WE REALLY MEAN IT…MAYBE

The Two Midnight Rule states that Medicare will generally not reimburse hospitals at inpatient rates for treatments that do not span two midnights.  The Rule itself is problematical since admissions sometimes are made on the then available facts which may not require two full overnight stays.  Even worse, RACs have made determinations that inpatient admission wasn’t “necessary”, and find that the hospital should have provided treatment on an outpatient basis resulting in an unpaid claim, which is made worse by the Two Midnight Rule.  Hospitals have been actively appealing such RAC determinations, and have been widely successful.  Unfortunately, as you may have read in previous issues, the federally required 90 day rule for deciding RAC appeals is simply being ignored, and it generally takes over a year to get incorrect RAC decisions overturned.

While on one hand CMS states that it will keep the Two Midnight Rule and will not delay its implementation, it has decided again to delay the Two Midnight Rule enforcement until at least April 30^th.

This time CMS says “believe me”.

WHO IS UNDERPAID?

The next time you hear that physicians and hospital CEOs are overpaid, consider the below 2014 compensations for the five largest health insurers:

1. AETNA CEO – Mark Bertolini – $15M;
2. UnitedHealth Group CEO – Stephen Hemsley – $14.9M
3. CIGNA CEO – David Cordani – $14.5M;
4. Anthem CEO – Joseph Swedish – $13.5M;
5. Humana – Bruce Broussard – $10.1M;

HIPAA CRIMES

Only a few reported cases reveal the extent of criminal prosecutions for HIPAA violations.  A criminal violation of HIPAA for accessing or releasing PHI without authorization and disclosing it to an unauthorized third-party can carry a jail term of up to 10 years, and currently a maximum fine of $500,000.

The most recent reported case involves Jamie Knapp who worked in Oregon, Ohio at ProMedica Bay Park Hospital.  The grand jury indictment indicates Knapp obtained PHI of nearly 600 patients by unauthorized access.  Apparently, Knapp was a respiratory therapist at the hospital, but it is unclear why or how the information was accessed and used.  To our knowledge, no one has yet been sentenced to the maximum 10 years.

This information can be used to emphasize, to employers and contractors, as a part of an active security program, the importance and severity of HIPAA violations.

SURPRISE SURPRISE!!

New York recently passed a measure to prevent billing for out-of-network emergency services.  The law effectively limits charges to what the consumer would have paid for in-network services.  Any additional sums must be resolved between the out-of-network physician and the health plan.  We recently reported on the unfortunate balance billing of consumers who went to an in-network hospital’s emergency room only to be billed at out-of-network rates because the in-network hospital subcontracts to an ER services firm that is not part of the hospitals in-network contract with the insurer.

If this practice is not prohibited on the federal level, expect to see most states follow New York’s lead in this matter.

This newsletter is edited by Paul Wallace of Jones ∙ Wallace, LLC, a member of the American Bar Association Healthcare Law Section and the American Health Lawyers Association who has been representing physicians and healthcare practices for over 25 years.  Mr. Wallace assists physicians in health practices in contract items, federal legal compliance, creation of practice entities, estate and wealth planning and similar issues.  Please feel free to call if you have any questions on this newsletter or legal matters at (812) 402-1600 or pwallace@joneswallace.com.