April 1, 2011 Legislation


Medical Staff



MedPAC has recommended to Congress that physicians be given a 1% raise next year instead of the 30% decrease under the SGR.  They also recommend that hospitals get a 1% increase.  They warn of potential fraud in the home health arena.

A bill before the House would repeal the limits of physician self referral to hospitals they own.  This means that more physician owned hospitals may be built.  Guess who is against this bill.  The AHA does not like any competition which would make their hospitals more efficient and physician friendly.   

The CBO has stated that the tort reform bill now before Congress would decrease the federal deficit by about $40 Billion over ten years.  This ain't much but it's better than increasing the deficit which seems to be the current president's want.

The OIG has stated that if unimplemented regs were started by CMS would save billions of dollars.  

CMS is getting rid of the rule that requires a physician signature on a lab slip as intrusive and expensive.   

GAO has reported there are nine alternatives for the potentially illegal individual mandate in Obamacare.  They did not endorse or evaluate the alternatives.  The alternatives are (1) modify open enrollment and penalize late enrollment (2) ease auto enrollment for employer health (3) do public outreach and education (4) personalized help for enrollment (5) impose a tax to pay for uncompensated care (6) increase cost between age groups to get young to sign up (7) restrict access to fed insurance to those with insurance (8) pay brokers to help people rather than give them commissions and (9) require credit rating services to factor in insurance with credit rating.  

The Senate will vote on the bill to get rid of the dreaded 1099 rule.  There are three bills the Senate will consider.  The first is the original one which would require a payback of money by individuals on health exchanges if their circumstances changed.  the second is one that would halt the payback if it is found too onerous.  This is so vague as to be meaningless.  The third is that the voiding of the 1099 rule would not have to be paid for.  The cost of repealing the bill is the loss of $19 Billion to Obamacare.

The House is looking at a bill that would direct HHS to develop their own methodology of payment for physicians instead of using the proprietary AMA RVS book. If that went through it would destroy a major source of funding for the AMA.

The non-partisan Kaiser Foundation has come out with a report on what they believe would happen if Medicare age went from 65 to 67.  They believe that not only would the people in the ages 65 and 66 have to pay more but so would younger people.  The older patients would pay about $2400 more per year and the younger patients would see their premium rise by 8%.  All this is predicated on Obamacare remaining. This would save the feds $7.6 Billion but add $$5.6 Billion to out of pocket costs to the 65 and 66 year olds, and $4.5 billion in employer retiree healthcare costs.

IT'S HERE.  Finally the new ACO rules have been published for comment.  The rules released on 3/31 are 780 pages and I have not read them.  Therefore I will not comment on them as opposed to the Obamacare which was passed with no one reading them.  Also published were the FTC, DOJ rules for antitrust immunity for some ACOs.  Most of the immunity will be given to those ACOs which do not block out other competing ACOs in the community.  ACOs on the cusp or CMS may request the FTC or DOJ to do an expedited review which will take less than 90 days.  

The administration has given its marching orders to the troops as to what to say when they are asked whether the ACO will take away patient choice of physician.  The answer is that ACOs are voluntary and the patient will continue to have free choice, however, not of both ACO and provider.  The troops are also to say the increased coordination will promote better care.  This is thought to be true but has not been proven.

The administration is delaying some Obamacare rules that were supposed to start in July.  The rules regarding insurance appeals will now begin next January.  They originally were to go into place last January.  The reason given for the delay is that the rules are to be changed in the near future.

Texas is one of the states that has a strict Corporate Practice of Medical Care law.  There is a bill afoot to take away that protection for the physician and allow hospitals in rural areas to employ physicians.  

Kentucky has announced that it will cut hospital and physician Medicaid reimbursement by 35%.  This will start April 1 and go to June 30, the end of the fiscal year.  This means that for remainder of the fiscal year physicians will see less if any Medicaid patients.  The hospitals will be stuck as the patients will use the ED as their physician.  How can the hospitals lose more money on these patients?  They can't so they will cut staff and services to the community.  Now the state pays hospitals about 85% of their costs and this would drop to 55%.

Virginia has passed a law that would forbid any licensure problem for any physician that will not take any insurance.  This is especially true of Medicaid with the expansion due to Obamacare.  The vote was unanimous. 

Pennsylvania has joined the myriad of states that can not afford the Obamacare Medicaid plan.  Under Obamacare, 750,000 more people would qualify for Medicaid.  the state can not afford the payments for these extra people.

Vermont's House has passed a bill for single payor health care.  It now goes to the state Senate.  The single payor would be accompanied by Medicare, Medicaid, the cadillac plans of union members as well as self insured plans of the big companies such as IBM.  The legislature did not say how it would be funded but the Governor stated it could be by a 14.5% payroll tax or an income tax.  Under the proposed law a five person professional board would decide benefits, reimbursement rates and how the cost containment and payment reform systems will work.  It was pointed out and dismissed that the large companies of the state would probably have to pay twice, once for their own self administered plan and once for the state plan.  That will not foster growth for the state.   

Rhode Island wants to enact a law that would require commercial insurances to pay physicians 125% of Medicare rates.  In return the physicians would be required to take Medicaid and have at least a 5% free care in their practice.  The state medical society opposes the bill for the obvious reasons.  Fees in the state have always been below their neighbors because the Blues have a monopoly in the state. 

Florida wants to pub Medicaid into HMOs and as part of that the legislature wants a rule that makes those that care for the patients quasi state actors and only be liable under med mal for $300,000 in non economic damages.      Top

Medical Staff

The Joint Commission has put out two new FAQs on MS.01.01.01.  They include the lack of need for any meeting to change bylaws, only a process passed by the medical staff and who from the medical staff may be on the Board of Directors of the hospital. 

Physicians apparently get a choice.  They can either get a 1% bonus on their Medicare billing by prescribing electronically at least 25 times between January 1, 2011 to December 31, 2011 or get the 1% EHR increase, not both.  Also to be exempt from a 1.5% decrease in 2012 one must electronically prescribe at least 10 times in the same period.  This must be done via claims and not registry or EHR.      Top


OIG Advisory Opinion

The OIG has partly reversed a past opinion and states that it is now okay for hospitals to provide free transport for patients from nearby physician offices to the hospital.  This is contingent on the offices being on or very near hospital grounds and the patient needing further treatment and they cannot transport themselves.  The OIG noted the transport would be only 1/4 mile and in a non extravagant mode, a van.        Top


DISCLAIMER: Although this article is updated periodically, it reflects the author's point of view at the time of publication. Nothing in this article constitutes legal advice. Readers should consult with their own legal counsel before acting on any of the information presented.