Health Headlines– July 11, 2022

CMS Issues CY 2023 Physician Fee Schedule Proposed Rule – On July 7, 2022, CMS released the Calendar Year (CY) 2023 Physician Fee Schedule (PFS) proposed rule (the Proposed Rule). The Proposed Rule includes proposed policy changes for Medicare payments under the Physician Fee Schedule and other Medicare Part B issues for claims occurring on or after January 1, 2023. According to CMS, the Proposed Rule changes aim to create a more equitable health care system resulting in better accessibility, quality, affordability, and innovation. Comments to the Proposed Rule are due by 5:00 p.m. on September 6, 2022.
Some of the proposed changes are highlighted below.

• CY 2023 PFS Rate Setting and Conversion Factor. CMS is proposing that the CY 2023 PFS conversion factor be $33.08, a decrease of $1.53 from the CY 2022 PFS conversion factor of $34.61. This proposed amount reflects the 0.0 percent required statutory update, the expiration of the 3.0 percent increase in PFS payments for CY 2022, and budget neutrality adjustments to ensure payment rates for individual services do not result in changes to estimated Medicare spending.
• Evaluation and Management (E/M) Visits. CMS is proposing to adopt most of the changes in coding and documentation for Other E/M visits approved by the AMA CPT Panel, effective January 1, 2023. This revised coding and documentation would include changes to CPT code definitions, including new descriptor times, revised interpretive guidance for levels of medical decision making, choice of medical decision making or time to select code level, and elimination of the use of history and exam to determine code level.
• Delay to Split (or Shared) E/M Visits Provided in the Facility Setting. CMS is proposing a one-year delay to the split (or shared) visits policy, which would have required more than half of total practitioner time to be spent by the billing provider to constitute the substantive portion for all split (or shared) services beginning on January 1, 2023.  Instead, for CY 2023, as in CY 2022, with the exception of critical care visits, the proposed rule would continue to permit any of the following to constitute the substantive portion of the visit: history, physical examination, making a medical decision, or spending time (more than half of the total time spent by the practitioner who bills for the visit). Delaying implementation of this policy allows for a one-year transition for providers to acclimate to the new changes and adopt workflow changes.  The delay will also provide stakeholders an opportunity for further comment on this policy. CMS is also proposing a number of technical corrections to policies for split (or shared) visits, including relocating the proposed definition of split (or shared) visits and clarifying critical care billing policies to state that CPT code 99292 could be billed after 104, not 75, or more cumulative total minutes spent providing critical care.
• Updated Medicare Economic Index (MEI). CMS is soliciting comments on a proposed revision to the MEI cost share weights, which measure the input price pressures of providing physician services. CMS is proposing a new methodology for estimating base year expenses that relies on publicly available data from the U.S. Census Bureau NAICS 6211 Offices of Physicians, which would allow for the use of data that are more reflective of current market conditions of physician ownership practices, rather than only reflecting costs for self-employed physicians, and will allow for the MEI to be updated on a more regular basis.
• Telehealth Services. CMS is proposing to implement the telehealth provisions in the 2022 Consolidated Appropriations Act and extend certain flexibilities in place during the public health emergency (PHE) for 151 days after the PHE ends, including: allowing telehealth services to be furnished in any geographic area and in any originating site setting, including the beneficiary’s home; allowing certain services to be furnished via audio-only visits; and allowing physical therapists, occupational therapists, speech-language pathologists, and audiologists to furnish telehealth services. CMS is also proposing to delay the in-person visit requirements for mental health services furnished via telehealth until 152 days after the end of the PHE.
• Behavioral Health Services. In light of the increased needs for mental health services, CMS is proposing to create a new General Behavior Health Integration (BHI) service personally performed by clinical psychologists (CPs) or clinical social workers (CSWs) to account for monthly care integration where the services furnished by a CP or CSW serve as the focal point of care integration, and to allow a psychiatric diagnostic evaluation to serve as the initiating visit. CMS is proposing to make an exception to the direct supervision requirement under its “incident to” regulation to allow behavioral health services provided under the general supervision of a physician or NPP, rather than under direct supervision, when these services are provided by auxiliary personnel incident to the services of a physician or NPP.
• Chronic Pain Management Services. CMS is proposing new HCPCS codes and valuation for chronic pain management and treatment services (CPM) for CY 2023. CMS is proposing to include elements in the CPM code, such as: the diagnosis; assessment and monitoring; administration of a validated pain rating scale or tool; the development and maintenance of a person-centered care plan; treatment management; behavioral health treatment; medication management; pain and health literacy counseling; chronic pain related crisis care; and ongoing communication and coordination between relevant practitioners. CMS is also proposing to add the new chronic pain management and behavioral health integration services to the RHC and FQHC specific general care management HCPCS code.
• Opioid Treatment Programs (OTPs). CMS is proposing to revise its methodology for pricing the drug component of the methadone weekly bundle and the add-on code for take-home supplies of methadone to stabilize the price for methadone for CY 2023 and subsequent years. CMS is proposing to modify the payment rate for the non-drug component of the bundled payments for episodes of care to base the rate for individual therapy on a crosswalk code for a 45-minute session, instead of a code for a 30-minute session.  CMS is also proposing to allow the OTP intake add-on code to be furnished via two-way audio-video communications technology when billed for the initiation of treatment with buprenorphine, and to allow the use of audio-only communication technology to initiate treatment with buprenorphine when audio-video technology is not available. Additionally, CMS is clarifying that OTPs can bill Medicare for medically reasonable and necessary services furnished via mobile units, and CMS is proposing that locality adjustments for services furnished via mobile units would be applied as if the service were furnished at the physical location of the OTP.
• Audiology Services. CMS is proposing to allow beneficiaries to have direct access, when appropriate, to an audiologist without a physician referral by creating a new HCPCS code for audiologists to bill for audiology services personally furnished by the audiologist including care for non-acute hearing or assessments unrelated to disequilibrium, hearing aids, or examinations for prescribing, fitting, or changing hearing aids. CMS is proposing to permit audiologists to bill for this direct access without a referral once every 12 months.
• Dental and Oral Health Services. CMS is seeking comment on proposed payment for other dental services, such as dental exams and necessary treatments prior to organ transplants, cardiac valve replacements, and valvuloplasty procedures that may be inextricably linked to, and substantially related and integral to, the clinical success of an otherwise covered medical service. CMS is also requesting comment on possible payment models for dental and oral health care services, and other impacted policies.
• Skin Substitutes. CMS is proposing to change the terminology of skin substitutes to ‘wound care management products’ in order to accurately reflect how clinicians use these products, and to provide a more consistent and transparent approach to coding and paying for these products as incident to supplies under the PFS, effective January 1, 2024. CMS is seeking feedback on key objectives related to skin substitute policies, including (1) ensuring a consistent coding and payment approach for skin substitute products across the physician office and hospital outpatient settings; (2) ensuring that all skin substitute products are assigned an appropriate HCPCS Level II code; (3) using a uniform benefit category across products within the physician office setting; and (4) maintaining clarity for interested parties on CMS skin substitutes policies and procedures.
• Colorectal Cancer Screening. CMS is proposing to expand Medicare coverage for certain early detection services colorectal cancer screening tests by reducing the minimum age payment limitation to 45 years and expanding the regulatory definition of colorectal cancer screening tests to include a follow-on screening colonoscopy after a positive stool-based colorectal cancer screening test result.
• Manufacturer Refund for Discarded Amounts of Certain Single-Dose Container or Single-Use Package Drugs. CMS proposes to implement a recent statutory change to require manufacturers to provide a refund to CMS for certain discarded amounts from a single-dose container or single-use package drug that exceeds an applicable percentage of at least 10% of total allowed charges for the drug in a given calendar quarter.
• Preventive Vaccine Administration Services. CMS is proposing to annually update the payment amount for preventive vaccine administration under the Medicare Part B vaccine benefit based upon the increase in the MEI and to adjust for the geographic locality, based upon the PFS locality where the preventive vaccine is administered using the geographic adjustment factor. CMS is also proposing to continue the additional payment for at-home COVID-19 vaccinations for CY 2023. In addition, CMS is proposing to clarify that its policies in the CY 2022 PFS final rule regarding the administration of COVID-19 vaccine and monoclonal antibody products will continue until the termination of the Emergency Use Authorization declaration for drugs and biological products under the Food, Drug, and Cosmetic Act.
• Conforming Technical Changes to the In-Person Requirements for Mental Health Visits. CMS is proposing to implement conforming regulatory text changes to include the delay of the in-person requirements for mental health visits furnished by RHCs and FQHCs through telecommunication technology under Medicare until the 152nd day after the COVID-19 PHE ends.
• Specified Provider-Based RHC Payment Limit Per-Visit.  CMS is proposing to clarify that a 12-consecutive month cost report should be used to establish a specified provider-based RHC’s payment limit per visit. 
• Clinical Laboratory Fee Schedule (CLFS). CMS is proposing to make certain conforming changes to the data reporting and payment requirements including: (1) specifying that for the data reporting period of January 1, 2023 through March 31, 2023, the data collection period is January 1, 2019 through June 30, 2019; (2) indicating that initially, data reporting begins January 1, 2017 and is required every 3 years beginning January 2023; (3) indicating that for CY 2022, payment may not be reduced by more than 0% as compared to the amount established for CY 2021, and for CYs 2023 through 2025, payment may not be reduced by more than 15% as compared to the amount established for the preceding year; and (4) codifying and clarifying various laboratory specimen collection fee policies.  In addition, CMS is proposing changes to the Medicare CLFS travel allowance policies to reflect the requirements for the methodology for travel allowance for specimen collection.
• Medicare Ground Ambulance Data Collection System. CMS is proposing changes to the Medicare Ground Ambulance Data Collection System to reduce burden on respondents and/or improve data quality. Specifically, CMS is proposing to update its regulations to provide flexibility to specify how ground ambulance organizations should submit hardship exemption requests and informal review requests, including to CMS’s web-based portal once that portal is operational. CMS is also proposing further changes and clarifications to the Medicare Ground Ambulance Data Collection Instrument, including editorial changes for clarity and consistency, updates to reflect the web-based system, clarifications responding to feedback from questions from interested parties and testing, and typos and technical corrections.

The Proposed Rule is expected to be published in the Federal Register on July 29, 2022. Please click here for a display copy of the Proposed Rule. The CMS fact sheet on the Physician Fee Schedule Proposed Rule can be found here.
Reporter, Jason A. de Jesus, Los Angeles, +1 213 443 4343, jdejesus@kslaw.com.

CMS Proposes Sweeping Changes to the Medicare Shared Savings Program – As part of the CY 2023 Physician Fee Schedule proposed rule (the Proposed Rule) released on July 7, 2022, CMS has proposed significant changes to the Medicare Shared Savings Program (MSSP).  The agency’s press release characterizes these proposed program changes as representing some of the most significant reforms since the inception of the MSSP in 2012.  CMS has announced a goal of having all traditional Medicare beneficiaries in an accountable care relationship with a healthcare provider by 2030.  The proposed rules are targeted to achieve that goal by encouraging providers in rural and underserved areas to participate in the MSSP, promoting health equity for underserved populations, and encouraging more accountable care organizations (ACOs) to participate and succeed in the program.

The most significant reforms in the Proposed Rule include providing advance shared savings payments to certain ACO that could be used to address the social needs of beneficiaries; implementing a health equity adjustment to ACO quality performance category scores; allowing certain ACOs additional time to transition to downside risk; and providing for various modifications in the calculation of ACO benchmarks, including removal of certain disincentives for successful ACOs.  The rule also includes several proposals to streamline administrative burdens on ACOs. 

Advance Investment Payments.  In this rule, CMS builds on a prior Innovation Center program that tested advance shared savings payments to support the formation of ACOs.  The current proposal marks the first time that traditional Medicare payments would be made available for this purpose.  The Proposed Rule states that the purpose of advance investment payments is to encourage low-revenue ACOs that are inexperienced with risk to participate in the MSSP, and to provide additional resources to those ACOs to support care improvements for underserved beneficiaries.  In order to receive these advance payments, an ACO applying to participate in the MSSP would complete a supplemental application for advance funds.  To be eligible to receive advance investment payments, the ACO must meet all of the following standards:

• The ACO is not a renewing or re-entering ACO;
• The ACO has applied to participate in the MSSP under any level of the BASIC track’s glide path;
• The ACO is inexperienced with performance-based Medicare ACO initiatives; and
• The ACO is a low-revenue ACO.

Advance investment payments may only be used to improve the quality and efficiency of items and services furnished to beneficiaries by investing in increased staffing, health care infrastructure, and the provision of accountable care for underserved beneficiaries, which may include addressing social determinants of health.  The ACO must establish and maintain a separate account to segregate advance investment payments from all other revenues, and disbursements from this account could be made only for allowable uses as set in the rule.  As part of its supplemental application for advance investment payments, the ACO must submit a spend plan describing how it will spend its advance investment funds during the period of the agreement to build care coordination capabilities, address specific health disparities and meet other criteria under the rule.  The spend plan must identify the categories of goods and services that will be purchased with these advance investment payments and the dollar amounts to be spent on the various categories.  CMS may review the ACO’s spend plan at any time and require modifications in the plan to comply with requirements of the rule.

A qualifying ACO would receive two types of advance investment payments: 

• A one-time payment of $250,000, received at the beginning of performance year 1; and
• Quarterly payments made during the first two performance years of the ACO’s agreement period.  These quarterly payments will vary based on the risk factors attributed to the ACO’s assigned beneficiaries.  For each of the ACO’s assigned beneficiaries, CMS will set a risk factors-based score.  This score is highest (100) for dual eligible beneficiaries.  If the beneficiary is not dual eligible, the risk factors-based score will be set to the Area Deprivation Index national percentile rank matched to the beneficiary’s mailing address.  If insufficient data is available to match the beneficiary to the Area Deprivation Index, the risk factors-based score will be set to 50.  The rule sets the payment amount per beneficiary based on the risk factors-based score, with the highest payment set at $45 for each beneficiary in the highest level of the risk factors-based score.  The ACO’s quarterly payment will be the sum of its beneficiary payment amounts, capped at 10,000 beneficiaries.  For ACOs having more than 10,000 beneficiaries, the highest risk factors-based scores would be used in the calculation.

ACOs will be monitored for continuing eligibility to receive advance investment payments.  If changes in the ACO participants cause the ACO to no longer meet the eligibility standards for these payments (e.g., the ACO is experienced with performance-based risk Medicare ACO initiatives or is a high revenue ACO), CMS would cease the quarterly advance payments and may recover advance investment payments already made. 

Advance investment payments will be recouped by CMS from shared savings earned by the ACO.  The agency will carry any balance forward to subsequent performance years in which the ACO earns shared savings, including subsequent agreement periods.  The ACO must repay all advance investment payments if it terminates participation in the MSSP during the agreement period in which advance payments were received.

Health Equity Adjustment.  Under the Proposed Rule, an ACO’s quality performance score will be adjusted for health equity bonus points based on the ACO’s high performance on quality measures and providing care for a higher proportion of underserved or dually eligible beneficiaries.  Health equity adjustment bonus points will be calculated for the ACO based on the proportion of the ACO’s assigned beneficiaries that are underserved, as measured by the proportion of beneficiaries that reside in a census block group with an Area Deprivation Index national percentile rank of at least 85, or that are dually eligible for Medicare and Medicaid.  The bonus points would be applied if the ACO scores in the top third or middle third of performance for each quality measure.  This adjusted score will be used in determining (i) whether the ACO meets the quality performance standards across all MIPS quality performance category scores; (ii) the final sharing rate for calculating shared savings payments, (iii) the shared loss rate for calculating shared losses under the ENHANCED track, and (iv) the quality score for an ACO affected by extreme and uncontrollable circumstances.  The health equity adjustment is intended to impact ACOs positively and would not be applied to penalize ACOs.

Sliding Scale to Determine Shared Savings.  The Proposed Rule would reinstate a sliding scale approach to determining shared savings based on the ACO’s quality performance.  Alternative quality performance standards would be set for ACOs that do not meet the quality performance standards to share in savings at the maximum rate.  The purpose of this proposed change in the current all-or-nothing approach is to avoid situations in which ACOs lose the opportunity to earn shared savings based on small differences in quality scores. 

Transition to Downside Risk.  The Proposed Rule would ease the current schedule under which MSSP ACOs are required to transition from the shared savings only model to a two-sided risk model.  For performance years beginning on January 1, 2023, ACOs currently participating in Level A or Level B of the BASIC track will have the option to continue in their current level of the glide path for the remainder of their agreement.  For agreement periods beginning on January 1, 2024, ACOs inexperienced with performance-based risk may participate in one 5-year agreement under a one-sided shared savings by entering the BASIC track’s glide path and remaining in Level A for all 5 years.  These ACOs may be eligible for a second agreement period within the BASIC track’s glide path (which would allow the ACO a total of 7 years before transitioning to two-sided risk).  In addition, for agreement periods beginning January 1, 2024, the Proposed Rule would remove the limitation on the number of agreement periods an ACO could participate in Level E of the BASIC track, and participation in the ENHANCED track would be optional.

ACO Benchmarks.  The Proposed Rule includes a number of adjustments to the ACO benchmarking methodology to address such matters as reducing the impact of ACO performance on ACO historical benchmarks and providing incentives for ACOs to care for medically complex, high-cost beneficiaries and to remain in the MSSP.  Among several other revisions, the proposed rule includes –

• A proposal to use a three-way blend of national and regional growth rates with a new prospectively determined administrative growth factor when updating the ACO’s benchmark for each performance year.  The effect of this blended growth rate would be to shield a portion of the annual update from savings resulting from MSSP ACO activity, thereby addressing increasing market penetration by ACOs in a regional service area. 
• An adjustment to the benchmark to account for the ACO’s prior savings, thereby mitigating the extent to which the ACO’s benchmark is ratcheted down over time.
• A proposal to reduce the impact of negative regional adjustments on ACO benchmarks by reducing the cap on negative regional adjustments and by decreasing the negative regional adjustment amounts as the proportion of dually eligible beneficiaries increases or the ACO’s weighted-average prospective HCC risk score increases.
• Proposed revisions to the application of the 3 percent cap on positive prospective HCC risk score growth to better account for medically complex, high-cost populations.

Administrative Matters and Updates.  The Proposed Rule also includes several provisions intended to reduce administrative burdens for ACOs and to update the beneficiary assignment methodology:

• Although an ACO’s marketing materials must still meet standards set in the MSSP rule, ACOs would no longer be required to submit marketing materials to CMS in advance. 
• ACOs would be required to provide the required standardized written notice to beneficiaries at least once during an agreement period rather than annually.  After the standardized written notice has been provided, the ACO must provide a verbal or written follow-up communication to the beneficiary, not later than the earlier of (i) the beneficiary’s next primary care service visit or (ii) 180 days from the date the standardized written notice was provided.  The follow-up beneficiary communication is intended to promote beneficiary comprehension of the standardized written notice.
• ACOs applying for the SNF 3-Day Rule Waiver would no longer be required to submit narratives describing the ACO’s communication plan, care management plan, and beneficiary evaluation and admission plan.  Instead, ACOs would submit attestations that these plans have been established. 
• Data sharing rules would be updated to provide that ACOs acting as organized health care agreements (OHCAs) may request aggregate reports and beneficiary-identifiable claims data.
• To ensure that the MSSP beneficiary assignment methodology remains consistent with billing and coding rules, the definition of primary care services used for beneficiary assignment will be updated, including incorporating new prolonged services codes and chronic pain management codes. 

The Proposed Rule can be found here.
Reporter, Kim H. Roeder, Atlanta, +1 404 572 4675, kroeder@kslaw.com.

OIG Issues Favorable Opinion Regarding Academic Medical Center Components’ Efforts to Provide Medical Care and Financial Assistance to Veterans – On July 5, 2022, OIG posted Advisory Opinion No. 22-15, regarding a proposal by two universities to provide medical care and financial assistance to veterans with mild-to-moderate traumatic brain injuries and associated physical and psychological health conditions. The requestors, groups within two academic medical centers, proposed to use donations to cover: (i) specialized care furnished to veterans who meet certain criteria; and (ii) certain out-of-pocket expenses related to that specialized care. OIG determined that it would not impose administrative sanctions in connection with the Anti-Kickback Statute (AKS) or the Beneficiary Inducements Civil Monetary Penalty (CMP) provision.

The Proposed Arrangements

The requestors are two universities. University A brings the request on behalf of the University A School of Medicine, a component of an academic medical center employing University A physicians and non-physician practitioners and operates an “Institute”, and on behalf of the University A Management Entity, a nonprofit corporation that provides support for the education, research, and patient care mission, including business management services to the University A School of Medicine. University B brings the request on behalf of the University B Medical Group. University B employs physicians and non-physician practitioners of the University B Medical Group, which is a component of an academic medical center and operates the “Center”. University B Medical Group and University A Management Entity are enrolled in Federal health care programs.

The Institute and Center (collectively, the Clinical Programs) are interdisciplinary programs designed to provide intensive outpatient treatment and specialty care to United States military service veterans with mild-to-moderate traumatic brain injuries (TBI) and associated physical and psychological health conditions connected to their military service, including post-traumatic stress (PTS). The Clinical Programs use the same interdisciplinary model of care that is used in the Department of Defense’s Intrepid Spirit Centers, but the Intrepid Centers are only available to active-duty service members. The Clinical Programs are designed to assist veterans with TBI and PTS who have unmet health needs due to the lack of access to specialty care for veterans with TBI in their communities. Although veterans may be able to find some aspects of treatment in their communities, the Requestors represented that the interdisciplinary care model is not otherwise available to veterans.

The Clinical Programs

The Proposed Arrangement would provide intensive outpatient treatment to qualified veterans through the Clinical Programs using an interdisciplinary care model. The Clinical Programs will assess initial eligibility to confirm (i) the potential patient’s veteran status; and (ii) that medical records show either a TBI diagnosis or a history of head injury that could have led to TBI or post-concussion syndrome (“head injury”). The eligibility review would also assess whether the veteran is psychiatrically stable and has no indication of unmanaged substance use disorder. If the potential patient meets the initial eligibility criteria, the veteran would participate in a 3-4 day in-person evaluation at a Clinical Program site. Based on this evaluation, specialists at the Clinical Program would collectively determine whether the intensive outpatient program is appropriate for the veteran on a case-by-case basis. If the veteran is approved, then the veteran would return for 3 weeks of intensive outpatient interdisciplinary treatment provided or coordinated by clinicians at one of the Clinical Programs. After the three-week program, case managers at the Clinical Programs would continue to follow up with the veteran for one year or longer, as needed, to assist the veteran with navigating resources for follow-up treatment and other services.

The Proposed Arrangement only includes medically necessary care and other ancillary services that are integral to the veteran’s specific intensive outpatient treatment program. If the veteran requires treatment or services that are related to the TBI, Head Injury or PTS but are not directly provided by the Clinical Program, then the Clinical Program would make arrangements with a third party for the services, and the cost of the services would be covered by the Clinical Program. If the veteran requires treatment or services unrelated to the TBI, Head Injury or PTS the Clinical Program would refer the patient elsewhere for treatment, but the unrelated treatment costs would not be covered by the Clinical Program.

Funding for Clinical Programs

Requestors propose to use charitable donations to cover the expenses that veterans would incur while receiving evaluation and treatment by the Clinical Programs, including out-of-pocket costs for treatment related to the veteran’s TBI, Head Injury or PTS and travel-related expenses to ensure that the veterans and their families incur no out-of-pocket expenses for participation in the Clinical Program regardless of ability to pay or any potential insurance status. Many offered services would not be covered by insurance, so without the financial support, veterans and their families would be left with large out-of-pocket expenses. Requestors will not advertise the availability of financial assistance.
Requestors would use charitable donations to provide three types of assistance:

• All out-of-pocket costs for treatment by the Clinical Programs and by third parties for the treatment related to the veteran’s TBI, Head Injury, or PTS diagnosis. For veterans without insurance, Requestors would cover all costs. For veterans with insurance, Requestors would cover all cost sharing and the cost of non-covered services. If a third-party provides services, the Requestors would instruct the third party to bill the Clinical Programs rather than the veteran or any payor.
• The cost of travel, modest lodging, and meals for in-person evaluation and treatment for the veteran, and as needed, a companion.
• The cost of travel for the veteran’s family for the last week of intensive outpatient treatment. The family’s in-person attendance is necessary to plan to meet the veteran’s future needs.

Funds for financial assistance will be raised from donors. The donors would be individuals and organizations that support veterans’ needs but would not be individuals or entities in the health care industry or entities that manufacture or furnish items or render services billable to Federal healthcare programs. Even with financial assistance, Requestors would sustain financial losses because the donor support is not expected to cover all of Requestors’ costs.

OIG Determination

OIG advised that the proposal would implicate both the AKS and the Beneficiary Inducements CMP provision. No exception or safe harbor covers the proposed conduct. However, OIG determined that, because of the unique circumstances present in the Proposed Arrangement, the Proposed Arrangement presents a minimal risk of fraud and abuse under the AKS and OIG will exercise its discretion and not impose sanctions under the Beneficiary Inducements CMP. OIG identified a number of factors supporting this decision:

• The Proposed Arrangement is unlikely to increase costs inappropriately for the federal healthcare programs and could result in overall cost savings because some services provided are not covered, and others will be provided by third parties would not be billed to the federal healthcare program. Requestors also certified that they would only provide medically necessary care and other ancillary services integral to the veteran’s treatment.
• Donors are not involved in the health care industry and do not render services or furnish items billable to a federal healthcare program. Donors would not have an interest in veterans receiving any particular items or services.
• There is a low risk that the Proposed Arrangement would induce veterans to receive any services from Requestors outside of those offered through the Clinical Programs. The Proposed Arrangement is designed to enable veteran access to the services of the Clinical Programs, not other covered services that are not a part of the Clinical Programs.
• Requestors will not advertise the availability of financial assistance, but all veterans will receive financial assistance regardless of insurance status or need.
• The Proposed Arrangement is unlikely to result in “leapfrogging” concerns where an arrangement would result in the bypassing of other providers equipped to provide quality medical care. To Requestors’ knowledge no other entities provide a similar, coordinated suite of services.

The Advisory Opinion may not be relied upon by anyone other than the Requestor.  A copy of Advisory Opinion 22-15 is available here.
Reporter, Alana Broe, Atlanta, +1 404 572 2720, abroe@kslaw.com.

DOJ and HHS Issue Healthcare Fraud and Abuse Control Program Fiscal Year 2021 Report – Last week, DOJ and HHS-OIG published its annual report regarding the Healthcare Fraud and Abuse Control (HFAC) Program (the Report). The Report summarizes the enforcement activity of DOJ and HHS and states that during Fiscal Year (FY) 2021, the Federal Government won or negotiated more than $5 billion in healthcare fraud judgments and settlements in addition to other healthcare administrative impositions in healthcare fraud proceedings.

These efforts, along with efforts in prior years, resulted in approximately $1.9 billion being returned to the Federal Government or paid to private persons in FY 2021. Of the $1.9 billion, the Medicare Trust Fund received approximately $1.2 billion.
With respect to enforcement actions, DOJ opened 831 new criminal healthcare fraud investigations, a decrease from the 1148 new criminal healthcare fraud investigations opened in FY 2020 as summarized in the FY 2020 HCFAC Report, available here. In addition, 312 defendants were convicted of crimes relating to healthcare fraud in FY 2021, a decrease from 440 in FY 2020. DOJ also opened 805 new civil healthcare fraud investigations in FY 2021, a decrease from 1079 new civil investigations in FY 2020.

HHS-OIG conducted investigations in FY 2021 as well, which resulted in 504 criminal actions against individuals or entities that engaged in crimes related to Medicare and Medicaid, and 669 civil actions, which include false claims and unjust-enrichment lawsuits filed in federal district court, and civil monetary penalty settlements. This was a decrease from the 578 criminal actions and 781 civil actions in FY 2020. HHS-OIG also excluded 1,689 individuals and entities from participation in federal healthcare programs in 2021, a decrease from 2,148 in 2020.

The Report also notes that the return on investment for the HCFAC Program over the last three years (2019-2021) was $4.00 returned for every $1.00 expended, based on actual recoveries and collections.

The Report further highlights significant criminal and civil investigations across the healthcare industry, including with respect to drug companies, durable medical equipment, electronic health records, genetic and COVID-19 testing, home health, hospice, hospitals, lab testing, nursing homes, pharmacies, physicians, prescription drugs and opioids, and psychiatric and psychological testing services. The Report further summarizes activities and accomplishments of the HHS-OIG including enforcements actions, audits/evaluations and its focus on data analytics. The Report also addresses activities of the Centers for Medicare and Medicaid Services, including its use of predictive analytics technology to prevent improper payments, and its medical review activities. In addition, efforts relating to the Food and Drug Administration Pharmaceutical Fraud Program, Department of Justice civil and criminal divisions and Federal Bureau of Investigation are also included in the report.

The FY 2021 HCFAC Report is available here.

Reporter, Lauren S. Gennett, Atlanta, + 1 404 572 3592, lgennett@kslaw.com.

ALSO IN THE NEWS

King & Spalding Webinar – The CMS SAFER Self-Assessment Attestation: New Requirements and New Opportunities for Patient Safety

This panel presentation will explore the recent CMS requirement for Medicare Promoting Interoperability Program (MIPS) eligible hospitals to attest to an annual completion of a Safety Assurance Factors for Electronic Health Records (EHR) Resilience Guides (SAFER) self-assessment. The SAFER Guides are a nine-part risk assessment that includes 147 unique recommended practices to promote the safe use of EHR systems. Topics for discussion include:

• An overview of the SAFER Guides and recommended practices;
• The new hospital self-assessment attestation requirement; and

• Practical strategies to leverage this attestation requirement to create an EHR patient safety advantage for organizations.

The webinar will be held July 27, 2022 from 1:00 to 2:00 p.m. ET.  Registration is free.  More information about the webinar and link to registration is available here.