Sep 12, 2018 | Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Management & Operations
Contrary to CMS and Joint Commission programs implemented in 2017 to reduce them, incidents of hospital-acquired infections have risen for the past few years
Clinical laboratories and anatomic pathologists know that hospital-acquired infections (HAIs) can be deadly, not just for patients, but for their caregivers and families as well. Even one HAI is too many. Thus, the federal Centers for Medicare and Medicaid Services (CMS) required healthcare organizations to upgrade their antimicrobial stewardship (AMS) programs to meet CMS requirements and Joint Commission accreditation starting in 2017.
Nevertheless, a recent Leapfrog Group report indicates hospitals are finding it increasingly difficult to remove infections all together. This has many healthcare leaders concerned.
The report, which was analyzed by Castlight Health, states that the number of hospitals reporting zero infections has declined significantly since 2015, according to a news release. According to the Leapfrog Group’s report:
- Two million people acquire HAIs every year;
- 90,000 people die annually from HAIs;
- HAI costs range from $1,000 to $50,000 depending on the infection.
Hospitals spend $28 to $45 billion annually on HAI costs, Healthcare Finance reported.
“I think it’s far too easy to let something slip, so it’s clear that there really needs to be a renewed focus on getting back to zero. We do still see some hospitals that are getting to zero, so it’s clearly possible,” Erica Mobley (above), Leapfrog Group’s Director of Operations, told Fierce Healthcare. (Photo copyright: LinkedIn.)
Regressing Instead of Progressing Toward Total HAI Elimination
Leapfrog Group’s report is based on 2017 hospital survey data submitted by 2,000 providers. The data indicates that in just two years the number of hospitals reporting zero HAIs dropped by up to 50%. The reported HAIs include:
The remaining infection measures studied by Leapfrog Group had less dramatic decreases over the same time period, according to Fierce Healthcare. Nevertheless, they are significant. They include:
- Surgical site infections (SSI) following colon surgery: 19% zero infections compared to 23% previously;
- Clostridium difficile (C. difficile) inpatient infections: 3% zero inpatient infections in 2017, compared to 5% in 2015.
Joint Commission Studies Antimicrobial Program Progress
Meanwhile, the Joint Commission acknowledged that implementation of antimicrobial stewardship programs by providers can be difficult. In “The Expanding Role of Antimicrobial Stewardship Programs in Hospitals in the United States: Lessons Learned from a Multisite Qualitative Study,” the accrediting organization released insights from interviews with 12 antimicrobial stewardship program leaders nationwide.
They published their study in “The Joint Commission Journal on Quality and Patient Safety.” Three themes emerged from the interviews:
- Hospitals have revised their antimicrobial programs, which originally operated on a “top-down” structure, to programs that include clinicians from throughout entire provider organizations;
- Health information technology (HIT) can enable real-time opportunities to launch antimicrobial therapy and treat patients; and,
- Some barriers exist in getting resources to integrate technology and analyze data.
“These programs used expansion of personnel to amplify the antimicrobial stewardship programs’ impact and integrated IT resources into daily workflow to improve efficiency,” the researchers wrote. “Hospital antimicrobial stewardship programs can reduce inappropriate antimicrobial use, length of stay, C. difficile infection, rates of resistant infections, and cost.”
What Do CMS and Joint Commission Expect?
According to Contagion, while the Joint Commission program is part of medication management, CMS places its requirements for the antimicrobial stewardship program under “infection prevention.”
CMS requirements for an antimicrobial stewardship program include:
- Developing antimicrobial stewardship program policies and procedures;
- Implementing hospital-wide efforts;
- Involving antimicrobial stakeholders for focus on antimicrobial use and bacterial resistance;
- Setting evidence-based antimicrobial use goals; and,
- Reducing effects of antimicrobial use in areas of C. difficile infections and antibiotic resistance.
Leapfrog Group’s data about fewer hospitals reporting zero infections offers opportunities for hospital laboratory microbiology professionals to get involved with hospital-wide antimicrobial program teams and processes and help their hospitals progress back to zero HAIs. Clinical laboratories, both hospital-based and independent, also have opportunities to contribute to improving the antimicrobial stewardship efforts of the physicians who refer them specimens.
—Donna Marie Pocius
Related Information:
Troubling New Report on Hospital Infections Comes While Centers Medicare and Medicaid Services Considers Discontinuing Publicly Reporting Rates
Leapfrog Group: Healthcare-Associated Infections
Antimicrobial Stewardship Standards: A Comparison of Centers for Medicare and Medicaid Services and Joint Commission Requirements
Joint Commission: New Antimicrobial Stewardship Standard
Core Elements of Hospital Antibiotic Stewardship Programs
Number of Hospitals Achieving Zero Infections Drops
Hospitals Losing Ground on Effectively Preventing Infections with Dramatic Drop in Those Reporting Zero Infections
The Expanding Role of Antimicrobial Stewardship Programs in Hospitals in the United States: Lessons Learned from a Multi-Site Qualitative Study
Sep 7, 2018 | Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing, Managed Care Contracts & Payer Reimbursement
Healthcare revenue cycle consultant Jonathan Wiik suggests healthcare providers must prepare their organizations for patients who need help paying increasing medical costs
When patients cannot pay their bills, all of healthcare—including clinical laboratories and anatomic pathology groups—also struggle. And, according to experts, medical laboratories already complying with federal value-based payment programs and precision medicine directives should expect increased pressure from patients seeking ways to pay for their services.
A recent analysis of this issue by TransUnion Healthcare (NYSE:TRU) states, “patients experienced an 11% increase in average out-of-pocket costs during 2017, rising from $1,630 in Q4 2016 to $1,813 in Q4 2017.” It is a development that should send up red flags to clinical laboratory managers seeking ways to maintain and increase revenues.
“Given the increased payment responsibility, being able to determine a patient’s ability to pay is increasingly important for hospitals,” noted Jonathan Wiik, Principal, Healthcare Strategy at TransUnion Healthcare (TRU). “In order to allow patients to focus on getting the care they need healthcare providers need processes and tools in place to help patients meet their financial obligations and to establish funding mechanisms that will benefit both the patient and provider.” Obviously, this also applies to clinical laboratories.
According to a news release, “The [TRU] analysis also revealed that in 2017, on average, 49% of patient out-of-pocket costs per healthcare visit were below $500; 39% were $501-$1,000; and 12% were more than $1,000.”
For providers, patients’ swelling unpaid balances mean more uncompensated care, the analysis also showed. And that means more unpaid balances for clinical laboratories as well.
Patients Struggle to Pay Amounts Under $500
Each year, more healthcare consumers are forced onto high-deductible health plans (HDHPs) that make them responsible for thousands and even tens of thousands of dollars in upfront costs.
And according to another TRU news release, patients with commercial insurance plans experienced a 67% increase in their financial responsibility over five years. In other words, after insurance plans paid providers, patients still needed to pony up 12.2% of the total bill in 2017, as compared to 8% in 2012.
During the most recent year studied by TransUnion Healthcare, patients’ out-of-pocket costs increased 11%, rising to $1,813 in 2017 from $1,630 in 2016, a news release revealed.
And it doesn’t take a huge bill for patients to feel the pain. TransUnion’s data reveals that 68% of patients with medical bills below $500 did not fully pay what they owed, RevCycle Intelligence reported. This has major implications for clinical laboratories and anatomic pathology groups because many lab charges fall under $500 and TransUnion shows that almost 70% of patients do not pay the full amount of these bills.
According to TRU, medical specialties with the highest out-of-pocket estimated amounts due from patients include:
- Orthopedics, $1,663;
- Plastic surgery, $1,566;
- Urology, $1,415; and,
- Neurology, $1,241.
The average deductible was $1,200 in 2016, up from just $303 in 2006, a 176% increase, Healthcare Dive reported, citing a new Peterson-Kaiser Health System Tracker report.
And, as Dark Daily previously reported, affluent and self-employed people also feel the pinch, as deductibles can be as high as $5,000/year for individuals and more than $10,000/year for a families, whether plans are purchased through the Affordable Care Act (ACA) or employers.
What Happens When Patients Don’t Pay?
Dark Daily also reported on a 2017 TransUnion Healthcare analysis that showed 99% of hospital bills of $3,000 or more were not paid in full by the end of 2016. (See, “Hospitals, Pathology Groups, Clinical Labs Struggling to Collect Payments from Patients with High-Deductible Health Plans,” September 6, 2017.)
When patients cannot afford to pay their bills, hospitals’ bad debt and charity-care levels rise. Together, bad debt and charity care comprise a provider’s uncompensated care.
“A lot of patients can’t afford these bills, which is why uncompensated care has bounced,” Wiik told Modern Healthcare.
Indeed, uncompensated care was $38.3 billion in 2016, up $2.6 billion since 2015, according to an American Hospital Association (AHA) 2017 fact sheet.
Meanwhile, the Centers for Medicare and Medicaid Services (CMS) reported that Medicare bad debt (the effect of Medicare patients not paying deductibles and co-pays) increased to $3.69 billion in 2016 from $3.14 billion in 2012, a 17% bump, TransUnion Healthcare pointed out.
Consumers Say They Want Prices, Financing Plans
Consumers say healthcare providers are not transparent about costs for procedures, nor do they effectively offer financing options. That’s according to a HealthFirst Financial news release, which states, “More than three-quarters, or 77%, of healthcare consumers say it’s important or very important they know their costs before treatment and 53% want to discuss financing options before care. However, the vast majority of healthcare providers are not satisfying these consumer demands.”
And, according to a HealthFirst Financial Patient Survey of 1,011 adults nationwide:
- “53% voice concern about the ability to pay a medical bill of less than $1,000;
- “35% worried about the ability to pay a bill of less than $500; and,
- “16% are concerned about the ability to pay a bill of less than $250.”
These numbers fall well into the amounts clinical laboratories charge for services rendered.
What Can Medical Laboratories Do?
To help their customers pay their bills and improve revenue, Dark Daily suggest labs:
- Use software that enables ordering clinicians to process advanced beneficiary notices and prior authorizations for services;
- Inform the customer prior to specimen collection about their financial responsibility for the test;
- Ask for payment-due at time of the patient encounter;
- Share key lab test price data in easily accessible and understandable ways;
- Keep credit card information securely on-hand for agreed-to balances patients are responsible for paying; and,
- Offer payment options, such as e-billing and financing plans.
As we’ve pointed out many times, because clinical laboratories are dependent on the physicians and hospitals they service, they are particularly vulnerable when patients stop paying their bills.
—Donna Marie Pocius
Related Information:
TransUnion Healthcare Analysis: Fight Rising Uncompensated Care
Patient Balances Continue to Increase in 2018, Driving Bad Debt and Uncompensated Care
Patient Payment Responsibility Increases 11% in 2017
Patient Financial Responsibility Increased 11% in 2017
It’s Never Too Soon to Communicate Pricing and Payment Options
Deductibles, Coinsurance on the Rise, But Cost of Copays Are Down
Growing Bad Debt Problem Illustrates Broken Billing System
American Hospital Association Uncompensated Care Cost Fact Sheet, December 2017 Update
From Millennials to Boomers, Patients Want to Discuss Healthcare Pricing and Payment Options Before Treatment
Even Higher Income Americans Are Frustrated with High Health Insurance Costs and Many Drop Coverage and Switch to Concierge Care
Hospitals’ Pathology Groups and Clinical Labs Struggling to Collect Payments from Patients with High Deductible Health Plans
Aug 31, 2018 | Digital Pathology, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing, Management & Operations
Affected patients speak about emotional, financial, and medical costs of receiving inaccurate results from the startup’s faulty Edison ‘finger-stick’ blood draw testing device
Healthcare consumers trust America’s clinical laboratories and anatomic pathology groups to provide accurate test results. When those test results are inaccurate, the loss of public trust can trigger a sharp decline in referrals/revenue and draw an avalanche of lawsuits by those harmed by inaccurate results.
The most recent example of this object lesson is disgraced blood testing company Theranos, previously estimated to be worth $9 billion but now struggling to stay afloat. The once high-flying startup has been brought to the edge of bankruptcy in the aftermath of a fraud settlement with the Securities and Exchange Commission (SEC), sanctions from the Centers for Medicare and Medicaid Services (CMS), investor lawsuits, consumer lawsuits, and a settlement with Walgreens over claims about Theranos’ Edison portable blood analyzer.
Theranos first made its unproven finger-stick blood draw device available to consumers in September 2013, when it announced a partnership with drugstore chain Walgreens (NASDAQ:WBA). At its height, Theranos operated 40 “Wellness Centers” in Walgreens stores in Arizona and a single location in California, which were the source of much of its revenue. USA Today reported the metro Phoenix-area centers alone sold more than 1.5 million blood tests, which yielded 7.8 million tests results for nearly 176,000 consumers. Theranos shuttered the wellness centers in 2016 after CMS inspectors found safety issues at Theranos’ laboratories in California and a Wall Street Journal (WSJ) investigation raised questions about the company’s testing procedures and accuracy claims. Ultimately, Theranos voided the results of all blood tests run on its Edison device from 2014 through 2015.
Breast-cancer survivor Sheri Ackert (above) told the WSJ she panicked when blood-test results from Theranos indicated her cancer may have reoccurred or were indicative of a rare type of tumor. After being retested by a different clinical laboratory, her results were found to be normal. Click here to watch a WSJ video about Ackert’s experience. (Photo/video copyright: Mark Peterman/Adya Beasley/Wall Street Journal.)
USA Today outlined the impact Theranos’ supposedly low-cost, cutting-edge technology had on several customers:
- A woman inaccurately diagnosed with the thyroid condition Hashimoto’s disease changed her lifestyle, made unnecessary medical appointments, and took medication she didn’t need;
- A woman inaccurately diagnosed with the autoimmune disease Sjögren’s syndrome was checked for food allergies before being retested and found not to have an autoimmune condition; and,
- An Arizona resident who had heart surgery visited a Theranos clinic five times to monitor the results of blood-thinning drug warfarin and was switched to a different drug. He had to have a second heart surgery to drain blood from the pericardial sac and believes more accurate test results could have averted the follow-up operation.
Arizona resident Steven Hammons visited a Theranos clinic several times to have his blood tested. He’d been placed on blood thinners following heart surgery. He was taken off the blood thinners presumably based on the results of those tests. However, as USA Today reported, one test result was later found to be inaccurate. Hammons, who underwent a second procedure to remove blood that had built up around his heart, told USA Today he was concerned about the safety of his fellow citizens.
“That makes me very concerned and worried for the safety of other Arizonans,” said Hammons, who once worked in the medical services division of a private health insurance company. “Government had a role in patient safety. The powers that be dropped the ball.”
Arizona Attorney General Mark Brnovich spearheaded a lawsuit against Theranos under the state’s Consumer Fraud Act, which led to a $4.65 million settlement covering full refunds for every Arizona customer who used the company’s testing services.
“Theranos may have not only had some erroneous test results, but they may have misread my rising blood pressure level as well,” Brnovich told The Republic in a 2017 article announcing the state’s fraud settlement with Theranos. “They said that about 10% of the results were inaccurate. The problem is, as an Arizona consumer, you don’t know whether you were part of that class or not.”
Downfall of a Once-Vaunted Clinical Laboratory Company
Dark Daily and sister publication The Dark Report have written extensively about these events. Former CEO Elizabeth Holmes founded Theranos in 2003 when she was just 19-years old. By 2013, Holmes had become a media sensation based on her claims that “Theranos had developed a medical technology that could do what seemed to be impossible: Its secret machines could run thousands of medical tests using the blood from a tiny finger-prick, and do so quickly and cheaply,” Bloomberg reported in a recent article outlining Holmes’ fall from grace.
While Holmes continues in the role of Chairman of Theranos’ Board of Directors, she was stripped of control of the company as part of the SEC settlement in 2016. The SEC found Holmes and then-company President Ramesh “Sunny” Balwani had fabricated claims Theranos technology had been validated by the Food and Drug Administration (FDA) and pharmaceutical companies and battle-tested by the US military in Afghanistan.
As a result, the SEC also barred Holmes from serving as an officer or director of any public company for 10 years. In October 2016, Theranos announced it would be closing its laboratory operations and focusing on its effort to create miniature medical testing machines, which it did. Nevertheless, the fallout continues.
As pressures on medical laboratories and pathology groups to cut costs while delivering quality care and value increases, laboratory leaders must not lose sight of the fact that accuracy of results remains the key to maintaining trust with healthcare consumers and a financially viable business.
—Andrea Downing Peck
Related Information:
Theranos, CEO Holmes, and Former President Balwani Charged with Massive Fraud
Theranos Receives Notice of Sanctions from the Centers for Medicare & Medicaid Services
Two More Investors Sue Theranos and Elizabeth Holmes for Fraud
Theranos Hit with Consumer Lawsuit over Faulty Blood Tests
Theranos, Walgreens Reportedly Reach a Deal to Settle Suit for under $30 Million
Theranos Selects Walgreens as a Long-Term Partner Through Which to Offer Its New Clinical Laboratory Service
An Open Letter from Elizabeth Holmes
How Startup Theranos Has Struggled with its Blood-Test Technology
Theranos Reaches $4.65 Million Fraud Settlement with Arizona
As Theranos Drama Unwinds, Former Patients Claim Inaccurate Tests Changed Their Lives
Theranos Statement on CMS 2567 Report
Agony, Alarm and Anger for People Hurt by Theranos’ Botched Blood Tests
Blood, Fraud and Money Led to Theranos CEO’s Fall from Grace
Holmes, Balwani Indicted by Department of Justice
Theranos News Gets Worse for the Former Silicon Valley Hero
After AACC Presentation, Elizabeth Holmes and Theranos Failed to Convince Clinical Laboratory Scientists and the News Media about Quality of Its Technology
Now Theranos Faces Criminal Investigation on Whether the Clinical Laboratory Company Misled Investors, according to Published Reports
Aug 8, 2018 | Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing, Management & Operations
As federal regulatory agencies continue to push transparency, hospitals, medical labs, anatomic pathology groups, and other healthcare providers must develop strategies for remaining competitive and maintaining patient volume
More price transparency continues to be a goal of Medicare officials. Some clinical laboratory managers and pathologists may be unaware of a proposed rule issued by the federal Centers for Medicare and Medicaid Services (CMS) in April that would require hospitals to post prices online as early as this January 1, 2019.
This action is a definitive demonstration of how the federal healthcare program continues to scrutinize how healthcare organizations communicate with patients and post their prices. This pressure on healthcare systems and individual providers extends to the clinical laboratories and anatomic pathology groups that support them. Without a plan to address these changes, medical laboratory test volume and practice revenues can be severely impacted.
Recent coverage from RevCycleIntelligence indicates that this trend is only just getting started.
“When you go to receive a healthcare service, there are always going to be situations where you can’t know what the costs will be, especially around emergency situations and some acute situations,” Centers for Medicare and Medicaid (CMS) Administrator Seema Verma told RevCycleIntelligence. “But for a lot of us, we’re going in for planned procedures. You should be able to know what it’s going to cost you.”
In April 2018, CMS posted a proposed rule that requires hospitals to post standard service rates online and update their pricing lists at least annually starting January 1, 2019. While many healthcare organizations currently report pricing to state boards and other online directories, this rule, if enacted, could make it easier for consumers to source reliable pricing information before obtaining care.
“We are concerned that challenges continue to exist for patients due to insufficient price transparency. Such challenges include patients being surprised by out-of-network bills for physicians—such as anesthesiologists and radiologists who provide services at in-network hospitals—and patients being surprised by facility fees and physician fees for emergency room visits. We also are concerned that chargemaster data are not helpful to patients for determining what they are likely to pay for a particular service or hospital stay,” the CMS proposed rule states.
In the proposed rule that references out-of-network bills, pathologists should have been included as a hospital-based physician service—such as anesthesiologists and radiologists—that submits bills to patients for care provided in the hospital. Pathology practice administrators may want to review the specific language of the proposed rule to understand how hospitals served by the pathology group will be required to post prices.
“If you’re buying a car or pretty much anything else, you’re able to do some research,” Seema Verma (above), Administrator, Centers for Medicare and Medicaid Services told RevCycleIntelligence. “You’re able to know what the quality is. You’re able to make comparisons. Why shouldn’t we be able to do that in healthcare? Every healthcare consumer wants that.” (Photo copyright: Centers for Medicare and Medicaid Services.)
Transparency Concerns Lead to Additional Questions from CMS
Alongside the proposed rule, CMS also is issuing a request for information (RFI) to give healthcare experts an opportunity to:
- Demonstrate the impact of current proposals; and,
- Make recommendations to further align the proposal with both the needs of healthcare organizations and service providers as well as the cost-reduction goals of CMS.
Key questions, according to RevCycleIntelligence, include:
- How should “standard charges” be defined (e.g., average or median rates for chargemaster items; average or median rates for groups of services commonly billed together as determined by the hospital; or average discount off the chargemaster amount across all payers)?
- What types of information would help patients understand hospital prices and patient financial responsibility? How should hospitals use this information to inform patients and decision-making?
- Should healthcare providers be required to tell patients about their out-of-pocket costs for a service prior to care delivery? Should providers even play a role in informing patients of out-of-pocket costs?
- Should CMS require providers to give patients information on what Medicare pays for a service?
- How should CMS enforce healthcare price transparency requirements? Should hospitals have to attest to meeting requirements?
Implications for Healthcare Services and Diagnostics Providers
RevCycleIntelligence reports that between CMS rules and bills introduced by Senators, an increase in healthcare transparency pricing is likely. These requirements will continue to apply pressure to clinical laboratories, anatomic pathology groups, and other diagnostics providers.
Much like the importance of communicating value to the new wave of payer and physician partnerships emerging around the country, transparency will offer an opportunity to communicate value to consumers.
However—particularly for high-margin services and assays—laboratories must create strategies to address pricing transparency and communicate the value of their services if they hope to maintain volumes and financial integrity at existing levels.
A study conducted by Johns Hopkins University researchers and published in The American Surgeon also highlights benefits that transparency might hold outside of simple regulatory compliance.
Analyzing data from six ambulatory care centers from 2016, they found that five out of six reported increases in both patient volume and revenue after adopting price transparency. Half of the centers also reported a reduction in administrative burden—a concern that medical laboratories must also address as streamlining operations and optimizing efficiency becomes a core part of successful lab operation in the face of healthcare reform.
Clinical laboratories and anatomic pathology groups should develop a strategy for addressing new transparency requirements. That strategy should include ways to effectively communicate their value to both healthcare providers and consumers. Should the CMS proposed rule progress to a final rule, failure to address pricing transparency may result in enforcement and compliance concerns—a critical issue for laboratories already facing tighter markets and increased regulatory and payer scrutiny.
—Jon Stone
Related Information:
“Just the Beginning” of Healthcare Price Transparency, Verma Says
CMS Aims to Catalyze Advancements in Consumer Price Transparency
Verma: CMS Will “Use Every Lever” for Promoting Interoperability, Data Access
CMS to Require Healthcare Price Transparency Online for Hospitals
Publish Your Prices, Boost Your Bottom Line
Healthcare Price Transparency in U.S. Not Improved in Recent Years
The Impact of Price Transparency for Surgical Services
Patients’ Views on Price Shopping and Price Transparency
Jul 11, 2018 | Laboratory News, Laboratory Operations, Management & Operations
New healthcare fraud prevention partnership white paper outlines the most common abuses and the reasons clinical laboratories are susceptible to fraudulent practices
When it comes to questionable marketing and billing practices for lab testing, clinical laboratory companies can expect increased scrutiny and enforcement actions by federal healthcare authorities. That’s one message in a recently-issued white paper that was jointly authored by the Centers for Medicare and Medicaid Services (CMS) and the Healthcare Fraud Prevention Partnership (HFPP).
Systemic Challenges That Put Clinical Labs at Risk
According to the CMS/HFPP report: “Examining Clinical Laboratory Services: What You Need to Know, How You Can Avoid its Consequences, and What to Do if You Are a Target of This Enforcement,” clinical laboratories face systemic challenges that can lead to the potential for fraud and abuse. Those include the:
- Number and variability of laboratories;
- High-volume, low-dollar nature of ordering, providing, and billing for clinical laboratory services; and,
- Technical complexity and continuing evolution of clinical laboratory services.
While HFPP, a public-private partnership of healthcare payers and allied organizations, notes it is difficult to put a price on the cost of laboratory fraud and abuse, it concludes, “[Fraud] can negatively impact patient care and outcomes, cause financial harm to legitimate service providers and drive up the cost of care for all.”
The CMS/HFPP white paper points out that fraud within the clinical laboratory industry typically is related to abuse of billing standards, improper laboratory relationships, and medically unnecessary testing, such as:
- Improper use of Current Procedural Terminology Code Modifier 91, which indicates when a test needs to be repeated on the same day;
- Unbundling of laboratory panels;
- Pass-through billing schemes;
- Rural health pass-through billing;
- Physician partial ownership of laboratories and co-referral networks;
- Use of exclusively large panels;
- Standing orders for laboratory tests;
- Excessive or improper urine drug testing;
- Sober living facilities (Sober Homes) that profit from urine drug testing; and,
- Excessive or improper genetic testing.
As the spotlight intensifies on an industry ripe for potential abuse, criminal and civil penalties for fraudulent and/or improper billing for medical laboratory services skyrocket as well.
This means clinical laboratory managers and pathologists can no longer simply rely on written compliance programs. They must implement compliance procedures that can stand up to investigations and enforcement actions and keep pace with frequently changing laws and regulations.
Diagnostic laboratories that fail to comply with healthcare fraud and abuse regulations face increasing legal risk. The Bipartisan Budget Act of 2018 (BBA) doubled many healthcare fraud and abuse penalties. The maximum penalties under U.S. Code § 1320a–7a—the Civil Monetary Penalties Law (CMPL)—for knowingly filing an improper claim jumped to $20,000; $30,000; or $100,000, depending on the violation.
Similarly, the maximum financial penalty related to payments to induce the reduction or limitation of services increased from $2,000 to $5,000. Criminal penalties for felony convictions of the Anti-Kickback Statute (AKS) also were substantially increased. Previously, a provider who violated the AKS could be fined as much as $25,000 and receive a maximum five-year prison sentence. As of February 9, 2018, AKS violations now can result in a maximum fine of $100,000 and up to a 10-year prison term.
Since 2015, monetary penalties for non-compliance with CMPL and AKS regulations have included an annual inflation adjustment, making the recently enacted increases less dramatic than they first appeared. Nonetheless, the BBA has upped the ante for clinical laboratories.
Protecting Your Clinical Laboratory Against Compliance Violations
“The BBA contained key changes to federal healthcare fraud statutes that, on the whole, reflect ongoing Congressional efforts to heighten penalties for healthcare fraud infractions. The revisions to the AKS and CMPL will, in Congress’s view, raise the stakes companies and individuals face in healthcare fraud cases,” noted law firm Hogan Lovells of Washington, D.C.
To help clinical laboratories and pathologists understand the significance of the CMS/HFPP white paper, and to navigate the increasingly treacherous regulatory and legal landscape, Dark Daily will be presenting a July 18 webinar titled “The New CMS White Paper on Healthcare Fraud Prevention: What You Need to Know, How You Can Avoid its Consequences, and What to Do if You Are a Target of This Enforcement.”
Melissa Jampol (left) and Charles Dunham, IV (right), are with Epstein Becker and Green, P.C., a national law firm with decades of experience focusing on healthcare and life science regulatory and enforcement issues that impact clinical and anatomic pathology laboratories, hospitals and health systems, and physician group practices and networks. (Photo copyrights: Epstein Becker and Green.)
During this valuable webinar, you will hear from two legal experts—Charles Dunham, IV, (above right) and Melissa Jampol (above left)—both of Epstein Becker and Green, P.C. (EBG). They have extensive healthcare industry regulatory experience and understand the enforcement process. They will provide diagnostic laboratories with a critical understanding of:
- Department of Justice operations, procedures and techniques for fraud enforcement, as well as laboratory actions that could be viewed as signs of potential fraud or abuse;
- Non-governmental enforcement procedures and techniques used by private health insurers;
- Tools for dealing with enforcement procedures or actions;
- How to build a compliance program that becomes infused in the culture of a clinical laboratory’s operations; and,
- Best practices designed to protect your lab from compliance violations or to mitigate potential problems, and more.
First to speak will be Charles Dunham, who is a partner at EBG. His national practice includes representation of healthcare providers and health-related entities. He has a particular focus on clinical and anatomic pathology laboratories, hospitals and health systems, and physician group practices and networks. His national clientele provides him with a wide view of the latest and most important developments in how laboratories, hospitals, and physicians need to comply with state and federal laws.
Clinical lab managers and pathologists participating in the webinar will get a unique, insider’s perspective from the co-presenter. Melissa Jampol is a former Assistant U.S. Attorney now at EBG. In this role, she has significant experience interacting with a range of federal and state law enforcement agencies on cases involving healthcare fraud and abuse. Her earlier experience includes more than six years as an Assistant District Attorney at the New York County District Attorney’s office.
To register for this crucial webinar and see essential details about discussion topics, use this link (or copy and paste this URL into your browser: https://pathologywebinars.com/current/the-new-cms-white-paper-on-healthcare-fraud-prevention-what-you-need-to-know-how-you-can-avoid-its-consequences-and-what-to-do-if-you-are-a-target-of-this-enforcement/).
While only a small percentage of labs engage in fraudulent business practices, all laboratory organizations today are subject to increased scrutiny and potential enforcement action. This essential webinar will provide in-depth information for laboratory managers and pathologists seeking practical advice on how to decrease non-compliance risks.
Don’t miss this unique opportunity to proactively protect your lab or pathology group from future problems, and learn how to respond if you are the subject of a payer audit, served with a Civil Investigative Demand letter, a subpoena, or other action. Register today!
—Andrea Downing Peck
Related Information:
Examining Clinical Laboratory Services: A Review by the Healthcare Fraud Prevention Partnership
Health Care Program Penalties Rise with Bipartisan Budget Act of 2018
Global Clinical Laboratory Services Market: Growing Demand for Quick Results and High Prevalence of Seasonal Infections Remain Important Drivers, Says TMR
Examining Clinical Laboratory Services Infographic
The New CMS White Paper on Healthcare Fraud Prevention: What You Need to Know, How You Can Avoid its Consequences, and What to Do if You Are a Target of This Enforcement
