Navigating The Rapids of Health Care Reform Without a Paddle0

 This article first appeared in Corporate Compliance Insights on March 28, 2013.

“The only fence against the world is a thorough knowledge of it.”  – John Locke, philosopher (1632-1704)

In its bid to restructure the nation’s health care system, the 2010 Patient Protection and Affordable Care Act (the “ACA”) has created both challenges and opportunities in the areas of corporate compliance, governance and risk communities. In three short years, myriad regulatory clarifications have swollen this 906-page statutory giant into a 70,000-page behemoth whose might has been enough to overcome the judicial and electoral challenges of 2012, eliminating any doubts as to whether reform is here to stay.

At its core, the ACA means different things to different people. Patients typically focus on the promise of new guarantees and protections for health insurance for the populace, as well as the penalties for those who remain without coverage. But the ACA has also captured the attention of health care providers as they shift from a formerly cost-based system toward one that gauges success or failure primarily on patient experience. Even the insurance industry must yield to the new law and wend its way through a changing landscape complete with medical loss ratio requirements, the end of lifetime limitations, challenges to any increase in premiums over a certain percentage, and the soon to be introduced Health Insurance Exchanges.

While the infusion of elements such as innovation, preventative care and overall wellness provide the Federal Government with a new and as yet untested backup plan to ensure the success of health care reform, plenty of room still exists within the ACA to combat health care fraud, abuse and waste. The False Claims Act stands at the forefront in the government’s battle to preserve the integrity of health care resources, although the law has evolved considerably since first signed into effect by President Lincoln in 1863.  By ensuring the legacy of the FCA for future generations, however, the ACA has also created several compliance risks for companies across the nation.  Here are the top five: … Read more →

Administrative, Clinical, Community, Health Care Reform, Historical, Hospitals, News, Regulatory

Two Strikes and Contraception is Out0

On February 1, 2013, the Federal Government issued proposed rules that may finally end the contraception controversy and its challenge to the Affordable Care Act’s commitment to preventative services, including addressing requirements relating to all FDA-approved contraceptive methods, sterilization procedures, and patient education and counseling for all women with reproductive ability.

The proposed rules lower the bar for employers engaged in secular and religious purposes, as well as those religious employers who hire outside the fold. The latest version acquiesces to eligible organizations opposed to contraceptive coverage, finally offering absolution from the requirements of Section 2713 of the Public Health Service Act, Section 715(a)(1) of the Employee Retirement Income Security Act and Section 9815(a)(1) of the Internal Revenue Code.  In essence, the proposed rules let these employers practice what they preach. … Read more →

Administrative, Clinical, Community, Health Care Law, Health Care Reform, Historical, News, Regulatory

The Affordable Care Act: A Not-So-Little Train That Must0

This article was first published in the Los Angeles Daily Journal on February 25, 2013.

“Things do not change. We change.”  – Henry David Thoreau

Finally free from the uncertainty of looming elections or Supreme Court decisions questioning constitutionality, modern American health care can now be compared to a speeding train serving infinite destinations, with conductors and passengers alike learning the routes along the way. Public transportation is usually forgiving, as the tardy or confused passenger always has the opportunity to catch the next train, but such is not always true in matters of public health.  Whether fan or foe of the Affordable Care Act (the ACA), this epic codification of health care reform is something that America cannot afford to miss.

At the time the ACA was passed in March 2010, by a margin of seven of the collective 431 Congressional votes, few of those involved had any real working knowledge of the 10,909 sections contained within the Patient Protection and Affordable Care Act, which were quickly adjusted and finalized by congressional changes the following week in the form of the Health Care and Education Reconciliation Act. Weighing in at over 900 pages, hindsight makes it clear that the ACA was only the beginning of the federal government’s plan to restructure the nation’s health care system, a fact that has been compounded by an estimated 70,000 pages of further regulations in the three years since President Barack Obama signed the ACA into law. … Read more →

Administrative, Clinical, Community, Health Care Law, Health Care Reform, Historical, Hospitals, News, Regulatory

Return of the Hall Monitor0

Say Hello to the Chief Compliance Officer at a Pharmaceutical Company Near You

This article first appeared in Pharmaceutical Compliance Monitor on February 11, 2013.

As any teenager will tell you, nobody likes a snitch. When it comes to the antics of the adolescent, rarely is unwanted disclosure or unsolicited intervention met with appreciation.  And yet, in observing the conduct displayed recently throughout many fields in our nation’s business sector, similar sentiment rang true across corporate America, and the moral “high road” was rarely found to intersect with the path most traveled. The health care industry was no different, and any strict constructionist interpretation of the Hippocratic Oath usually limited “do no harm” to the delivery of patient care in its most literal sense, foregoing the machinations conspiring behind the scenes to keep a hospital’s doors open in the face of a souring economic climate.

Now Is the Time for Compliance

The ethical transformation in health care that gained momentum one score and seven years ago has its origins in a law signed on March 2, 1863, by the president famous for the words “four score and seven years ago” uttered that same year.  The False Claims Act (the “FCA”), also known as “Lincoln’s Law” and the “Informer’s Act,” has evolved considerably since its enactment to become the “primary litigative tool for combating fraud” (see S. Rep. 99-345, at 2 (1986)).  … Read more →

Administrative, Community, Health Care Law, Health Care Reform, Hospitals, News, Regulatory

The Poor Get Poorer: The Fate of Distressed Hospitals Under the Affordable Care Act0

This article, written by Samuel R. Maizel and Craig Garner, first appeared at 2012 No. 12 Norton Bankr. L. Adviser 1 in December 2012. 

Synopsis

Distressed hospitals in America operate on small or non-existent profit margins.3 For many of those hospitals, the federal Medicare program and the individual States’ Medicaid programs are the largest payors. While the Patient Protection and Affordable Care Act of 2010 (the “Affordable Care Act”) was designed in part to increase the number of insured nationwide, the result of which should be positive for hospitals, any cause for celebration must first address the cost containment provisions in the Affordable Care Act that create new concerns for financially distressed hospitals. Included among the multitude of provisions in the Affordable Care Act are an immediate 1% cut in Medicare revenue, phased in reductions in disproportionate share payments to hospitals, future, permanent penalties of up to 1% of Medicare payments for hospitals which perform poorly under the Hospital Value Based Purchasing Program, and additional penalties for hospitals with unacceptable rates of re-admission or too many hospital acquired conditions rates.4 Together these cuts create a daunting challenge for the many financially distressed hospitals in America that simply lack the resources to establish an infrastructure designed to treat Medicare patients in this era of change.

Background

Medicare is the federal program that provides health care coverage to individuals aged 65 or older. Medicaid offers similar access for medical services on a state level for qualifying individuals, many of whom are poor. Medicaid covers 69 million people.5 By 2020, under the Affordable Care Act the number of Medicaid beneficiaries is likely to increase to 93 million.6 Combined, Medicare and Medicaid pay for more than half of the annual hospital bills in America. … Read more →

Clinical, Community, Health Care Law, Health Care Reform, Historical, Hospitals, News, Regulatory, Technology

A Lesson from the Sneetches0

This Practitioner Application to the article “Post Acute Care and Vertical Integration After the Patient Protection and Affordable Care Act” (by Patrick D. Shay and Stephen S. Mick) appeared in the January/February Edition (Volume 58, No. 1) of the Journal of Healthcare Management.

In his classic tale “The Sneetches,” Theodor Seuss Geisel (Dr. Seuss, 1961) created a society divided by entitlement in which the lines of separation were removed, thrusting its members together. A satire about discrimination, “The Sneetches” offers children an early introduction to the arbitrary walls that those forces governing society can build and destroy at their whim.

Shay and Mick may be said to describe a similar scenario as they apply provisions of the 2010 Affordable Care Act (ACA ) to post-acute care and vertical integration under the Medicare Shared Savings Program (also known as accountable care organizations or ACOs) and to bundled payment systems. They note that these are the areas in which the influences of the ACA are most apparent. In the process, Shay and Mick remind us that perception is formed largely on the basis of factors lurking beneath the surface that care little for public opinion. For example, much like Dr. Seuss’s Sneetches, Hurricane Sandy, which struck the East Coast shoreline in October 2012, rendered the “haves” and “have nots” almost indistinguishable. Bellevue Hospital, the oldest hospital operating in the United States, was capable of offering roughly as much care during and immediately following the hurricane as it was in 1736, when the New York City Almshouse designated six bedrooms as Bellevue’s first “ward.” … Read more →

Administrative, Children's Health, Clinical, Community, Health Care Law, Health Care Reform, Historical, Hospitals, News, Regulatory

Health Care Reform: Walking the Fine Line Between Epic and Tragic0

This article was first published at California Healthcare News on January 8, 2013.

The recent changes to the core structure of modern American health care are nothing short of epic, rivaled in historic scale only by the introduction of Medicare in 1965. Although each decade over the past 50 years has in some way used government programs and incentives in an attempt to urge health care to undergo recalibration as a means to establish industry stability, by the end of the first decade of the 21st Century it had become evident that health care in the United States was fast becoming unsustainable as it existed. Enter health care reform.

Three years after the Federal Government passed the Affordable Care Act in an attempt to right the sinking ship, we the people are still waiting for the tide to turn. Having survived last summer’s monumental challenge before the United States Supreme Court and a presidential election in November, the Affordable Care Act has not only emerged as the law of the land, it has cemented its place as health care’s blueprint throughout America for decades to come. For California, however, the timing is unjust, as the perfect storm brought about by fiscal cliff/debt ceiling concerns heads straight for Sacramento from the east just as health care’s versions of Scylla and Charybdis approach forebodingly from both north and south. … Read more →

Administrative, Clinical, Community, Health Care Law, Health Care Reform, Historical, Hospitals, News, Regulatory, Technology

Winter Journal 20130

I am pleased to share with you a collection of my most recent writings on the Affordable Care Act, all of which can be accessed through this link: Click Here for the Winter Journal 2013

The recent changes to the core structure of modern American health care are nothing short of epic, rivaled in historic scale only by the introduction of Medicare in 1965.  Although each decade over the past 50 years has in some way used government programs and incentives in an attempt to urge health care to undergo recalibration as a means to establish industry stability, by the end of the first decade of the 21st Century it had become evident that health care in the United States was fast becoming unsustainable as it existed.

Having survived last summer’s monumental challenge before the United States Supreme Court and a presidential election in November, the Affordable Care Act has not only emerged as the law of the land, it has cemented its place as health care’s blueprint throughout America for decades to come. Unfortunately, the speed at which health care reform appears to move can at times be dizzying, and its demands are often draconian at first glance.

History has shown that health care in the United States is resilient, and often finds ways to surprise even its toughest critics. Though it is too soon to predict the future of health care in the United States, the value of historical information pertaining to the evolution of our health care system should not be discounted.  Only through the combination of historical perspective and modern-day analysis have I been able to understand the essence of the Affordable Care Act.

It is my hope that the following articles will provide the reader with similar guidance.

Very truly yours,

Craig B. Garner

Administrative, Clinical, Community, Health Care Law, Health Care Reform, Historical, News, Non Clinical, Regulatory, Technology

Redefining the Valuation Methods of Modern Day Hospital Care1

This article was first published in the New York State Bar Association’s Health Law Journal, Vol. 17, No. 3 (Summer/Fall 2012).

Due to the sensitive nature of the industry it services, the American hospital must rightfully operate under copious federal and state regulations, in addition to volumes of rules and ordinances established by separate, non-governmental entities. Though policing policies such as accreditation, certification and periodic review come from a variety of both public and private sources, the goal is generally consistent: develop uniform standards to ensure that hospitals in the U.S. operate at an acceptable safety level while delivering quality patient care.

The Many Paths to Accreditation

Though its primary function is without question the delivery of accurate and effective medical treatment, health care is also big business.[1] In an attempt to promote constant vigilance among America’s hospitals, any one institution may be subject to accreditation review at any time from private, non-governmental organizations such as the Joint Commission,[2] the Healthcare Facilities Accreditation Program (HFAP),[3] Accreditation Commission for Health Care (ACHC),[4] Community Health Accreditation Program (CHAP),[5] the Compliance Team, Inc.,[6] Healthcare Quality Association on Accreditation (HQAA),[7] or DNV Healthcare, Inc. (DNV),[8] among others.[9]

By and large, each private entity governs through its own set of rules.  For example, the Joint Commission surveys hospitals by following more than 276 standards and reviewing 1,612 elements of performance.  HFAP does largely the same thing pursuant to its 1,100 or more individual standards.  Focusing on home medical equipment as well as durable medical equipment, prosthetics, orthotics and supplies (“DMEPOS”), HQAA has developed a review process consistent with federal standards.[10] … Read more →

Administrative, Clinical, Community, Health Care Law, Historical, Hospitals, Miscellaneous, News, Regulatory, Surgery

The Supreme Court Opens the Road to Health Care Reform, But Will California Meet the Challenge?0

This article, by Craig B. Garner, Esq. and Julie A Simer, Esq., first appeared in the Business Law News of the State Bar of California (Issue 3 2012).

Almost 28 months after President Barack Obama signed the Affordable Care Act (“ACA”)[1] into law, the United States Supreme Court upheld the constitutionality of health care reform.[2]  Though the underlying arguments set forth in the 59-page majority slip opinion venture deep into the labyrinth of constitutional law and test the traditional boundaries of federalism, the holding itself is clear and concise: (1) the ACA’s individual mandate is constitutional;[3] and (2) the Medicaid expansion provisions found within the ACA survive, but the Federal Government is prohibited from penalizing “[s]tates that choose not to participate in [the Medicaid expansion] by taking away their existing Medicaid funding.”[4]   The decision promises to have a dramatic effect on California, as the country’s most populous state.

In ruling that the individual mandate is constitutional, the Court rejected the Commerce Clause[5] and the Necessary and Proper Clause[6] in the Constitution as bases for upholding the mandate. The Court held that the Commerce Clause failed to provide a sufficient nexus between the requirement to purchase health insurance and its anticipated effect on interstate commerce to validate the individual mandate:

No matter how “inherently integrated” health insurance and health care consumption may be, they are not the same thing: They involve different transactions, entered into at different times, with different providers.  And for most of those targeted by the mandate, significant health care needs will be years, or even decades, away.  The proximity and degree of connection between the mandate and the subsequent commercial activity is too lacking to justify an exception . . . .[7]

Chief Justice Roberts noted that the Commerce Clause does not give Congress the authority to compel an individual “to become active in commerce by purchasing a product, on the ground that … failure to do so affects interstate Commerce.” [8]  Likewise, the Court rejected the Necessary and Proper Clause as a means to sustain the individual mandate, finding it was not “an essential component of the insurance reforms.”[9] The Court distinguished previous decisions upholding laws under the Necessary and Proper Clause, because the laws at issue in those cases “involved exercises of authority derivative of, and in service to, a granted power.”   Whereas, the individual mandate would give Congress the ability to create the “necessary predicate to the exercise of an enumerated power.” The Court added:  “Even if the individual mandate is ‘necessary’ to the Act’s insurance reforms, such an expansion of federal power is not a ‘proper’ means for making those reforms effective.[10] … Read more →

Administrative, Community, Health Care Law, Health Care Reform, Historical, Hospitals, News, Regulatory

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