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Services (CMS) released its final rule implementing the new Quality Payment Program for physicians in lieu of the repealed sustainable growth rate factor (SGR).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 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 MACRA repealed the Sustainable Growth Rate (SGR) formula for annually adjusting Medicare payment to the nation’s physicians, replacing the SGR with a value-based payment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.
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.
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.
MEDICARE EHR MEANINGFUL USE PENALTY NOTICES ON THEIR WAY TO 257,000
On December 21, the federal Centers for Medicare & Medicaid Services (CMS) began issuing letters to physicians and other health professionals eligible to participate in the Medicare EHR Incentive Program notifying them of a 1% Medicare payment penalty they will incur in 2015 for failing to meet Stage 1 meaningful use (MU) benchmarks for use of electronic health records (EHRs). More than 257,000 eligible professionals (EPs) are slated to receive penalty notification letters, a number the American Medical Association (AMA) says is “worse than we anticipated.” Physicians facing the 1% penalty in 2015 will experience an additional 1% payment reduction in each subsequent year they fail to meet EHR MU objectives, up to a maximum of 5%. A physician who also fails to meet MU e-prescribing objectives set through the Electronic Prescribing Incentive Program will experience an additional 1% penalty reduction in Medicare payment. Of the 257,000 EPs scheduled to be penalized under the EHR meaningful use program in 2015, approximately 28,000 also face the 1% e-prescribing penalty.
Data has not yet been made available to show how many Iowa physicians and other health professionals eligible to participate in these two Medicare incentive programs are facing the 2015 Medicare payment penalties. CMS data does show, however, that from January 2011-October 2014, EPs in Iowa received total incentive payments of $350,896,401 for meeting Stage 1 EHR MU objectives either through Medicare ($244,634,629) or Medicaid ($106,261). National data also indicates that Iowa providers have made substantial progress in implementing and using e-prescribing.
The AMA issued a statement saying that it was “appalled” that more than 50% of all EPs will face MU penalties in 2015. “The penalties physicians are facing under the Meaningful Use program are part of a regulatory tsunami facing physicians,” including potential payment reductions from the Physician Quality Reporting System (PQRS) and the Value-based Modifier Program (VBM) as well as ongoing application of budget sequester cuts. Effective April 1, 2015, physicians also face a 21.2% Medicare payment reduction absent corrective congressional action on the SGR.
Not all physicians are eligible to participate in these Medicare MU incentive programs and many eligible physicians applied for and received hardship exemptions making the 2015 penalties inapplicable to them. Of those who are eligible, many elect not to participate, believing the payment penalties they would incur are far less than the costs, burdens, and problems they would face in purchasing and implementing electronic health record systems at this time. An AMA-RAND study released in October 2013 showed that EHR implementation was a significant factor in growing physician dissatisfaction with medical practice. Physicians say that EHR systems interfere with face-to-face physician-patient interactions; are more cumbersome and expensive to implement than projected; often are not interoperable; and are fraught with operational failings.
The AMA continues to advocate for suspension of EHR MU penalties while promoting EHR MU program improvements to better reflect the current state of EHR system functionality, interoperability, workability, and costs. (Link to October 13, 2014 letter: http://www.ama-assn.org/ama/pub/news/news/2014/2014-10-14-ama-blueprint-improve-meaningful-use.page)
Physicians receiving letters will have until the end of February to challenge CMS’ determination.
Courts across the country have routinely decided that HIPAA does not create or authorize a private right of action. [See Doe v. Board of Trs. of Univ. of Ill., 429 F. Supp.2d 930, 944 (N.D. Ill. 2006); Slue v. New York Univ. Med. Ctr., 409 F. Supp.2d 349, 373 (S.D.N.Y. 2006); See about 8th Cir. Case.] HIPAA contains a pre-emption provision titled “Effect on State Law,” which states in part, that it “shall supersede any contrary provision of State Law,” but also an exception that HIPAA shall not supersede a conflicting State Law provision if the provision of State Law, “…subject to section 264(c)(2) of the Health Insurance Portability and Accountability Act of 1996, relates to the privacy of individually identifiable health information.” 42 U.S.C. §132od-7 (1996). Recently, the Supreme Court of Appeals of West Virginia dealt with a claim brought by an individual against St. Mary’s Medical Center, Inc., claiming “negligence, outrageous conduct; intentional infliction of emotional distress, negligent infliction of emotional distress, negligent entrustment, breach of confidentiality, invasion of privacy, and punitive damages.” R.K. v. St. Mary’s Med. Ctr., Inc. – – – S.E.2d – – – -, 2012 WL 5834577 (W.Va.: Nov. 15, 2012). The Plaintiff did not assert a claim under HIPAA. The Supreme Court of Appeals of W. Va., overruling the lower court, found that R.K.’s state law claims for the wrongful disclosure of his medical and personal health information are not pre-empted by HIPAA…” (Id.) [See Health Law Express Express@hortyspringer.com (November 29, 2012)]. The case was remanded.
The outcome of this case and its application raises the issue of whether private actions of individuals for medical records privacy breaches can be successful. As electronic health records and medical records conversion continues, any health entity involved with healthcare records should pay special attention to this case and the line of cases like it. In my opinion, this result has the potential to limit the HIPAA pre-emption and to open the holders of healthcare records to new causes of action. This result opens a large potential legal issue for holders of healthcare records. You should watch the outcome of this case and make sure that, if you are a holder of healthcare records, you fully understand the ramifications of this case.
Electronic Health Records will change the practice of medicine. Physicians, hospitals, medical groups are all in the process of converting to the electronic health record. Currently, nearly $4.5 billion in federal incentives have helped move this conversion forward. Over the final three months of 2011, EHR incentive payments from the federal government doubled. In a recent study by the National Center for Health Statistics nearly 57% of physician practices currently utilize EHR for matters other than billing. In a recent study, it was found that many physicians found the conversion to EHR to be difficult or very difficult. Primarily, the taxing issues were financial and in the realm of training or lack thereof. Education in the area of EHR is very important. On December 8, 2011, I spoke at a seminar for LawReview CLE entitled: Introduction to Electronic Health Records. This CLE provided a background into the EHR world and many of the issues, including legal issues and implementation issues that physicians, physician clinics and hospitals will face.
Many rural physicians and smaller physician groups are still behind in the implementation of EHR in their practices. The Modern Healthcare article entitled “Small Providers Still Lag on EHRs,” sets forth the findings of two studies to support this claim. (I was surprised it took studies to verify this fact.) Finances and the daunting thought of implementation are key factors for this lag. In order to help these rural physicians and physician groups make strides in the EHR conversion, not only must financial incentives continue, but also continued efforts to educate and to aid in the training of the EHR process.