New Long Term Care Facility Closure Notice Requirements

Centers for Medicare & Medicaid Services (“CMS”) published an interim final rule on February 18, 2011 to implement the Affordable Care Act’s provision regarding notice for closure of long term care facilities. The interim final rule requires a Health Facility Administrator (“HFA”) to submit to the U.S. Secretary of Health and Human Services (“Secretary”), the state LTC Ombudsman, residents and legal representatives of residents’ written notification of impending closure of a facility. The interim final rule is effective on March 23, 2011 and may be later revised based on comments received by CMS.

Notice of impending closure must be issued 60 days prior to the closure date or on a date not later than determined by the Secretary in the event of the facility’s participation in Medicare and/or Medicaid. The notice must include a plan for transfer and relocation of residents and include “assurances” that residents are transferred to the most appropriate facility in terms of quality, services and location, taking the resident’s needs and choices. In addition, the HFA must ensure that no new residents are admitted to the facility after the notification of closure is issued. Facilities must also develop and have a policy and procedure in place to ensure that the HFA performs the required facility closure notice duties described above.

The facility notice closure requirement is personal to HFAs and failure to comply may result in Civil Monetary Penalties being levied against the HFA (minimum of: $500 – first violation,
$1,500 – second violation and $3,000 – third violation) and potential exclusion from participation in Federal health care programs. Facilities will also be subject to deficiency citation during surveys for failure to maintain policies and procedures designed to ensure the HFA’s completion of the facility notice closure requirement. Comments on the interim final rule are being accepted by CMS until 5:00 p.m. on April 19, 2011. For more information about how to comment, see the left column on page 9504 of the Proposed Rule, or contact Zach Cattell at 317-616-9001 or zcattell@ihca.org.

HHS and CMS Issue Proposed Rule Authorizing States to Identify OPPC’s

On February 17, 2011, the Centers for Medicare & Medicaid Services (“CMS”) and the Department of Health and Human Services (“HHS”) announced a proposed rule under the PatientProtection and Affordable Care Act ("PPACA") that would grant states the authority to codify Other Provider Preventable Conditions (“OPPCs”) and Provider Preventable Conditions (“PPCs”) that include, at minimum, the Hospital Acquired Conditions (“HACs”) defined by Medicare, but also state-identified conditions. HHS believes establishing Medicare requirements as the minimum for the application of the policy is appropriate because many states that have implemented Hospital Care Acquired Condition (“HCAC”) policies have adhered to Medicare requirements, because the conditions are generally accepted by the provider community.

PPCs are defined under two categories; HCACs and OPPCs. The proposed rule would include a definition for an HCAC that would not be limited to those specifically outlined by Medicare, but also include conditions identified by states for prevention of health care reimbursement under state plans, as approved by CMS through the state plan review process. Accordingly, the proposed definition would establish Medicare requirements as the floor, but allow further state innovation as determined by each state.

Such a policy would extend to applying nonpayment provisions to service settings beyond the inpatient hospital setting. Under the proposed rule, states may identify similar OPPCs related to services furnished in settings other than inpatient hospitals, such as nursing home facilities. State plans would have to provide for nonpayment for care and services related to these OPPCs and federal financial participation would not be available in state expenditures for such care and services related to OPPCs.

The proposed definition of an OPPC would include, at a minimum, wrong surgical or other invasive procedure performed on a patient, a surgical or other invasive procedure performed on the wrong body part, and a surgical or other invasive procedure performed on the wrong patient. As of January 15, 2009, Medicare no longer covers the above mentioned surgical or invasive procedures, or hospitalizations and other services related to these non-covered procedures as defined by Medicare.

The proposed criteria for other OPPCs would be similar to the criteria for HCACs, including that a condition or event identified by a state must be; (1) a discrete, auditable, quantifiable, and clearly defined occurrence, (2) clearly adverse, resulting in a negative consequence of care that results in unintended injury or illness, and (3) reasonably preventable, meaning an event that could have been anticipated and prepared for, but that occurs because of an error or other system failure.

HHS hopes to make these requirements effective July 1, 2011, and is currently soliciting comments. If you have questions about the proposed rule, or about how the PPACA may impact your organization, please contact Leigh Ann O'Neill at 317-238-6346.

CMS Rescinds Clinical Lab Requisition Physician Signature Requirement

The Centers for Medicare and Medicaid Services (CMS) will be rescinding the requirement for a physician’s signature on clinical lab requisitions for all settings, including skilled nursing facilities (SNFs).

Even prior to publication of the final rule, published on November 29, 2010 as part of the CY 2011 Final Physician Fee Schedule Rule (73 FR 73170), AHCA and other members of the Clinical Lab Coalition were fighting this issue. They were successful in obtaining a delay in implementation to March 31, 2011, since the requirement was to have been effective on January 1, 2011.

AHCA had sought withdrawal of this policy since it would be in direct contradiction to the stringent regulatory mandates regarding timely and high quality nursing facility care. Requiring a physician signature on clinical lab requisitions also would have been a complete negation of the efforts of AHCA provider members to provide the highest quality care possible.

Furthermore, in many cases, facilities would have been forced to send patients to the hospital so that clinical laboratory tests could be obtained in a timely fashion, causing totally unnecessary trips, potentially harmful transfers for patients, and increased costs to the Medicare program. AHCA was concerned that CMS had reversed its long-established position on lab tests, put in place after a lengthy negotiated rulemaking process in 2001 with broad stakeholder involvement, which established that there were alternatives to document physician intent to order a lab test besides a physician signature on the requisition, such as notation in the patient’s medical record.

Reprocessing of Skilled Nursing Facility Claims

In early February, the Centers for Medicare and Medicaid Services (CMS) announced it had discovered an error in the non-labor share percentage used for calculating Skilled Nursing Facility (SNF) and Swing Bed (SB) Prospective Payment System (PPS) reimbursement for fiscal year 2011. Reports indicate that the error caused all SNF and SB claims from October 1, 2010 until now to generate slightly lower payments for RUG rates. CMS is correcting this percentage in the SNF Pricer and, upon successful implementation, contractors will begin adjusting all previously adjudicated SNF and SB PPS claims with discharge dates on or after October 1, 2010, to apply correct reimbursement. This adjustment process may take up to 8-10 weeks to finalize. According to CMS, the impact on the per-claim payment is very small.

In addition, CMS instructed contractors to suspend any newly submitted SNF and SB PPS claims, with discharge dates on or after October 1, 2010, at the contractor’s sites until the updated SNF Pricer is installed. CMS expects to complete full testing and installation by February 14, 2011.

Should you have any questions about this article or other issues relating to long term care payments, please contact Lori McLaughlin at lmclaughlin@kdlegal.com or (219) 227-6075.

CMS Proposed Rule: Resident’s Right to Voice Concerns to State QIO

Centers for Medicare & Medicaid Services (“CMS”) published a proposed rule on February 2, 2011 that would require ten Medicare certified providers and suppliers, including Long Term Care Facilities, to issue a notice to Medicare beneficiaries regarding the beneficiary’s right to voice concerns to the Quality Improvement Organization (“QIO”) in their state. In Indiana, the Medicare QIO is Health Care Excel. A similar notice requirement is already in-place for Medicare beneficiaries receiving in-patient hospital care and CMS believes that the expansion of notice to Medicare beneficiaries regarding their right to voice concerns to a QIO will further assist in improving the quality of health care.

The proposed rule would require each Medicare certified Long Term Care Facility to inform all Medicare beneficiaries, or his/her representative or surrogate, at the time of admission of the beneficiary’s right to file a written complaint with the QIO in their state regarding the quality of care they are receiving or have received. The Long Term Care Facility must supply the Medicare beneficiary with the name, phone number, email and mailing address of the QIO upon admission. The Long Term Care Facility would also be required to document in the beneficiary’s record that the information was provided upon admission.

CMS estimates that complying with the new requirement, once made final, would impose a one-time two (2) hour burden on each Long Term Care Facility to develop a standard written form that would fulfill the notice requirement. CMS also estimates that it will take a total of five (5) minutes to inform the beneficiary and document the distribution of the notice.

Comments on the proposed rule are being accepted by CMS until 5:00 p.m. on April 4, 2011. For more information about how to comment, see the left column on page 5756 of the Proposed Rule, or contact Zach Cattell at 317-616-9001 or zcattell@ihca.org.

ISDH Updates Universal Precautions Rule

On January 10, 2011, the ISDH Universal Precautions rule was formally updated with the publishing of the Final Rule in the Indiana Register. The rule amends 410 IAC 1-4 to update and modify general precautions to incorporate best health care practices in order to provide greater protections to the public. Several new requirements regarding hand hygiene and medical glove use are specified. See http://www.in.gov/legislative/iac/20110105-IR-410090810FRA.xml.html for a copy of the new regulation.

AHCA Submits Comments on Guidance Relating to Medicaid/Medicare Exclusion List

Recently, the Department of Health and Human Services' ("HHS") Office of Inspector General ("OIG") solicited comments from Medicare and Medicaid providers as to the potential need for updated guidance as to the OIG's excluded provider program. Under the program, the OIG has the authority to exclude from participation in the Medicare and Medicaid program providers who have committed certain health care-related offenses, or have had their licenses revoked or suspended (as well as for many other reasons). If a provider is excluded, and an entity subsequently bills Medicare or Medicaid for services attributable to that excluded provider, the OIG can recover the sums paid, in addition to hefty penalties. The current OIG "authority" on the matter comes in an outdated 1999 Special Advisory Bulletin, where the OIG outlined the ins and outs of the exclusion program. It looks like something new might be coming out though, and if the American Health Care Association's ("AHCA") comments are taken to heart, the new OIG guidance will include information about the OIG's intent to further utilize its current exclusion authority with respect to individuals based on their relationships with corporations that have been found guilty of health care-related offenses. Additionally, AHCA smartly suggested that the OIG make clear what happens when a provider self-discloses the fact that they may have billed for services provided by an excluded provider? Hopefully, the OIG will take all of the AHCA's suggestions into consideration. New OIG guidance on these matters is expected sometime this Spring.

If you have questions about the Medicaid/Medicare exclusion program, or about AHCA's recent comments to the OIG, please contact Susan Ziel at 317-238-6244, or Leigh Ann Lauth O'Neill, at 317-238-6346.