Medicare’s Hospital Readmissions Reduction Program0

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This November 10, 2014, e-Bulletin is from the Health Law Committee of the Business Law Section of the California State Bar.

In its third year, Medicare’s Hospital Readmissions Reduction Program (“RRP”) penalized hospitals for certain excess readmissions, including those relating to acute myocardial infarction (AMI), heart failure (HF), pneumonia (PN), total hip arthroplasty (THA) and total knee arthroplasty (TKA). On October 1, 2014 (the beginning of the new fiscal year for the federal government), the total amount for which a hospital may be penalized increased to 3 percent (up from 2 percent in fiscal year 2014 and 1 percent in fiscal year 2013). In addition to the increased penalty, this year Medicare also introduced four new measures for inclusion in the Hospital RRP: (1) coronary artery bypass grafts (CABG) surgery; (2) chronic obstructive pulmonary disease (COPD); (3) percutaneous coronary intervention (PCI); and (4) other vascular conditions.

For 2015, the formula employed by CMS to calculate the readmissions penalty is:

Aggregate payments for excess readmissions =

[(sum of base operating DRG payments for AMI) x (Excess Readmission Ratio for AMI-1)] + [(sum of base operating DRG payments for HF) x (Excess Readmission Ratio for HF-1)] + [sum of base operating DRG payments for PN x (Excess Readmission Ratio for PN-1)] + [(sum of base operating DRG payments for COPD) x (Excess Readmissions Ratio for COPD-1)] + [(sum of base operating DRG payments for THA/TKA) x (Excess readmissions Ratio for THA/TKA-1)].

Aggregate payments for all discharges = sum of base operating DRG payments for all discharges. Ratio = 1 – (Aggregate payments for excess readmissions/Aggregate payments for all discharges.) Readmission Adjustment Factor for 2015 is the higher of the ratio or 0.9700, all of which is based on claims data from July 1, 2010 to June 30, 2013.

In California, 223 hospitals (64 percent) were penalized, with the average penalty being 0.41 percent. By comparison, 307 hospitals nationwide lost the maximum amount (1 percent) of their patient reimbursements in fiscal year 2013, and only 18 hospitals lost the maximum amount (2 percent) in fiscal year 2014. This year, 39 hospitals will receive the largest penalty (3 percent).  A complete listing of hospital results for fiscal year 2014–2015 is available at this link (courtesy of Kaiser Health News).

Administrative, Clinical, E-Bulletins, Health Care Law, Health Care Reform, Hospitals, News, Regulatory

California’s Annual Data Breach Report0

statebarlogoThis November 7, 2014, e-Bulletin is from the Health Law Committee of the Business Law Section of the California State Bar.

In the October 2014 California Data Breach Report, Attorney General Kamala D. Harris offers a number of recommendations to protect the 38 million consumers in California, the same state where 17 percent of 2012 data breaches in the United States occurred and with a 28 percent increase in 2013. Some key findings from the AG’s report include:

  • In 2013 the AG’s Office received 167 data breach reports.
  • The retail industry reported the most breaches in 2013 (26 percent). Health care made up for 15 percent of statewide breaches in 2013.
  • More than half of the 2013 breaches (53 percent) were caused by computer intrusions (malware and hacking). The remaining breaches resulted from physical loss or theft of laptops or other devices containing unencrypted personal information (26 percent), unintentional errors (18 percent) and intentional misuse by insiders (4 percent).
  • Between 2012 and 2013, lost or stolen hardware or portable media containing unencrypted data made up the majority of breaches in the health care sector (70 percent).

… Read more →

Administrative, Clinical, E-Bulletins, Health Care Law, Health Care Reform, Hospitals, News, Regulatory, Technology

Safeguarding the Pharmaceutical Distribution System0

This October 23, 2014, e-Bulletin is from the Health Law Committee of the Business Law Section of the California State Bar.

statebarlogoIn November 2013, Congress passed and President Obama signed into law the Drug Quality and Security Act (the “2013 Act,” Public Law 113-54), which intended to create uniform, national licensing standards for wholesale distributors and third-party logistics providers for the purpose of safeguarding the pharmaceutical distribution system.  In passing this new law, Congress recognized the need for clarity in distinguishing between manufacturers, wholesalers and distributors. To this end, the 2013 Act established uniform, national licensing standards that specifically preempted existing state licensing requirements for participation in the supply chain of pharmaceutical products. … Read more →

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Affordable Care Act and Health Plans Offered by Religious Employers0

Update from The State Bar Business Law Section’s HEALTH LAW COMMITTEE – The Affordable Care Act and Health Plans Offered by Religious Employers

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Since first announced in August 2011, the inclusion of contraceptive care as a mandatory component in the employer promotion of preventative services sparked a First Amendment inferno that many thought threatened the Affordable Care Act as well as a number of additional federal and state laws.  As a result, the Federal Government partially recanted this requirement by delaying its implementation for certain entities by an additional year. Regulations promulgated in 2012 kept contraceptive care in the gamut of preventative services, but created a temporary enforcement safe harbor for objecting employers. In 2013, the Federal Government issued proposed rules in an attempt to end the contraception controversy and its challenge to the Affordable Care Act’s commitment to preventative services. Some 200,000 comments later, the preventative services coverage rules in 2013 lowered the burden so employers can sidestep certain separations between church and state.  … Read more →

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