical causation in challenging the employer’s failure to give section 85.27(4) notice.

The Court focused solely on the meaning and intent of section 85.27(4) and, in doing so, engaged in an exhaustive analysis of this statutory provision, concluding that section 85.27(4) means what it says. “[A]n employer who authorizes care is responsible for the cost of the care up to the time when the employer notifies the employee it is no longer authorizing the care.” Employers under this statute have the power to choose care and with that, the Court said, comes the responsibility to monitor care for the purpose of determining when further care will no longer be authorized.

However, the Court went on to say that section 85.27(4)’s notice obligation is not meant to permit “an employee to take advantage of an employer by seeking compensation after the fact for care the employee knew or should have known was not within the scope of the employer’s prior authorization.” As such, an employer who fails to give statutory notice nonetheless should be permitted to show, by a preponderance of the evidence, that the employee knew or reasonably should have known either that the care the employee received was unrelated to the employee’s claim for workers’ compensation benefits or the employer no longer authorized the care. The Court sent the case back to the workers’ compensation commissioner to make this evidentiary finding under the facts in this case.

One justice dissented, arguing that section 85.27(4)’s notice obligation is clear and unambiguous and employers are well-equipped to monitor care and give such notice when the employer deems it appropriate to no longer authorize that care. If the legislature had meant to give employers a second option of proof, it would have said so in the law. “With due respect, the clear language of the statute and its bright-line allocation of responsibility for care provided by authorized providers prior to notice of a change is far superior to (and far simpler than) the majority’s new unwieldy standard.”

This case, decided in April of 2016, was about disputed costs for care received from May 2010-April 2011, and liability for those costs is still not settled. If nothing else, employers are reminded by this case that the legislature meant business when it imposed section 85.27(4) workers’ compensation notice obligations upon them. Similarly, medical providers treating injured workers may want to assure as reasonably as they can that care provided to an injured worker continues to be authorized by the employer. As the old saw goes, time is money. Engaging in protracted evidentiary battles around liability is far from free.

Paul Drey Addresses Iowa Medical Society Conference

Posted in Iowa Medical Society

Brick Gentry’s president Paul Drey twice addresses the Iowa Medical Society (IMS) at its Annual Conference in Coralville, Iowa this month.

Protect Yourself: The Basics of Employment Contracts,” illuminates considerations for physician employment agreements. The program synopsis raises important questions:  “The work does not end once you verbally accept a position. But does the offer meet your needs? Will this contract limit your practice options in the future? Find out answers to these questions and more during this session.”

Paul Drey’s second presentation is in conjunction with Timothy Irhig, M.D., of UnityPoint Clinic – Trinity Palliative Medicine. “Legal and Ethical Issues Related to End-of-Life Care,” is summarized in the IMS program: “Carrying out the wishes of patients at the end of their lives is important. When a patient has an advanced directive, healthcare professionals need to know what the legal and ethical guidelines are regarding the decisions that were made prior to or early in their disease process. This session features information you need to care for your patients and protect yourself.”


Posted in Electronic Health Records, HIPAA, Medical Records, Release of Information

HIPAA AND FEES FOR MEDICAL RECORDS – Updated OCR guidance sets limits.

Physicians and other HIPAA covered entity providers are familiar with HIPAA’s rule on fees that may be charged when individuals request copies of their medical records. The federal Office of Civil Rights (OCR), the enforcement agency for the HIPAA Privacy Rule, recently released updated guidance directives on when fees may be imposed and limitations on costs that may be included in assessing such fees. Medical practices, especially those with separate HIPAA and non-HIPAA medical record fee schedules, may be surprised at what the OCR is now saying.

HIPAA Privacy Rule 164.524(c)(4) is at the center of the OCR’s guidance. According to that rule, individuals requesting a copy of their protected health information (PHI) may be charged a reasonable, cost-based fee that includes only (i) the cost of labor for copying the PHI, whether in paper or electronic format; (ii) supplies for creating the paper or electronic media consistent with the individual’s request; and (iii) postage if the individual has requested mailing. The rule also permits assessing a fee for costs in preparing an explanation or summary of the individual’s PHI when agreed to by the individual.

In its guidance, the OCR further clarifies appropriate costs that may be considered in setting a fee and those costs that may not. A fee may reflect labor costs incurred in creating and delivering an electronic or paper copy in the form and format requested or agreed upon by the individual after the requested PHI has been identified, retrieved, compiled/collated, and readied for copying. More specifically, the fee may consider labor costs incurred in –

  • Photocopying paper PHI;
  • Scanning paper PHI into an electronic format;
  • Converting electronic PHI in one format to the format requested by or agreed upon by the individual;
  • Transferring (e.g., uploading, downloading, attaching, burning) electronic PHI from the covered entity’s system to a web-based portal when the PHI is not already maintained in or accessible through the portal, portable media, e-mail, app, personal health record, or other manner of delivery of the PHI;
  • Creating and executing a mailing or e-mail with the requested PHI.

A fee may not take into account labor costs associated with verification, documentation, searching for, retrieving, segregating or otherwise preparing the PHI for copying; maintaining systems; or recouping capital for data access, storage, or infrastructure, even if such costs are authorized by State law.

Supply costs appropriately considered in setting a fee include paper toner for paper copies and CD or USB drives for electronic media as may have been requested or agreed upon by the individual. However, a covered entity may not require an individual to purchase portable media; rather, individuals have the right to have copies of their PHI mailed or e-mailed to them upon request.

Even if a covered entity’s fee takes into account only permissible costs, that fee also must be reasonable. While conventional wisdom might assume continued increases in legitimate medical record fee costs, the OCR believes advances in automation and technology predict decreasing labor costs and, in certain instances, even disappearance of such costs.

Additional points of clarification from the OCR include the following —

  • While a permissible fee may be charged to individuals requesting copies of their PHI, “covered entities should provide individuals who request access to their information with copies of their PHI free of charge,” particularly if the individual requesting access cannot afford the fee.
  • A covered entity may not charge a fee when individuals access their PHI through the covered entity’s certified EHR system. A covered entity, the OCR maintains, incurs no labor or supply costs when individuals access their PHI through an available View, Download, or Transmit function on a covered entity’s EHR system.
  • Individuals cannot be charged a fee to only inspect their PHI at the covered entity’s office.

The OCR emphasizes that covered entities must give individuals requesting copies of their PHI advance notice of fees that may be charged. In addition, covered entities should post on their web sites an approximate fee schedule for regular types of access requests and should be prepared, upon request, to provide a breakdown on factors that make up their fees. A covered entity may calculate their fees in three ways: actual costs, average costs, or flat fee for electronic copies; the OCR details how each of these calculations can be made.

The OCR specifically addresses fees that may be charged to third parties requesting an individual’s PHI as authorized by the individual. When individuals request that their copied PHI be sent to a named third party, the HIPAA fee rule applies and, the OCR says, “It doesn’t matter who the third party is.” Similarly, if a third party, on behalf and at the direction of an individual, forwards an individual’s request for release of the individual’s PHI to that third party, the HIPAA fee rule applies. On the other hand, if a third party initiates a request for an individual’s PHI on the third party’s behalf and with the individual’s authorization, then HIPAA’s fee limitations do not apply.

Even if State law specifies fees to be charged for medical records, covered entities are bound by the limitations of the HIPAA fee rule unless a covered entity can show that the State’s fee schedule is based on the same types of costs permitted by HIPAA and is reasonable. Iowa law specifies limitations on fees that may be assessed for medical records in two instances: 1) requests for medical records for workers’ compensation purposes, Iowa Administrative Code 876-8.9, and 2) release of medical records to a party adverse to the individual in litigation consistent with a patient waiver or court order whereby fees charged must be consistent with the workers’ compensation fee schedule or as otherwise specified, Iowa Code section 622.10(6). In each of these Iowa-defined situations, individuals authorize release of their medical records not as an exercise of their HIPAA individual rights of access but as required by law and regulation. Arguably, these are the type of third party releases to which the HIPAA fee rule does not apply. Medical practice believing otherwise, however, should then assure that their fee charges in these instances of Iowa law and regulation do not exceed amounts permitted by the HIPAA fee rule.

The OCR’s guidance on medical record fees is contained within a comprehensive release entitled, Individuals’ Right under HIPAA to Access their Health Information, 45 CFR 164.524, found at http://www.hhs.gov/hipaa/for-professionals/privacy/guidance/access/index.html. This practical resource includes specific OCR responses to many frequently asked questions (FAQs) on individual rights of access to PHI and fee charges. This OCR guidance document gives important insight into how this chief regulator reads these HIPAA rules. It is well worth the read.

Peeling Back the Apple Watch

Posted in Electronic Health Records, HIPAA
Apple Watch at Brick Gentry P.C.

Apple Watch at Brick Gentry P.C.

Apple Watch, HIPAA, and Mobile Healthcare Industry.

When one of our more tech savvy partners recently showed us his new Apple Watch, it instinctively raised questions as to how would HIPAA regulate its use. One possible answer is that the features of this new Apple Watch may be the linchpin to a whole new culture in the mobile health industry.

Time will determine the answer, but the new Apple Watch does possess interesting features that will impact the mobile health care industry. Along with the Apple Watch, the company offers the HealthKit app, which is an application that can be used by the Apple Watch and is designed to log one’s activity and health data, and the ResearchKit software, which launched in April 2015, Apple has also introduced interesting “tools” in the health care marketplace—for the consumer, the provider, and possibly, other vendors. So, in addition to changing the health care marketplace, the Apple Watch and other applications have opened the door to multiple legal issues that will need to be addressed.

We co-authored “Peeling Back the Apple Watch:  Do HIPAA and the Apple Watch Go Together?” which is published this fall in ABA Health eSource and in Chicago Medicine, We highlight the major role the Apple Watch could play in the development of the mobile healthcare industry, and its possible impact on the regulatory framework used to control patient privacy.

  • Opportunities for consumers
  • Opportunities for healthcare providers
  • Privacy, security and data vulnerability
  • Applicability of HIPAA
  • Applicability of the FTC
  • Patient Safety Concerns
  • Discoverability and evidentiary issues of e-data in court proceedings
  • Future Role of Wearable Devices in Mobile Health

View the full article:  Peeling Back the Apple Watch_ Health Law Section.

Medicare “Incident To” Billing – CY 2016 Clarifications

Posted in Centers for Medicare and Medicaid Services-CMS

The billing physician must be the supervising physician.

The final CY (calendar year) 2016 Medicare physician payment rule is out and published in the November 16, 2015 Federal Register. In that rule, CMS (Centers for Medicare & Medicaid Services) made two changes clarifying Medicare’s Part B “incident to” billing rule found at 42 CFR 410.26. The amended regulatory language becomes effective on January 1, 2016.

The first of the two incident to rule changes relates to auxiliary personnel. Physicians and certain “other practitioners” (clinical psychologists, physician assistants, nurse practitioners, clinical nurse specialists, certified nurse-midwives) may bill incident to for services and supplies provided by auxiliary personnel under their supervision. “Auxiliary personnel” means any individual acting under the supervision of a physician (or other practitioner) and can be employees, leased employees, or independent contractors. 42 CFR 410.26(a)(1). Auxiliary personnel must meet state law requirements, including licensure, for providing the service or supply. The final CY 2016 Medicare payment rule adds language specifying that auxiliary personnel must not be excluded from Medicare, Medicaid or any other Federal health program or had enrollment revoked at the time the incident to service or supply is provided. This new language clarifies what already is a Medicare billing requirement.

The second incident to rule change relates to supervision of auxiliary personnel. Only the physician (or other practitioner) who directly supervises the auxiliary personnel providing the service or supply can bill incident to for that service or supply. The physician (or other practitioner) providing direct supervision to auxiliary personnel can be, and very well may be, different from the physician (or other practitioner) treating the patient “more broadly.” Nonetheless, only the supervising physician (or other practitioner) is permitted to bill incident to for services and supplies provided by auxiliary personnel. 42 CFR 410(b)(7).

This revised regulatory language clarifies CMS’ longstanding but sometimes misunderstood position. In its comments to the final rule, CMS explains: “[B]illing practitioners should have a personal role in, and responsibility for, furnishing services for which they are billing and receiving payment as an incident to their own professional service.” In cases, then, where a beneficiary’s treating physician refers the beneficiary to another physician and where auxiliary personnel provide services to that beneficiary under the supervision of the second physician, only the second physician, not the referring physician, is authorized to bill incident to. The second physician’s billing number is reported on the claim form. Although the referring physician has a connection to the services, “we believe the physician or other practitioner directly supervising the incident to service assumes responsibility and accountability for the care of the patient that is provided by auxiliary personnel.”

Medicare’s expectations for “direct supervision” sometimes cause misunderstandings of their own. For purposes of incident to billing, “direct supervision” requires physician (or other practitioner) to be present in the office suite and immediately available to furnish assistance and direction to auxiliary personnel when providing the service or supply; direct supervision does not require the supervising practitioner’s presence in the same room. 42 CFR 410.32(b)(3)(ii). By way of note, only general supervision is required when services or supplies are provided by clinical staff incident to transitional care or chronic care management. 42 CFR 410(b)(7), 42 CFR 410.32(b)(3)(i).

In closing, in comments to its incident to rule changes, CMS noted stakeholder suggestions that it clarify by way of a CPT code listing those services that can or cannot be billed incident to. Medicare law dictates that only services and supplies of the kind commonly furnished in physicians’ offices without charge or included in a physician’s charge may be billed incident to; regulations provide additional specificity but not a listing of services appropriate for incident to billing. 42 CFR 410.26(a)(7), 42 USC 410.26(b)(1-4). CMS said it would take this suggestion under advisement in issuing future guidance on Medicare incident to billing.


Posted in Centers for Medicare and Medicaid Services-CMS, Medicaid

State plans must consider impact of provider rates on beneficiary access

US Supreme Court says providers cannot challenge Medicaid payment rates in a court of law

Physicians under Iowa’s Medicaid program consistently provide quality medical care to our State’s 560,000 Medicaid beneficiaries despite payment rates that, according to the Iowa Medical Society, are nearly the same as rates paid to physicians in 2000. IA Health Link requires Medicaid’s four contracted managed care organizations (MCOs) to pay physicians no less than the Medicaid fee-for-service rates in effect on July 1, 2015; Medicaid-enrolled providers who do not sign with an MCO suffer a 10% out-of-network reduction in payment rates. In 2016, physicians again will petition the Iowa General Assembly for a Medicaid rate increase, an ask that may be at odds with the substantial cost-savings goal of IA Health Link.

Exasperation with sluggish state and federal responses to Medicaid payment inadequacy has led to provider lawsuits over the years. Provider claims focus on that section of federal Medicaid law referred to by regulators as the “access requirement.” Each state’s Medicaid program, as part of its state plan, must “assure that payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area.” 42 USC 1396a(a)(30)(A) [Emphasis added].

In March of this year, the U.S. Supreme Court dealt a harsh blow to provider lawsuits, ruling in a close 5-4 decision that providers cannot seek remedy through the courts against a state Medicaid program for inadequate payment rates. In Armstrong v. Exceptional Child Center, et. al., 575 US ___ (No. 14-15, decided March 31, 2015), habilitation service providers alleged that Idaho’s Medicaid payment rates violated Medicaid’s “access requirement” law. Lower federal courts ruled in favor of the providers. The Supreme Court, however, held that no private right of action existed to support Medicaid payment rate challenges by providers through the courts. Instead, the majority argued, the only avenue of redress Congress gave to providers was through the secretary of Health and Human Services (HHS) who must assure that each state Medicaid plan satisfies federal requirements. The “sheer complexity” of this “judgment-laden” statutory payment requirement, the Court said, speaks volumes in favor of exclusive enforcement through federal regulators best suited to manage it in a consistent manner. The dissenting justices disagreed, arguing that if Congress had intended to deny providers access to the courts, Congress would have said so in the Medicaid law.

In a final rule published in the November 2, 2015 Federal Register, the Centers for Medicare & Medicaid Services (CMS) requires each state Medicaid program, as part of its state plan, to develop an access monitoring review plan no later than July 1, 2016, to assure compliance with the statutory access requirement. The rule, CMS says, sets forth a framework “to make better informed, data-driven decisions” on, among other things, service rate structures and provider payment methodologies impacting beneficiary access. Because the Armstrong decision places enforcement accountability with HHS for state plan compliance with Medicaid’s access requirement, CMS says it must be more transparent in exercising data-driven judgment calls on payment adequacy affecting beneficiary access.

The final rule, 42 CFR 447.203(b), requires access monitoring review plans to include an analysis specifying data sources, methodologies, baselines, assumptions, trends and factors, and thresholds regarding sufficient access, each of which may vary by geographic location within a state. Further, the plan must consider, among other things, the availability of care through enrolled providers to Medicaid beneficiaries in each geographic area by provider type and site of service as well as actual or estimated levels of provider payment available from other payers, public and private, by provider type and site of service. The review plan and analysis must specify measures used by the state to analyze beneficiary access, such as time and distance standards; providers participating in Medicaid; providers accepting new Medicaid beneficiaries; service utilization patterns; and telehealth availability.

States are required to submit an access monitoring review analysis to CMS with any state plan amendment reducing provider payment rates or restructuring provider payment methodologies that could result in diminished access. In the event of no state plan payment rate amendment but, rather, stagnant rates over the course of many years, state Medicaid programs, nonetheless, are required to complete access analyses at least once every 3 years for, among other things, primary care services and physician specialist services.  CMS calls for additional comments and information to improve upon data and metrics identified in this final rule.

Most Iowa physicians are touched by Medicaid. In many Iowa communities, Medicaid patients are a significant percentage of the physician’s practice base. Adequate Medicaid payment rates fairly reflecting physician costs are important in assuring physician participation in Medicaid and in avoiding tough restrictions on the number of Medicaid patients they see. CMS’ new rule evidences greater regulatory focus on adequate Medicaid payment rates based on uniform, objective, data-driven criteria, bearing in mind, however, that payment rates are important only as they affect beneficiary access. While instinct influenced by a long history of inaction may make physicians justifiably suspicious about the ultimate value of this new rule, CMS has set in motion an avenue of oversight and remedy that physicians and other Medicaid providers should not ignore.