Nov 29, 2017 | Coding, Billing, and Collections, Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Sales and Marketing, Laboratory Testing, Management & Operations
Medical laboratories today struggle to submit clean claims and be promptly and adequately reimbursed as health insurers institute burdensome requirements and audit more labs
Across the nation, clinical laboratories and anatomic pathology groups of all sizes struggle to get payment for lab test claims. Veteran lab executives say they cannot remember any time in the past when medical laboratories were challenged on the front-end with getting lab test claims paid while also dealing on the back-end with ever-tougher audits and unprecedented recoupment demands.
These issues center upon the new policies adopted by the Medicare program and private health insurers that make it more difficult for many clinical laboratories to be in-network providers, to obtain favorable coverage guidelines for their tests, and to have the documentation requested when auditors show up to inspect lab test claims. This is true whether the audit is conducted by a Medicare Recovery Audit Contractor (RAC) or a team from a private health insurer.
Source of Financial Pressure on Medical Laboratories in US
Another source of financial pressure on medical laboratories in the United States today is the ongoing increase in the number of patients who have high-deductible health plans—whether from their employer or from the Affordable Care Act’s Health Insurance Marketplace (AKA, health exchanges). The individual and family annual deductibles for these plans typically start at around $5,000 and go to $10,000 or more. Many labs are experiencing big increases in patient bad debt because they don’t have the capability to collect payment from patients when they show up in patient service centers (PSCs) to provide specimens.
Some of these developments make it timely to ask the question: Is it a trend for payers to gang up on clinical laboratories and pathology groups and make it tougher for them to be paid for the lab tests they perform? Multiple factors can be identified to support this thesis.
“Is it a coincidence that, in recent years, so many payers are initiating numerous requirements that add complexity to how labs submit claims for lab tests and how they get paid?” asked Richard Faherty of RLF Consulting LLC. Faherty was formerly Executive Vice President, Administration, with BioReference Laboratories, Inc. “I can track four distinct developments that, collectively, mean that fewer lab claims get paid, expose clinical laboratories to extremely rigorous audits with larger recoupment demands, and heighten the risk of fraud and abuse allegations due to use of contract or third-party sales and marketing representatives who represent independent medical lab companies.”
Faherty described the first of his four developments as prior-authorization requirements for molecular and genetic tests. “Health insurers are reacting to the explosion in molecular and genetic testing—both in the number of unique assays that a doctor can order and the volume of orders for these often-expensive tests—by establishing stringent prior-authorization requirements,” he noted.
More Prior-Authorization Requirements for Molecular, Genetic Tests
“At the moment, many clinical lab companies and pathology groups are attempting to understand the prior-authorization programs established by Anthem (which became effective on July 1) and UnitedHealthcare (which became effective on November 1),” explained Faherty. “Just these two prior-authorization programs now cover as many as 80 million beneficiaries. There are plenty of complaints from physicians and lab companies because the systems payers require them to use are not well-designed and quite time-consuming.
“One consequence is that many lab executives complain that they are not getting paid for genetic tests because their client physicians are unable to get the necessary prior authorization—yet the lab decides to perform the test to support good patient care even though it knows it won’t be paid.”
Richard Faherty (left), CEO, RLF Consulting LLC, and formerly with Bio-Reference Laboratories, Inc., will moderate this critical webinar. Joining him will be Rina Wolf (center), Vice President, Commercialization Strategies, Consulting and Industry Affairs, XIFIN, Inc., and Karen S. Lovitch (right), JD, Practice Leader, Health Law Practice, Mintz Levin, PC, Washington, DC. The webinar takes place Wednesday, December 6, 2017, at 2 p.m. EST; 1 p.m. CST; 12 p.m. MST; 11 a.m. PST. Click here to register. (Photo copyright: Dark Intelligence Group.)
Payers Checking on How Clinical Laboratories Bill, Collect from Patients
Faherty’s second trend involves how medical lab companies are billing and collecting the amounts due from patients. “Most payers now pay close attention to how clinical laboratories bill patients for co-pays, deductibles, and other out-of-pocket amounts that are required by the patients’ health plans,” he commented. “Labs struggle with this for two reasons.
“One reason is the fact that tens of millions of Americans currently have high-deductible health insurance plans,” said Faherty. “In these cases, medical laboratories often must collect 100% of the cost of lab testing directly from the patients. The second reason is the failure of many independent lab companies to properly and diligently balance-bill their patients. This puts these labs at risk of multiple fraud and abuse issues.”
Many Medical Lab Companies Undergoing More Rigorous Audits by Payers
Faherty considers trend number three to be payers’ expanding use of rigorous audits of lab test claims. “In the past, it was relatively uncommon for a clinical lab company or pathology group to undergo audits of their lab test claims,” he observed. “That has changed in a dramatic way. Today, the Medicare program has increased the number of private auditors that visit labs to inspect lab test claims. At the same time, private health insurers are ramping up the number and intensity of the audits they conduct of lab test claims and substantially increasing their demands for recoupment without audit.
“One consequence of these audits is that medical laboratories are being hit with substantial claims for recoupment,” noted Faherty. “I am aware of multiple genetic testing companies that have been hit with a Medicare recoupment amount equal to two or three years of the lab’s annual revenue. Some have filed bankruptcy because the appeals process can take three to four years.”
Are Contract Lab Sales Reps More Likely to Offer Physicians Inducements?
Faherty’s fourth significant trend involves the greater use of independent contractors that handle lab test sales and marketing for clinical lab companies. “This trend affects both labs that use third-party lab sales reps and labs that don’t,” he said. “Labs that use contract sales and marketing representatives do not have direct control over the sales practices of these contractors. There is ample evidence that some independent lab sales contractors are willing to pay inducements to physicians in exchange for their lab test referrals.
“This is a problem in two dimensions,” noted Faherty. “On one hand, clinical lab companies that use third-party sales contractors don’t have full control over the marketing practices of these sales representatives. Yet, if federal and state prosecutors can show violations of anti-kickback and self-referral laws, then the lab company is equally liable. In certain cases, government attorneys have even gone after executives on a personal basis.
“On the other hand, I am hearing lab executives complain now that a substantial number of office-based physicians are so used to various forms of inducement offered by third-party sales representatives that the lab’s in-house sales force cannot convince those physicians to use their lab company without a comparable inducement. If true, this is a fundamental shift in the competitive market for lab testing services and it puts labs unwilling to pay similar inducements to physicians at a disadvantage.”
These four trends describe the challenges faced by every clinical laboratory, hospital laboratory outreach program, and pathology group when attempting to provide lab testing services to office-based physicians in a fully-compliant manner and be paid adequately and on time by health insurers.
Why Some Labs Continue to Be Successful and What They Can Teach You
These four trends may also explain why many medical lab companies are dealing with falling revenue and encountering financial difficulty. However, there continue to be independent lab companies that have consistent success with their coding, billing, and collections effort. These labs put extra effort into aligning their business practices with the requirements of the Medicare program and private health insurers.
To help pathologists and managers running clinical laboratory companies, hospital lab outreach programs, and pathology groups improve collected revenue from lab test claims and to improve lab compliance, Pathology Webinars, LLC, is presenting a timely webinar, titled, “How to Prepare Your Lab for 2018: Essential Insights into New Payer Challenges with Lab Audits, Patient Billing, Out-of-Network Claims, and Heightened Scrutiny of Lab Sales Practices.” It takes place on Wednesday, December 6, 2017 at 2:00 PM EDT.
Three esteemed experts in the field will provide you with the inside scoop on the best responses and actions your clinical lab and pathology group can take to address these major changes and unwelcome developments. Presenting will be:
· Rina Wolf, Vice President, Commercialization Strategies, Consulting and Industry Affairs, XIFIN, Inc. in San Diego; and,
· Karen S. Lovitch, JD, Practice Leader, Health Law Practice, Mintz Levin, PC, in Washington, DC;
· Moderating will be Richard Faherty of RLF Consulting LLC, and formerly with Bio-Reference Laboratories, Inc.
Special Webinar with Insights on How Your Lab Can Collect the Money It’s Due
To register for the webinar and see details about the topics to be discussed, use this link (or copy and paste this URL into your browser: http://pathologywebinars.com/how-to-prepare-your-lab-for-2018-essential-insights-into-new-payer-challenges-with-lab-audits-patient-billing-out-of-network-claims-and-heightened-scrutiny-of-lab-sales-practices/).
This is an essential webinar for any pathologist or lab manager wanting to improve collected revenue from lab test claims and to improve lab compliance. During the webinar, any single idea or action your lab can take away could result in increasing collected revenue by tens of thousands even hundreds of thousands of dollars. That makes this webinar the smartest investment you can make for your lab’s legal and billing/collection teams.
—Michael McBride
Related Information:
How to Prepare Your Lab for 2018: Essential Insights into New Payer Challenges with Lab Audits, Patient Billing, Out-of-Network Claims, and Heightened Scrutiny of Lab Sales Practices
Risk, Compliance, Pay—A Juggling Act for Labs
Continued ‘Aggressive Audit Tactics’ by Private Payers and Government Regulators Following 2018 Medicare Part B Price Cuts Will Strain Profitability of Clinical Laboratories, Pathology Groups
Threats to Profitability Causing Clinical Laboratories, Pathology Groups to Take on Added Risk by Entering into ‘Problematic’ Business Relationships and Risky Pricing Plans
Payers Hit Medical Laboratories with More and Tougher Audits: Why Even Highly-Compliant Clinical Labs and Pathology Groups Are at Risk of Unexpected Recoupment Demands
‘Death by 1,000 Knives’ Could Be in Store for Clinical Laboratories, Pathology Groups Not Prepared to Comply with New Medicare Part B Regulations
Nov 6, 2017 | Coding, Billing, and Collections, Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory Pathology
Medical laboratory leaders must take steps to protect their lab’s financial stability and know how to prepare and respond to investigations and regulatory threats
Clinical laboratories and anatomic pathology groups may soon face a new normal that includes more frequent and tougher audits by both private payers and the government, resulting in larger monetary demands. The financial strain medical laboratories will experience from more aggressive audits will be compounded by the roll out on January 1, 2018, of new Medicare Part B price cuts.
Attorney Richard S. Cooper, Co-chair, National Healthcare Practice Group, McDonald Hopkins, LLC, in Cleveland, says audit activity has been “ramping up” during the past 18 months, but has accelerated in recent months.
“We are seeing a dramatic increase in the number of audits and the dollar amount the payers are trying to recoup as a result of those audits,” Cooper said in an interview with Dark Daily, noting monetary demands can reach “seven to eight” figures.
“We’re seeing that with both government payers as well as commercial payers and we’re seeing much more aggressive audit tactics being utilized than we have in the past.”
Payers Put Clinical Laboratories Under Increased Scrutiny
While toxicology/pharmacogenomics and molecular/genetic testing laboratories frequently are the targets of the increased scrutiny, Cooper says no medical laboratory is immune from questioning. The “medical necessity” of providing and billing for diagnostic tests or services, and laboratory waivers of “patient responsibility” for copays and deductibles, are the two most common compliance issues being cited, states Cooper, who points to Cigna, UnitedHealthcare and Blue Cross Blue Shield as among the most active commercial payers his firm encounters.
“There are large dollars at stake and they are going after those dollars,” Cooper explains.
In this new environment, Cooper maintains medical directors and lab executives must:
- Protect the lab’s financial stability in 2018 by considering operational changes and taking other steps to prepare for revenue losses due to PAMA (Protecting Access to Medicare Act).
- Get educated about practices that can trigger audits by commercial payers, or state and federal regulators, and consider conducting self-audits using an independent third-party.
- Know how to respond if a lab is charged with proficiency test violations, which can result in significant penalties from Centers for Medicaid and Medicare Services (CMS), such as loss of a lab’s CLIA license and revocation of the medical director’s license to operate a medical laboratory for two years.
- Expect scrutiny of “piggyback” arrangements with toxicology labs that could raise compliance concerns and violate commercial payer contracts. A “piggyback” arrangement is where a lab bills under the payer contract of another provider because it is unable to contract with the payer directly. This often involves “piggybacking” on lab or hospital (usually Critical Access Hospital) contracts. In many cases, the billing entity does not perform the lab services for which they are billing. The services are instead performed by the non-participating lab, and the billing provider pays most of the collections back to the non-billing laboratory, retaining a fee for using the contracts. There may not be disclosure to the payers about which entity actually performed the test.
Navigating Tougher Clinical Laboratory Laws and Regulations
To help medical laboratory and pathology group leaders prepare for the perils they face, and take proactive steps to navigate the tough lab regulations and legal issues that lay ahead, click here to register for Dark Daily’s upcoming webinar “Tougher Lab Regulations and New Legal Issues in 2018: More Frequent Payer Audits, Problems with Contract Sales Reps, Increased Liability for CLIA Lab Directors, Proficiency Testing Violations, and More,” (or place this link into your browser: https://ddaily.wpengine.com/product/tougher-lab-regulations-and-new-legal-issues-in-2018-more-frequent-payer-audits-problems-with-contract-sales-reps-increased-liability-for-clia-lab-directors-proficiency-testing-violations-and).
Attorney Richard S. Cooper, Co-chair, National Healthcare Practice Group, McDonald Hopkins LLC, in Cleveland will be a featured speaker and moderator during a new Dark Daily webinar on the Medicare Part B price cuts, and the critical legal and compliance issues clinical laboratories and pathology groups face starting in 2018. (Photo copyright: McDonald Hopkins LLC.)
This crucial learning event takes place on Wednesday, November 8, 2017, at 1 p.m. EST.
Cooper, who will moderate the webinar, will be joined by David W. Gee, JD, a Partner at Davis Wright Tremaine LLP in Seattle, and Jeffrey J. Sherrin, JD, President and Partner, O’Connell and Aronowitz in Albany, New York.
These three attorneys are among the nation’s foremost experts in issues unique to clinical laboratories, pathology groups, hospital labs, toxicology/pharmacogenomics labs, and molecular/genetic testing labs. Following our speakers’ presentations, there will be a question and answer period, during which you can submit your own specific questions to our experts.
You can’t afford to miss this opportunity. Click here to get up to speed on the most serious regulatory, compliance, and managed care contracting issues confronting all labs today. This webinar will provide solutions to the perils facing labs now and in 2018 by helping you map a proactive and effective course of action for your clinical lab or pathology group.
—Andrea Downing Peck
Related Information:
Tougher Lab Regulations and New Legal Issues in 2018: More Frequent Payer Audits, Problems with Contract Sales Reps, Increased Liability for CLIA Lab Directors, Proficiency Testing Violations, and More
What Every Lab Needs to Know about the Medicare Part B Clinical Laboratory Price Cuts That Take Effect in Just 157 Days, on Jan. 1, 2018
Nation’s Most Vulnerable Clinical Laboratories Fear Financial Failure If Medicare Officials Cut Part B Lab Fees Using PAMA Market Price Data Final Rule
Nov 1, 2017 | Coding, Billing, and Collections, Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing, Managed Care Contracts & Payer Reimbursement
Medical laboratory leaders and pathologists must be fully aware of the coming legal and regulatory changes taking place starting January 1, 2018, or risk fines and decreased reimbursements
January 1, 2018, marks the start of new Medicare Part B price cuts for clinical laboratory and anatomic pathology testing. But decreasing reimbursement rates is just one issue facing medical laboratory leaders. The other is the increasingly rigorous regulatory environment poised to ensnare labs and pathology groups unprepared to navigate the dark waters of government compliance.
Tougher payer audits, higher recovery demands, and enforcement policies that increase the personal liability of CLIA lab directors and lab executives, are reasons why attorney David W. Gee, JD, a Partner at Davis Wright Tremaine LLP in Seattle, argues that laboratories need to step up their focus on compliance and due diligence. He notes laboratories must guard against “death by 1,000 knives” in this new landscape.
Insufficient Focus on Compliance Brings Consequences to Clinical Laboratories and Their Management
“There are more and more people and agencies whose focus it is to regulate and watch the dollars and make sure there is integrity in the system,” noted Gee in an interview with Dark Daily. “That includes not only the formerly regular players—the OIG [Office of Inspector General, US Department of Health and Human Services] and DOJ [Department of Justice]—but you’ve got an increasing number of states with their own False Claims Acts. You’ve got state agencies looking at opportunities to clean up the system and to tag along with other investigations going on, as well as commercial payers who have become more active in pursuing litigation and other measures against practices they allege to be fraudulent.”
Faced with these emerging trends, Gee stresses that labs must:
1. Recognize the increased personal liability facing lab directors, owners, and management, and take steps to mitigate risk of enforcement actions that not only expose executives to potential penalties but also jeopardize the financial health of lab organizations.
2. Understand the importance of meaningful and sustained investment in compliance (including providing compliance officers with the resources to manage an increasingly complex job) and leverage OIG guidance to assess gaps and risks in compliance programs.
3. Be aware of risks inherent in third-party marketing agreements, which can result in short-term spikes in order volume, but which also could reduce “lines of sight” to clients, making it even more difficult to adhere to compliance standards.
Gee believes the emphasis labs place on cost control and “running lean” often results in a lack of attention being paid to compliance. He argues today’s competitive environment increases the need for laboratory directors to ensure proper business practices are followed and “compliance fundamentals are not overlooked in the haste to compete for the business of referral sources.”
Healthcare attorney and Partner, David W. Gee, JD, of Davis Wright Tremaine, LLP, in Seattle will be one of three featured speakers during a new Dark Daily webinar on the Medicare Part B price cuts, and the critical legal and compliance issues clinical laboratories and pathology groups face starting in 2018. (Photo copyright: Davis Wright Tremaine, LLP.)
CLIA-Lab Directors to Be Held Personally Liable for Compliance Failures
Because federal regulators are considering holding CLIA-lab directors personally liable for compliance failures, Gee suggests laboratory executives should be motivated to put effective compliance programs in place.
“The best reason I can give for insisting as a lab director that the company actually has a successful and effective compliance program is that these days they stand to lose,” he argues. “The ability to prove you are not complicit—and that you are not the driver of things that have gone wrong—comes down to having an effective and well-documented compliance program so you are on record. And so there’s evidence that, as an engaged lab leader, you tried to do the right thing.”
Educational Opportunities for Lab Leaders
To help medical laboratory and pathology group leaders prepare for the perils they face, and take proactive steps to navigate the tough lab regulations and legal issues that lay ahead, click here to register for Dark Daily’s upcoming webinar “Tougher Lab Regulations and New Legal Issues in 2018: More Frequent Payer Audits, Problems with Contract Sales Reps, Increased Liability for CLIA Lab Directors, Proficiency Testing Violations, and More,” (or place this link into your browser: https://ddaily.wpengine.com/product/tougher-lab-regulations-and-new-legal-issues-in-2018-more-frequent-payer-audits-problems-with-contract-sales-reps-increased-liability-for-clia-lab-directors-proficiency-testing-violations-and).
This crucial learning event takes place on Wednesday, November 8, 2017, at 1 p.m. EST. Gee will be joined by Jeffrey J. Sherrin, President and Partner, O’Connell and Aronowitz in Albany, New York, and Richard Cooper, Chair, National Healthcare Practice Group, McDonald Hopkins, LLC, in Cleveland.
These three attorneys are among the nation’s foremost experts in issues unique to clinical laboratories, pathology groups, hospital labs, toxicology/pharmacogenomics labs, and molecular/genetic testing labs. Following our speakers’ presentations, there will be a question and answer period, during which you can submit your own specific questions to our experts.
You can’t afford to miss this opportunity. Click here to get up to speed on the most serious regulatory, compliance, and managed care contracting issues confronting all labs today. This webinar will provide solutions to the perils facing labs now and in 2018 by helping you map a proactive and effective course of action for your clinical lab or pathology group.
—Andrea Downing Peck
Related Information:
Tougher Lab Regulations and New Legal Issues in 2018: More Frequent Payer Audits, Problems with Contract Sales Reps, Increased Liability for CLIA Lab Directors, Proficiency Testing Violations, and More
What Every Lab Needs to Know about the Medicare Part B Clinical Laboratory Price Cuts That Take Effect in Just 157 Days, on Jan. 1, 2018
Nation’s Most Vulnerable Clinical Laboratories Fear Financial Failure If Medicare Officials Cut Part B Lab Fees Using PAMA Market Price Data Final Rule
Oct 30, 2017 | Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing
Indicted on charges related to 124 genetic cancer tests performed between 2013 and 2014, former Hershey Medical Center Research Technologist Floyd Benko pleads guilty to charges with a maximum sentence of up to five years in prison
Wake up calls don’t come any clearer. False reporting of clinical laboratory test results will not be tolerated and anyone engaged in it will pay hefty fines and go to jail. Medical laboratories and anatomic pathology groups were put on notice when in July, nearly two years after he was indicted for healthcare fraud, Floyd Benko, of Palmyra, Penn., pled guilty in State District Court to charges of making false statements.
Benko, a 60-year old former research technologist at the Hershey Medical Center (HMC) in Hershey, Penn., surrendered to authorities on July 31, 2015, according a 2015 news release from The United States Attorney’s Office for the Middle District of Pennsylvania. The charges centered on 124 genetic diagnostic tests he performed at HMC between 2013 and 2014. Repeat testing conducted at HMC’s expense resulted in 60 tests results returned from two outside laboratories that differed from Benko’s reported results. No civil charges related to those 60 patients have been filed at the time of writing. And while sentencing is not yet scheduled, part of Benko’s plea requires restitution to HMC in the amount of approximately $70,000.
According to a Department of Justice (DOJ) press release, “The maximum penalty for false statements in healthcare matters is five years’ imprisonment, a term of supervised release following imprisonment, and a fine.” Coverage of the case at PennLive adds, “That agreement also cites a stipulation between the prosecution and defense that the advisory guidelines for Benko’s case call for a prison term of up to one and a half years.”
A Brief History of the Case and Charges
Details in media coverage regarding the case remain scant. However, case filings highlight a few details that help to establish a timeline of the alleged wrongdoing.
According to filings found at Leagle, charges stem around results to a range of genetic diagnostics, including:
· Epidermal Growth Factor Receptor (EGFR);
· KRAS gene mutation; and,
· BRAF gene mutation tests.
Documents show Benko had more than two decades of experience working with HMC. He also helped to define standard operating procedures (SOPs) for the tests in question. This is key to the case as charges stem from failing to follow the SOPs he helped to put in place.
Between April 9, 2013, and November 10, 2014, Benko performed 124 of these procedures for HMC. The SOPs required use of a NanoDrop 2000 spectrophotometer and preservation of tissue samples and specimens involved in all procedures.
Court filings note, “In late 2013, a treating physician observed that a patient’s HMC test results were at odds with the patient’s clinical profile. Defendant had performed the particular test in question. The treating physician ordered the same test from an outside laboratory, which reached a different result than the results reached by Defendant on the same patient’s tissue.”
Penn State Milton S. Hershey Medical Center (above) where in 2013 to 2014 Floyd Benko, a 60-year-old research technologist, improperly conducted 124 gene mutation clinical laboratory tests and then lied about it to cover up his lack of following standard operating procedures. (Photo copyright: PennLive/Paul Chaplin.)
When these results were brought to the attention of HMS supervisors, they requested Benko repeat the test. His results, again, differed from those of outside laboratories. This led to a request to access the tissues used in the test. Benko could not provide them.
Upon further investigation, the samples for 124 tests were missing. Court filings note, “[Benko] had no explanation for the missing DNA and tissue slides at that time.” HMS ordered retests for the tests with outside laboratories at a loss of more than $102,000. The 2015 DOJ press release breaks down these losses further, separating the figure into “$65,000 for outside laboratory testing and $37,406 for assay refunds.”
Of the 124 results, 60 returned discordant with Benko’s findings. This led to Benko sending two letters to HMS supervisors—one in April 2014 and another in October 2014, following his termination—attempting to explain the discordant results. Neither mentioned the NanoDrop 2000 spectrophotometer or provided reasons for failing to preserve tissue samples.
In July 2015, a federal grand jury returned an indictment on three counts related to the questioned testing. The court filing lists charges as follows:
“In Count I, the indictment charges Defendant with healthcare fraud in violation of 18 U.S.C. § 1347. According to the indictment, Defendant defrauded HMC in connection with the delivery of healthcare services by:
1. Failing to use the NanoDrop 2000 spectrophotometer in conducting the assays;
2. Failing to preserve the leftover patient tissue samples;
3. Failing to disclose his actions to his supervising physician or HMC management; and,
4. By providing false statements about the manner in which he performed the tests.
Counts II and III charge Defendant with making false statements to HMC. Counts II and III are predicated on the letters Defendant wrote to HMC in April and October of 2014.”
Critical Considerations for Medical Laboratories
The criminal charges levied at Benko directly result from his work in a clinical laboratory. And while the guilty plea does not include the healthcare fraud charge, it highlights the potential criminal liability risks pathology and medical laboratory workers face when tests prove inaccurate due to user error.
Because of discordant test results, an individual worker of a clinical laboratory was held liable for damages. Ensuring protocol adherence and accuracy of test results—particularly as new genetic assays and diagnostics reach laboratory test menus—can help to identify potential problems before they become a legal concern.
Maintaining rigorous records and following protocols for required samples and specimens also can help to establish evidence and resolve concerns should they arise.
—Jon Stone
Related Information:
Former Hershey Medical Center Research Technologist Charged with Healthcare Fraud
Former Hershey Medical Center Research Technologist Pleads Guilty to Making False Statements About Cancer Tests
Former Hershey Med Center Research Technologist Indicted for Fraud
Former Hershey Medical Center Worker Pleads Guilty to Lying About Cancer Testing Procedure
Hospital Staffer Admits to Lying About Genetic Cancer Tests
Former Hershey Med Tech Pleads Guilty to Lying About Fudging Cancer Testing
U.S. v. Benko No. 1:15-cr-00159
United States of America v. Floyd A. Benko, Defendant
Oct 18, 2017 | Compliance, Legal, and Malpractice, Digital Pathology, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing
The Joint Commission opposed the Medicare proposal, and patient advocate groups say rescinding it is a setback for hospital transparency
Powerful interests arrayed against greater transparency in the performance of hospitals, physicians, and medical laboratories have stopped a proposed Medicare program that would have allowed the public to see the results of hospital inspections.
Stopped in its tracks was an effort by the Centers for Medicare and Medicaid Services (CMS) to make hospital accreditation inspection reports available for public viewing. Opposition to this program led CMS to withdraw its plan for heightened transparency.
CMS originally called the proposal “groundbreaking” in a National Public Radio (NPR) article. That’s because it would have enabled consumers to view reports that private accreditation organizations, such as The Joint Commission, complete after each inspection. Inspection reports contain information on errors and problems found during hospital surveys. CMS’ push for more transparency in hospital inspections is consistent with the healthcare industry’s trend toward open sharing of healthcare quality, price, and other data.
“We are proposing changes relating to transparency of accrediting organizations survey reports and plans of correction of providers and suppliers,” CMS officials wrote in a proposed rule published on April 28.
CMS Pulls Back Proposal to Make Hospital Survey Reports Public
But it was not to be. After receiving comments, CMS officials stated in early August that the agency had pulled back the proposal.
“CMS is committed to ensuring that patients have the ability to review the findings used to determine that a facility meets the health and safety standards required for Medicare participation. However, we believe further review, consideration, and refinement of this proposal is necessary to ensure that CMS establishes requirements, consistent with our statutory authority, that will inform patients and continue to support high quality care,” noted a CMS fact sheet.
Agencies Find Problems in Hospitals That Accreditors Do Not, CMS Declares
It’s against federal law for CMS to release data related to hospital inspections, Becker’s Hospital Review reported. And, as part of the Clinical Laboratory Improvement Amendments (CLIA), clinical laboratories must participate in inspections to ensure they qualify for Medicare and Medicaid payments. However, the inspection reports of the nation’s medical laboratories are not made public.
So, what motivated CMS to make healthcare organizations’ inspection information public? CMS noted that private accreditation organizations miss serious provider problems that state inspectors find in follow-up visits to hospitals, ProPublica explained.
In fact, state agency reviews of 103 hospitals in 2014 found 41 serious deficiencies, including 39 missed by the accreditors, noted the NPR article.
The chart above based on Johns Hopkins research was compiled by the National Center for Health Statistics and reported by The Washington Post. It shows that medical errors are now the third leading cause of death in the US. (Photo copyright: The Washington Post.)
“Right now, the public has very little information about the places where they’re putting their life on the line, and that’s just not acceptable. If [they are] a good place, what are they afraid of?” Rosemary Gibson, Senior Advisor at The Hastings Center, stated in the NPR article.
Reaction from Accreditors and Consumer Groups Differs
The Joint Commission opposed the CMS proposal. And, now, patient safety advocacy groups are disappointed about the decision by Medicare officials to rescind the proposed program.
“We believe the proposal will have significant detrimental consequences on our nation’s ability to continually improve the delivery of healthcare services,” stated Mark Chassin, MD, FACP, MPP, MPH, Joint Commission President and Chief Executive Officer, in a June letter to CMS published partially in an HCPro blog post.
HCPro, a firm that aids organizations in accreditation, credentialing, and other needs, noted the following Joint Commission concerns about publicly shared survey reports in the blog post:
- Providers may be less likely to be open about opportunities for improvement;
- Accreditors could struggle to create new standards;
- The number of non-accredited facilities may increase;
- Accreditation may be devalued; and,
- Costs to providers and accreditors would likely rise.
The Center for Improvement in Healthcare Quality (CIHQ), another accreditation option for hospitals, also expressed concerns with the CMS proposal, according to the ProPublica report.
“Knowing that survey [inspection] reports are public knowledge will only incentivize hospitals and other healthcare entities to go back to the days of ‘hiding’ quality of care issues from accreditors, rather than working with us to improve the quality and safety of care rendered to patients,” CIHQ advised in the ProPublica article.
The Leapfrog Group, which bills itself as an advocate of hospital transparency, called the reversed proposal “a disappointing setback for healthcare transparency.”
In a statement, Leah Binder, President and Chief Executive Officer of The Leapfrog Group, noted, “We are disappointed to learn that the agency that runs Medicare (CMS) has reversed course on its proposal to require private accrediting organizations, such as the Joint Commission, to publicly release reports of problems they found in hospitals and other healthcare facilities. The public deserves full transparency on how the healthcare industry performs.”
Clearly the public is calling for increased transparency in healthcare. As are many organizations and industry journals, such as the Association of Health Care Journalists (AHCJ), which presented a national award to Ellen Gabler, an investigative reporter for the Milwaukee Journal Sentinel, for her work covering weaknesses in inspections for clinical laboratories. (See Dark Daily, “Journalists Take Home Top National Awards for Their Work Covering Theranos and the Clinical Laboratory Industry,” May 16, 2016.)
Some Accreditation Information Available Online
So, for the time being, it appears that what is found during hospital inspections will stay within the inspection report and will not become available to the general public. However, with consumers expecting greater transparency and higher levels of service in all aspects of healthcare, the interest in public access to the quality performance of hospitals, physicians, clinical laboratories, and anatomic pathology groups will only increase.
Meanwhile, for patients interested in existing resources about provider quality, The Joint Commission has an online “find a gold star healthcare organization” quality check. Also, the American College of Surgeons publishes an online search for accredited facilities. And, the Centers for Disease Control and Prevention (CDC) offers an online search for CLIA accredited labs.
—Donna Marie Pocius
Related Information:
Secret Data on Hospital Inspections May Become Public At Last
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Sep 25, 2017 | Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Management & Operations
Payers are cutting reimbursements for anatomic pathology services, making it essential for every pathology group to understand its financial present and future
Certain pathology business leaders are warning their colleagues that the era of private pathology group practice domination of the anatomic pathology marketplace is about to end. The only question is how rapidly the clinical and financial foundations of smaller pathology group practices erodes to the point where these groups are unable to generate adequate reimbursement to sustain the practice and the incomes of the individual pathologists.
However, along with this bad news comes a note of optimism. There is a once-in-a-lifetime opportunity for the anatomic pathology profession to take ownership of genetic testing and precision medicine—the most important diagnostic technologies to emerge in the past 100 years. The danger for anatomic pathologists is how to successfully transition from the private group practice model to the new clinical practice models that deliver genetic testing and precision medicine services.
Why Pathologists Are Making Less Money Today
The economic plight of private practice pathology is familiar to all pathologists. During the past decade, reimbursement for technical component (TC) and professional component (PC) services was regularly beat down by payers. For example, pathologists lost the TC grandfather clause in 2012, which immediately caused many histology labs to go from profit to loss. (See Dark Daily, “In Fixing Physician Medicare Pay, Congress Enacts Yet Another Cut in Clinical Laboratory Test Fee Schedule,” February 12, 2012.)
Similarly, over the past 10 years, each time private health insurers negotiated the renewal of a managed care contract with a pathology group practice, they aggressively cut the prices they paid for anatomic pathology services. And the corresponding explosive growth of narrow provider networks exacerbated the financial erosion from lower prices. Many smaller pathology groups found themselves excluded from these networks, causing them to lose access to the large numbers of private-pay patients served by these networks.
“It is important for every surgical pathologist and every pathology practice administrator to recognize that they have the ability to negotiate much more favorable terms and increased network access with health insurers, but only if they come to the negotiating table with the right information and techniques,” observed Robert L. Michel, Editor-in-Chief of Dark Daily and The Dark Report. “Pathology groups showing strong financial performance today know these techniques and strategies. When negotiating managed care contracts, they achieve higher reimbursements, more favorable terms, and in-network status.”
Proven Ways to Help Pathology Groups Protect and Increase Revenue
Pathologists who would like to protect their groups’ revenue and bolster their partners’ income have the opportunity to learn and master the most effective managed care contracting techniques and strategies. Three nationally prominent experts in pathology business and operations are participating in a special webinar, titled “How Payers Are Repricing Anatomic Pathology: Your Financial Present and Your Pathology Group’s Future,” which takes place on Thursday, September 28, 2017 at 2:00 p.m. EDT.
Pictured above left to right are Mick Raich, President and CEO, Vachette Pathology; Jeffrey Pearson, MD, System Medical Director, Bronson Hospital Laboratories; and, Christopher Jahnle, co-founder and Managing Director, Haverford Healthcare Advisors. The three distinguished speakers will share expertise and experiences you can use to protect your pathology group’s revenue while preserving partner income. (Photo copyright: Dark Daily.)
First to speak on this webinar is Mick Raich, founder and CEO of Vachette Pathology, of Blissfield, Mich. He will discuss how Medicare and private insurers are using new pathology and lab repricing models to slash reimbursement and control utilization of expense pathology testing services. Raich will explain why payers are engaging such third-party companies as AIM Specialty Health of Chicago, Avalon Healthcare Solutions of Tampa, Fla., BeaconLBS of Montvale, N.J., and InformedDNA of St. Petersburg, Fla., to develop coverage guidelines, issue preauthorization, and manage the network of labs and pathology groups allowed to provide services.
Raich will further explain what pathologists must know about the Medicare Access and CHIP Reauthorization Act (MACRA) physician payment program, with its MIPS—Merit-based Incentive Payment System—that is designed to pay bonuses or assess penalties each year, depending on how individual physicians perform against their own operational and clinical benchmarks.
Insidious Methods Payers Use to ‘Take Back’ by Underpaying Certain Pathology Claims
Another topic that Raich will address can mean significantly greater collected revenue for your pathology group. He will explain the new phenomenon of how private payers are auditing error rates on claims, then taking back those overpayments by underpaying the labs or pathology groups on claims for specific CPT codes (current procedural terminology codes). Raich will show how your billing/collection team can detect these claims and recover full payment from the payers.
How One Pathology Group Practice Doubled in Size
The second important financial topic of the webinar involves the merger, acquisition, and consolidation of private pathology group practices. You’ll learn why many group practices are losing their independence due to declining revenue or because their parent hospital was acquired by a health system. Pathologist Jeffrey Pearson, MD, is the System Medical Director at Bronson Hospital Laboratories in Kalamazoo, Mich. He is also a partner and President of Pathology Services of Kalamazoo, PC.
During his tenure at Bronson, Pearson helped facilitate the acquisition and assimilation of two hospital laboratories and one for-profit laboratory. His pathology practice has doubled in size and developed a high degree of subspecialization. Each time, the pathology group associated with the acquired entity had to be integrated with his health system’s existing pathology group practice. Experiences will be shared regarding:
· How to assimilate acquired laboratories;
· Practice utilization management; and
· Leveraging success to grow the practice and obtain favorable part A contracts.
Understanding How to Increase the Value of Your Anatomic Pathology Group
To round out the financial techniques and strategies you and your pathology practice administrator can use to protect your group’s revenue and boost partner income, the webinar’s third expert will discuss the latest developments in pathology practice mergers, acquisitions, and consolidations.
Christopher Jahnle is co-founder and Managing Director of Haverford Healthcare Advisors in Paoli, Penn., a suburb of Philadelphia. Over the past decade, his firm has represented Aurora Diagnostics of Palm Beach Gardens, Fla., as a purchaser of private pathology group practices.
Jahnle will describe the specific characteristics of a private pathology practice that have the highest value to buyers in today’s marketplace. You’ll understand how your pathology group’s unique mix of managed care contracts, hospital/health system relationships, and sub-specialist expertise will be valued by a potential acquirer or merger partner.
Jahnle will share case study examples to help you identify useful things your pathology group can do to make it more profitable and increase its value. This is essential knowledge if your group’s pathologists are considering such strategies as:
· “Should we merge with a bigger pathology group?”
· “Should we sell our pathology group?” and
· “Should we add subspecialists and pursue more hospital contracts?”
All three expert speakers have practical knowledge that you can use to protect your pathology group’s revenue while preserving partner income. It is why this webinar is timely and a “must attend” for you, your pathology practice administrator, and your pathology group’s legal and financial consultants.
Full details about this important webinar are at this link (or copy and paste this URL into your browser: http://pathologywebinars.com/how-payers-are-repricing-anatomic-pathology-your-financial-present-and-your-pathology-groups-future/).
—Michael McBride, Managing Editor
Related Information:
How Payers Are Repricing Anatomic Pathology: Your Financial Present and Your Pathology Group’s Future
In Fixing Physician Medicare Pay, Congress Enacts Yet Another Cut in Clinical Laboratory Test Fee Schedule
