Estimated Cost Savings and New Revenue From Installing an EHR

Based on research studies and federal funding estimates for an electronic health record system of no particular brand name, installing an EHR system can generate as much as $1.7 million per physician in cost savings or new revenue over five years, according to R&D MedTech, the maker of an EHR system. Here is the breakdown:

Practice Process Improvements ($216,300). A federal study found an EHR for a single physician yielded savings $26,600 in year one, $41,300 in year two, $31,400 in year three, $85,100 in year four and $85,100 in year five.

More Revenue Through Better Coding ($210,000). A study of 14 small practices found each physician could raise his/her revenue by as much $42,000 per year with increased coding levels resulting from implementation of EHR.

Malpractice Liability Insurance Discount ($25,000). Many malpractice insurance carriers are offering physicians discounts of 2-5 percent for using an EHR in their practice, on the premise the EHR system will reduce risk by helping to eliminate some of the most common reasons for claims, such as oversights on patient record reviews or notifying patients of prescription refills.

PQRI Financial Incentives ($50,000). The Physician Quality Reporting Initiative provides financial incentives of up to an additional 2 percent of Medicare payments to physicians who successfully report on specific quality measures provided to patients. Incentive payments range from $1,000 to over $98,000.

E-Prescribe Stimulus ($6,000). This amount covers two years of incentives, assuming most practices will switch to the full Medicare EHR stimulus incentive available in 2011.

Medicare/Medicaid Stimulus ($44,000/$63,750). Starting in 2011, physicians who meet the “meaningful use” criteria for certified EHRs for all applicable years would receive $44,000 through Medicare or $63,750 through Medicaid.

Tax Incentive ($250,000). The American Recovery and Reinvestment Act amended Section 179 of the Tax Code to increase the small business expense for qualified property to $250,000 with a 50 percent bonus depreciation.

Clinical Trial Revenue ($500,000). For clinical trials, additional new revenue is available to practices using EHR that was not available with paper records.

In-House Pharmacy Revenue ($360,000). This involves linking EHR to an on-site dispensing system in place of phoning or faxing prescriptions to the pharmacist, making call-backs for non-formulary drugs, and answering inquiries because of illegible handwriting and mandated prior authorization for refills.

See the full estimate by R&D MedTech.

Massachusetts Report Finds Hospitals’ Negotiating Clout With Insurers Drives Up Costs

Massachusetts hospitals and physician groups with market clout negotiate rates that are twice as high as for other hospitals, and such clout is the main cause of healthcare inflation in the state, according to a release by State Attorney General Martha Coakley.

Ms. Coakley’s office based the findings on a year-long study of the Massachusetts market, finding that about 10 hospitals enjoy reimbursements 10-100 percent higher, for similar work, than reimbursements for the other 55 hospitals in the state.

The office’s report says the 10 favored hospitals had brand-name recognition or few competitors in their markets, but it did not name any provider or insurer, saying its aim was to identify systemic problems and not blame individual organizations.

Based on its findings, the report recommended against establishing global payments covering a patient’s entire medical care for an illness, an approach recommended by a state commission.

The study concluded that higher healthcare costs are basically caused by rising prices, not increased demand for new services. One major insurer reported provider price increases accounted for 80 percent of the growth of medical expenses from 2006-2009.

The report called on the state to:

• Discourage or prohibit contract provisions that perpetuate market disparities;
• Increase transparency and standardization in payment and quality;
• Reform payments to account for market distortions; and
• Encourage development of a “value-based” healthcare market.

Read the Massachusetts Attorney General’s release on health insurance reimbursements.

Five-Year Fix for Medicare Doctor Pay Cuts in Works

As lobbying intensifies, momentum is building to provide a five-year reprieve that would block a 21-percent fee cut to physicians who treat Medicare patients. If no legislative action is taken this month, the physician pay cut is set to go into effect in March, according to a report in The Hill.

The Senate recently passed pay-as-you-go legislation requiring Congress to offset new spending or tax cuts with corresponding spending cuts or tax increases, and the House passed a similar bill last year and is expected to take up a new version next week, The Hill reported. The Senate bill includes an exemption from pay-as-you-go for the physician payment fix. Specifically, it would allow Congress to spend up to $82 billion for physician payments without having to find offsetting savings or revenue sources. This amount would be enough to lock in fees at their current rates for five years.

The American Medical Association and other physician groups — joined by AARP — have been lobbying for a more expensive overhaul to the Medicare physician payment system, known as the sustainable growth rate formula, or SGR. Passing a permanent fix could cost $200 billion, according to a Feb. 2 report in Politico. Finding such a solution tops the AMA’s healthcare reform agenda.

Read The Hill’s report on physician fee cuts.

Intrapreneurship

I was in a meeting recently and a discussion was proposed as to whom should be the owner of an idea originated inside a hospital. The employee, the institution, both?

It is clear to me that when a physician is hired to do research, the output of this research should belong to the hospital, and the hospital should acknowledge his/her contribution by giving away part of the benefits obtained from it. In this case, the new idea would probably have been unthinkable outside the premises of the hospital, without its infrastructure and assets, so it makes sense.

But what happens if an employee has an idea, let’s say, related to his/her field of experience but not necessarily linked to research? Let’s take this example, if an OR Nurse perceives a need and thinks about a solution to this need while in the operating room, let’s say a new medical device, should the idea belong to the hospital? Well, yes, the idea came to them because they were working at the hospital, but can the hospital claim any ownership over it?

Who is the owner of the idea, then? It may seem a futile discussion, but to me it represents the most important barrier to innovation in our healthcare systems, so it is far from trivial. Sometimes employees don’t engage in innovation because they perceive the ownership issue as unfair. If we want to foster innovation in healthcare, this question needs to have a clear answer. At the end of the day, it all goes down to how the hospital sees healthcare professionals: Do employees work for the hospital, or do they work at the hospital?

Are hospitals really willing to encourage innovation and intrapreneurship inside their premises? Are hospitals willing to create a culture of reward for those entrepreneurs? There is a lot to be gained here: if the hospital succeeds in fostering innovation, it can create a great environment to attract talent, lead, and generate economic value and social impact.

People do respond to incentives. That’s something I learned very early when dealing with innovators and entrepreneurs. Innovation should not trigger a war between the healthcare facility and the employee. It should always be a win-win scenario where both parties can create a lot of value if they cooperate. So, in my opinion this is not about claiming ownership, but about both parties acknowledging how far can they go and how better they will be if they work together, and share the ownership. That’s the answer that makes sense to me.

 

North Carolina Rejects First Health’s Bid for Surgery Center

North Carolina’s Department of Health and Human Services has rejected a certificate of need application by FirstHealth of the Carolinas to build a $3.5 million surgery center in Hoke County, according to a report by theFayetteville Observer.

The Pinehurst, N.C.-based health system, and Cape Fear Valley Health System, based in Fayetteville, N.C. were previously both given approval to move forward with plans to build facilities in the county.

Cape Fear proposed a 41-bed hospital, which gained greater community support, than FirstHealth’s eight-bed hospital and surgery center proposal, according to the report.

A spokesperson for FirstHealth said in the report that if both health systems were to withdraw their appeals, both systems could move forward with construction.

Read the Fayetteville Observer’s report on FirstHealth’s certificate of need denial.

EMR 101: An Overview of Key Benefits

It’s no secret the Internet is everywhere, so it is a contradiction that millions of Americans feel secure enough to do their banking online, but the U.S. healthcare system is still wary of transitioning health and medical records into an electronic format.

As I sat with Ron Pelletier, vice president of market strategy, at a SourceMedical conference in Las Vegas, he stated, healthcare in general, grossly underutilizes the internet. We discussed one of the main reasons outpatient centers have been slow to change. “On the ASC side, things may not have been broken. Reimbursements were good, now that is changing. These centers are under pressure with reimbursements shrinking and costs going up. Many are saying, ‘In order to stay competitive and keep my business afloat, I need to find better ways of doing this.’ The necessity now is driving them.” states Pelletier.

This series of articles will cover some of the key points that need to be addressed when considering the implementation of an EMR in your ASC, including key benefits of EMRs, what to look for in a provider, how to get your staff ready for this impending transition.

To begin, we should consider the many definitions of an EMR. “There have been so many people out there that have said ‘I am selling an EMR’ and all it is is scanning in your paper and saving it to a computer,” says Craig Veach, senior vice president of operations for Amkai. “Then there are others who have a forms-based system. In the PIIM study, of the original 50 that were considered, none of those were even the forms-based systems because PIIM thought they were not commercially viable. You want something that is a true work-flow manager. Our EMR handles communications within the organization using an internal email and instant message (IM) that allows people to pass info and stay HIPAA compliant. It’s customizable on how it is set up to manage an individual organization’s workflow,” Veach adds. The Parsons Institute for Information Mapping (PIIM) study Veach refers to recently reviewed the top six EMR systems available on the market today.

This brings us to some of the key benefits a facility can gain through implementing an EMR. Michael Nolte, vice president and general manager of marketing for GE Healthcare IT, is aware that there are many questions and concerns from administrators and staff, but says that the long-term benefits will by far surpass the short-term apprehension. “In particular, for a smaller business, it’s a pretty big transition. There are three key benefits. First is the quality of care that you can deliver as a provider; when an EMR is used effectively it’s a really powerful tool. Both from a medical and a legal perspective, you have ensured that you have the right documentation in place that you are making good care decisions and that you have the ability to deliver the best quality of care for your patients. Second, is when our providers get really good at using a piece of software, and are transitioning from something that is usually more paper-based, it makes them more efficient. The ability to use their time more effectively, spending more time in the operating room and less time in the office is definitely enhanced by use of the software. And third is accuracy from a billing and reimbursement standpoint. In terms of getting a clear, well documented perspective on activity so that clinicians are getting paid for what they do everyday.”

On a more fundamental level, there are cost benefits in paper saving. “A lot of these centers are drowning in paper,” affirms Sean Benson, co-founder of ProVation Medical, part of Wolters Kluwer Health. “They are documenting everything on paper and with that come a lot of cost and inefficiencies. That includes the cost of paper, storage of charts, doing a chart pull, and assembling charts. All of those costs are really taken out of the system when you move to an electronic medical record. You are taking a lot of the redundancies out of the system.”

Oftentimes, hearing the benefits from peers can be most beneficial. Daren Smith, BSN, administrator at Fremont Surgical Center in Fremont, Neb., also shares his thoughts about the benefits. “It has so much capability to increase the level of quality of care that you are able to give to your patients. The EHR system capabilities to cross-check medications and make sure that the required information is there. Also, the ability for that information to be shared widely makes it very important. We have also found that it lends some credibility to your organization; that you are ahead of the game, ahead of the curve.”

What should an ASC look for in a provider? Administrators may want to consider what type of ASC in which they are working. If the ASC is a brand-new facility, it makes sense to start with an EMR. “For new ASCs, it’s almost a no brainer in terms of EMR and full-automation. We find that it is a straight forward conversation when you ask a new ASC, ‘why would you start by duplicating the old paper-based workflow when you have a chance to start fresh?’ The question is usually positively viewed since it just makes sense to go electronic from the outset. Existing ASCs are also interested, but have a little more adaptation to existing processes that they might see necessary. Actually, it’s an opportunity to look at current workflow and adapt it a little to realize the benefits from the software,” Don Fallati, senior vice president of marketing, Amkai states.

The existing ASC wanting to convert to an EMR has various items to address. While a new staff in a new ASC can face the implementation of an EMR with ease, staff members in current less technology-based facilities may be quick to decline the idea of learning anything new. The biggest part of getting ready for an EMR system is to realize there will be change. “If the staff, especially the internal champions or the leaders of the organization are resistant to change then they are going to be real problems. If you can identify key leaders within the organization, who understand that change is an important part of the process, and the short term challenges are worth the longer term benefits moving to an electronic system then you are really on the right track.”, states Benson.

Joe Macies, CEO of Amkai adds, “These systems today are modular. You don’t have to swallow the entire package and it doesn’t have to change every single facet of workflow. My two words of advice would be: get started. The EMR benefits are so great over such a long term, and eventually so necessary, I think, in any healthcare provider organization that you can get started and have a fairly graceful migration of your people at a reasonable pace over time when you’ve got modular software that fits users needs. It’s helpful not to approach EMR as having to find the perfect solution.”

Stay tuned to the second part of this series, EMR 202: How to Get Ready for Implementation where SurgiStrategies speaks to some ASCs that are in the process of EMR implementation or have an EMR in place where they discuss concerns challenges and advice.

11 Things to Know About the False Claims Act

1. Initial development of the False Claims Act. The False Claims Act, also known as the “Lincoln Law” after its primary proponent, President Abraham Lincoln, was initially developed during the Civil War. The Act was a response to war profiteering by military contractors who attempted to defraud the government, for example, by sending boxes of sawdust instead of guns or selling the same cavalry horse to the armed forces multiple times. The Act remained in its original form from its initial passage in 1863 until 1943, at which point various amendments de-incentivizing qui tam actions made the statute nearly obsolete. In 1986, the Act was amended again with greater incentives for private citizens to report fraud on the government. The Act has become an increasingly active mechanism to combat fraud and false claims submitted to the federal government ever since. For additional background information, see http://www.all-about-qui-tam.org/fca_history.shtml.

2. Overview of Qui Tam concepts. Qui Tam means “in the name of the king”. The concept of a Qui Tam action is similar to a whistleblower action and allows a private person, referred to as a “relator,” to file suit on behalf of the United States against those who have falsely or fraudulently claimed federal funds. Incentives are built in so that the qui tam relator is able to receive a part of the proceeds of a victory on behalf of the government. Further, the portion of an award amount that the relator retains is greater if the government does not join in the suit and therefore he or she does not receive the help of the government. Alternatively, if the government joins or “intervenes” in the lawsuit, the relator retains a lesser portion of any judgment or settlement obtained.

False Claims Act qui tam actions run the gamut of federally funded programs, from Medicare and Medicaid to defense and other government procurement contracts, federally insured mortgage and other federal housing programs, disaster assistance loans, agricultural subsidies and more. Persons who knowingly make false claims for federal funds are liable for three times the government’s loss plus a civil penalty of $5,500 to $11,000 for each claim. Relators recover 15 to 25 percent of the proceeds of a successful suit if the United States intervenes in the qui tam action, and up to 30 percent if the United States declines to intervene and the relator pursues the action alone. During fiscal year 2009 alone, relators were awarded $255 million. (This figure does not include relator shares awarded after Sept. 30, 2009.)

3. Top hospital recoveries. To see a list of the top 20 False Claims recoveries to date, go to www.taf.org/top20. Several hospitals and hospital companies have paid massive settlements to resolve false claims actions against them, including St. Barnabas Hospitals, a non-profit hospital chain in New Jersey, which paid $265 million in 2006 to settle allegations related to improperly claiming “outlier” Medicare payments (additional payments for particularly difficult or complex procedures). Also in 2006, Tenet Healthcare, a national hospital system, agreed to pay the federal government $900 million for billing violations also involving manipulation of outlier payments, as well as kickbacks, upcoding and bill padding. Similarly, in 2000, Columbia HCA, the largest for-profit hospital chain in the country paid more than $731 million to settle False Claims Act allegations against it. Currently, Toumey Healthcare System in South Carolina is involved in a False Claims litigation based on physician self-referral law violations that resulted in the submission of false claims, a legal theory that proved successful against a medical practice management company in the 2008 case U.S. v. Rogan in the Seventh Circuit Court of Appeals.

4. 2009 recoveries. In 2009, the U.S. government recovered $2.4 billion dollars under the False Claims Act. This was the second highest annual collection amount recorded in history, thanks in large part to an enormous settlement between the government and Pfizer Inc. The Department of Justice made the following statement regarding the Pfizer settlement in Sept. 2009:

American pharmaceutical giant Pfizer Inc. and its subsidiary Pharmacia & Upjohn Company Inc. hereinafter together “Pfizer”) have agreed to pay $2.3 billion, the largest health care fraud settlement in the history of the Department of Justice, to resolve criminal and civil liability arising from the illegal promotion of certain pharmaceutical products, the Justice Department announced today.

Pharmacia & Upjohn Company has agreed to plead guilty to a felony violation of the Food, Drug and Cosmetic Act for misbranding Bextra with the intent to defraud or mislead. Bextra is an anti-inflammatory drug that Pfizer pulled from the market in 2005. Under the provisions of the Food, Drug and Cosmetic Act, a company must specify the intended uses of a product in its new drug application to FDA. Once approved, the drug may not be marketed or promoted for so-called “off-label” uses – i.e., any use not specified in an application and approved by FDA. Pfizer promoted the sale of Bextra for several uses and dosages that the FDA specifically declined to approve due to safety concerns. The company will pay a criminal fine of $1.195 billion, the largest criminal fine ever imposed in the United States for any matter. Pharmacia & Upjohn will also forfeit $105 million, for a total criminal resolution of $1.3 billion.

In addition, Pfizer has agreed to pay $1 billion to resolve allegations under the civil False Claims Act that the company illegally promoted four drugs – Bextra; Geodon, an anti-psychotic drug; Zyvox, an antibiotic; and Lyrica, an anti-epileptic drug – and caused false claims to be submitted to government health care programs for uses that were not medically accepted indications and therefore not covered by those programs.

5. Healthcare fraud — Top industry for False Claims recovery. Healthcare fraud represents the largest and most profitable industry for Qui Tam false claims collections. Healthcare fraud recoveries accounted for approximately $1.6 billion, more than two-thirds of the $2.4 billion dollars collected under the False Claims Act in total during 2009. Numerous federal agencies shared in these recoveries, including the Department of Health and Human Services, in connection with its Medicare and Medicaid programs; the Office of Personnel Management, which administers the Federal Employees Health Benefits Program; the Department of Defense for its TRICARE insurance program; and the Department of Veterans Affairs.

6. Pharmaceutical and medical device companies – Main targets. The largest qui tam settlements in 2009 came from pharmaceutical and medical device companies, including Pfizer, Sanofi-Aventis, Bayer HealthCare, Quest Diagnostics and Eli Lilly, amongst others. The DOJ reported that pharmaceutical and device companies accounted for $866.7 million in settlements for federal recoveries, in addition to $402 million being returned to state Medicaid programs.

7. Retention of overpayments now can be considered a False Claims Act violation. In 2009, President Obama signed into law the Fraud Enforcement and Recovery Act of 2009 which implemented significant changes to the False Claims Act, including the expansion of prohibited conduct under the False Claims Act to include not just the improper filing to collect monies, but also the known retention of overpayments by hospitals or other health care providers. The 2009 amendments also make clear that false claims submission to a state Medicaid program, although not directly submitted to the federal government, does constitute a violation of the False Claims Act.

8. Hospital sample False Claims policy. All health care providers and businesses submitting claims to the government for payment should have health care regulatory and false claims policies in place to educate its employees and agents and minimize the submission of false claims and the potential liability attached thereto. A good sample policy is available online at www.centralcommunityhospital.com. This sample policy is particularly designed to address a community hospital’s approach to false claims and other policies, and may need to be modified depending on the size of the entity, breadth of practice, or type of industry or provider submitting the claims.

9. Plaintiff’s law firms focus on Qui Tam. Over the past several years, there has been a dramatic increase in the number of Qui Tam suits. As a result, there are now law firms that focus exclusively on qui tam actions. One such firm, Warren Benson Law Group, states on its website, www.warrenbensonlaw.com/medicare-fraud.com:

In recent years, Medicare fraud and Medicaid fraud have been the two most active areas of qui tam litigation, outnumbering qui tam cases involving defense contractor fraud. It is estimated that Medicare fraud and other fraud cost the federal government billions of dollars each year.

There are numerous frauds Medicare and other healthcare providers and companies have devised to cheat the Government…[such as:]

- Services not rendered
- Upcoding schemes and Unbundling
- Kickbacks and Self Referrals
- Falsely Certifying and Giving False Information
- Lack of Medical Necessity
- Fraudulent Cost Reports
- Grant or Research Fraud

These firms generally take qui tam cases on a contingency fee basis, making it enticing for potential relators to come forward and initiate litigation against the alleged wrong-doers.

10. Broad provider responsibility – Scope of liability. In the face of the increasing scrutiny of claims and the relatively new era of Recovery Audit Contractors, parties should understand the broad scope of what can be considered a false claim and their obligations to properly bill for services. A good discussion of the breadth of the provider’s responsibility is set forth in an article by Charlie Artz, a well-regarded healthcare attorney. See False Claims Act Implications in Physician’s News Digest www.physiciansnews.com/law/805artz.html. A few of the key concepts discussed by Mr. Artz are excerpted below:

In Re: Cardiac Devices Qui Tam Litigation, the U.S. District Court in Connecticut refused to dismiss a whistleblower’s case against health care providers who submitted claims for services that were not covered by Medicare, held that the health care providers had a duty to familiarize themselves with all requirements for reimbursement, and allowed the False Claims Act case to proceed exposing the health care providers to millions of dollars in refunds and civil fines.

Although the opinion was close to 100 pages in length, the key facts can be summarized as follows. Then-HCFA published a manual over 1,000 pages in length containing literally hundreds of reimbursement rules and requirements. These billing guidelines were not statutes passed by Congress after the people had an opportunity to debate them. These were not regulations published with notice and comment by the general public or the health care community to make improvements or to object to certain clauses. These were purely interpretive guidelines published by the federal government. One of those several hundred billing guidelines contained a provision prohibiting reimbursement for any non-FDA approved device or service. The 40 hospital defendants in this massive federal court litigation submitted claims to Medicare and received payment for services provided to patients who participated in clinical trials involving several different investigational cardiac devices that had not been approved for marketing by the FDA.
One clause in the hospital payment manual stated that medical devices not approved for marketing by FDA are considered investigational by Medicare and are not reasonable and necessary for the diagnosis and treatment of illness or injury under the Medicare statutory definition of medical necessity. Apparently, the hospitals billed these services by mistake, believing that since the clinical trial was approved, the provider was allowed to bill Medicare for the device and related services.

A whistleblower realized many hospitals were billing Medicare for non-FDA approved cardiac devices and filed a civil false claims case in federal court. The federal government intervened and is now prosecuting the False Claims Act case against hospitals. The hospitals asked the federal court to dismiss the case for several reasons. One of the key defenses is that a simple violation of a statute or regulation does not, by itself, trigger False Claims Act liability. The federal court rejected that analysis and made the following key points that should guide your compliance efforts.
11. Heightened regulatory and enforcement environment – False Claims Act and Anti-kickback Statute. The government has looked to regulatory mechanisms like the False Claims Act to recover money spent improperly as a politically palatable way to attack healthcare providers and healthcare costs. Given the demonstrated success of this strategy, we expect more, not less, recovery of claims of this sort. As William Corr, Deputy Secretary of the U.S. Department of Health and Human Services, stated on October 28, 2009:
As a result of the priority given to combating health care fraud by President Obama, the government has been able to achieve a more rapid response to fraudulent schemes and increase its recovery of more funds lost to fraud than in previous years. For example, HHS Office of Inspector General investigations have resulted in $4.0 billion in receivables for FY 2009, increase from $3.2 billion in DIG investigative receivables in FY2008. Strike force cases typically are indicted and litigated faster than traditional criminal health care fraud cases.

Since March 2007 strike force cases that included HHS agents have obtained 189 convictions, 443 indictments, and total an estimated $227 million in expected recoveries. During this time, the Department of Justice also secured the largest health care fraud settlement in history against a pharmaceutical company for Medicare and Medicaid fraud and for violating the Food, Drug and Cosmetic Act. I refer to the $2.3 billion settlement with Pfizer to resolve criminal and civil liability arising from the illegal promotion of certain pharmaceutical products.

HHS pandemic plan unlikely to receive adequate funding

Prompted by 2006 legislation, the Department of Health and Human Services (HHS) released its first National Health Security Strategy last month, hard on the heels of the H1N1 pandemic.

The plan is focused on protecting people’s health during a large-scale emergency, according to a statement from HHS, and includes 10 objectives and an implementation guide to assist public and private healthcare organizations prepare for and manage health threats.

The policy is unlikely to receive adequate funding in the near future, according to Joseph White, professor of public policy, epidemiology and biostatistics, and director of the Center for Policy Studies at Case Western Reserve University in Cleveland.

“The details in the interim strategy seem reasonably well-considered, [but] the overall rhetoric is boilerplate,” says White. “There won’t be much result because the budget situation is awful, and there is unlikely to be real money.”

BIRD FLU PROMPTS NEW PLAN

The security strategy was mandated in the Pandemic and All Hazards Preparedness Act, passed shortly after the avian flu scare in 2005 and the SARS epidemic in 2003. The legislation directed the HHS secretary to develop the plan with an accompanying implementation process by 2009 and to revise the documents every four years. HHS stated, however, that it will update the implementation plan every two years to reflect advances in public health and medicine.

“As we’ve learned in the response to the 2009 H1N1 pandemic, responsibility for improving our nation’s ability to address existing and emerging health threats must be broadly shared by everyone—governments, communities, families, and individuals,” HHS Secretary Kathleen Sebelius said in a statement. “The National Health Security Strategy is a call to action for each of us so that every community becomes fully prepared and ready to recover quickly after an emergency.”

White believes this policy is, in part, the Obama administration’s attempt to better define duties between the HHS and the Federal Emergency Management Agency (FEMA), which joined the Department of Homeland Security after 9/11. Before the terrorist attacks, FEMA took an “all hazards” approach to disaster management, which included health epidemics, White says.

“A lot of serious public administration people whom I know said at the time that putting FEMA in DHS was a terrible idea,” he says. “So ‘all hazards’ was eliminated, and FEMA basically stopped paying attention to little things like hurricanes and epidemics.”

The goals of HHS’s strategy, such as building community resilience and strengthening and sustaining emergency response systems make sense, he says, but are unlikely to be high priorities.

“I’d be shocked if there is real money behind it,” he says.

6 Best Practices for Negotiating Managed Care Contracts for ASC Pain Management

Amy Mowles, president and CEO of Mowles Medical Practice Management in Edgewater, Md., offers the following advice on negotiating reimbursements with commercial payors for pain management for ASCs.

1. Getting started. When you receive the payor’s proposed contract, including the entire proposed fee schedule, be aware that just about everything in there is negotiable.

• You can start by requesting an increase in all fees.
• The vast majority of pain management procedures fall into one to three categories. If the payor is objecting to the entire increase, try to focus on a few specific issues, such as two or three group rates that are significantly low and are your most frequently billed codes.
• Using objective data to back up your points will always give you a stronger case.Data sources may include:
  • Your practice’s accountant or reports you run on average billed procedures and average number of procedures per patient encounter.
  • AMA Annual Socioeconomic Survey
  • MGMA publications
  • Medical Economics Survey
  • Department of Commerce Web site

• Be sure to identify all payor policies that could undermine your practice. Watch for requirements that do not agree with requirements of other payors. Multiple or conflicting rules will wear down your billing staff. A contract is going to create more work if it requires invoices while other contracts do not, or if it reimburses for multiple procedures at 100/50/50 when others reimburse at 100/50/25.

• Consider using a “requesting a standard” addendum for all your contracts. This addendum typically lists the fee schedule, and how multiple procedures, implants and supplies will be paid. Identifying these items in the contract will help you build leverage, create a good political base and record successful agreements.

2. Negotiating grouper payments. Many payors still base ASC reimbursements on the old “grouper” methodology, which Medicare phased out in calendar year 2008.

• Payors that use the old groupers often add a tenth grouper, Group 0, which typically includes minor, office-based procedures such as trigger point injections and non-fluoroscopic guided procedures (nerve blocks) and sometimes even off-list procedures that are not in the payor’s regular list, such as discography. Carefully check rates for this added group because they may include procedures you perform (or plan to) and could be undervalued.
• Add-on codes such as those for each additional level (facets joint injections, transforaminal epidural injections and neurolytics) should all have the same “mapping” — assigning them to the same group — as in other contracts. Otherwise, you will find discrepancies when you perform a cost-to-reimbursement analysis. Moreover, some payments may turn out to be below Medicare rates, which is hardly a good idea.
• Find out the payment methodology for off-list procedures. These are referred to as “no Medicare value” or “non-grouped procedures.” This is vitally important for both the old groupers system as well as the new APCs. The old grouper payment system had a significant number of procedures that were off-list, many of which were typically office-based procedures without fluoroscopy guidance. However, discography (CPT 62290 and 62291), a popular diagnostic pain management procedure, was and still is off-list.
• It is critical to ascertain the payment amount and methodology. You may find that requesting mapping to a specific payment group is better than a percentage of billed charges. Payment arrangements based on a percentage of billed charges typically carries a default amount, called a ceiling, which may not be cost effective.
• Find out how implantable devices are handled. Devices such as spinal cord electrodes and stimulators and drug infusion pumps may be carved out and billed separately, or the price of the implanted device may be added to the group. If devices are carved out, make sure the margin is above the current Medicare rate.
• Placing electrode arrays for a spinal cord stimulator trial (CPT 63650) is a popular procedure and Medicare’s current reimbursement is actually quite good. Remember that Medicare’s payment indicator of H8 means the procedure is not subject to multiple-procedure discounting. Since many pain management physicians place two-electrode arrays, make sure the payor won’t reduce the payment of the second placement, whether or not the device is included in the reimbursement.

3. Dealing with plans using the new APC methodology. Commercial payors are increasingly transitioning from groupers to the new ambulatory payment methodology system developed for Medicare.

• For APCs, ask whether the payor’s mapping is precisely the same as Medicare’s. If it is different, your procedures may turn out to pay less than you expected.
• How are off-list procedures such as discography paid? These should be defined with a default rate at a percentage of billed charges, with or without a ceiling. If there is a ceiling, make certain your fee is high enough for the discount. The other option would be to suggest the payor add these off-list procedures to a particular group.
• Ask about additional carve-outs for drugs, supplies or fluoroscopy you would like to have. It doesn’t hurt to ask how these will be reimbursed rather than if they will be.
• With APCs, it’s better to negotiate the all-inclusive rate or negotiate an amount for the device plus a reasonable handling fee. You do not want to have a contract that forces you to send a paper claim with an invoice.

4. If the payor offers both methodologies. Determine your top 15 most frequently billed codes. You may actually be better off with the calendar year 2007rates and groupers, especially if you have a lot of minor procedures and the default rate for off-list procedures is favorable.

5. Negotiating any kind of contract. Here are some basic tips that will apply to any kind of payment system you negotiate.

• For procedures requiring a costly one-time use device, such as a spinal wand for percutaneous discectomy (62287), which costs about $1,000 per case, ask if its pass-through code (C2614) would be carved out. This is important because the payor may have grouped this with a rate that does not cover the costs of the one-time use device.
• Inquire about the new CPT codes for facet joint injections. Prior to 2010, these injections were billed with two CPT codes, one code for the first level and another for each additional level. But under the new 2010 codes, these injections are billed as three codes: single, second and third, plus each additional injection. If the reimbursement is the same as last year, try to make sure facet injections for the third and additional levels (64492 & 64495) get a higher fee.
• Ask for the payment policies and rates for multiple procedures during the same patient encounter. If you don’t settle this, you could end up with a contract that pays below Medicare rates. You should get 100 percent of the fee schedule for the first procedure and then 50 percent for each additional procedure. You do not want to let it go down to 25 percent for any further additional procedures after the second. Ask if there is a maximum number of procedures allowed per patient encounter. This is not the same as medical necessity precedence.
• Agreeing to an all-inclusive case rate is not a good idea for most pain management procedures, unless the rate is high enough to cover multiple pain procedures involving bilateral and/or additional levels injections. Make sure this does not somehow include the professional component of a fluoroscopy.
• Ask for additional payment for the technical component of the use of the C-arm for fluoroscopy guidance and interpretive reports. The most frequently billed codes as follows:
  • 77002-tc Fluoroscopic guidance for needle placement for spinal injection procedures
  • 77003-tc Fluoroscopic guidance for needle placement for nerve blocks
  • 72275-tc (Epidurogram (with dictation) w/o use 76005)
  • 72285-tc (Radiological interpretation, cervical)
  • 72295-tc (Radiological interpretation, lumbar)

6. Final tips. Remember to read the entire contract and assess all the ways it could impact you now and in the future before you sign.

• If you can’t reach a reasonable agreement, ask yourself: Would losing this contract benefit or hurt my practice? How much of a market presence does this payor have? And do we see a significant amount of this payor’s enrollees?
• It’s essential that the contract is a friendly, mutually beneficial agreement. You have a lot of mutual interests. For example, what benefits the plan’s enrollees benefits your patients. And if the contract is cumbersome for you to administer, it will probably be cumbersome for the payor as well. Remember to work closely with your payor representative. People respond positively to people they know and respect.

Mortality, costs higher for women with cardiovascular disease

HEART DISEASE SHOULD top the list of women’s health concerns. Women disproportionately fear dying from breast cancer compared to heart disease, dutifully scheduling annual mammography, oblivious to their cardiovascular risks. There is little demand by women and the medical community for an urgent agenda or a “march for the cure” for heart disease in women.

Cardiovascular disease (CVD) is the single most common cause of death in women and men. Despite widespread assumptions to the contrary, women have accounted for more than one-half of the almost 1 million deaths due to heart disease and stroke in the United States annually since 1984. Women, compared to men, especially those under the age of 50 years, experience higher rates of recurrent myocardial infarction, heart failure and mortality after a first myocardial infarction, and are more likely to be misdiagnosed or diagnosed late in the course of their illness.

Annual hospitalizations and mortality for heart failure and total CVD expenditures are greater for women than men. While mortality from cardiovascular diseases has significantly declined over the past three decades, women have not experienced the same reductions in death and disability as have men. This significant gender-related mortality gap persists due to a combination of low awareness, misconceptions by physicians and women, gender-based physiologic differences, and disparities in care.

While these data might initially appear discouraging, improving these measures represents a significant opportunity to improve women’s CVD outcomes as well reduce overall healthcare expenditures by providing optimal screening and preventive services, appropriate and accurate diagnostic tests and timely cardiac care.

LESS THERAPY FOR WOMEN

The underlying causes for these disparities are multifactorial and the solutions complex. Gender-based disparities in preventive, diagnostic and therapeutic interventions are present on multiple levels. Women receive fewer cardiac diagnostic evaluations and less intensive therapy, from preventive interventions, to revascularization procedures to aspirin prescriptions. Even after a diagnosis of heart disease, gender-based differences in provision of care are present.

Women hospitalized with myocardial infarction are more likely than men to be managed by generalists, rather than referred for cardiology consultation, and are less likely to be transferred from community hospitals to centers for advanced care—practices associated with poorer short-term outcomes.

Additionally, societal and individual misconceptions about cardiovascular risk and what a heart patient “looks like,” along with inadequate gender-specific research data on cardiovascular disease and risk factors, contribute to lower awareness and poorer outcomes. While women’s symptoms can sometimes be challenging to address, both women and their physicians can be too quick to attribute potential manifestations of cardiac disease to menopause or aging. It is important to counteract the widely held belief that women do not develop heart disease except at advanced ages by raising physicians’ “index of suspicion” for cardiovascular disease in women.

There is also a growing body of literature documenting important biologic gender differences in CVD that may impact clinical care delivery. There are obvious differences due to the effects of gonadal hormones. However, differences in symptoms, accuracy of diagnostic tests, response to therapy, prevalence and relative risk of cardiovascular risk factors, as well as social and behavioral issues have all been identified. It is not always apparent whether or not these differences warrant a variation in established practice.

Many early cardiovascular clinical trials routinely exclude women or make no effort to enroll women in sufficient numbers to draw gender-based conclusions. With few exceptions, women currently make up only 20% to 30% of participants in cardiovascular clinical trials. Even when women are included as research subjects, it is often difficult to determine their outcomes from published reports. Only a quarter of recent cardiovascular trial results published in major U.S. internal medicine and cardiology journals reported gender-specific outcomes.

The lack of relevant research in women has resulted in a substantial and persistent gender-based knowledge gap about everything from the symptoms of heart attack in women, to the risks and benefits of commonly used cardiovascular diagnostic tests and therapies. Better evidence from properly designed research studies can better serve women with CVD.

An important example is the National Heart, Lung and Blood Institute (NHLBI)-funded multi-center Women’s Ischemic Syndrome Evaluation (WISE) study of approximately 900 women who underwent coronary angiography for chest pain symptoms and a multitude of other investigations designed to better characterize ischemic heart disease in women. We have already learned a great deal from numerous WISE publications that have underscored the value of gender-specific research and fundamentally changed the understanding of chest pain, CVD risk factors, vascular function, hormone interactions and atherosclerosis in women.

Cardiovascular clinical trial design must include women in adequate numbers to provide gender-specific data, and that data must be analyzed and reported by gender.

Systemic contributions to differences in cardiovascular care for women also include physician practice and referral patterns. In the United States, many women receive all or most of their medical care from specialists in obstetrics and gynecology during their reproductive years and continue those relationships well past menopause, or until a significant non-gynecologic illness occurs. Traditionally, there has been a greater focus on reproductive and breast health than on other health risks, and less awareness and self efficacy among these specialists about early cardiovascular risk identification and treatment.

RISK FACTORS ON THE RISE

The rise in risk factor prevalence in younger women, especially smoking, obesity and diabetes, has led to a growing number of individuals at high risk who do not look like typical heart patients. Reducing women’s future burden of CVD will depend heavily on improved preventive measures which currently fall short of recommendations. Simply taking what has been proven effective, and widely and appropriately applying it to women, can markedly improve care and outcomes.

Critical to this effort is continued education about women’s cardiovascular risks, symptoms and the use of appropriate diagnostic tests and therapies.

The most recent guideline, published in 2007 by the American Heart Assn. and endorsed by multiple professional and patient organizations, has simplified the risk assessment and decision-making process for easier implementation in daily practice.

The guidelines encourage clinicians and patients to focus on reducing long-term, rather than 10-year CVD risk. With few exceptions, those therapies that have been shown efficacious in men also prevent CVD in women and should be recommended to women at risk.

Sharonne Hayes, MD, FACC, is the director of the Mayo Clinic Women’s Heart Clinic and associate professor of medicine for the Mayo Clinic College of Medicine.

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