Buried In The Budget Bill Are Belated Gifts For Some Health Care Providers

When President Donald Trump signed the last-minute budget deal into law earlier this month, the news coverage emphasized how the bill boosted military funding, provided tens of billions in disaster aid and raised the debt ceiling.

But buried deep in the 652-page legislation was a repeal of a limit on Medicare coverage of physical and occupational therapy. It received little public attention, but to the American Physical Therapy Association, this headline was decades in the making.

The group had spent 20 years lobbying to reverse a component of the Balanced Budget Act of 1997, which would have limited patients to $2,010 worth of occupational therapy a year, and another $2,010 of physical therapy and speech-language pathology. Each time the limit was about to kick in, APTA managed to postpone its implementation — sometimes for just months, sometimes for another year or so.

Justin Moore, APTA’s CEO, quit his job as a physical therapist in Missouri and moved to Washington, D.C., in 1999 specifically to lobby Congress full time about staving off these so-called therapy caps. He recalls recruiting thousands of physical therapists to protest on Capitol Hill, long hours lobbying in congressional offices and eleventh-hour victories to keep the cap from taking effect.

Just hours after Trump signed the sweeping bill, Moore joked: “I’ve got to figure out what to do next,” celebrating the victory with cupcakes in his Virginia office.

It’s a story of one long-fought battle, marked by legislative twists and convolutions, procrastination and budgeting witchcraft. But it provides a window into the bizarre world of the way much of health care financing gets done in Washington — as an afterthought and via backroom negotiations.

“This is a miniature version of what we also have as the inefficiencies of health policy and health care,” said Thomas Miller, a resident fellow at the conservative American Enterprise Institute, a Washington think tank. “We do a lot of things that burn up resources and energy, and we treat them as a big deal, and that tends to keep you down in the trenches, shooting at things in front of you and not looking at the larger picture.”

In their enthusiasm to pass a budget this month, Congress included permanent dissolution of the therapy caps — 277 pages into the bill. The bill contained several other measures meant to placate medical constituencies by fulfilling their financial requests: for instance, forestalling payment cuts to so-called Disproportionate Share Hospitals, which treat higher proportions of low-income patients, and continuing a payment bump to certain rural home health providers.

An Arbitrary Amendment

The therapy cap came as an amendment to the 1997 budget bill, part of a “big push to reform entitlements,” recalled Katherine Hayes, health policy director at the D.C.-based Bipartisan Policy Center, who worked at the time for Rhode Island Republican Sen. John Chafee, then the chair of the Senate subcommittee on health care.

Its inclusion was somewhat arbitrary — “an assignment … to get some savings in the health sector,” recalls Sen. Ben Cardin (D-Md.), who at the time was a junior member of the House Ways and Means Committee, where the proposal originated.

Others recalled some concern that Medicare was paying too much for physical therapy and a hope that limiting coverage might help control these costs.

Since lawmakers “had to reach the target [for savings], it went into the package. Once it went into the package, it was enacted and became law,” said Cardin, who has introduced numerous bills over the years attempting to repeal the caps.

Almost immediately, backlash came from a small but impassioned therapy contingent, willing to devote the bulk of its lobbying resources to this one issue, with effect. Lawmakers on both sides of the aisle balked when it came to actually implementing the caps.

Over the years, that resistance translated into Capitol Hill rallies, starring speakers such as Maine Republican Sen. Susan Collins, who would wear and remove baseball caps — metaphorically “lifting the cap,” Moore recalled. It also meant full-court-press phone-a-thons from the nation’s physical therapy community, calling on Congress to extend the delay, usually by attaching legislative language to whatever must-pass spending bill or health care funding measure was moving through the pipeline.

The therapy lobby kept the legislative patches going, but efforts always stopped short of a full repeal, many recalled. This solution allowed lawmakers to have it both ways: They did not have to take a generous popular benefit, physical therapy, away from voters. But they continue to support a budget amendment aimed at taming runaway spending.

“For a number of years, we thought [the cap] was not a thoughtful approach,” said Cybele Bjorklund, who worked from 1995 to 2015 as a Democratic staffer in Congress. “Many Republicans also realized pretty early on this was not good policy. But again — nobody wanted to then pay to get rid of it.”

And so, sidestepping imposition of the therapy cap was achieved by adding the delay into a hodgepodge of small health initiatives, known as the “extenders,” which are addressed every few years. In 2006, Congress switched from delaying the cap to simply allowing for easy exceptions for patients who needed therapy beyond the stipulated limits.

On the balance sheet for the budget bill that passed this month, the nonpartisan Congressional Budget Office estimated the permanent therapy cap repeal will cost more than $6 billion over the next decade.

A Few Hiccups And, Ultimately, Repeal

The ups and downs of the therapy cap provision kept APTA in business — providing fodder to mobilize their members and resulting in increasing lawmakers’ interest in a permanent deal, Moore said. Political gamesmanship and partisan bickering resulted in brief lapses — in late 2003, for a month in 2006 and in early 2010 — when lawmakers failed to patch together a bill in time.

Meanwhile, the estimated cost of forestalling or mitigating therapy caps grew more expensive each time around.

An effort to incorporate repeal of the caps into the 2010 Affordable Care Act failed, partially, Bjorklund recalled, because Democrats wanted the sweeping health law as a money saver. That meant every penny counted, and even a few billion dollars represented deadweight.

In 2015, a proposed Senate amendment to a larger bill on doctor payments again would have ended the therapy caps. It was ruled out of order after falling two votes short of a motion to waive concerns about its relevance.

That exhaustive 20-year effort laid the groundwork for this month’s deal. When Bjorkland heard that therapy caps could be on the table for this year’s budget bill?

“I remember saying, ‘Please, just get rid of it, will you? Finish it off!’” she said.

Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente. http://www.kaiserhealthnews.com

Engler Moves To Fire Osteopathic Dean

In an email letter to members of the Michigan State University Board of Trustees, the university’s new interim president, John Engler, reports he wants to fire Dr. William Strampel, Dean of the Osteopathic Medical School since 2002, for his role in the Larry Nassar case.

The President’s recommendation, after five days on the job, requires an affirmative vote of a faculty hearing committee to reverse his tenure.

Strampel has been on medical leave since last December.

According to an MSU news release, he was accused of not following-up on the medical procedures he asked Nassar to follow after a joint FBI and campus police department investigation into sexual abuse allegations concerning Nassar.

The release quoted Strampel as saying he did not “see the need to follow up to ensure” Nassar complied with the recommendations to use a rubber glove and have another adult in the room during his medical exams.

“William Strampel did not act with the level of professionalism we expect from individuals who hold senior leadership positions, particularly a position that involves student and patient safety,” wrote Engler. “Further allegations have arisen that question whether his personal conduct over a long period of time met MSU’s standards. We are sending an unmistakable message today that we will remove employees who do not treat students, faculty, staff, or anyone else in our community in an appropriate manner.”

Engler added that he hopes the “courageous survivors” of Nassar’s abuse “will see this as an unmistakable indication that things are changing quickly at Michigan State.”

This story presented in cooperation with MIRS, a Lansing-based news and information service.

Former U-M Pediatric Doc Charged With Child Pornography

A former University of Michigan-affiliated pediatric rheumatologist who was investigated for having sex with a patient is facing federal child pornography charges, according to a federal complaint unsealed Feb. 12.

Mark Franklin Hoeltzel, 46, stood mute—meaning a not guilty plea was entered for him—in front of U.S. District Magistrate Judge Elizabeth A. Stafford. He is charged with receipt of and possession of child pornography. He faces up to 20 years in prison if convicted as charged.

U.S. Assistant Attorney General Mollie O’Rourke asked that Hoeltzel be immediately detained, which Stafford granted.

Defense attorney Raymond Cassar said he demanded the hearing to argue for his client’s release because he believes Hoeltzel, who had returned from treatment out of state when he was arrested, is not a risk of flight nor is he a risk to the community.

“He was coming back into the state when they arrested him and the government knew that; we had made arrangements for him to come back,” Cassar said. “The biggest reason I want to get him out on bond is to get him back into treatment here in Michigan.

“That’s important for him. The treatment he’s undergoing is important for him. It’s important for his growth and to address the charges,” added Cassar, declining to elaborate on the treatment. “Mark Hoeltzel is a good man. He’s never been in trouble before and I need to remind all . . . readers he is presumed innocent. We are looking forward to our day in court.”

Cassar did not speak about the specific allegations except to acknowledge the charges.

The complaint, filed in U.S. District Court in Detroit, said the investigation began Dec. 4 when Ann Arbor law enforcement learned the state’s Department of Licensing and Regulatory Affairs (LARA) was investigating the Ann Arbor doctor “for having a sexual relationship with a female patient.”

That investigation lead to a search warrant of Hoeltzel’s Ann Arbor home on Dec. 11 where investigators seized a flash drive that contained about 210 images of child pornography and a Dell laptop that contained about 94 images of child pornography, according to a complaint authored by U.S. Homeland Security Investigations Special Agent Michael MacBride, who noted that the images contained about 71 unique files between both devices and the rest were duplicates.

The files, created or accessed between 2008 and May 17, 2017, contained primarily images of minor females with their genitals exposed “in a lascivious manner,” according to the complaint.

Hoeltzel’s patient told authorities in December that she had been treated for rheumatoid arthritis for years and that at age 18 the doctor sent her a text message instructing her to make an appointment with him, according to court documents.

The patient told authorities that during the first appointment, Hoeltzel “grabbed her from behind, pulled her butt into his groin, and rubbed his erect penis on her” and they “engaged in regular and frequent sexual acts” at his clinic and her home, MacBride’s complaint noted.

The complaint further alleges that Hoeltzel discussed his 12- to 15-year-old patients with the woman, describing the teens as “hot.” The woman also said Hoeltzel spent “many occasions” with her at his clinic engaged in sex acts and not providing medical treatment.

MacBride’s complaint describes the complainant as a “vulnerable” person who has a “chronic debilitating condition, which causes her to have a dependency on narcotic prescription pain medication in addition to mental health diagnoses.”

In January, Attorney General Bill Schuette’s office said Hoeltzel began texting the woman, then 17, after he saw her at the clinic when she received treatment from another doctor. Hoeltzel transferred the patient’s care to himself.

Schuette’s office also said Hoeltzel exchanged emails and online messages with an 11-year-old patient he met at a U-M Arthritis Camp in 2004. The exchanges lasted through 2006, and were “flirtatious and suggestive” messages, which the girl’s mother reported to the Arthritis Foundation, who was responsible for the camp.

After the mother reported it, university officials required Hoeltzel to undergo a “boundaries course,” according to the complaint.

As of Monday, Hoeltzel has not been charged in connection with the relationship with his patient or in connection with the allegations about the 11-year-old child.

MacBride said a LARA investigator also reviewed Hoeltzel’s prescriptions for his patient and determined that he prescribed narcotics “beyond and outside of recommendations for a patient” with the woman’s diagnoses.

LARA suspended Hoeltzel’s medical license on Dec. 21 on U-M initially suspended Hoeltzel, whose employment was later terminated.

Jake Jacobson, director of public relations for Children’s Mercy Hospital in Kansas City, Missouri, confirmed Monday that the hospital warned Hoeltzel’s former patients there that he had been accused of sexual misconduct with two Michigan patients.

Hoeltzel worked for the Missouri hospital between 2007 and 2013.

Jacobson said the hospital began a “thorough internal investigation” in late January when it learned about the allegations against Hoeltzel in Michigan. He could not say whether any patients reported misconduct by the doctor nor could he say whether the investigation includes allegations of child pornography.

Cassar said he was not aware of the Children’s Mercy investigation.

This story presented in cooperation with MIRS, a Lansing-based news and information service.

COMPLIANCE CORNER: State OIG Initiating Aggressive Pharmacy Inventory Audits

Recently, we have received reports that the Michigan Department of Health and Human Services (MDHHS) Office of Inspector General (OIG) is conducting aggressive audits of pharmacies that concentrate on invoice and inventory records. In most cases, the targets of these invoice and inventory audits are independent pharmacies. According to the OIG, the purpose of inventory audits is to ensure that a pharmacy is not billing Medicaid for more drugs than it purchased. But the methodology utilized by the OIG is susceptible to error, resulting in inaccurate overpayment demands, and there are questions as to the legality of these types of audits prior to July 1, 2015. This article will explore the legal framework governing inventory audits and one of the many legal defenses being raised by pharmacies subject to recoupment as a result of this type of audit.

Pharmacies, like any other healthcare provider, are required to comply with various federal and state laws, as well as state policies as a condition of participation in the Medicaid program. The OIG relies on authorities contained within the Medicaid Provider Manual, as well as its general powers under the Social Welfare Act, 400.1 et. seq., and Executive Reorganization Order 2010-1, MCL 333.26368, to perform inventory audits.

While the OIG has broad powers to conduct audits and recoup funds paid in excess to which a pharmacy is entitled, its power is tempered by notice requirements. MDHHS is required to provide notice to each provider of a change in policy or procedure affecting providers, MCL 400.111a(6). “[A] person is not required to resort to, and shall not be adversely affected by, a matter required to be published and made available, if the matter is not so published and made available.” MCL 15.241. Documents that are required to be published and made available to the public by a state agency include “written statements that implement or interpret laws, rules, or policy, including but not limited to, guidelines manuals, and forms with instructions, adopted or used by the agency in the discharge of its functions.” Id.

On June 1, 2015, pharmacy providers received notice of a new proposed policy, MSA 15-15, which required pharmacies to maintain various records, including invoices, manufacturer and/or wholesaler sales records, distributor delivery records, inventory transfer records, and provider payment records, to support the quantity of goods paid for by Medicaid during the audit period. Under this policy, failure to maintain these records would result in recoupment of pharmacy funds. MSA 15-15 was characterized as an “addition” to pharmacy audit policy to support the ability of the Department to recover funds where there is insufficient documentation of inventory and purchase histories. Prior to MSA 15-15, the Medicaid Provider Manual did not explicitly provide that failure to maintain invoices, manufacturer and/or wholesaler sales records, distributor delivery records, inventory transfer records, and provider payment records would result in recoupment.MSA 15-15 went into effect on July 1, 2015, and was incorporated into the Pharmacy chapter of the Medicaid Provider Manual in subsection 19.2— an entirely new subsection— on October 1, 2015. Although subsection 19.2 has only been in effect since July 1, 2015, the OIG has relied on this section to support audits of pharmacy invoice records from the last seven years.

Outside of subsection 19.2, the OIG is utilizing general policies applicable to all providers to support inventory audits prior to July 1, 2015. The “Record Keeping” section of the General Information for Providers chapter of the Medicaid Provider Manual requires all providers, including pharmacies, to maintain certain fiscal records for a period of seven years. One type of fiscal record that must be maintained is purchase invoices for items offered or supplied to the beneficiary. Medicaid Provider Manual, General Information for Providers, §§ 15.1 and 15.6; See also MCL 400.111b. However, this general policy does not require pharmacies to maintain the other types of documents listed in subsection 19.2, including manufacturer and/or wholesaler sales records, distributor delivery records, inventory transfer records, and provider payment records, and it does not provide that failure to maintain these records will result in recoupment.

Thus, pharmacies hit with overpayment demands by the OIG are challenging the results of inventory audits before July 1, 2015 on the ground that, prior to that date, the Pharmacy chapter of the Medicaid Provider Manual did not provide that failure to maintain the comprehensive list of documents identified in subsection 19.2 would result in recoupment. This issue is currently under review by Administrative Law Judges in the Michigan Administrative Hearing System.

Notwithstanding any potential legal defenses that may exist, Pharmacies should take inventory audits by the OIG very seriously. There could be devastating financial consequences if a pharmacy fails to maintain the documentation listed in subsection 19.2 of the Pharmacy chapter of the Medicaid Provider Manual for a period of seven years. For additional information, please contact a Wachler & Associates attorney at 248-544-0888.

Sarah Hillegonds is an associate attorney at Wachler & Associates, P.C. Ms. Hillegonds practices in all areas of healthcare law and devotes a substantial portion of her practice to representing health care entities in the defense of RAC, Medicare, Medicaid and third-party audits. Ms. Hillegonds also represents healthcare providers in licensing matters.


ON POINT WITH POs: Wanted: A Connected Network Of Michigan Upstreamists Focused On #SDOH

The upstreamists are coming! The upstreamists are coming! If you know what I’m talking about, I’ll consider you a loyal follower of this column—or someone who is already attuned to the social determinants of health (#SDOH). In my October 2017 column, I discussed a call to action on #SDOH and cited the upstreamist term used by Rishi Manchanda, MD, a physician and public health innovator who has worked in South Central Los Angeles and advocates for incorporating #SDOH into primary care.

I couldn’t be more excited to announce that Dr. Manchanda will be coming to Michigan (for the first time!) when MedNetOne joins with the Oakland University School of Health Sciences on Wednesday, April 18 to present a day-long symposium at OU on #SDOH, Better Upstream Health for Better Downstream Care. Dr. Manchanda will be joined by healthcare innovator Paul Grundy MD, MPH, who just stepped down after a stellar career as IBM’s Global Director of Healthcare Transformation and is considered the “godfather” of the Patient Centered Medical Home.

A quick review: social determinants of health may include:
• Economic resources, including access to jobs that provide a living wage
• Safe workplaces and safe neighborhoods
• Quality of schools and availability for advanced education and training
• Clean and safe water, air and food
• Positive support systems through home and family relationships and extended social interactions

The broad spectrum of factors comprising #SDOH can make it challenging to know where to begin when managing health crises that arise as a result of inadequate understanding of the role #SDOH play in overall health and quality of life. To this end, Better Upstream Health for Better Downstream Care is an important event – but not only for those directly involved with providing healthcare and administering healthcare programs or organizations. It’s planned as a community event to engage the healthcare community, legislators, local and state leaders, business decision makers and concerned citizens who want to be part of the solution for holistic healthcare that addresses the role that #SDOH play in overall health and wellness.

Tragically, we have all seen how #SDOH has played out in Flint and with other social and environmental disasters. This conference is a call to action to identify new opportunities for innovative programs and cross-sector partnerships to drive change across and between social services and health systems and help galvanize current and potential upstreamists as part of the solution. No one person or organization can do this alone. With more upstreamists in the community we can enhance and target efforts to raise awareness of -and act on- #SDOH in the broader public health conversation. Upstreamists investigate and aim to resolve the root cause of illness or lingering ill health; they don’t necessarily treat symptoms. Although physicians can certainly be upstreamists, as Drs. Manchanda and Grundy have already shown, we also need a greater reach and buy-in. We need pharmacists, clinicians, community health workers, social workers, behavioral health specialists, public health experts and public interest attorneys. We also need students like those at OU’s School of Health Sciences and other academic disciplines, including liberal arts, engineering and computer science, to be thinking of new ideas and innovations that address #SDOH.

It’s a new era, and we need all hands on deck to make measurable change through multi-disciplinary initiatives. Please join us on April 18 and help Michigan launch an upstreamist community network.

To register for the event or for sponsorship information, visit https://www.oakland.edu/shs/healthology/. If you want to help Michigan be a leader in developing upstreamists, contact me at ematuszewski@mednetone.net

ON MEDICINE: The Girl And The Doctor

In the age of Larry Nassar, in the era of #metoo, what is a girl to think? What is a doctor to think? What are the rules these days? From the standpoint of doctor-patient relations, the fallout from the Larry Nassar case could be toxic for medical care.

First, how are doctors trained? When young people graduate from medical school and enter practice, traditionally they take the Hippocratic Oath, either as originally written, or as updated. The Oath has two salient sentences. The first is: “I will use treatment to help the sick according to my ability and judgment, but never with a view to injury and wrong-doing.”

The other pertinent sentence is “Into whatsoever houses I enter, I will enter to help the sick, and I will abstain from all intentional wrong-doing and harm, especially from abusing the bodies of man or woman, bond or free.” Both of these promises are intended to prevent the doctor from engaging in self-serving behavior that is not in the best interests of the patient.

One more principle is taught to all medical students: “First do no harm,” often quoted in the original Latin: Primum non nocere.

It is assumed that the young doctor understands these admonitions. If not, he or she has no business practicing medicine. Then, after entering practice, if he or she is found to be in violation of these precepts it is up to the profession first to take appropriate action. All or almost all medical institutions have – or should have – mechanisms for reporting and acting on possible abuses. It goes without saying that any that do not have such protocols need to develop them, stat. Further, in every state our profession maintains very successful Physician Health Plans for dealing with treatable physicians who have psychiatric issues. For those who are not amenable to treatment, the Board of Medicine in every state is empowered to remove the license of any physician whose behavior is criminally harmful to patients. Beyond that, the legal system is the obvious place for addressing egregious and dangerous behavior.

What can we tell patients so they will feel secure the next time they visit a doctor? This is more complicated. Without medical backgrounds, they may not know exactly what constitutes appropriate practice and what does not. Some already fear doctors and misinterpret the reason for a legitimate pelvic exam. As a result, the doctor, intimidated by fear of the patient’s reaction, fears touching the pelvic area, even when it is entirely appropriate. Doctors today are required to have a third person present, but patients will remember that this did not protect young girls in the examining room of the crafty Larry Nassar. According to newspaper reports, he was able to conceal what he was doing even from a concerned parent.

So what are the rules that will make patients and doctors comfortable? The internal examination of any woman who ever has been sexually active is perfectly appropriate when performed in order to rule out or treat pathology in the gynecologic area. This exam also is performed in order to identify and document sexual abuse in a young girl of any age. To reiterate, in this case an invasive exam is done, with gloved hands and in the presence of a female observer, when a medical condition of the female genitalia is suspected or treated. There are very few indications for performing such an exam on girls who have never been sexually active. There is no indication at all for an internal exam to be performed without gloves. Note: The physician must be aware that in some cultures an internal exam is considered a violation of a girl’s virginity, thus possibly impairing her chance of marriage in the future.

Beyond the routine adult gynecologic exam, babies and young children may come to the doctor because of a diaper rash, an accident or other problems that warrant careful examination of the perineum, and sometimes it is necessary to perform visual inspection of the vagina using a small scope or speculum. Normally such examinations are performed by a pediatrician, pediatric surgeon, pediatric urologist or other qualified specialist. Whether or not to perform routine examinations on sexually active minors is another question, one that requires physicians to make a judgment call.

It is almost impossible to think of any indication for a sports doctor, orthopedic surgeon or any similar specialist to perform any internal examination on a girl of any age, unless possibly in the context of major surgery to treat serious trauma, cancer, other dramatic illness, or birth defects.
Doctors need to inform their patients in advance of their intention to perform examinations of the perineum, and they need to explain the rationale. Patients need to be reassured that when they go to a doctor they will be treated with respect. And, as the Larry Nassar case has shown us, when they suspect they are being mistreated, they should voice their concerns immediately.

If the doctor is able to explain the questioned procedure in a way that makes sense, that should be the end of it. If not, the patient or family should take the concern to the referring doctor or, if that is not feasible, to the institution that employs the doctor. The popular #metoo meme may help empower patients to do just that today.

What we must avoid is for patients to fear doctors and doctors to fear patients. If we need to put up the Hippocratic Oath in our offices, so be it. If we need to create and post our own office rules for examinations so patients can read them, so be it. If we need to take an extra moment to explain what we are doing, so be it. Patients need to be reassured that they will be safe when they visit the doctor and that their next doctor will not turn out to be another Larry Nassar.

LEGAL LEANINGS: As Telemedicine Soars, Reimbursement For Telemedicine Services Slowly Evolve

The use of telemedicine has soared in recent years, as new technologies develop and consumer demand for instant access to healthcare increases. Indeed, the telemedicine market is expected to grow to $113.1 billion by 2025, at an estimated compound annual growth rate of 18.8%. It is expected that at least 7 million patients in the United States will access telemedicine services in 2018, a sharp increase from 2013, when the estimated number of telehealth patients was fewer than 350,000. Despite this momentous growth, reimbursement continues to be a key obstacle for telemedicine providers. However, reimbursement rules by various payors are slowly expanding to cover more telemedicine services.

Medicare remains one of the most restrictive payors for telemedicine services, with exceptionally limiting reimbursement rules. With some exceptions, Medicare will pay for a telemedicine encounter only when the patient is located in a rural area and present at an eligible originating site, the service must be delivered by one of eight eligible professionals and the modality must be real-time, interactive, and face-to-face (thus prohibiting “store and forward” telemedicine technologies), with a limited number of available codes. Notably, Medicare recently changed its coding for telemedicine services, eliminating use of the “GT” modifier traditionally used to indicate that the service was provided via telemedicine; in its place, Medicare has created Place of Service Code 2, which should be used in the place of the former GT modifier. A list of Medicare’s rules, restrictions, and codes for telemedicine encounters can be found at: https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/TelehealthSrvcsfctsht.pdf. Despite Medicare’s reluctance to shed its restrictive reimbursement rules, several drafts of legislation have been proposed to expand Medicare payment for telemedicine services, typically targeted to particular conditions and disease states. Accordingly, Medicare payment restrictions may soon be eased, albeit gradually.

Contrary to Medicare, Medicaid plans are generally more liberal in reimbursing a variety of telemedicine services. According to www.medicaid.gov, Medicaid views telemedicine as a “cost-effective alternative to the more traditional face-to-face way of providing medical care . . . . As such, states have the option/flexibility to determine whether (or not) to cover telemedicine; what types of telemedicine to cover; where in the state it can be covered; how it is provided/covered; what types of telemedicine practitioners/providers may be covered/reimbursed, as long as such practitioners/providers are ‘recognized’ and qualified according to Medicaid state/regulation; and how much to reimburse for telemedicine services, as long as such payments do not exceed Federal Upper Limits.”

Currently, 48 state Medicaid programs offer some type of coverage for telehealth services. The Center for Connected Health Policy has compiled a survey of each state’s Medicaid reimbursement rules for telemedicine, with hyperlinks to each Medicaid program’s rules, available at http://www.cchpca.org/state-laws-and-reimbursement-policies. Michigan’s Medicaid program currently reimburses for a variety of live video encounters, including inpatient consults, outpatient consults, psychiatric diagnostic procedures, training services, end stage renal disease-related services, behavioral health and substance use disorder treatment and education services. Although Michigan’s Medicaid program typically requires the patient to be located at an eligible original site, which includes physician or other provider offices, a patient may be treated from home for behavioral health therapies. Further details can be found in Michigan’s Medicaid Provider Manual, available at http://www.mdch.state.mi.us/dch-medicaid/manuals/MedicaidProviderManual.pdf.

Commercial payors vary with respect to payment for telemedicine services. State “parity” laws may require a health plan to pay for telehealth services, and a minority of states require health plans to pay the same amount for telehealth services as if the treatment had been provided in-person. However, many payor contracts omit specific terms relating to telemedicine payment, perhaps unintentionally. Physicians need not be passive in hoping that a private health plan will pay for telemedicine services. Providers can get ahead of a telehealth payment dispute by requesting key terms for telemedicine reimbursement when payor contracts are first negotiated and signed. Providers should make their contracting team aware of what telemedicine services are available to their patients, so that they can request specific terms for the telemedicine modalities used by that provider in their negotiations. Knowledge of your state’s parity law can and should be used in negotiations with payors as well (although a parity statute is not required to negotiate reimbursement). Additionally, Medicare Advantage coverage for telehealth is a potential area for growth, as Medicare Advantage plans recognize the positive outcomes and lower costs for telemedicine services, and can benefit greatly from those cost savings.

Finally, telemedicine providers need not be restricted to the intricacies of Medicare, Medicaid and private health plan reimbursement rules, which frequently conflict. Telehealth providers can find other ways of generating revenue for its services, including providing services for a flat rate or an hourly rate charged directly to patients. Many patients are willing to pay a reasonable out of pocket amount for the convenience of telehealth services, provided the rate is fair market value and meets other state-specific rules.

With some advance planning and knowledge of the reimbursement rules for the specific telemedicine modalities used in their practice, providers can develop a workable plan for generating telemedicine revenue. For more information on telemedicine reimbursement issues, contact Marki Stewart at Dickinson Wright.

Marki Stewart is an attorney in Dickinson Wright’s Healthcare Practice group. Her practice focuses on healthcare regulatory and transactional law, with extensive experience regarding federal and state fraud and abuse laws, including Stark and the Anti-Kickback Statute, HIPAA, electronic health records, business transactions, joint ventures, physician recruitment, and Accountable Care Organizations. Marki has specialized knowledge of the unique legal issues surrounding telemedicine, including licensing issues, credentialing, privacy, and security.


The collective “wisdom” promoted by the MBAs, nouveau healthcare experts, politicians and bureaucrats can be condensed into a singular thought: Doctors were part of an anachronistic model which was condescendingly labeled a “cottage Industry.” According to this expanding array of mutually anointed experts, this was a stupid residual from a previous era. The truly operative word here is industry. Then, as an industry, it needed to be aggressively nudged into modernity as these wizards envisioned it. Included in this group-think vision was the caveat that turning the physicians’ practice of medicine, a profession, into an industrial model laden with regulations, mandates, rules, care models and protocols was mandatory. But could it have been the dollar signs in the eyes of the industrialists when gazing at 16 percent of the U.S. economy attributed to healthcare that was originally and continues at present to be the salient motivator? Add to this the enormous transfer of power to the federal government.

Those fortunate enough to get in on this potential bonanza certainly have prospered. The exponential increase in government healthcare bureaucrats with their lavish salaries and benefits, the hospital management aristocracy, the health insurance companies, the IT companies selling their ludicrous fantasies, the pharmaceutical enterprise with its layers of profiteering and of course the trial lawyers always vigilant to new financial opportunities have all prospered as each has taken a bite out of the blossoming financial and power laden cornucopia. Now we have hospital systems consolidating in their battle with insurance companies, which themselves are merging with pharma, to directly compete with hospitals by extracting previous inpatient dollars to outpatient initiatives.

This has produced the increasing movement of physicians, buried in valueless, unproven nonsensical schemes that magnified their overhead and sapped their productivity, to hospital employment or incorporated into conglomerates funded by venture capitalists as these businesses bought their practices. Physicians’ professional organizations have been complicit in inflicting MACRA on the medical profession. MACRA is a barely understandable moving target virtually guaranteed to reduce physicians’ incomes as the law satisfies its budget-neutral requirement. [Editor’s Note: The Medicare Access & CHIP Reauthorization Act is a law regulating how the Center for Medicare and Medicaid Services pays physicians. The act pays increased or decreased rates based on a variety of criteria. MACRA has drawn considerable criticism from the healthcare community based both on its structure and program details.]

Hospitals utilize what may be one of the single most corrosive forces ever devised, the relative value unit (RVU). What employed physician does not eagerly await these “dashboards” of “value” showing his or her productivity including how well they stack up with other doctors locally and even across the country? This wondrous array of colorful graphs ostensibly tells a physician’s employer if he or she is a hard worker. Where is listening to patients, examining patients, counselling patients, teaching colleagues or even hugging a patient reflected in the RVU? Hint, it isn’t. Physicians must make few waves, select the best templates on their EHRs so that billing documentation is maximized and produces many lucrative procedures to optimally fulfill the RVU productivity demands. But if a physician works slowly, deliberately and conservatively, creates clinically valuable narrative notes or, “God forbid,” is thoughtful and frank about silly policies, he or she is an outlier. Now really, does productivity as measured by the RVU really have a place in rendering medical care?

Then there is the matter of masters. The doctor now answers to an employer, to an insurance company, to a government bureaucrat and finally to a patient. Somehow, one must question the appropriateness or even the morality of such a bastardized system.

While all of this money from 16-plus percent of an $18 trillion economy is being distributed among the industrialists, physicians are being taught altruism. What a wonderful tool has altruism been to regulate physicians’ singular and crucial role relative to the entire industry to irrelevance both as practitioners and as entrepreneurs.

In retrospect, maybe the good old “cottage industry” with the simplicity of a valued interaction grounded in the relationship of a doctor with a patient may have actually been superior to what exists now and where the profession seems to be heading in its future. Don’t buy into the predictable gotcha response by the elitists, “American medicine was never great.” Of course things in medicine’s past could have been better. But medicine will never be perfect. The mistake though is to abandon certain ideas from the past and eventually forget them when racing toward a questionable future. In no way is this meant to imply time travel back to the “good old days.” It sometimes seems that the more healthcare is forced to change, the more screwed up it becomes. The more screwed up it becomes, the less chance remains for reasoned inclusion of still-valued traditions of the past. It is incredible the changes in healthcare that have resulted from unproven assumptions and continue to be used as a basis for abandoning what has worked before. Physicians still have choices; options still exist. But the window is closing and will do so more rapidly with the passage of time. Inertia, apathy and finally surrender are traits of those “burned out.”

Remember, ink and paper still exist and printed notes cannot be hacked, not to be taken in its literal sense but for what is implied.

80% Of Flint Legionnaire’s Cases From Water Switch

(FLINT)—an 80 percent majority of the 87 Legionnaires’ diseases cases that came out of the city of Flint from 2014 to 2017 can be connected to the city’s water supply, according to a hotly disputed study released in early February.

A research team made up of experts from the University of Michigan, Wayne State University and Colorado State University also found the less chlorine used to treat Flint River water, the more likely those who drank the water contracted Legionnaires’ disease.

Temperature of the water was not tested, a key point because the warmer the water, the easier it is for Legionella to grow. However, the researches from the “Flint Area Community Health and Environment Partnership (FACHEP) research team” did suggest using polyvinyl chloride pipes, which don’t release iron when exposed to corrosive water.

The Department of Health and Human Services (DHHS) quickly disputed the report’s findings, writing that it reviewed the final draft articles, as did an independent third party, KWR Watercycle Research Institute and found numerous flaws that were brought to the research team’s attention, but to no avail.

“By publishing these inaccurate, incomplete studies at this point, FAHCEP has done nothing to help the citizens of Flint and has only added to public confusion on this issue,” wrote the department.

“The researchers not only failed to accurately describe conversations with MDHHS, but utilized variables in their dataset that inaccurately reflect the timing associated with cases of Legionnaires in Flint. Researchers also overestimate the risk to public health by focusing on a string of the bacteria, serogroup 6, that is not typically associated with Legionnaires’ disease.’

The release is unique in that it questions the articles at a time when the agency’s director and chief medical executive are facing charges arising over Flint water and Legionnaire’s Disease.

The findings, published in the academic journals Proceedings of the National Academy of Science and mBio, were announced the same day as more criminal court action took place from those public officials neck deep in the Flint water crisis.

A Genesee County Drain Commissioner’s office officials testified at a preliminary exam for four current and former Michigan Department of Environmental Quality employees that he warned then-appointed emergency manager Darnell Earley, former finance director Gerald Ambrose, Flint’s former director of public works Howard Croft, former utilities director Daugherty Johnson, former Mayor Dayne Walling and district supervisor Stephen Busch that they didn’t have to switch to the Flint River. However, Croft said they were ready and Ambrose called it a “good deal for the city of Flint.”

Busch is one of the four MDEQ employees charged. Early, Ambrose, Croft and Johnson were also charged with crimes related to the water crisis.

John O’Brien, division director in the Genesee County Drain Commissioner’s office, testified that he toured the city’s water treatment plant at least twice pre-April 2014—when the city switched from Detroit water to Flint River—and that the plant wasn’t capable of providing safe drinking water because, in part, it was still under construction, including the chlorine room. Chlorine is essential to treating the water.

“We believed the plant was not ready to go based on conversations we had with the state and city from June 2013 to February 2014,” he testified.

O’Brien estimated it would take at least 90 days to complete construction on the water plant, which had been dormant decades, and test the facility to produce water before introducing it to the drinking water supply. He said staff also needed training because several employees were clearly there simply because they were “happy to have a job because they just came over from solid waste management” department.

“They came from garbage haulers,” he said. “Two weeks before that they were all riding shotgun on a garbage truck.”

O’Brien questioned Busch about why he authorized the city to activate the water treatment plant when it wasn’t ready and Busch replied that he “was directed to,” which O’Brien interpreted meant someone “higher up at MDEQ or (Department of) Treasury gave the go-ahead to move the treatment plant forward.”

Special Prosecutor Todd Flood questioned whether O’Brien would allow his family to drink the water with that knowledge, and O’Brien replied he did because in 2014 both city leaders and DEQ gave no indications there were problems so “we had no reason not to drink it.”

But, O’Brien changed his mind when he learned in late 2015 that there were issues with the water.

O’Brien was the only witness Monday in the preliminary exam for Busch; Liane Shekter Smith, 57, former chief of the DEQ’s Office of Drinking Water and Municipal Assistance; district engineer Michael Prysby, 54; and Patrick Cook, 54, a specialist for the DEQ’s Community Drinking Water Unit.

At the conclusion of the exam, Judge Jennifer Manley will decide if the four defendants will head to Genesee County Circuit Court for trial in connection with the 2014 Flint water crisis.

Busch and Prysby both face two counts each of misconduct in office, tampering with evidence and violation of Michigan’s Safe Drinking Water Act. They are alleged to have mislead the U.S. Environmental Protection Agency and Genesee County Health Department about the lack of safety in drinking in Flint’s water from the Flint River.

Shekter Smith and Cook both face one count each of misconduct in office and willful neglect of duty. Cook also is charged with conspiracy to commit misconduct in office for allegedly manipulating reporting of the lead and copper levels in the drinking water.

The prosecution previously announced they also will seek an involuntary manslaughter charge against Busch and Shekter Smith at the conclusion of the preliminary exam. The charge is in connection with the deaths of two people whom prosecutors say legionella contributed to their deaths.
This story presented in cooperation with MIRS, a Lansing-based news and information service.

Amazon And Healthcare

Three huge and influential employers, Amazon, Berkshire Hathaway and JP Morgan Chase, announced Jan. 30 they were partnering to create an independent company aimed at reining in health-care costs for their U.S. employees.

There were almost no details available about what the company would do or how it would use technology to disrupt and simplify the complicated fabric of American health care. But there’s no doubt that the companies, which collectively employ more than 1 million workers worldwide, have a real interest in ratcheting down their spending on health care. Health-care premiums are split between employers and employees and have been growing much faster than wages.

Major health company stock prices tumbled on the news, and the announcement stirred excitement — and questions — about how the three companies could bring their clout to containing costs in the massive employer-sponsored health insurance market, which provides coverage to approximately 160 million Americans.

According to a survey of employer health benefits, health insurance premiums have been rising faster than wages. Between 2012 and 2017, workers’ earnings grew by 12 percent, while premiums went up by 19 percent. Between 2007 and 2012, premiums increased twice as fast as workers’ earnings.

The announcement comes amid rampant rumors and anticipation that Amazon could disrupt health care as it has in other industries, particularly in the business of selling prescription drugs.

A person at one of the companies who is familiar with the matter said that this is day one of the joint venture and that specific plans will take shape over time. The person said that the joint venture is not currently expected to be a new health insurance company or a hospital or a pharmaceutical company, but a company that can bring technology tools to bear on making health care more transparent, affordable and simple. The person warned that could change.

“The ballooning costs of healthcare act as a hungry tapeworm on the American economy. Our group does not come to this problem with answers. But we also do not accept it as inevitable,” Warren Buffett, Berkshire Hathaway chairman, said in a statement.

This isn’t the first time big employers have tried to tackle health-care costs. Two years ago, 20 major companies including Verizon, American Express, IBM and Shell Oil joined in a Health Transformation Alliance to improve the way health care is purchased for employees. Mercer, a human resources consulting firm, runs several collectives of employers that join forces to purchase prescription drugs, using the extra leverage from having a larger group to wring better prices.

Amazon, with 541,900 employees globally as of October, is known for transforming industries. For months, rumors that it could enter health care have sent shudders through the stock prices of companies whose business models might be threatened. Some see the biggest health-care deal in years—a merger between CVS and Aetna announced last year — as partially fueled by the threat that Amazon could start selling drugs.
Amazon, already one of the country’s largest employers, has been expanding. Last year, the company announced plans to hire 50,000 warehouse workers, staging a one-day blitz dubbed “Amazon jobs day.” The company is also scouting sites for a second North American headquarters, where it plans to employ as many as 50,000 full-time workers, many of them in high-paying office jobs.

Berkshire Hathaway is an Omaha-based conglomerate employing approximately 367,700 employees across a variety of industries including insurance, candy manufacturing, electric utilities, newspapers, fractional jet ownership, ice cream, bricks and furniture. Its longtime chairman, Buffett, said last year at his shareholder meeting that health-care costs were a bigger impediment to American competitiveness than taxes.
“Medical costs — which are borne to a great extent by business — have gone from 5 percent to 17 percent” of the economy since 1960, Buffett said. “Our health costs have gone up incredibly and will go up a lot more.”
The holding company is one of the most valuable in the world, as measured by market capitalization. Berkshire Hathaway earned $24 billion in net profit in 2016 and has more than $100 billion in cash on hand.

JPMorgan Chase is the largest bank in the country with more than $2 trillion in assets and what its chief executive, Jamie Dimon, calls a “fortress” balance sheet. It is unclear what specific expertise the bank will bring to the effort, but the company has a lot at stake in reining in health-care spending. The company last year spent $1.25 billion on medical benefits for 300,000 U.S. employees and family members.

As the head of the powerful Business Roundtable, Dimon emerged as one of the most vocal and visible chief executives pushing for changes to the corporate tax code last year. But he has not spoken as often or as forcefully about the problems in the health-care system, mentioning it only briefly in his annual letter to shareholders last April.

“Our nation’s healthcare costs are essentially twice as much per person vs. most other developed nations,” Dimon said.

The independent company would be jointly led by executives from all three companies, although a chief executive has not yet been announced. It will be free from the need to deliver a profit. Todd Combs, an investment officer of Berkshire Hathaway, Marvelle Sullivan Berchtold, a managing director of JPMorgan Chase and Beth Galetti, a senior vice president at Amazon will manage the company in its early stages.