CMS Retracts Guidance on F322 - Feeding Tubes

by Zach Cattell, JD, IHCA General Counsel

Guidance issued by CMS this past September that was to be effective this November has been retracted. Survey & Certification Memorandum 11-37-NH is no longer valid and CMS is revising the guidance to incorporate information from the Quality Indicator Survey process. CMS anticipates releasing revised guidance during the first six months of 2012.


If you have any questions about this topic, please contact Zach Cattell at zcattell@ihca.org or 317-616-9001.

Physician Signatures Not Required for Clinical Labs Under Clinical Laboratory Fee Schedule

by Zach Cattell, JD, IHCA General Counsel

CMS released its final rule making Revisions to Payment Policies to the Physician Fee Schedule for CY 2012 and CMS has officially retracted the proposed physician or non physician practitioner signature requirement on clinical lab test requisition policy. CMS had proposed for January 1, 2011 implementation of a rule which would have required a physician’s or qualified non physician practitioner’s signature on all requisitions for clinical diagnostic laboratory tests paid for on the basis of the Clinical Laboratory Fee Schedule (CLFS). The American Health Care Association, along with State affiliates, fought the proposal. CMS had first delayed the implementation and then had indicated that it would eliminate the requirement. The release of the final rule confirms the elimination of the proposal.

The final rule states “After consideration of the public comments received, we are finalizing our proposal to retract the policy that was finalized in the CY 2011 PFS final rule with comment period, which required a physician's or NPP's signature on a requisition for clinical diagnostic laboratory tests paid under the CLFS (75 FR 73483) and to reinstate our prior policy that the signature of the physician or NPP is not required on a requisition for a clinical diagnostic laboratory test paid under the CLFS for Medicare purposes.”

If you have any questions or for additional information, please contact Zach Cattell at zcattell@ihca.org or 317-616-9001.

CMS Issues Guidance to States for an Independent Informal Dispute Resolution Process for Long Term Care Facilities

by Zach Cattell, JD, IHCA General Counsel

Section 6111 of the Patient Protection and Affordable Care Act (ACA), in part, formed the basis for the establishment of a new Independent Informal Dispute Resolution (IIDR) process within the Civil Money Penalty scheme. Per Federal Regulations at 42 CFR 488.431, the new IIDR process has specific timelines and requirements for facilities to meet in order to take advantage IIDR. On October 14, 2011, CMS issued Survey & Certification Memorandum 12-02-NH (click here for a copy) that provides further guidance on the new IIDR process.

The new IIDR process is an option for facilities to elect if the facility is the subject of a Civil Money Penalty (CMP) that is subject to being collected and placed in an escrow account. CMS is phasing in the CMS collection and escrow provisions of the ACA and attendant regulations and will only be applying the CMP collection and escrow authority on the most serious deficiencies. Until further notice from CMS only those deficiencies that cite actual harm or immediate jeopardy (G or above) will be subject to the CMP collection and escrow and only those deficiencies will trigger the opportunity for IIDR. Any CMPs imposed for D, E and F deficiencies will be collected under the current process and are not subject to the new IIDR process.

Federal funding is available to States, through the State Survey Agency, for development of the IIDR process. The Indiana State Department of Health (ISDH) recently issued an alert indicating that the department is in the process of developing a new IIDR process according to the CMS guidance. The new IIDR process must:

1. Offer a facility the opportunity for IIDR within 30 calendar days of notice of imposition of CMP that will be collected and placed into escrow. A facility has 10 calendar days to request IIDR after receiving notice.

2. Be completed within 60 calendar days of receipt of the facility request for IIDR. “Completed” IIDR means that (a) a final decision has been rendered, (b) a written report has been generated, and (c) the ISDH has provided written notice to the facility of the decision.

3. Generate a written record of the decision before the CMP is collected. Such written record must include (a) each disputed deficiency/survey finding, (b) a summary of the IIDR recommendation with rationale for the result, (c) documents submitted by the facility, and (d) comments submitted to the IIDR by the Ombudsman and/or residents and their representatives.

4. Notify the Ombudsman, resident and resident’s representative of the opportunity to submit comments to the IIDR entity prior to the completion of the IIDR process.

5. Be administered by an entity that does not have a conflict of interest with the ISDH (State Survey Agency) and that has specific understanding of Medicare and Medicaid program requirements.

CMS indicates that for States to receive Federal funds for IIDR in FY 2012, States must have a process and estimated budget submitted to CMS by November 30, 2011. Furthermore, the new IIDR process is set to begin on January 1, 2012. It is unclear at this time whether the ISDH will meet either deadline. Given that Indiana law regarding state agencies contracting for services requires a fairly lengthy procurement process, it does not seem likely that the ISDH process will be finalized and ready by January 1, 2012. For deficiencies that are subject to the new IIDR process, States may not charge facilities for the IIDR process. For situations that do not require the new IIDR (deficiencies that do not require escrowing of CMP), the State may develop and charge for its own resolution process.

IHCA will continue to monitor the development of Indiana’s IIDR process. For additional information please contact Zach Cattell at zcattell@ihca.org or 317-616-9001.

Changes in Interpretive Guidelines for the Use of Feeding Tubes

by David Bufford, Hall Render, IHCA Associate Member

CMS released a Survey & Certification letter in September announcing revisions to surveyor guidance related to the use of feeding tubes in facilities, effective November 30, 2011. The revisions include the deletion of tag F-321, which addressed not utilizing a feeding tube unless it was unavoidable, and rolled the interpretive guidance for that tag into tag F-322.

The guidance for tag F-322 has been revised to provide clarification to nursing home surveyors when determining compliance with the regulatory requirements for feeding tubes. The actual federal regulation at issue, 42 CFR 483.25(g), has not changed. The guidance now better reflects the intent of the regulation to ensure the feeding tube is utilized only after an adequate assessment determines that the resident's clinical condition makes the intervention medically necessary. The feeding tube must be utilized in accordance with current clinical standards of practice and services are provided to prevent complications to the extent possible. Additionally, the facility must provide services to restore normal eating skills, to the extent possible.

The new guidance will address identify the key elements for tag F-322 that determine the level of severity. Severity Level 1 is not applicable to this tag.

CMS Provides Guidance for Nursing Facility Gardens

by David Bufford, Hall Render, IHCA Associate Member

CMS released a Survey & Certification letter in September providing guidance for nursing homes that desire to utilize on-site gardens to provide fresh produce for residents. After numerous inquiries from facilities, CMS confirmed that residents can benefit from home-grown foods as long as food-borne illness dangers are mitigated to the greatest extent possible.

The facility should follow safe food handling practices once foods are harvested and brought into the kitchen for preparation. Additionally, the facility must have in place policies and procedures for maintaining the garden. Such actions will permit the facility to remain in compliance with 42 CFR 483.35(i), Sanitary Conditions, and the related survey tag, F371.

In the event of an outbreak of a food-borne illness, surveyors will request the facility’s policies and procedures related to the garden if the facility’s main food source has been ruled out as the cause. The facility must immediately report any outbreak of a food-borne illness, regardless of the cause, to the local health department. The facility must also comply with any local or state requirements related to growing food on-site.

Medicaid RAC Rule Finalized

Section 6411 of the Patient Protection and Affordable Care Act (PPACA) expanded Federal efforts in the auditing and health care fraud arena by requiring that the Recovery Audit Contractor (RAC) program, which had previously only applied to Medicare, be applied to Medicaid as well. The Medicaid RAC programs will be operated by each individual State, but will be jointly funded by the State and the Federal government.
On September 16, 2001, the Centers for Medicare and Medicaid Services finalized the rule that will implement the health care fraud and abuse program. The Final Rule "provides guidance to States related to Federal/State funding of State start-up, operation and maintenance costs of Medicaid Recovery Audit Contractors (Medicaid RACs) and the payment methodology for State payments to Medicaid RACs." While the framework for the Medicaid RAC program was established in the corresponding proposed rule, the Final Rule sets forth the following important points:

· States may exclude Medicaid managed care claims from review by Medicaid RACs

· States must coordinate the recovery audit efforts of their Medicaid RACs with other auditing entities

· States must set limits on the number and frequency of medical records to be reviewed by the Medicaid RACs subject to requests for exceptions made by the RACs

· RACs must not review claims that are older than 3 years from the date of the claim, unless it receives approval from the State

· RACs should not audit claims that have already been audited or that are currently being audited by another entity

· If a provider appeals a Medicaid RAC overpayment determination and the determination is reversed, at any level, then the Medicaid RAC must return its contingency within a reasonable timeframe as prescribed by the State

· States must adequately incentivize the detection of underpayments and States must notify providers of underpayments that are identified by the Medicaid RACs

· States must provide appeal rights under State law or administrative procedures to Medicaid providers that seek review of an adverse Medicaid RAC determination

The Final Rule becomes effective on January 1, 2012.

"Long-Term Care Providers Must Not Adopt Residents’ Racial Preferences"

by Laurie E. Martin, Hoover Hull LLP


Long-term care providers may violate federal anti-discrimination law if they have a policy of honoring their resident’s racial preferences in assigning health care providers. A recent opinion from the U.S. Court of Appeals for the Seventh Circuit, Chaney v. Plainfield Health Care Center, 612 F.3d 908 (7th Cir. 2010), found that a provider’s policy of acceding to the racial biases of its residents was an unlawful employment practice that, along with racial animosity from the plaintiff’s co-workers, created a hostile workplace in violation of Title VII of the Civil Rights Act of 1964.

Certain Plainfield residents refused assistance from black CNAs. Plainfield had a policy of honoring its resident’s racial preferences, citing state and federal laws granting residents the right to choose providers, to privacy, and to bodily autonomy. Accordingly, African American plaintiff Brenda Chaney’s daily assignment sheets stated in writing that one of her residents “Prefers No Black CNAs.”

Over the course of three months, co-workers referred to Chaney in derogatory racial terms on multiple occasions. She reported the comments to management, and the comments eventually stopped, but Plainfield’s racial preference policy remained in place.

Chaney was later terminated for using profanity in front of a resident, although Plainfield later claimed other reasons led to her discharge. The court cautioned that a shifting justification for an employment decision can be circumstantial evidence of an unlawful motive. Rudin v. Lincoln Land Cmty. Coll., 420 F.3d 712, 723-34 (7th Cir. 2005).

The Seventh Circuit reversed summary judgment for Plainfield, finding that although Plainfield had acted to stop the racial epithets, it had actually encouraged a racially charged environment through its daily written assignment sheets reminding Chaney and her co-workers that certain residents preferred no black CNAs.

Chaney, 612 F.3d at 913-15. The court explained that, unlike gender, race is never a legitimate reason – a bona fide occupational qualification – for accommodating patients’ privacy interests. “Just as the law tolerates same-sex restrooms or same-sex dressing rooms, but not white-only rooms, to accommodate privacy needs, Title VII allows an employer to respect a preference for same-sex health providers, but not same-race providers.” Id. at 913.

Finally, the court disagreed that an Indiana regulation which gives residents a right to “choose a personal attending physician and other providers of services,” (410 Ind. Admin. Code 16.2-3.1-3(n)(1)), required Plainfield to instruct its employees to accede to the racial preferences of its residents. The court suggested that the regulation may require Plainfield to allow the resident reasonable access to a white aide if she wished to employ one at her own expense, but that it did not trump Plainfield’s duty to its employees to abstain from race-based work assignments. Title VII contains no good faith defense permitting an employer to ignore federal mandates in favor of allegedly conflicting state law. Id. at 914.

The Court suggested several actions a long-term care provider could take to confront a hostile resident without exposing itself to hostile workplace liability:

• Warn residents before admission of the facility’s non-discrimination policy and secure the resident’s consent in writing.

• Attempt to reform the resident’s behavior after admission.

• Assign staff based on race-neutral criteria that minimize the risk of conflict.

• Advise employees that they can ask for protection from racially harassing residents.

Id. at 915 (citing Patrick Gavin & JoAnne Lax, When Residents and Family Harass Staff: The Tightrope between Regualtory Compliance, Risk Management and Employment Liability, LONG TERM CARE AND THE LAW 16-18 (Feb. 27, 2008) (American Health Lawyers Association, Seminar Materials.)

Employers can also seek to avoid liability under Title VII by enacting and consistently enforcing the following helpful practices:
• Establish a clear and effective anti-harassment policy

• Respond promptly to any complaints of harassment from employees.

• Provide clear and comprehensive reasons for discharge at termination.

• Seek clarification from the Indiana State Department of Health or legal counsel if a state regulation appears to require actions inconsistent with federal law.

Laurie E. Martin is an associate with Hoover Hull LLP. She represents employers, including long term care facilities and hospitals, in state and federal court and before administrative agencies on all employment and employee-benefit related matters including compliance with the Family and Medical Leave Act (FMLA), Title VII of the Civil Rights Act, the Employee Retirement Income Security Act of 1974 (ERISA), the Americans with Disabilities Act (ADA), Genetic Information Nondiscrimination Act (GINA), wage and hour disputes, wrongful discharge and blacklisting. Visit www.hooverhull.com or contact Laurie E. Martin directly at 317-822-4400, ext. 136, to discuss your employment-related needs.