[Source: Healthcare Financial Management Association (HFMA)]
CMS Issues 2008 Outpatient Prospective Payment System Final Rule
On Nov. 1, the Centers for Medicare and Medicaid Services (CMS) continued its initiative to link payment with quality in a final rule with comment period updating the hospital Outpatient Prospective Payment System (OPPS), effective for services furnished during CY08. The rule also updates the payment rates for the revised ambulatory surgical center (ASC) payment system beginning in CY08.
After taking into account the market basket update and other factors that affect the level of payments, CMS estimates hospitals will receive an overall average increase of 3.8 percent in Medicare payments for outpatient services in CY08. The CMS Office of the Actuary projects that payments (including beneficiary coinsurance) under the OPPS will increase by about 10 percent to approximately $36 billion in CY 2008 from $32.7 billion in CY 2007, due in part to increased use of hospital outpatient services.
Hospitals that are paid under the Inpatient Prospective Payment System are required to report the applicable hospital outpatient quality measures in order to receive the full OPPS market basket update in CY 2009; otherwise, their CY 2009 update will be reduced by 2.0 percentage points.
In addition, the final rule provides larger payment bundles for certain OPPS services, which is intended to provide hospitals with greater flexibility in managing their resources.
The final rule will be published in the Federal Register on Nov. 27, 2007. View the final rule. Read the CMS press release.
See AHLA's report on this issue: "Final OPPS Rule Includes Overall 3.8% Update", Health Lawyers Weekly, November 2, 2007
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Medicare Final Rule Announces 2008 Physician Fees and Reforms for Accurate Payments and Quality
Under a final physician payment rule issued yesterday, the Centers for Medicare and Medicaid Services (CMS) estimates that it will pay approximately $58.9 billion to about 900,000 physicians and other healthcare professionals. The revised payments, quality incentive rates, and related policy changes, which will become effective Jan. 1, 2008, are included in the Medicare physician fee schedule final rule. The rule will be published in the Nov. 27 Federal Register.
Since July 1, 2007, under the Physician Quality Reporting Initiative (PQRI), eligible professionals who report specific measures on quality of care furnished to Medicare beneficiaries may earn incentives up to 1.5 percent of their total allowed charges, subject to a cap.
The Medicare law includes a statutory formula requiring CMS to implement a negative 10.1 percent update in payment rates for physician-related services. This formula compares the actual rate of growth in spending to a target rate, which is based on such factors as the growth in the number of Medicare fee-for-service beneficiaries and statutory or regulatory changes in benefits. According to a press release, "CMS has no choice but to implement this negative update because it is mandated by a statutory formula."
Download the final rule. Read the CMS press release.
See AHLA's report on this issue: "CMS Issues Final Physician Payment Rule With 10.1% Cut", Health Lawyers Weekly, November 2, 2007
Friday, November 2, 2007
Cost of Uncompensated Hosptial Care Reached $31.2 Billion in 2006; Underpayments Reached $29.9 Billion
The American Hosptial Association (AHA) released the results of its Annual Survey of Hospitals in October. In its Uncompensated Hospital Care Cost Fact Sheet, AHA said that the data from the Annual Survey showed that hospitals had uncompensated care costs amounting to $31.2 billion (5.7% of total expenses) in 2006. However, uncompensated care excludes other unfunded costs of care, such as underpayments from Medicare and Medicaid. In its Underpayment By Medicare and Medicaid Fact Sheet, AHA reported that underpayments to hospitals (defined as the difference between the costs incurred and the reimbursement received for delivering care to patients) reached $29.9 billion in 2006 (up from $4 billion in 2000).
Other reports and studies by the AHA can be found here.
Other reports and studies by the AHA can be found here.
District Court in Alabama to Determine Whether section 1395w-26(b)(3) of Medicare Act is a "Complete Preemption" Statute
[Source: Health Lawyers Weekly, November 2, 2007]
The U.S. District Court for the Southern District of Alabama granted a motion for interlocutory appeal October 15 on the question of whether whether § 1395w-26(b)(3) of the Medicare Act is a complete preemption statute. The court ruled in the instant case that at least some of plaintiffs' state law claims were completely preempted, while the same court and another district court ruled previously that similar claims were not subject to complete preemption. See Bolden v. Healthspring of Alabama, Inc., Nos. 07-413-CG-B, 07-414-CG-M (S.D. Ala. 2007); and Harris v. Pacificare Life & Health Ins. Co., No. 2:06-956-ID (M.D. Ala. 2007).
The cases involved lawsuits brought against health insurers by Medicare beneficiaries asserting they were fraudulently induced into enrolling in the insurers' Medicare Advantage (MA) plans.
Continue reading
Case: Dial v. HealthSpring of Ala., Inc., No. 2:07-0412-KD-C (S.D. Ala. Oct. 15, 2007).
The U.S. District Court for the Southern District of Alabama granted a motion for interlocutory appeal October 15 on the question of whether whether § 1395w-26(b)(3) of the Medicare Act is a complete preemption statute. The court ruled in the instant case that at least some of plaintiffs' state law claims were completely preempted, while the same court and another district court ruled previously that similar claims were not subject to complete preemption. See Bolden v. Healthspring of Alabama, Inc., Nos. 07-413-CG-B, 07-414-CG-M (S.D. Ala. 2007); and Harris v. Pacificare Life & Health Ins. Co., No. 2:06-956-ID (M.D. Ala. 2007).
The cases involved lawsuits brought against health insurers by Medicare beneficiaries asserting they were fraudulently induced into enrolling in the insurers' Medicare Advantage (MA) plans.
Continue reading
Case: Dial v. HealthSpring of Ala., Inc., No. 2:07-0412-KD-C (S.D. Ala. Oct. 15, 2007).
New York Court Says A Physician's E-mails With Attorney on Hospital's E-mail System Not Privileged
[Source: Health Lawyer's Weekly, November 2, 2007]
A physician's communications with his attorney via his hospital-employer’s email system were not protected from discovery under the attorney-client privilege or work product doctrine in a subsequent employment dispute, a New York court ruled October 17.
According to the court, because hospital policy explicitly prohibited personal use of its email system and informed employees of potential monitoring, the physician could not claim these communications were privileged.
Court said, “A ‘no personal use’ policy combined with a policy allowing for employer monitoring and the employee’s knowledge of these two polices diminishes any expectation of confidentiality.”
Continue reading
A physician's communications with his attorney via his hospital-employer’s email system were not protected from discovery under the attorney-client privilege or work product doctrine in a subsequent employment dispute, a New York court ruled October 17.
According to the court, because hospital policy explicitly prohibited personal use of its email system and informed employees of potential monitoring, the physician could not claim these communications were privileged.
Court said, “A ‘no personal use’ policy combined with a policy allowing for employer monitoring and the employee’s knowledge of these two polices diminishes any expectation of confidentiality.”
Continue reading
2007 Tennessee Medical Malpractice Claims Report - Judgments Down in 2006
The Tennessee Department of Commerce & Insurance released the 2007 Medical Malpractice Claims Report, which showed a decline in medical malpractice judgments and settlements in 2006. Tennessee trial courts issued six medical malpractice judgments totaling $4,951,459 (down from $6,075,724 in 2005). Settlements in 2006 occurred for 15.24% of medical malpractice claims, totaling damage payments of $100,233,337 (down from $119,091,990 in 2005).
See report here
See report here
Medicare Part D spent $32 billion in 2006, study finds.
[Source: Health and Life Sciences Law Daily, November 2, 2007]
HealthDay (11/2, Preidt) reports, "In 2006, introduction of the U.S. Medicare Part D prescription drug benefit increased the number of seniors' prescriptions by 158 million, at a cost of $32 billion to Medicare," according to a study published in the November/December issue of the journal Health Affairs. Co-author Frank Lichtenberg, a business professor at Columbia University, and colleagues "analyzed data on 584 million prescriptions filled at the Walgreens pharmacy chain from September 2004 to December 2006." After including "the increased number of prescriptions that followed the introduction of Medicare Part D," the researchers found "that the amount paid by patients decreased only 5.6 percent, while the amount paid by private insurers increased by 22.3 percent." In addition, the data indicated that "Medicare spent about $203 for each additional prescription for the elderly, about 3.5 times as much as the average price ($57) for a prescription in 2006." The researchers concluded that "we need to think carefully about the economic implications of this program, which the federal government will ultimately have to raise taxes to pay for," particularly since Medicare Part D is expected to cost "$797 billion by 2015."
HealthDay (11/2, Preidt) reports, "In 2006, introduction of the U.S. Medicare Part D prescription drug benefit increased the number of seniors' prescriptions by 158 million, at a cost of $32 billion to Medicare," according to a study published in the November/December issue of the journal Health Affairs. Co-author Frank Lichtenberg, a business professor at Columbia University, and colleagues "analyzed data on 584 million prescriptions filled at the Walgreens pharmacy chain from September 2004 to December 2006." After including "the increased number of prescriptions that followed the introduction of Medicare Part D," the researchers found "that the amount paid by patients decreased only 5.6 percent, while the amount paid by private insurers increased by 22.3 percent." In addition, the data indicated that "Medicare spent about $203 for each additional prescription for the elderly, about 3.5 times as much as the average price ($57) for a prescription in 2006." The researchers concluded that "we need to think carefully about the economic implications of this program, which the federal government will ultimately have to raise taxes to pay for," particularly since Medicare Part D is expected to cost "$797 billion by 2015."
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