Is CMS listening to PAC provider’s concerns about securing physician documentation?

In a recent FAQ CMS published relating to the Pre-claim Review Demonstration for Home Health Services, CMS provided an interesting response to a question about  what home health agencies (HHAs) should do if a certifying physician won’t provide documentation.

Post-acute care (PAC) providers, including HHAs, have been concerned with an inability to secure documentation from physicians and/or to secure timely physician visits in order to meet regulatory compliance expectations.  In the FAQ, published 9/15/16, CMS provides –

Q.  What should HHAs do if the certifying physician will not provide documentation?

A. CMS created an informational letter directed towards physicians that will be available for download on the Pre-Claim Review Demonstration for Home Health Services website. Home Health Agencies can give the letter to physicians reminding them of their responsibility to provide the documentation. If the physician and/or facility will still not provide the documentation, Home Health Agencies should notify their MAC or CMS (at of the uncooperative physicians and/or facilities. Physicians and/or facilities who show patterns of non-compliance with this requirement, including those physicians and/or facilities whose records are inadequate or incomplete, may be subject to increased reviews, such as through provider specific probe reviews.

This statement from CMS reveals that it has started to hear and respond to PAC provider concerns about securing physician documentation in order to meet CMS compliance requirements.  Real behavior change may come when providers use the process outlined and CMS follows up on complaints. However, whether or not providers actually use the process of notifying the MAC or CMS, given the referral relationship providers maintain with physicians, remains to be seen.

For more information on the FAQ, home health, Medicare payment, or regulatory compliance in general, please feel free to contact Ari Markenson at or 212.692.1012.

CMS Arbitration Rules

By Susan V. Kayser

CMS has released the final version of a broad-based proposed rule update that will take effect November 28, 2016.  One of the most notable provisions is a prohibition on including a mandatory arbitration provision in a nursing home admission agreement.  Long a bone of contention, with strong advocacy efforts on each side of the question of whether such mandatory clauses should be allowed, it remains to be seen whether the rule will be challenged in court.  Those against mandatory arbitration say it deprives individuals of their day in court; those in favor say there are benefits, including less expensive and quicker resolution of claims.

Only admissions agreements of future residents will be affected by the new rule.  Providers should note too that arbitration clauses are not banned altogether.  In a blog post on September 28, 2016, Acting CMS Administrator Andy Slavitt stated “[f]acilities and residents will still be able to use arbitration on a voluntary basis at the time a dispute arises.”  He went on to say that “[e]ven then, these agreements will need to be clearly explained to residents, including the understanding that these arbitration agreements are voluntary, and that these agreements should not prevent or discourage residents and families from talking to authorities about quality of care concerns.”

The new rule includes a number of other new or modified provisions, which according to CMS were designed to set higher standards for quality and safety in long-term care facilities and protect and empower residents, with a focus on preventing abuse and neglect in facilities.

Government Cracks Down On Nursing Home Use of Social Media

On August 5, 2016, the Centers for Medicare and Medicaid Services (CMS) published a Survey and Certification Memorandum (Notice) urging State health departments to enforce violations by nursing homes in posting patient images on social media. This development was interesting given that the Office for Civil Rights (OCR), the enforcer of the Health Insurance Portability and Accountability Act (HIPAA) Privacy and Security Rules, presumably should already be cracking down on any such violations of resident rights as a violation of HIPAA. According to Modern Healthcare, increased instances of nursing home staff inappropriately posting resident pictures on social media may have sparked this pronouncement by CMS.

Specifically, CMS will more strictly enforce, through State agencies, corrective actions to ensure that employee postings of residents in a degrading manner do not occur in the nursing home setting. Interestingly, the Notice does not discuss nursing homes reporting such employee conduct to OCR, but does indicate that employees should report such postings on social media of residents as abuse “to at least one law enforcement agency.” Continue reading Government Cracks Down On Nursing Home Use of Social Media

Duane Morris’ Michael E. Clark to Present at ABA’s Third Medical Device & Healthcare Technology Compliance Institute

Duane Morris special counsel Michael E. Clark will serve as program chair and moderate the panel discussion, “Yates Memorandum: The New Normal?” during the American Bar Association’s (ABA) Third Medical Device & Healthcare Technology Compliance Institute, to be held on October 13–14, 2016, in Washington, D.C. Mr. Clark’s presentation will take place on Thursday, October 13, at 9:00 a.m.

The session will feature a discussion of the Department of Justice’s new policy to prosecute corporate executives with a focus on the ethical considerations of representing corporations and executives. There will be an emphasis on ethical considerations, including scope of representation, client identification and duties. CLE Ethics Credit is available.

For more information, please visit the event listing on the Duane Morris website.

Another Positive Development for the Medical Marijuana Industry

Just one week after the DEA and FDA reiterated the federal government’s willingness to allow broader research into the health benefits of cannabis, the Ninth Circuit Court of Appeals issued a decision barring the DOJ from using federal funds to prosecute individuals and businesses conducting activities in compliance with state medical cannabis laws and regulations.

In U.S. v. McIntosh, No. 15-10117, (9th Cir. 2016), the Court determined that a rider (§ 542) to the appropriations act that funded the government through September 30, 2015, which provided that funds made available under that act could not be used “to prevent [] States from implementing their own State laws that authorize the use, distribution, possession. of cultivation of medical marijuana,” was to be read as prohibiting the federal government from prosecuting individuals and businesses acting pursuant to those state laws and regulations because such prosecution would effectively prevent the states from implementing their cannabis laws and regulations.

As the Court explained, “DOJ, without taking any legal action against the Medical Marijuana States, prevents them from implementing their laws that authorize the use, distribution, possession, or cultivation of medical marijuana by prosecuting individuals for use, distribution, possession, or cultivation of medical marijuana that is authorized by such laws. By officially permitting certain conduct, state law provides for nonprosecution of individuals who engage in such conduct. If the federal government prosecutes such individuals, it has prevented the state from giving practical effect to its law.”

The Court was also careful to warn industry participants that cannabis-related conduct falling outside a state’s cannabis laws and regulations would not be protected from federal prosecution:  “We conclude that § 542 prohibits the federal government only from preventing the implementation of those specific rules of state law that authorize the use, distribution, possession, or cultivation of medical marijuana. DOJ does not prevent the implementation of rules authorizing conduct when it prosecutes individuals who engage in conduct unauthorized under state medical marijuana laws. Individuals who do not strictly comply with all state-law conditions regarding the use, distribution, possession, and cultivation of medical marijuana have engaged in conduct that is unauthorized, and prosecuting such individuals does not violate § 542.”



Medicare’s Fraud Fighting 2YR ROI – $12.4 for every $1 Invested…

The U.S. Department of Health and Human Services (DHHS) and the Centers for Medicare and Medicare Services (CMS) recently released its – Annual Report to Congress on the Medicare and Medicaid Integrity Programs For Fiscal Years 2013 and 2014.

The biggest and most important take-away from the report – the government achieved “… a two-year average return on investment of 12.4 to 1 for the period that ended on September 30, 2014.”

Program integrity and fraud fighting efforts by DHHS and CMS have consistently represented a significant return on investment for the government. This is likely the single biggest reason why providers have not seen any serious reduction in program integrity efforts and fraud fighting enforcement over at least the last 10 years. Continue reading Medicare’s Fraud Fighting 2YR ROI – $12.4 for every $1 Invested…

Assessing Common Regulatory Risks in Health Care Provider Transactions: Where to start for PE investors…

Health care providers are heavily regulated, that’s no surprise to private equity investors. As a result, investing in health care provider businesses requires savvy in assessing what regulatory risks an acquisition target may present and whether or not those risks are an impediment to moving forward with a transaction.

Common risks include: reimbursement and claims issues, internal audits, external audits, regulatory investigations, criminal and civil government initiated litigation, and licensure and inspection citations or deficiencies.

The diligence process often uncovers one or many issues with any of these common risk areas. Continue reading Assessing Common Regulatory Risks in Health Care Provider Transactions: Where to start for PE investors…

CMS Preventative Measures…Pre-Claim Review Demonstration for Home Health Services

Beginning August 1, 2016, the Centers for Medicare & Medicaid Services (CMS) will be implementing a three-year Medicare pre-claim review demonstration for home health services in the states of Illinois, Florida, and Texas. Michigan and Massachusetts will follow in 2017. CMS is testing whether pre-claim review will help it prevent fraud occurring in Home Health Agencies (HHAs) as well as whether or not pre-claim review will help reduce expenditures while maintaining or improving quality of care.

During the pre-claim review demonstration period, HHAs will submit the same information they currently submit for payment, but will be required to do so earlier in the claims process. Continue reading CMS Preventative Measures…Pre-Claim Review Demonstration for Home Health Services

DOJ Settles Another FCA Case with A Hospice Over Patient Ineligibility

Following on the heels of a number of recent False Claims Act (“FCA”) cases alleging that patients were not eligible to receive hospice services (Good Shepherd Hospice Inc., Guardian Hospice of Georgia LLC,  Hospice of Arizona, L.C. and Altus Healthcare & Hospice Inc., to name a few), the U.S. attorney for the District of Colorado just completed an $18 million dollar settlement with UnitedHealth Group Inc. affiliate, OptumHealth LLC.

The settlement follows the DOJ’s 2014 intervention in two whistleblower-initiated FCA suits.   The whistleblowers, and eventually the DOJ, alleged that the hospice defrauded Medicare by billing services for hospice patients who were not terminally ill.  The DOJ had alleged that the Hospice’s  practices reportedly discouraged doctors from recommending that ineligible patients be removed from hospice and failed to monitor that nurses were accurately recording patients’ conditions in medical records.

As usage of the hospice benefit continues to increase at a rapid pace, investigations of whether or not patient eligibility is determined to be appropriate are going to continue. Additionally, the DOJ’s success in investigating and settling FCA cases relating to hospice eligibility issues  translates into continued enforcement efforts in this area. Providers should focus their compliance efforts on this important risk area and ensure that they are conducted period auditing and monitoring of patient eligibility and physician certifications for hospice care.

For more information on hospice FCA claims or investigations, hospice regulatory enforcement, or Medicare or regulatory compliance in general, please feel free to contact Ari Markenson at or 212.692.1012.

The Marijuana Business Takes Root in Pa.

Duane Morris’ Seth Goldberg was quoted in the Philadelphia Business Journal  on the opportunities and risk facing entrepreneurs in the development medical marijuana industry in Pennsylvania.

While the upfront costs to entrepreneurs wanting to enter the market are expected to run into the millions of dollars, the payoff could be substantial. The ArcView Group, a market research firm that studies the cannabis industry, estimates the Pennsylvania medical marijuana market will start out with annual sales at about $125 million and grow at a rate of about 180 percent per year in the program’s first few years.

“There will also be huge opportunities for entrepreneurs who want to create ancillary businesses that are integral to the core growing and dispensing businesses,” said Seth Goldberg, a Philadelphia attorney with Duane Morris who specializes in commercial and health care matters.

Continue reading The Marijuana Business Takes Root in Pa.