MHA's Executive Briefing

Congress urged not to repeal ACA limits on physician self-referral

The American Hospital Association, Federation of American Hospitals, and Coalition of Full Service Community Hospitals on April 6 urged members of Congress to strongly oppose two recently introduced bills (H.R. 1186 and H.R. 1159) that would repeal new limits on physician self-referral under the Patient Protection and Affordable Care Act.

"To be clear, community hospitals embrace fair competition where facilities compete over quality, price and patient satisfaction," they said in a letter to freshmen House Republicans. "However, we are strongly opposed to self-referral which skews the marketplace in favor of physician owners who self-refer the healthiest and wealthiest patients to their own facilities…The data gathered over the last decade clearly showed that self-referral was creating an unlevel, anti-competitive playing field, and threatened patient safety, as well as the health care safety net provided by full-service community hospitals."

H.R. 1186, introduced by Rep. Sam Johnson (R-TX), would repeal the ACA moratorium on self-referral to physician-owned hospitals formed after Dec. 31, 2010. H.R. 1159, introduced by Rep. Doc Hastings (R-WA), would repeal both the moratorium and the requirement that physicians disclose their ownership interest in hospitals to patients.

CMS Open Door Forum on Transparency Reports Recap

The Centers for Medicare and Medicaid (CMS) recently held a Conference Call entitled, “Special Open Door Forum on Transparency Reports and Reporting of Physician Ownership or Investment Interests.”

During the conference call, a number of issues and questions were discussed regarding Section 6002 of the Affordable Care Act (ACA)—commonly known as the Physician Payment Sunshine Act—which requires the public reporting of payments or other value transfers made to physicians and teaching hospitals by manufacturers and group purchasing organizations of drugs, devices, biologicals, and medical supplies that are covered by Medicare, Medicaid or the Children’s Health Insurance Program.

Before addressing the questions and comments, the moderator noted that CMS will soon begin a draft notice of proposed rulemaking on Section 6002, which is expected to be published later this year. She also noted that stakeholders should submit comments on the questions discussed during this conference call by April 7.

Comments can be emailed directly to physiciansunshine@cms.hhs.gov. Additionally, a recording of the call will be accessible until March 28 at 1-800-642-1687, meeting code: 51513536.

An audio recording and transcript of the call will be posted to the Special Open Door Forum website and will be accessible for downloading beginning on or around April 21, 2011.

Read more here.

House bills would repeal ACA limits on physician self-referral

Reps. Sam Johnson (R-TX) and Doc Hastings (R-WA) each introduced legislation March 17 to repeal new limits on physician referral to hospitals in which they have an ownership interest, which were included in the Patient Protection and Affordable Care Act. Johnson’s bill (H.R. 1186) would repeal the ACA moratorium on self-referral to physician-owned hospitals formed after Dec. 31, 2010, while Hastings’ bill (H.R. 1159) would repeal both the moratorium and the requirement that physicians disclose their ownership interest in hospitals to patients.

“Congress already spoke on this issue when it passed a provision to ban self-referral to new physician-owned hospitals,” said American Hospital Association Executive Vice President Rick Pollack. “We strongly urge Congress to keep the ban in place. Repealing it would drive up health care costs and will make it hard for full-service hospitals to provide essential public services.”

Free Access to Health Affairs Papers on Imaging Self-Referral Boom

In the December issue, Health Affairs published a series of papers on the effects of self-referral by physicians for imaging services. For the holidays, Health Affairs is opening up free access to the entire set of imaging papers through Monday, January 3.

Learn more here.

Study: Physician ownership of medical equipment highlights self-referral issue

One in six physicians in 2008 reported that their practice owned or leased advanced imaging equipment, according to a new study by the Center for Studying Health System Change. Another 25% reported that their practice owned or leased equipment for laboratory services, 23% for X-rays, 29% for non-invasive procedures and 11% for invasive procedures. One in seven physicians reported that their practice owned or leased three or more types of equipment.

"Given the growing evidence that physician self-referral contributes to unnecessary and costly care, policy makers might reconsider the broadness of the in-office ancillary service exemption to the Stark law," the study concludes. "Ultimately, moving away from fee-for-service payment toward payment mechanisms that reimburse physicians for a broader unit of service, such as an episode of care, or putting physicians at least partially at risk for the cost of care will alter the financial incentives that now encourage physician self-referrals."

[ via AHA News Now ]

Health Affairs examines physician self referrals for imaging

The December issue of Health Affairs contains four studies that examine physician self-referrals for imaging. Collectively, the studies conclude that when physicians who are not radiologists refer patients to imaging facilities that they own or lease, imaging services are overused and spending increases without any noticeable benefit to patients.

One researcher urges policymakers to curb abuses of self-referral and take steps to ensure Medicare patients receive only medically necessary imaging services. Researchers for the American College of Radiology found that self-referrals do not offer some of the advantages often mentioned by orthopedists, neurologists and others who have invested in high-tech imaging, such as MRI and CT scans.

The ACR team concludes that the practice usually leads to higher costs and only rarely with shorter episodes of illness. Funding for these peer-reviewed studies was provided by a grant from Blue Shield of California Foundation.

[ via AHA News Now ]

CMS issues self-referral disclosure protocol

The Centers for Medicare & Medicaid Services on Sept. 23 released a protocol for voluntarily self-disclosing actual or potential violations of the physician self-referral statute, as required by the Patient Protection and Affordable Care Act. When a Medicare service provider or supplier electronically submits a disclosure under the self-referral disclosure protocol, CMS will review the circumstances surrounding the matter disclosed to determine a resolution.

The provider or supplier's ACA obligation to return any potential overpayment within 60 days will be suspended until they enter a settlement agreement, or withdraw or are removed from the protocol. The protocol cannot be used to obtain a CMS determination as to whether an actual or potential violation of the physician self-referral law occurred, or to disclose conduct already disclosed under the Office of Inspector General's self-disclosure protocol.

The American Hospital Association supported the ACA provision requiring the self-referral disclosure protocol, and urged the Department of Health and Human Services to make full use of the authority granted by Congress to assure fair enforcement of the self-referral law. The self-disclosure protocol was issued as an information collection request that received emergency approval.

Physician-owned hospitals file lawsuit over ban

A group of physician-owned hospitals in Texas is suing for a stop to the new health care law's ban on Medicare and Medicaid reimbursements to future doctor-owned facilities, reports the Dallas Morning News.

The complaint, filed in a Tyler, Texas, court June 3, alleges that two large hospital associations made a deal with Congress and the Obama administration last year acquiescing to lower Medicare reimbursements in exchange for the ban on payments to future physician-owned hospitals.

Supporters of the ban say that physician-owners have a conflict of interest and too much power to cherry-pick the best-paying patients, while opponents such as Physician Hospitals of America say that the restrictions on these facilities will limit access in areas where they are desperately needed.

Read the press release here.

Representatives ask GAO to study self-referrals in imaging services

House Energy and Commerce Committee Chairman Henry Waxman (D-CA), Ways and Means Committee Chairman Sander Levin (D- MI) and Health Subcommittee Chairman Pete Stark (D-CA) have asked the Government Accountability Office to evaluate the extent of physician self-referral arrangements for advanced imaging and radiation oncology services and their impact on Medicare spending. In a recent letter to GAO, the committee leaders expressed concern that "the potential financial incentives associated with self-referral could lead to the overprovision of imaging and radiation oncology services."

[ via AHA News Now ]

Hospital groups recommend new self-referral exceptions

In a comment letter on Feb. 17, the American Hospital Association, Association of American Medical Colleges and Federation of American Hospitals offered the Centers for Medicare & Medicaid Services specific recommendations for two new exceptions to the physician self-referral law “to enhance the ability of hospitals and physicians to work together to foster high-quality, cost effective patient care using economic incentives.” Noting that a CMS’ draft proposal would create “unnecessary barriers to designing arrangements that benefit patient care,” the associations called for an improved framework that “specifies only the essential requirements … while permitting flexibility for how they are met.”

In a companion letter to the Inspector General’s Office, the associations requested formal withdrawal of the 1999 Special Bulletin regarding gainsharing arrangements, noting that the use of incentives has become increasingly important “to foster improvement in quality and efficiency and is embedded in many current federal health care initiatives.” The associations said, “We agree with the OIG’s implicit acknowledgment that the experiences and context that gave rise to the 1999 Bulletin have significantly changed … and believe that the interpretation of the CMP [civil money penalties] standard as set forth in the Bulletin is no longer consistent” with the OIG’s thinking on the statute. They conclude, “If the CMP provision were restated in the way we believe it was intended – to prohibit only payments intended to reduce reasonable and medically necessary services – these quality-improvement and shared-savings programs, which contain sufficient safeguards against this risk, would be able to proceed.”

The associations also requested that OIG and CMS coordinate enforcement policy on these programs, adding, “A companion safe harbor from the OIG would provide hospitals and physicians the benefit of coordinated guidance that would facilitate the development of these programs. We believe our recommendations to CMS would provide an appropriate basis for an anti-kickback statute safe harbor to be issued by the OIG.”