Category Archives: Washington D.C.

Obama’s Executive Order, Its Impact on Health Care Costs, and the Constitutionality of Executive Orders

Pres. Barack Obama will address the nation tonight at 8 pm (Thursday, November, 20, 2014). He is expected to discuss his executive order that will delay deportations of up to 5 million migrants.

What does an executive order on immigration have to do with Medicaid? Well, you can bank on the fact that almost none of the 5 million people has private health care coverage….which means, there is a high likelihood that most, if not all, the people would qualify for Medicaid.

With the expansion of Medicaid in many states, adding another 5 million people to the Medicaid program would be drastic.  Think about it…in NC, approximately 1.8 million people rely on Medicaid as their insurance.  5 million additional Medicaid recipients would be like adding 3 more North Carolinas to the country.

So I looked into it…

The Kaiser Family Foundation website states that even immigrants who have been in America over 5 years are sometimes still barred from getting Medicaid and those people would remain uninsured.  The Kaiser website states that under current law “some lawfully present immigrants who are authorized to work in the United States cannot enroll in Medicaid, even if they have been in the country for five or more years.”

By law, only immigrants who have green cards are entitled to enroll in Medicaid or purchase subsidized health care coverage through the ACA. Usually those immigrants with green cards are on the course to become citizens.

Regardless of whether Obama’s executive order tonight will or will not allow the 5 million people Medicaid coverage (which it will not), the executive order absolutely will greatly increase health care costs

The truth is that, with or without Obama’s executive order, the government already funds some health care for undocumented immigrants. We have an “emergency Medicaid” program and it pays hospitals to provide emergency and maternity care to immigrants if: 1) he or she otherwise would be Medicaid eligible if they weren’t in the country illegally or 2) he or she are legally present in this country for less than 5 years.  (Which is the reason that ER wait times are so long…if you have no health insurance and you get sick, the ER is precisely where you go).

However, with the additional 5 million people living within the borders of USA, it is without question that the “emergency Medicaid” funds will sharply escalate as hospitals provide more emergency care. ER waits times will, inevitably, increase. Health care costs, in general, surge as the population increases.  And the addition of 5 million folks in America is not a “natural” increase in population.  It will be like we added additional states.  Overnight and with the stroke of a pen, our population will grow immensely.  I guess we will see whether we get “growing pains.”

An act of Congress will still be required before the undocumented immigrants impacted by the executive order would be allowed to participate in the Medicaid programs and the Children’s Health Insurance Program (CHIP) coverage.

As to the Constitutionality of executive orders…

Executive orders are not specifically mentioned in the Constitution.  Many people interpret the nonexistence of executive orders in the Constitution as barring executive orders.

Article I Section I of the Constitution clearly states that all legislative powers reside in Congress. However, an executive order is not legislation. Technically, an executive order is a policy or procedure issued by the President that is a regulation that applies only to employees of the executive branch of government.

Nonetheless, our country has a vast history of president’s issuing executive orders. Abraham Lincoln issued an executive order to engage military in the Civil War, Woodrow Wilson issued an executive order arming the military before we entered World War I, and Franklin Roosevelt approved Japanese internment camps during World War II with an executive order.

Regardless of your political affiliation, in my opinion, it is very interesting that Obama would initiate an executive order regarding immigration given his past statements over the years complaining about past presidents’ executive orders being unconstitutional.

In 2008 campaign speeches, Obama regularly emphasized the importance of civil liberties and the sanctity of the Constitution.

In fact, in speeches, Obama stated, “most of the problems that we have had in civil liberties were not done through the Patriot Act, they were done through executive order by George W. Bush. And that’s why the first thing I will do when I am president is to call in my attorney general and have he or she review every executive order to determine which of those have undermined civil liberties, which are unconstitutional, and I will reverse them with the stroke of a pen.”

Whether or not people believe that executive orders are constitutional, it is indisputable that presidents on both sides of the aisle have issued executive orders.

Reagan and Bush issued executive orders. Although there is an argument that those executive orders came on the heels of congressional bills, as adjustments. Neither Reagan nor Bush simply circumvented Congress.

Going back to tonight’s anticipated executive order allowing 5 million migrants to remain in America…

While the executive order will not allow the 5 million people immediate access to Medicaid and other subsidized health care, it will allow 5 million more uninsured people to exist in America, which will, undoubtedly, increase health care costs and ER visits. And, eventually, the additional 5 million people will be eligible for Medicaid, subsidized health care, and all other benefits of living in America.

Supreme Court Will Decide Whether Citizens in NC and 26 Other States Can Receive Tax Credits for Health Care Premiums!!

With a decision that, I can only imagine, ricocheted against the White House walls, the Supreme Court granted certiorari to hear King v. Burwell this past Friday, November 7, 2014, despite Obama’s administration’s request for the Supreme Court to postpone granting certiorari in order to wait for a D.C. circuit to re-visit an opinion, the Halbig ruling.

The Supreme Court’s decision in King could, potentially, have devastating consequences on the Affordable Care Act (ACA). However, I write that last sentence with an asterisk. Journalists across the country are entitling articles, “Obamacare Is Doomed! Everybody Panic!”, “The Supreme Court Might Gut Obamacare. Your State Could Save It,” and “Obamacare vs. Supreme Court.” These titles to articles are misleading, at best, and factually incorrect, at worst. King v. Burwell is actually not an attack on the ACA. But I will explain later…

First of all, what the heck is certiorari…or “cert”, as many attorneys call it?

A writ of certiorari is actually an order from a higher court to a lower court demanding a record in a case so that the higher court may review the lower court’s decision. A writ of certiorari is the instrument most used by the Supreme Court to review cases. The Supreme Court hears such a small, minute fraction of lawsuits that when the Supreme Court “grants cert,” it is a big deal.

I have written in the past about these same two appellate court cases, which were both published July 22, 2014, within hours of one another, regarding the Health Care Premium Subsidies Section of the Affordable Care Act. These two cases yield polar opposite holdings. In Halbig v. Burwell, the D.C. Circuit Court found that the clear language of the ACA only allows the health care premium subsidies in states that created their own state-run health care exchanges, i.e, residents in NC along with 35 other states would not be eligible for the subsidies. See my blog: Halbig: Court Holds Clear Language of the ACA Prohibits Health Care Subsidies in Federally-Run Exchanges.

Juxtapose the 4th Circuit Court’s decision in King v. Burwell, which held that “For reasons explained below, we find that the applicable statutory language is ambiguous and subject to multiple interpretations. Applying deference to the IRS’s determination, however, we uphold the rule as a permissible exercise of the agency’s discretion.”

So the two cases came to two entirely different conclusions. Halbig: ACA is clear; King: ACA is ambiguous.

Well, for everyone else, that is as clear….as mud.

When the D.C. court decided Halbig, it was not an en banc decision. In English, this means that the entire bench of judges in the D. C. Circuit did not hear the case, only a panel of three (which is the usual way for a case to be heard on appeal to a federal circuit). The Obama administration, along with other proponents of the ACA, hoped that the U.S. Supreme Court would deny cert to King until the D.C. court could re-visit its decision, this time en banc.

Yet, this past Friday, the Supreme Court opted to consider King v. Burwell.

The sole issue to be decided is: Whether the Internal Revenue Service may permissibly promulgate regulations to extend tax-credit subsidies to coverage purchased through exchanges established by the federal government under Section 1321 of the Patient Protection and Affordable Care Act.

How is King v. Burwell NOT an attack on the ACA?

The plaintiffs in King are not asking the Supreme Court to strike down the ACA, even, in part. They are asking the Court to uphold the plain language of the ACA by holding that the IRS’s interpretation of the ACA is erroneous. Let me explain…

Section 1311 directs states to establish exchanges, and Section 1321 directs the federal government to establish exchanges “within” any state that opts to not set up its own state-run exchange, e.g., NC.

Section 1401 authorizes subsidies for people whose household income falls between 100 and 400% of the federal poverty level, who are not eligible for qualified employer coverage or other government programs, and who enroll in coverage “through an Exchange established by the State.” (emphasis added). These 3 criteria are crystal clear based on the plain language of the statute.

The statute makes no provision for subsidies in states that opt not to create their own exchange but, instead, allow the federal government to create an exchange within its state.

The ACA was intended to create penalties if the states do not establish their own exchanges. For example, the subsidies are not allowed to citizens of states without state-created exchanges.

In August 2011, the IRS issued a proposed rule [add link] announcing it would provide tax credits (and implement the resulting penalties) in states with federal exchanges, too. IRS officials later admitted to Congress that they knew the statute did not authorize them to issue tax credits through federal exchanges…Oops…

The proposed rule received much negative feedback based on the fact that the IRS appeared to have no statutory basis for the rule. Nonetheless, the proposed rule was finalized in May 2012, and lawsuits ensued…

Oklahoma began the litigation with Pruitt v. Burwell in September 2012. In September 2014, a federal district court held that the plain language of the ACA does not allow subsidies in states with federally-run exchanges. In May 2013, Halbig v. Burwell was filed, and in September 2013, King v. Burwell was filed.

So, much to the contrary of popular belief, these lawsuits are not “against the ACA” or “proving the unconstitutionality of the ACA.” Instead, these lawsuits are “against” the IRS interpreting the ACA to allow tax credits for all states, even if the state has a federally-run exchange.

Will it negatively impact the ACA if the plaintiffs win? That would be a resounding yes.

Oral argument could be as soon as March 2015.

CSC Sued in NY: Accused of Multi-Million Dollar Healthcare Fraud Scheme!!

Remember the NCTracks lawsuit?  NCTracks Derailed: Class Action Lawsuit Filed!!  Computer Sciences Corporation (CSC) is one of the Defendants in that action here in NC.

Well, Monday CSC was hit with another enormous lawsuit.  This one is filed in New York, and the Plaintiff is the U.S. Federal Government.

The feds are accusing CSC of a multi-million dollar Medicaid fraud scheme through its Medicaid billing software CSC implemented in NY.

Here is the press release.

From the complaint: “[T]hese fraud schemes were far from isolated events; instead, they were part and parcel of a general practice at CSC and the City to blatantly disregard their obligations to comply with Medicaid billing requirements.” (Compl. par. 8.)

The feds are seeking treble damages, which permits a court to triple the amount of the actual/compensatory damages to be awarded to a prevailing plaintiff.

According to the lawsuit, CSC has received millions of taxpayer dollars (budgeted for Medicaid) unlawfully and in direct violation of federal billing requirements.

If I were a taxpayer in NY, I would be incensed!!!! If I were a Medicaid recipient of parent of a child receiving Medicaid services, I would be furious!!

Now, take a step back…who is administering our Medicaid billing system here in NC?

Answer: CSC

This will almost certainly cause the federal government to peer a bit closer at all CSC’s billing software systems in other states…

Obamacare, Health Care Exchanges, Subsidies, Typos, and Speak-o’s

Have you ever said something that you immediately wished you could put back in your mouth? I know I have! In fact, just recently, I was eating lunch with my husband and one of our closest friends Josh. Josh, his wife, Tracey, my husband Scott and I ride horses together almost every weekend. Our daughters come with us, and it’s a fun family event. So, I should have known that a manger is a tool used in barns to hold the hay for the horses to eat, not just baby Jesus’ bed.

Josh tells me that he is going to pick up a manger. To which I respond, “Josh, why do you need a baby manger?” If words came out of your mouth on a string, I would have grabbed that string and shoved it back into my mouth. Of course, my husband had no end to his ribbing. “Josh, why do they sell baby mangers in Tractor Supply?” And “Baby Jesus was so lucky that someone put a manger in that barn for when he was born.”

At that point, I would have liked to claim that I had a “speak-o.” You know, like a typo, but for speech.

At least this is what Jonathan Gruber has claimed…that he made a speak-o in 2012.

Jonathan Gruber is one of the architects of the Affordable Care Act (ACA). He drafted much of the language included in the ACA. After the ACA was passed, Gruber was interviewed by a number of journalists regarding specific sections of the ACA. One of the sections on which he spoke was the section that allowed for health care premium subsidies for people enrolled in the program who reside in states which created state-run health care exchanges as opposed to states that opted to use the federal exchange. For ease of this blog, I will call this ACA section the “Health Care Premium Subsidies Section.”

As I am sure you are aware if you follow my blog, two appellate court cases came out July 22, 2014, regarding the Health Care Premium Subsidies Section, with polar opposite holdings. In Halbig v. Burwell, the D.C. Circuit Court found that the clear language of the ACA only allows the health care premium subsidies in states that created their own state-run health care exchanges, i.e, residents in NC along with 35 other states would not be eligible for the subsidies. See my blog: “Halbig: Court Holds Clear Language of the ACA Prohibits Health Care Subsidies in Federally-Run Exchanges.”

Juxtapose the 4th Circuit Court’s decision in King v. Burwell, which held that “For reasons explained below, we find that the applicable statutory language is ambiguous and subject to multiple interpretations. Applying deference to the IRS’s determination, however, we uphold the rule as a permissible exercise of the agency’s discretion.”

The two cases were released within hours of each other and came to two entirely different conclusions. Halbig: ACA is clear; King: ACA is ambiguous.

Interesting to note is that D.C. is not a state, and the 4th Circuit clearly embraces five states.

In my Halbig blog, I explain the legal analysis of statutory interpretation. I also explain that based on my reading of the Health Care Premium Subsidies Section, I tend to side with the D.C. courts and opine that the Section is not ambiguous.

If, however, a court finds that the statutory language is ambiguous, the court defers to the agency’s interpretation “so long as it is based on a permissible construction of the statute,” which is clear case law found in the 4th Circuit.

Therefore, once the 4th Circuit determined that the statute is ambiguous, the court made the correct determination to defer to the IRS’ ruling that all states could benefit from the subsidies.

Yet another approach to statutory interpretation is considering the legislative intent. The courts may attempt to evaluate legislative intent when the statute is ambiguous. In order to discern legislative intent, courts may weigh proposed bills, records of hearing on the bill, amendments to the bill, speeches and floor debate, legislative subcommittee minutes, and/or published statements from the legislative body as to the intent of the statute.

Recently, some journalists have uncovered 2012 interviews with Gruber during which he states that the Health Care Premium Subsidies Section was drafted intentionally to induce the states to create their own health care subsidies and not rely on the federal exchange. How’s that for intent?

The exact language of that part of the 2012 interview is as follows:

Interviewer: “You mentioned the health information [sic] Exchanges for the states, and it is my understanding that if states don’t provide them, then the federal government will provide them for the states.”

Gruber: “I think what’s important to remember politically about this is if you’re a state and you don’t set up an Exchange, that means your citizens don’t get the tax credits… I hope that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these Exchanges, and that they’ll do it.”

What do you think? You think Gruber is pretty explicit as to legislative intent? Well, at least in 2012….

In 2014, Gruber states, as to his 2012 comment, “I honestly don’t remember why I said that. I was speaking off-the-cuff. It was just a mistake. People make mistakes. Congress made a mistake drafting the law and I made a mistake talking about it.”

According to Gruber, Congress made a typo; Gruber made a speak-o.

“It’s unambiguous that it’s a typo,” Gruber tells reporter Chris Matthews from NBC and MSNBC.

Um…a typo when the statement is spoken? Hence, the new word “speak-o” blowing up Twitter.

If Gruber’s statement was truly a speak-o, it was a re-occurring speak-o. Gruber also made two speeches in which he listed three possible threats to the implementation of Obamacare. In both cases the third “threat” was that states would not set up exchanges and, instead, would rely on the federal government.

I anticipate that Gruber’s 2012 and contrary 2014 statements will be at issue as these cases, Halbig and King, move forward.

As for me, I would like to invoke my own speak-o’s. I can only imagine how I will be received when I appear before a court and say, “Your Honor, I apologize. That was a speak-o.”

Halbig: Court Holds Clear Language of the ACA Prohibits Health Care Subsidies in Federally-Run Exchanges

Remember my post, “The Great and Powerful ACA: Are High, Inflated Premiums Hiding Behind the Curtain?” I warned of the possible consequences of Halbig v. Burwell…and it happened.

Halbig v. Burwell was decided earlier today.

The Halbig court held that the Internal Revenue Service (IRS) went too far in extending subsidies to those who buy insurance through the federally run, Healthcare.gov website.

The Halbig court ruled that the subsection of the ACA that allows high insurance premium tax credits, according to the plain language of the statute, only applies to those individuals enrolled “through an exchange established by the state.” (emphasis added). Therefore, if Halbig is upheld on en banc review by the D. C. Circuit (see below) or on appeal to the U. S. Supreme Court, residents who reside in two-thirds (or 36) of the states that did not establish state-run health care exchanges (including NC), will not benefit from the health care subsidies.

Looking at the decision through a purely objective, legal lens, I believe the federal court of appeals is correct in its ruling. I also agree that the ruling will have drastic and devastating consequences for the ACA and the people who would have benefited from the health care subsidies.

However, the law governing statutory construction and interpretation is clear. Statutory interpretation is the process by which courts interpret legislation.

For years, the U.S. Supreme Court has been explicit on statutory interpretation. “We begin with the familiar canon of statutory construction that the starting point for interpreting a statute is the language of the statute itself. Absent a clearly expressed legislative intention to the contrary, that language must ordinarily be regarded as conclusive.” Consumer Product Safety Commission et al. v. GTE Sylvania, Inc. et al., 447 U.S. 102 (1980).

In other words, if the words of a statute are unambiguous, then the statutory interpretation ends. The clear words of the statute must be followed.

Let me give an example of ambiguous language:

A magazine printed the following: “Rachel Ray enjoys cooking her family and her dogs.” If that were true, Rachel Ray’s family and dogs would be very upset. I am sure what the editor meant to write was “Rachel Ray enjoys cooking, her family, and her dogs.”

It is amazing how important a comma is.

The Halbig court held that the section of the ACA allowing health care subsidies only apply to those enrolled in an exchange established by the state is not ambivalent. Thus, according to statutory interpretation rules, the judicial inquiry ends.

So what happens now?

A request for an en banc ruling by the D. C. Circuit is the next step for Department of Justice. An en banc ruling is a decision made by all the justices, or the entire bench, of an appeals court, instead of a panel selected by the bench. In this case, three federal judges sat on the panel and the case was decided 2-1. An appeals court can only overrule a decision made by one of its panels if the court is sitting en banc.

Looking beyond any en banc ruling, the case could, potentially, be heard by the U.S. Supreme Court, especially in light of the importance of the decision and the fact that a 4th Circuit Court of Appeals ruled the opposite way literally hours after Halbig was announced. See David King, et al. v. Burwell, et al.

The Fourth Circuit found the ACA ambiguous, and it states, “For reasons explained below, we find that the applicable statutory language is ambiguous and subject to multiple interpretations. Applying deference to the IRS’s determination, however, we uphold the rule as a permissible exercise of the agency’s discretion. We thus affirm the judgment of the district court.”

Bizarre that two courts hold opposing positions on the same issue and publish both decisions on the same day.  It reminds of the old Sam the Sheepdog cartoon, “Duh! Which way did he go? Which way did he go, George?”

Finally, in closing, and on a personal note, I would like to dedicate this blog to my lab-doberman mix, Booker T, who, sadly, passed Sunday.  He was my best friend for over 14 years.  You will be greatly missed, Booker T.  Rest in peace.

Booker T

The Great and Powerful Affordable Care Act: Are High, Inflated Premiums Hiding Behind the Curtain?

A lawsuit that could come out as early as tomorrow could be catastrophic for the Affordable Care Act (ACA) in as many as 36 states and impact approximately 5.4 million Americans.

In so many ways, in the last year or so, the all-changing, great and powerful ACA that promised affordable health care for all and “if you like your health care coverage, you can keep it,” has fallen monumentally short of its original, lofty promises.

In a way, we all wanted to believe in the promises of the ACA, like Dorothy in “The Wizard of Oz.” Who can forget the disappointed sigh Dorothy expels when Toto pulls back the curtain of the Great and Powerful Oz only to see a mundane, elderly man with absolutely no super powers or means to grant her wishes. Dorothy wanted Oz to be real. She wanted desperately for Oz to be as Great and Powerful as he proclaimed. However, in reality, he was not.

Like Dorothy wanted Oz to be real, we all wanted the ACA to create an affordable, nationwide health care system…this health care utopia.

So many lofty promises of the ACA have already been crushed, either by the Supreme Court’s decision that allows states to opt-out of Medicaid expansion, or by President Obama himself in executive actions, including an action delaying the employee mandate.

The courts may deflate the illusions of grandeur of the ACA even more with an upcoming and anxiously awaited decision. The case of Halbig v. Burwell, a D.C. Court of Appeals case, has concerned citizens everywhere, who wait on bated breath for a ruling. Halbig could have a huge (negative) impact on health care premiums. Halbig could be the Toto that pulled back the curtain on the ACA.

Let me explain:

There is a subsection of the ACA that allows high insurance premium tax credits, in an effort to make premiums more affordable for low-income families. The subsection applies to individuals who make less than $46,075. In implementing the ACA, it was contemplated that those individuals who make under $46,075 will have difficulty affording the insurance premiums; therefore, the ACA gives nice, large tax credits to offset the costs of premiums.

However, according to the plain language of the statute, these tax credits only apply to those individuals enrolled “through an exchange established by the state.” (emphasis added). Yet two-thirds (or 36) of the states did not establish state-run health care exchanges (including NC). Instead, these states relied on the federal exchange, in part, to avoid additional cost expenditures.

Here is a map of states according to whether it is expanding Medicaid:

current-status-of-the-medicaid-expansion-decisions-healthreform1

The Halbig case asks the question: Can people living in states run by a federal health exchange reap the benefit of tax credits intended for those people participating in an exchange run by the state?

If the Halbig Court takes that stance that the statute is not ambivalent and must be followed exactly as it is written, then millions of Americans will become ineligible for the tax credits for health care premiums, because they will not be enrolled in a state-run exchange. Premiums would sky-rocket and many Americans would be unable to afford health care…again. It is estimated that without the tax credits, the health care premiums will cost 4x as much.

Interestingly, the Internal Revenue Service (IRS) weighed in and issued a highly-contested rule authorizing the federal exchange to issue tax credits. Amidst all the tomfoolery about the IRS targeting 501(c) charities owned by the Tea Party, it is surprising, at least to me, that the IRS would issue such a contentious ruling in favor of the ACA and anti-conservatives.

Hence, the Halbig case, in which Plaintiffs argue that the IRS has exceeded its statutory authority in issuing tax credits to those residing in states with federal exchanges, when the ACA clearly states that the tax credits only apply to state-run exchanges.

If the D.C. Court of Appeals sides in favor of the Plaintiffs, the following could occur:

• Residents of 36 states could pay health care premiums 4x more than promised;
• The ACA would fall short of promises…again;
• The IRS will have exceeded its authority to benefit Democrats…again;
• People may not be able to afford the health care premiums;
• The ACA could risk the downfall of many more promises.

We all wanted the ACA to create health care utopia. We all wanted the Great and Powerful Oz to be Great and Powerful.

But the courts may tell us we just can’t say, “Pay no attention to the man behind the curtain!!”

Mass Medicare and Medicaid Payment Suspensions Increase Based on “Credible Allegations of Fraud”

One way in which President Obama pushed the Affordable Care Act (ACA) through Congress was the promise that the ACA would, basically, fund itself by the increase in recoupments from providers for fraud, waste, and abuse…hence, the dramatic increase in audits and payments suspensions for both Medicare and Medicaid providers.

Herein lies the problem, by relying on you, who accept Medicare and Medicaid to fund, even a portion, of the ACA, we are de-incentivizing you, as a health care providers, to accept Medicare and Medicaid. Think about this logically, we are placing MORE people in a system (by expanding Medicaid), more people will rely on Medicare and Medicaid as their health insurance, but we are incentivizing FEWER providers to accept Medicaid and Medicare. It is as though we don’t care what happens to the people once we give them insurance. The goal of the ACA seems to be: get more people insured; instead of having the goal to allow everyone to get health care.

But I digress…

Section 6402(h) of the ACA requires suspension of Medicare and/or Medicaid payments when there is a credible allegation of fraud. Before the ACA, the suspension was not mandatory.

So, what constitutes a credible allegation of fraud?

Let me give you a real life example. One of my clients, we will call it Company Good Health, had its Medicare and Medicaid payments suspended based on an anonymous letter claiming Good Health commits Medicaid fraud and sent to the Division of Health and Human Services (DHHS) with no name of the author or return address. Therefore, DHHS had no way to contact the anonymous author to verify whether any sentence within the letter had an ounce of veracity. In fact, the author of the letter may very well have been an ex-girlfriend of the CEO or a bitter competitor for business. There is no way to know.

Yet, according to the ACA, an allegation of fraud is credible if it has an “indicia of reliability.” Look up “indicia.” I did. I found “from Latin plural of indicium (“a notice, information, discovery, sign, mark, token”).” I thought, that’s an unhelpful definition, so I looked up indicia in my legal dictionary, Black’s Law Dictionary. I found, in part, “[t]he term is much used in Civil Law in a sense nearly or entirely synonymous with Circumstantial Evidence. It denotes facts that give rise to inferences, rather than the inferences themselves.” Facts that give rise to inferences. Circumstantial evidence is evidence which may allow a judge or jury to deduce a certain fact from other facts which can be proven. In some cases, there can be some evidence that cannot be proven directly, such as with an eye-witness. (Think of the Scott Peterson trial).

Under the ACA, if there is a fact that gives rise to an inference of an allegation of fraud, the your Medicare and Medicaid reimbursements must be suspended. I underlined the words in the preceding sentence “inference,” “allegation,” and “must” to emphasize the slight and without any factual verification circumstance may be that causes suspension of payments. For many of you, this suspension is financially debilitating and will cause you to go out of business…or, at the very least, never accept Medicare or Medicaid again. Suspensions of payments do not only affect you, if affects your recipients as well.

An example of a mass suspension can be found in our nation’s capital. Recently, in D.C., the Medicaid agency suspended payments to 52% of the city’s home health agencies for personal care services (PCS). The companies hired an attorney and got a temporary restraining order (TRO) preventing the city from withholding funds, but lost at the preliminary injunction.

In an Order denying the preliminary injunction, the Judge stated that “in contrast to a provider’s right to participate in the Medicaid program, there is no constitutional right to receive Medicaid payments.” (To which I disagree, because there is a right to Medicaid payments for services rendered. National case law from multiple jurisdictions illustrates this, but maybe it was not argued before or accepted by this judge).

The Center for Medicare and Medicaid (CMS) has also suspended Medicare payments on a large-scale. CMS suspended Medicare payments to 78 Dallas area home health providers. Last year’s “Health Care Fraud and Abuse Control report” stated that 297 providers were under “active suspension” from Medicare and 105 more suspensions were approved.

Another example of a mass suspension is the behavioral health providers in New Mexico. In June 2013, the Health Services Division (HSD) suspended all reimbursements for 15 behavioral health care providers, all of whom accounted for 87% of New Mexico’s behavioral health care, based on credible allegations of fraud. Most accused providers went out of business.

While both Medicare and Medicaid require the suspension of reimbursements upon a credible allegation of fraud, you are slightly more protected. Medicare suspensions end after 18 months and can only be extended from 6 months in special circumstances.

There is no such protection for you when it comes to Medicaid; the states make the rules. There is a good cause exception that allows the state NOT to suspend payments, but, to date, I have yet to witness one good cause exception being recognized by the state. Instead, relief for the accused providers only comes from filing a lawsuit, most likely, an injunctive lawsuit. The downside of filing a lawsuit is that you have to pay attorney’s fees, which can be daunting, and you must find an attorney that specializes in Medicare and Medicaid. I have seen too many inexperienced, but well-intended, attorneys create bad law for providers due to self-imposed, legal stumbles.

The enigma within the language of the ACA, in this particular section, is the complete disregard for due process. See my blog on “How the ACA Has Redefined the Threshold for “Credible Allegations of Fraud” and Does It Violate Due Process?”  By suspending Medicare and Medicaid reimbursements due to “indicia of reliability of an allegation of fraud,” the government is usurping your right to payment for services rendered without notice and an opportunity to be heard, which is one of the bedrocks of our Constitution.

So what are you to do if you are caught up in this web of mass suspensions based on “indicia of reliability of an allegation of fraud?”

Contact your Medicare and Medicaid litigation attorney!  And do NOT forget to fill out the “good cause” exception…just in case…

Sebelius Out, Burwell In: A New Secretary to Lead the Department of Health and Human Services (Federal)

The following article is breaking news on the Health Care Policy Report:

The Senate June 5 voted 78-17 to confirm Sylvia Mathews Burwell as secretary of the Department of Health and Human Services.

Republicans who voted against the nomination included Senate Minority Leader Mitch McConnell (R-Ky.), who in an earlier floor statement compared voting for the nomination to appointing a “new captain for the Titanic.” Other Republicans who voted against the nomination included Roy Blunt (Mo.), Ted Cruz (Texas), John Cornyn (Texas), Pat Roberts (Kan.) and John Thune (S.D.).

In urging his colleagues to vote in favor of the nomination, Finance Committee Chairman Ron Wyden (D-Ore.) said that Burwell enjoys bipartisan support and that Republicans and Democrats will need to work together to ensure the future of Medicare.

Burwell, director of the Office of Management and Budget, will replace Kathleen Sebelius, who announced her resignation in April but agreed to stay on until a successor is confirmed.
Burwell has sailed through Senate committee hearings and a committee vote, and easily passed a procedural vote June 4 when 14 Republicans voted with Democrats, 67-28, to end debate on the nomination.

HHS Announces More Time for Noncompliant Plans, Other ACA Policies

BNA’s Health Care Policy Report:

Posted March 5, 2014

The Obama administration March 5 said consumers can keep their health plans that don’t comply with the Affordable Care Act for two more years, as part of a release of new ACA rules and policies.

The Department of Health and Human Services noted that in fall 2013, the administration extended through 2014 noncompliant health plans in the small group and individual health insurance markets, for insurers that received permission from their state to do so. Now, the department is extending its “transitional policy for two years,” to policy years beginning on or before Oct. 1, 2016.

“This gives consumers in the individual and small group markets the choice of staying in their plan or joining a new Marketplace plan as the new system is fully implemented,” the HHS said.

The HHS also issued a comprehensive ACA insurance markets rule (CMS-9954-F) called the Notice of Benefit and Payment Parameters for 2015. The regulation includes provisions on premium stabilization; open enrollment for 2015; annual limitations on cost sharing; consumer protections; financial oversight; and the Small Business Health Options Program, or SHOP.

For the temporary “risk corridors program,” which helps stabilize premiums when enrollees are much sicker or much healthier than expected, the HHS said it intends to operate the program in a budget-neutral manner, with payments coming in equaling the amount of money going out, “while helping to ensure that prices remain affordable in 2015 and beyond.”

The Treasury Department and the Internal Revenue Service also released final rules (TD 9661) March 5 to implement the information reporting provisions for insurers and certain employers under the ACA that take effect in 2015. Treasury said the final rules on information reporting by employers “will substantially streamline reporting requirements for employers, particularly those that offer highly affordable coverage to full-time employees.” Treasury also released final rules (TD 9660) to provide guidance for reporting by insurers and other parties that provide health coverage under the ACA.

An HHS bulletin on the plan extension is at http://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/transition-to-compliant-policies-03-06-2015.pdf. The HHS and Treasury rules are posted at the public inspection website: http://www.federalregister.gov/public-inspection.

Study Shows the ACA Will Not Lead Physicians to REDUCE the Number of Medicaid Recipients, Supply and Demand, and Get Me My Pokemon Cards!

A recent “study” by Lippincott, Williams, and Wilkins is entitled “Doctors Likely to accept New Medicaid Patients as Coverage Expands.”  (I may or may not have belly laughed when I read that title).  See my blog “Medicaid Expansion: Bad for the Poor.”

The beginning of the article reads, “The upcoming expansion of Medicaid under the Affordable Care Act (ACA) won’t lead physicians to reduce the number of new Medicaid patients they accept, suggests a study in the November issue of Medical Care, published by Lippincott Williams & Wilkins, a part of Wolters Kluwer Health.”

The study was published October 16, 2013. (BTW: From what I can discern from the article, the title actually means that physicians will be forced to accept more Medicaid patients because there will not be additional physicians accepting Medicaid).  Odd title.

According to this study, the ACA will not cause doctors to reduce the number of Medicaid patients.  What does this study NOT say?  Nothing indicates that the ACA, which will allow millions more of Americans to become eligible for Medicaid, will cause MORE physicians to accept Medicaid.  Nor does the study state that the ACA will cause physicians to accept MORE Medicaid recipients.

Am I the only person who understands supply and demand?

Anyone remember the 1999 Toys.R.Us.com debacle? On-line shopping was just heating up.  I was in law school, and I, as well as millions of others, ordered Christmas presents on-line from Toys R Us.  I ordered a bunch of Pokemon trading cards for a nephew…remember those? Me either…I just bought them for my nephew.  Toys R Us promised delivery by December 10th. 

Toys R Us was, apparently, a very popular store that year, because Toys R Us is unable to package and ship orders in time to meet the December 10th deadline.  Nor could Toys R Us meet the deadline of Christmas.  Employees were working through the weekends.  About two days before Christmas, and just in time to create last-minute havoc during Christmas time, Toys R Us sends out thousands of emails saying, “We’re sorry.”

Obviously, Toys R Us was slammed by the media, and thousands of consumers were highly ticked off…including me.

I had to go to the mall (a place to which I detest going) on Christmas Eve (the worst day to shop of the entire year, except Black Friday, which I also avoid) to get my nephew a present.

Toys R Us learned its lesson.  It outsourced its shipping to Amazon.com, which, obviously, has the whole shipping thing down pat.

Hypothetical:

50 million people are currently eligible for (and receive) Medicaid services (these numbers are purely fictional, as I do not know the real numbers…I basically estimated 1 million per state, which, I am sure, is an underestimation).  Say there are 3.5 million physicians that accept Medicaid (70,000/state, which is probably a high estimation, when we are considering only physicians and not health care providers, generally). 

Our hypothetical yields 14.28 Medicaid recipients per physician.  Or a ratio of 14.28:1.

Media state that, if NC expanded Medicaid, that 587,000 more North Carolinians would be eligible for Medicaid if NC expanded Medicaid.

Using NC as a state average, 29.35 million more people would be eligible for Medicaid if all states expanded Medicaid (obviously not all states are expanding Medicaid, but, in my hypothetical, all states are expanding Medicaid).  This equals a total of 79.35 million people in America on Medicaid.

But….no additional physicians….

Because, remember, according to the Lippincott study, the upcoming expansion of Medicaid under the Affordable Care Act (ACA) won’t lead physicians to reduce the number of new Medicaid patients they accept.  But the ACA does not lead more physicians to accept Medicaid or physicians to accept more Medicaid patients.

This brings the ratio to 22.67:1.  8 1/2 new patients per one physican…and, BTW, that one physician may not be accepting new Medicaid patients or may not have the capacity to accept more Medicaid patients.  It’s a Toys R Us disaster!!!  No one is getting their Pokemon trading cards!!!

Why not? Why won’t the ACA lead more physicians to accept Medicaid?  Why won’t the ACA lead physicians to accept more Medicaid recipients?

Didn’t the ACA INCREASE Medicaid reimbursement rates?  Wouldn’t higher reimbursement rates lead more physicians to accept Medicaid and physicians to accept more Medicaid recipients???  I mean, didn’t you hear Obama tout that Medicaid rates would be increased to Medicare rates?  I know I did.

One average, Medicaid pays approximately 66% of Medicare reimbursement rates.  Obviously, every state differs as to the Medicaid reimbursement rate.

The ACA, however, slashes the Medicare budget by 716 million from 2013 to 2022.  The cuts are across-the-board changes in Medicare reimbursement formulas for a variety of Medicare providers, including hospitals, nursing homes, home health agencies, and hospice agencies.   Furthermore, the ACA creates the Independent Payment Advisory Board (IPAB), which is intended to determine additional Medicare reimbursement rate cuts. IPAB will be creating a new Medicare spending target; it will be comprised of 15 unelected bureaucrats.  The board will be able to make suggestions to Congress to reign in Medicare spending, and one of the biggest tools the IPAB has is cutting physician reimbursement rates.

It’s the old smoke and mirrors trick…We will raise Medicaid rates to Medicare rates…pssst, decrease the Medicare rate so we can meet our own promise!!

While I am extremely happy to hear that, at least according to the Lippincott study, the ACA will not lead physicians to reduce the number of Medicaid patients they accept, I am concerned that the ACA will not lead more physicians to accept Medicaid and physicians to accept more Medicaid recipients.

In fact, the study states that “[t]he data suggested that changes in Medicaid coverage did not significantly affect doctors’ acceptance of new Medicaid patients. “[P]hysicians who were already accepting (or not accepting) Medicaid patients before changes in Medicaid coverage rates continue to do so,” Drs Sabik and Gandhi write.  I bet the Drs. did not ask, “Would you continue to accept Medicaid, if you knew that your practice would endure more audits, post-payment reviews, possible prepayment reviews, and, in general, suspensions of reimbursements if anyone alleges Medicaid fraud, irrespective of the truth?”

Which tells me…hello…more Medicaid recipients, not more doctors!! Even if the physicians already accepting Medicaid COULD accept additional Medicaid recipient patients, each physician only has a certain amount of capacity.  To my knowledge, the ACA did not increase the number of hours in a day.  Supply and demand, people!!

Where are my Pokemon cards???!!!