CARES Act Provider Relief Fund: Compliance and the Impact on Hospital Margins
The effects of COVID-19 create numerous hospital financial management issues. One specific issue is hospitals maintaining financial stability. As the United States adjusts to the pandemic, hospitals have the burden of navigating their purpose, mission, and values while maintaining operations. The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) is a comprehensive bill that includes provisions that financially assist healthcare providers. Nevertheless, as with all federal assistance, compliance with specific conditions is required. As the pandemic continues, if hospitals accept federal help to stabilize finances, awareness, and increasing training to comply with federal guidelines is crucial.
Rule Changes, Regulatory Waivers Expand Access to Health Care Services During Pandemic
Recent regulatory waivers and rule changes by the Centers for Medicare and Medicaid Services (“CMS”) have resulted in a notable increase in patients seen remotely, according to two recent studies. The studies suggest that CMS regulatory waivers and rule changes, which included expanded access to COVID-19 testing and telehealth services in response to challenges faced by health care providers and patients during the COVID-19 pandemic, have increased remote delivery of mental health care and highly specialized clinical practices like plastic surgery.
CMS Issues New Rigid COVID-19 Requirements for Skilled Nursing Facilities
The Centers for Medicare & Medicaid Services (“CMS”) released new guidance for skilled nursing facilities (“SNFs”) as part of a larger rulemaking agenda for healthcare institutions in the throes of the current public health emergency with COVID-19. CMS has also detailed the fines for non-compliance with the new COVID-19 requirements for SNFs and other healthcare institutions such as hospitals and laboratories.
CMS Modernizing the Physician Self-Referral and Anti-Kickback Regulations
On October 9, 2019, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule to modernize and clarify the regulations that interpret the Medicare physician self-referral law (often called the “Stark Law”), which has not been significantly updated since it was enacted in 1989. As CMS tries to reconstruct the healthcare field, it is imperative for compliance programs to prepare for the changes in regulations to come. The following discussion provides a brief overview of the proposed changes but is not an exhaustive list of all rulemakings related to the physician self-referral law.
CMS Issues New Rule to Tighten Provider Enrollment
On September 5, 2019, the Centers for Medicare and Medicaid Services (“CMS”) released its final rule with comments on Program Integrity Enhancements to the Provider Enrollment Process (“ The Program Integrity Enhancements”). The final rule gives CMS the power to revoke Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) enrollments of providers or suppliers who have an “affiliation” with previously sanctioned entities, even if those providers and suppliers aren’t directly violating any existing rules themselves. CMS says that this new authority will help to “stop fraud before it happens.”
Rush University Medical Center’s 2019 Privacy Breach Incident
In March 2019, Rush University Medical Center (“Rush University”) sent out breach notification letters to approximately 45,000 patients. The letter advises patients that a privacy incident occurred that may have involved the patients’ personal information. The privacy incident was caused by an employee of a third-party financial services vendor. The employee released a file that contained patient information to an unauthorized person. According to the breach notification letter, law enforcement and regulatory officials were involved in the investigation of the privacy incident. Rush University sent the breach notification letter in compliance with the Health Insurance Portability and Accountability Act’s privacy and security rules.
The Years Long Process to a Revised Common Rule and Implementation
The Common Rule, the Federal policy protecting human subjects of biomedical and behavioral research, was published in 1991. The process to update the policy has taken place over the last several years, leading to the final rule revisions which were effective as of July 19, 2018. After January 20, 2019, institutions are now permitted to implement the entirety of the revised Common Rule. Any institution receiving funds, supervision, or review from any of the twenty Federal Departments and Agencies that have codified the Common Rule must implement this revised rule in their compliance programs.
Trump Administration’s Proposal to Update Anti-Kickback Safe Harbors Gives Patients Drug Price Relief at the Pharmacy Counter
On January 31, 2019, the Trump administration proposed yet another regulation in efforts to control rising prescription costs for Americans. If the regulation becomes final, drug manufacturers and Pharmacy Benefit Managers (“PBM”) will no longer be able to harbor from Anti-Kickback violations when negotiating discounts with Medicare and Medicaid managed care programs. The Administrations, continuing the tone of transparency, will instead provide Medicare Part D beneficiaries with the ability to receive discounted prices at the pharmacy counter. The administration hopes this will allow patients to not endure high out-of-pocket costs by purchasing medications at a more affordable price necessary to sustain their health.
Injunctions Halt Trump Administration’s Attempt to Expand Religious Exemption for Obamacare Contraceptive Mandate
A pair of injunctions in the Northern District of California on January 13, and the Eastern District of Pennsylvania on January 14, halted the implementation of amendments to a religious exemption to the so-called contraception “mandate” of the Affordable Care Act, also known as Obamacare. The “mandate” requires most employers to include contraception coverage in the insurance plans they offer to employees. While Obama administrative agencies contemplated religious exemptions early on, contentious litigation and political transition expanded the scope of the exemption until these latest developments.
OIG Work Plan on Nursing Facility Staffing Levels
In August, the U.S. Department of Health and Human Services (“HHS”) Office of Inspector General (“OIG”) made an additional focus in its Work Plan for the oversight of nursing facility staffing levels. These changes were made in the light of backlash from a July 2018 news article which reported that nearly 1,400 nursing homes had fewer qualified staff on duty than they were required or failed altogether to provide reliable staffing information to the Centers for Medicare and Medicaid Services (“CMS”).