Category Archives: Access to Care
This data note reviews the Medicaid estimates included in the American Health Care Act prepared by the Congressional Budget Office (CBO) and staff at the Joint Committee on Taxation (JCT).
When it comes to the managed care organizations (MCOs) in NC, something smells rancid, like pre-minced garlic. When I first met my husband, Scott, I cooked with pre-minced garlic that comes in a jar. I figured it was easier than buying fresh garlic and dicing it myself. Scott bought fresh garlic and diced it. Then he asked me to smell the fresh garlic versus the pre-minced garlic. There was no contest. Next to the fresh garlic, the pre-minced garlic smelled rancid. That is the same odor I smell when I read information about the MCOs – pre-minced garlic in a jar.
In NC, MCOs are charged with managing Medicaid funds for behavioral health care, developmentally disabled, and substance abuse services. When the MCOs were initially created, we had 13. These are geographically situated, so providers and recipients have no choice with which MCO to interact. If you live in Sandhills’ catchment area, then you must go through Sandhills. If you provide services in Cardinal’s catchment area, then you must contract with Cardinal – even though you already have a provider participation agreement with the State of NC to provide Medicaid services in the State of NC.
Over the years, there has been consolidation, and now we have 7 MCOs.
From left to right: Smoky Mountain (Duke blue); Partners Behavioral Health (Wake Forest gold); Cardinal Innovations Healthcare (ECU purple); Sandhills (UNCC green); Alliance Behavioral Healthcare (mint green); Eastpointe (Gap Khaki); and Trillium (highlighter yellow/green).
Recently, Cardinal (ECU purple) and Eastpointe (Gap khaki) announced they will consolidate, pending authorization from the Secretary of DHHS. The 20-county Cardinal will morph into a 32-county, MCO giant.
Here is the source of the rancid, pre-minced, garlic smell (in my opinion):
One – MCOs are not private entities. MCOs are prepaid with our tax dollars. Therefore, unlike Blue Cross Blue Shield, the MCOs must answer to NC taxpayers. The MCOs owe a duty of financial responsibility to taxpayers, just like the state government, cities, and towns.
Two – Cardinal CEO, Richard Topping, is paid $635,000, plus he has a 0 to 30 percent bonus potential which could be roughly another $250,000, plus he has some sort of annuity or long-term package of $412,000 (with our tax dollars).
Three – Cardinal is selling or has sold the 26 properties it owns or owned (with our tax dollars) to lease office space in the NASCAR Plaza office tower in uptown Charlotte for $300 to $400 per square foot plus employee parking (with our tax dollars).
Four – Cardinal charges 8% of public funds for its administrative costs. (Does that include Topping’s salary and bonuses?) How many employees are salaried by Cardinal? (with our tax dollars).
Five – The MCOs are prepaid. Once the MCOs receive the funds, the funds are public funds and subject to fiscal scrutiny. However, the MCOs keep whatever funds that it has at the end of the fiscal year. In other words, the MCOs pocket any money that was NOT used to reimburse a provider for a service rendered to a Medicaid recipient. Cardinal – alone – handles around $2.8 billion in Medicaid funding per year for behavioral health services. The financial incentive for MCOs? Terminate providers and reduce/deny services.
Six – MCOs are terminating providers and limiting access to care. In my law practice, I am constantly defending behavioral health care providers that are terminated from an MCO catchment area without cause or with erroneous cause. For example, an agency was terminated from their MCO because the agency had switched administrative offices without telling the MCO. The agency continued to provide quality services to those in need. But, because of a technicality, not informing the MCO that the agency moved administrative offices, the MCO terminated the contract. Which,in turn, puts more money in the MCO’s pocket; one less provider to pay. Is a change of address really a material breach of a contract? Regardless – it is an excuse.
Seven – Medicaid recipients are not receiving medically necessary services. Either the catchment areas do not have enough providers, the MCOs are denying and reducing medically necessary services, or both. Cardinal cut 11 of its state-funded services. Parents of disabled, adult children write to me, complaining that their services from their MCO have been slashed for no reason….But the MCOs are saving NC money!
Eight – The MCOs ended 2015 with a collective $842 million in the bank. Wonder how much money the MCOs have now…(with our tax dollars).
Rancid, I say. Rancid!
Come one! Come all! Step right up to be one of the first 6 states to test the new Medicare-Medicaid Affordable Care Act (ACO) pilot program.
Let your elderly population be the guinea pigs for the Center for Medicare and Medicaid Services (CMS). Let your most needy population be the lab rats for CMS.
On December 15, 2016, CMS announced its intent to create Medicare/caid ACOs. Currently, Medicare ACOs exist, and if your physician has opted to participate in a Medicare ACO, then, most likely, you understand Medicare ACOs. Medicare ACOs are basically groups of physicians – of different service types – who voluntarily decide (but only after intense scrutiny by their lawyers of the ACO contract) to collaborate care with the intent of higher quality and lower cost care. For example, if your primary care physician participates in a Medicare ACO and you suffer intestinal issues, your primary care doctor would coordinate with a GI specialist within the Medicare ACO to get you an appointment. Then the GI specialist and your physician would share medical records, including test results and medication management. The thought is that the coordination of care will decrease duplicative tests, ensure appointments are made and kept, and prevent losing medical records or reviewing older, moot records.
Importantly, the Medicare beneficiary retains all benefits of “normal” Medicare and can choose to see any physician who accepts Medicare. The ACO model is a shift from “fee-for-service” to a risk-based, capitated amount in which quality of care is rewarded.
On the federal level, there have not been ACOs specially created for dual-eligible recipients; i.e., those who qualify for both Medicare and Medicaid…until now.
The CMS is requesting states to volunteer to participate in a pilot program instituting Medicare/Medicaid ACOs. CMS is looking for 6 brave states to participate. States may choose from three options for when the first 12-month performance period for the Medicare-Medicaid ACO Model will begin for ACOs in the state: January 1, 2018; January 1, 2019; or January 1, 2020.
Any state is eligible to apply, including the District of Columbia. But if the state wants to participate in the first round of pilot programs, intended to begin 2018, then that state must submit its letter of intent to participate by tomorrow by 11:59pm. See below.
I tried to research which states have applied, but was unsuccessful. If anyone has the information, I would appreciate it if you could forward it to me.
Participating in an ACO, whether it is only Medicare and Medicare/caid, can create a increase in revenue for your practices. Since you bear some risk, you also reap some benefit if you able to control costs. But, the decision to participate in an ACO should not be taken lightly. Federal law yields harsh penalties for violations of Anti-Kickback and Stark laws (which, on a very general level, prohibits referrals among physicians for any benefit). However, there are safe harbor laws and regulations specific to ACOs that allow exceptions. Regardless, do not ever sign a contract to participate in an ACO without an attorney reviewing it.
Food for thought – CMS’ Medicare/caid ACO Model may exist only “here in this [Obama] world. Here may be the last ever to be seen of [healthcare.gov] and their [employee mandates]. Look for it only in [history] books, for it may be no more than a [Obamacare] remembered, a [health care policy] gone with the wind…”
As, tomorrow (January 20, 2017) is the presidential inauguration. The winds may be a’changing…
You could hear the outrage in the voices of some of the NC legislators (finally, for the love of God – our General Assembly has taken the blinders off their eyes regarding the MCOs) at the Joint Legislative Oversight Committee on Medicaid and NC Health Choice on Tuesday, December 6, 2016, when Cardinal Innovations‘, a NC managed care organization (MCO) that manages our Medicaid behavioral health care in its catchment area, CEO, Richard Topping, stated that his salary was raised this year from $400,000 to $635,000 – with our tax dollars. (Whoa – totally understand if you have to read that sentence multiple times; it was extraordinarily complex).
Senator Tommy Tucker (R-Waxhaw) was especially incensed. He said, “I received minutes from your board, Sept. 16 of 2016, they made that motion, that your 2017 comp package, they raised your salary from $400,000 to $635,000, they gave you a 0 to 30 percent bonus potential which could be roughly another $250,000 and also you have some sort of annuity or long-term package of $412,000,” said Sen. Tommy Tucker.
Sen. Tucker was not alone.
Representative Dollar was also concerned. But even more surprising than our legislators stepping up to the plate and holding an MCO accountable (MCOs have expensive lobbyists – with our tax dollars), the State’s Department of Health and Human Services (DHHS) Secretary Rick Brajer was visibly infuriated. He spoke sharply and interrogated Topping as to his acute income increase, as well as the benefits attached.
As a health care blogger, I receive so many emails from blog readers, including parents of disabled children, who are not receiving the medically necessary Medicaid behavioral health care services for their developmentally disabled children. MCOs are denying medically necessary services. MCOs are terminating qualified health care providers. MCOs are putting access to care at issue. BTW – even if the MCOs only terminated 1 provider and stopped 1 Medicaid recipient from receiving behavioral health care services from their provider of choice, that MCO would be in violation of federal law access to care regulations. But, MCOs are terminating multiple – maybe hundreds – of health care providers. MCOs are nickeling and diming health care providers. Yet, CEO Topping will reap $635,000+ as a salary.
The MCOs, including Cardinal, do not have assets except for our tax dollars. They are not incorporated. They are not private entities. They are extensions of our “single state agency” DHHS. The MCOs step into the shoes of DHHS. The MCOs are state agencies. The MCOs are paid with our tax dollars. Our tax dollars should be used (and are budgeted) to provide Medicaid behavioral health care services for our most needy and to be paid to those health care providers, who still accept Medicaid and provide services to our most vulnerable population. News alert – These providers who render behavioral health care services to Medicaid recipients do not make $635,000/year, or anywhere even close. The reimbursement rates for Medicaid is paltry, at best. Toppings should be embarrassed for even accepting a $635,000 salary. The money, instead, should go to increasing the reimbursements rates – or maintaining a provider network without terminating providers ad nauseum. Or providing medically necessary services to Medicaid recipients.
Rest assured, Cardinal is not the only MCO lining the pockets of its executives. While both Trillium and Alliance, other MCOs, pay their CEOs under $200,000 (still nothing to sneeze at). Alliance, however, throws its tax dollars at private, legal counsel. No in-house counsel for Alliance! Oh, no! Alliance hires expensive, private counsel to defend its actions. Another way our tax dollars are at work. And – my question – why in the world does Alliance, or any other MCO, need to hire legal counsel? Our State has perfectly competent attorneys at our Attorney General’s office, who are on salary to defend the state, and its agencies, for any issue. The MCOs stand in the shoes of the State when it comes to Medicaid for behavioral health. The MCOs should utilize the attorneys the State already employs – not a high-dollar, private law firm. These are our tax dollars!
There have been few times that I have praised DHHS in my blogs. I will readily admit that I am harsh on DHHS’ actions/nonactions with our tax dollars. And I am now not recanting any of my prior opinions. But, last Tuesday, Sec. Brajer held Toppings feet to the fire. Thank you, Brajer, for realizing the horror of an MCO CEO earning $635,000/year while our most needy population goes under-served, and, sometimes not served at all, with medically necessary behavioral health care services.
What is deeply concerning is that if Sec. Brajer is this troubled by actions by the MCOs, or, at least, Cardinal, why can he not DO SOMETHING?? Where is the supervision of the MCOs by DHHS? I’ve read the contracts between the MCOs and DHHS. DHHS is the supervising entity over the MCOs. Our Waiver to the federal government promises that DHHS will supervise the MCOs.
If the Secretary of DHHS cannot control the MCOs, who can?
Disclosure: This is the opinion/facts from the Kaiser Family Foundation, not me. But I found this interesting. My opinion will be forthcoming.
Kaiser Family Foundation article:
Medicaid covers about 73 million people nationwide. Jointly financed by the federal and state governments, states have substantial flexibility to administer the program under existing law. Medicaid provides health insurance for low-income children and adults, financing for the safety net, and is the largest payer for long-term care services in the community and nursing homes for seniors and people with disabilities. President-elect Trump supports repeal and replacement of the Affordable Care Act (ACA) and a Medicaid block grant. The GOP plan would allow states to choose between block grant and a per capita cap financing for Medicaid. The new Administration could also make changes to Medicaid without new legislation.
1. HOW WOULD ACA REPEAL AFFECT MEDICAID?
A repeal of the ACA’s coverage expansion provisions would remove the new eligibility pathway created for adults, increase the number of uninsured and reduce the amount of federal Medicaid funds available to states. The Supreme Court’s 2012 ruling on the ACA effectively made the Medicaid expansion optional for states. As of November 2016, 32 states (including the District of Columbia) are implementing the expansion. The full implications of repeal will depend on whether the ACA is repealed in whole or in part, whether there is an alternative to the ACA put in place and what other simultaneous changes to Medicaid occur. However, examining the effects of the ACA on Medicaid provide insight into what might be at stake under a repeal.
What happened to coverage? The ACA expanded Medicaid eligibility to nearly all non-elderly adults with income at or below 138% of the federal poverty level (FPL) – about $16,396 per year for an individual in 2016. Since summer of 2013, just before implementation of the ACA expansions, through August 2016 about 16 million people have been added to Medicaid and the Children’s Health Insurance Program. While not all of this increase is due to those made newly eligible under the ACA, expansion states account for a much greater share of growth. States that expanded Medicaid have had large gains in coverage, although ACA related enrollment has tapered. From 2013 to 2016 the rate of uninsured non-elderly adults fell by 9.2% in expansion states compared to 6% in non-expansion states.
What happened to financing? The law provided for 100% federal funding of the expansion through 2016, declining gradually to 90% in 2020 and beyond. Expansion states have experienced large increases in federal dollars for Medicaid and have claimed $79 billion in federal dollars for the new expansion group from January 2014 through June 2015. Studies also show that states expanding Medicaid under the ACA have realized net fiscal gains despite Medicaid enrollment growth initially exceeding projections in many states.
What other Medicaid provisions were in the ACA? The ACA required states to implement major transformations to modernize and streamline eligibility and enrollment processes and systems. The ACA also included an array of new opportunities related to delivery system reforms for complex populations, those dually eligible for Medicare and Medicaid and new options to expand community-based long-term care services.
2. WHAT WOULD CHANGES IN THE FINANCING STRUCTURE MEAN FOR MEDICAID?
A Medicaid block grant or per capita cap policy would fundamentally change the current structure of the program. These policies are typically designed to reduce federal spending and fix rates of growth to make federal spending more predictable, but could eliminate the guarantee of coverage for all who are eligible and the guarantee to states for matching funds. States would gain additional flexibility to administer their programs but reduced federal funding could shift costs and risk to beneficiaries, states, and providers.
How would it work? Block grants or per capita caps could be structured in multiple ways. Key policy decisions would determine levels of federal financing as well as federal and state requirements around eligibility, benefits, state matching requirements, and beneficiary protections. Previous block grant proposals have determined a base year financing amount for each state and then specified a fixed rate of growth for federal spending. Under a Medicaid per capita cap, the federal government would set a limit on how much to reimburse states per enrollee. Payments to states would be based on per enrollee spending multiplied by enrollees. Spending under per capita cap proposals fluctuate based on changes in enrollment, but would not account for changes in the costs per enrollee beyond the growth limit. To achieve federal savings, the per capita growth amounts would be set below the projected rates of growth under current law.
What are the key policy questions? Key questions in designing these proposals include: what new flexibility would be granted to states, what federal requirements would remain in place, what requirements would be in place for state matching funds, what is the base year and growth rates, and how would a potential repeal of the ACA work with a block grant proposal? Given the lack of recent administrative data, setting a base year could be challenging. These financing designs could lock in historic spending patterns and variation in Medicaid spending across states, resulting in states deemed “winners” or “losers.”
What are the implications? Capping and reducing federal financing for Medicaid could have implications for beneficiaries, states, and providers including: declines in Medicaid coverage or new financial barriers to care; limited funding for children (the majority of Medicaid enrollees) as well as the elderly and those with disabilities (populations that represent the majority of Medicaid spending); reduced funding for nursing homes and community-based long-term care (Medicaid is the largest payer of these services); reductions in federal revenues to states and Medicaid revenues for safety-net providers. A block grant would not adjust to increased coverage needs during a recession. Block grants or per capita caps would not adjust to changes in health care or drug costs or emergencies. Recently Medicaid costs have increased due to high cost specialty drugs and Medicaid has been used to help combat the growing opioid crisis.
3. HOW COULD MEDICAID BE CHANGED THROUGH ADMINISTRATIVE ACTIONS?
The Administration could make changes to Medicaid without changes in legislation.
How can changes be made through guidance? A new administration can reinterpret existing laws through new regulations and new sub-regulatory guidance. While there are rules that govern how to change regulations, a new administration has more flexibility to issue or amend sub-regulatory guidance, such as state Medicaid director letters. Rules promulgated by the Obama administration could be rolled back or changed.
How can changes be made through waivers? Throughout the history of the Medicaid program, Section 1115 waivers have provided states an avenue to test and implement demonstrations that, in the view of the Health and Human Services Secretary, advance program objectives but do not meet federal program rules. Longstanding federal policy has required waivers to be budget neutral for the federal government.
What kind of waivers may be considered? Seven states are using waivers to implement the ACA Medicaid expansion, including Indiana. The Indiana waiver, implemented under then Governor Pence, includes provisions to impose: premiums on most Medicaid beneficiaries; a coverage lock-out period for individuals with incomes above the poverty level who fail to pay premiums; health savings accounts; and healthy behavior incentives. The Obama administration has not approved waivers that would require work as a condition of Medicaid eligibility. It also has denied Ohio’s waiver request to impose premiums regardless of income and exclude individuals from coverage until all arrears are paid on the basis that this would restrict or undermine coverage from existing levels. Many other states are using waivers to implement payment and delivery system reforms. The incoming administration could decide whether or not to renew existing waivers and can approve a new set of waivers to promote its own program goals.
Knicole Emanuel Interviewed on Recent Success: Behavioral Health Care Service Still Locked in Overbilling Dispute with State
Last Thursday, I was interviewed by a reporter from New Mexico regarding our Teambuilders win, in which an administrative judge has found that Teambuilders owes only $896 for billing errors. Here is a copy of an article published in the Santa Fe New Mexican, written by Justin Horwath:
The true tragedy is that these companies, including Teambuilders, should not have been put out of business based on false allegations of fraud. Not only was Teambuilders cleared of fraud, but, even the ALJ agreed with us that Teambuilders does not owe $12 million – but a small, nominal amount ($896.35). Instead of having the opportunity to pay the $896.35 and without due process of law, Teambuilders was destroyed – because of allegations.
All Medicare/Caid Health Care Professionals: Start Contracting with Qualified Translators to Comply with Section 1557 of the ACA!!
Being a health care professional who accepts Medicare and/ or Medicaid can sometimes feel like you are Sisyphus pushing the massive boulder up a hill, only to watch it roll down, over and over, with the same sequence continuing for eternity. Similarly, sometimes it can feel as though the government is the princess sleeping on 20 mattresses and you are the pea that is so small and insignificant, yet so annoying and disruptive to her sleep.
Well, effective immediately – that boulder has enlarged. And the princess has become even more sensitive.
On May 18, 2016, the Department of Health and Human Services (HHS) published a Final Rule to implement Section 1557 of the Affordable Care Act (ACA). Section 1557 of the ACA has been on the books since the ACA’s inception in 2010. However, not until 6 years later, did HSD finally implement regulations regarding Section 1557. 81 Fed. Reg. 31376.
The Final Rule became effective July 18, 2016. You are expected to be compliant with the rule’s notice requirements, specifically the posting of a nondiscrimination notice and statement and taglines within 90 days of the Final Rule – October 16, 2016. So you better giddy-up!!
First, what is Section 1557?
Section 1557 of the ACA provides that an individual shall not, on the basis of race, color, national origin, sex, age, or disability, be
- excluded from participation in,
- denied the benefits of, or
- subjected to discrimination under
all health programs and activities that receive federal financial assistance through HHS, including Medicaid, most Medicare, student health plans, Basic Health Program, and CHIP funds; meaningful use payments (which sunset in 2018); the advance premium tax credits; and many other programs.
Section 1557 is extremely broad in scope. Because it is a federal regulation, it applies to all states and health care providers in all specialties, regardless the size of the practice and regardless the percentage of Medicare/caid the agency accepts.
HHS estimates that Section 1557 applies to approximately 900,000 physicians. HHS also estimates that the rule will cover 133,343 facilities, such as hospitals, home health agencies and nursing homes; 445,657 clinical laboratories; 1300 community health centers; 40 health professional training programs; Medicaid agencies in each state; and, at least, 180 insurers that offer qualified health plans.
So now that we understand Section 1557 is already effective and that it applies to almost all health care providers who accept Medicare/caid, what exactly is the burden placed on the providers? Not discriminating does not seem so hard a burden.
Section 1557 requires much more than simply not discriminating against your clients.
Section 1557 mandates that you will provide appropriate aids and services without charge and in a timely manner, including qualified interpreters, for people with disabilities and that you will provide language assistance including translated documents and oral interpretation free of charge and in a timely manner.
In other words, you have to provide written materials to your clients in their spoken language. To ease the burden of translating materials, you can find a sample notice and taglines for 64 languages on HHS’ website. See here. The other requirement is that you provide, for no cost to the client, a translator in a timely manner for your client’s spoken language.
In other words, you must have qualified translators “on call” for the most common 15, non-English languages in your state. You cannot rely on friends, family, or staff. You also cannot allow the child of your client to act as the interpreter. The clients in need of the interpreters are not expected to provide their own translators – the burden is on the provider. The language assistance must be provided in a “timely manner. “Further, these “on call” translators must be “qualified,” as defined by the ACA.
I remember an English teacher in high school telling the class that there were two languages in North Carolina: English and bad English. Even if that were true back in 19XX, it is not true now.
Here is a chart depicting the number of non-English speakers in North Carolina in 1980 versus 2009-2011:
As you can see, North Carolina has become infinitely more diverse in the last three decades.
And translators aren’t free. According to Costhelper Small Business,
It seems likely that telehealth may be the best option for health care providers considering the cost of in-person translations. Of course, you need to calculate the cost of the telehealth equipment and the savings you project over time to determine whether the investment in telehealth equipment is financially smart.
In addition to agencies having access to qualified translators, agencies with over 15 employees must designate a single employee who will be responsible for Section 1557 compliance and to adopt a grievance procedure for clients. Sometimes this may mean hiring a new employee to comply.
The Office of Civil Rights (“OCR”) at HHS is the enforcer of Section 1557. OCR has been enforcing Section 1557 since its inception in 2010 – to an extent.
However, expect a whole new policing of Section 1557 now that we have the Final Rule from HHS.
Don’t we have due process in America? Isn’t due process something that our founding fathers thought important, essential even? Due process is in our Constitution.
The Fourteenth (governing state governments) and the Fifth Amendment (governing federal government) state that no person shall be “deprived of life, liberty, or property without due process of law.”
Yet, apparently, if you accept Medicaid or Medicare, due process is thrown out the window. Bye, Felicia!
How is it possible that criminals (burglars, murderers, rapists) are afforded due process but a health care provider who accepts Medicaid/care does not?
Surely, that is not true! Let’s look at some examples.
In Tulsa, a 61-year-old man was arrested for killing his Lebanese neighbor. He pled not guilty. In news articles, the word “allegedly” is rampant. He allegedly killed his neighbor. Authorities believe that he may have killed his neighbor.
And prior to getting his liberty usurped and getting thrown in jail, a trial ensues. Because before we take a person’s liberty away, we want a fair trial. Doesn’t the same go for life and property?
Example A: I recently received a phone call from a health care provider in New Jersey. She ran a pediatric medical daycare. In 2012, it closed its doors when the State of New Jersey accused it of an overpayment of over $12 million and suspended its funds. With its funds suspended, it could no longer pay staff or render services to its clients.
Now, in 2016, MORE THAN FOUR YEARS LATER, she calls to ask advice on a closing statement for an administrative hearing. This tells me (from my amazing Murdoch Mysteries (my daughter’s favorite show) sense of intuition): (1) she was not provided a trial for FOUR YEARS; (2) the state has withheld her money, kept it, and gained interest on it for over FOUR YEARS; (3) in the beginning, she did have an attorney to file an injunction and a declaratory judgment; and (4) in the end, she could not afford such representation (she was filing her closing argument pro se).
Examples B-P: 15 New Mexico behavioral health care agencies. On June 23, 2013, the State of New Mexico accuses 15 behavioral health care agencies of Medicaid fraud, which comprised 87.5% of the behavioral health care in New Mexico. The state immediately suspends all reimbursements and puts most of the companies out of business. Now, MORE THAN THREE YEARS LATER, 11 of the agencies still have not undergone a “Fair Hearing.” Could you imagine the outrage if an alleged criminal were held in jail for THREE YEARS before a trial?
Example Q: Child psychiatrist in rural area is accused of Medicaid fraud. In reality, he is not guilty. The person he hired as his biller is guilty. But the state immediately suspends all reimbursements. This Example has a happy ending. Child psychiatrist hired us and we obtained an injunction, which lifted the suspension. He did not go out of business.
Example R: A man runs a company that provides non-emergency medical transportation (NEMT). One day, the government comes and seizes all his property and freezes all his bank accounts with no notice. They even seize his fiance’s wedding ring. More than TWO YEARS LATER – He has not stood trial. He has not been able to defend himself. He still has no assets. He cannot pay for a legal defense, much less groceries.
Apparently the right to speedy trial and due process only applies to alleged burglars, rapists, and murderers, not physicians and health care providers who render medically necessary services to our most fragile and vulnerable population. Due process??? Bye, Felicia!
What can you, as a health care provider, do if you are accused of fraud and your reimbursements are immediately suspended?
- Prepare. If you accept Medicare/caid, open an account and contribute to it generously. This is your CYA account. It is for your legal defense. And do not be stupid. If you accept Medicaid/care, it is not a matter of if; it is a matter of when.
- Have your attorney on speed dial. And I am not talking about your brother’s best friend from college who practices general trial law and defends DUIs. I am talking about a Medicaid/care litigation expert.
- File an injunction. Suspension of your reimbursements is a death sentence. The two prongs for an injunction are (a) likelihood of success on the merits; and (b) irreparable harm. Losing your company is irreparable harm. Likelihood of success on the merits is on you. If your documents are good – you are good.
It is a timeless joke. What goes down, but never goes up? Medicaid rates!
Having a Medicaid card is as useful as holding a lottery ticket. Sure, maybe you’ll hit the jackpot and find a quality health care provider with whom you share some common connection, but, most likely, you will receive nothing but false hope. 10% of nothing is nothing.
For health care providers that do accept Medicaid – how many of you are accepting new patients? Or maybe the better question is – how many of you are profitable from your Medicaid patients?
Because we live in a society in which we need money to live, if Medicaid pays less than the cost, health care providers will not accept Medicaid. And you cannot blame them. It’s happening all over the country. In Utah, dentists are un-enrolling in Medicaid, i.e., refusing their Medicaid patients. See article. Pennsylvania has a shortage of psychiatrists..even more so who accept Medicaid. See article. “Some 55% of doctors in major metropolitan areas refuse to take new Medicaid patients, according to a 2014 report by Merritt Hawkins. The Department of Health and Human Services reported that same year that 56% of Medicaid primary-care doctors and 43% of specialists weren’t available to new patients.” See article.
Medicaid is failing our most vulnerable and many more. Medicaid, as it exists now, fails every taxpayer, every health care provider who accepts it, and every family member of a developmentally disabled person who is dependent on Medicaid.
The cost of the Medicaid program is expected to rise from $500 billion to $890 billion by 2024, according to the Center for Medicare and Medicaid Services (CMS). Yet – throwing more money at a dysfunctional program does not equate to Medicaid recipients gaining access to quality care. The increased money is not going to the services for Medicaid recipients. The ballooned Medicaid budget is not earmarked to elevate the current, inadequate Medicaid reimbursements, which would induce more health care providers to accept Medicaid. The higher the cost of Medicaid, the more the government slashes the reimbursement rates. Yet our government is willing to throw Medicaid dollars at managed care organizations (MCOs) to release the burden of managing such shortfalls and turn a blind eye when our taxpayers’ money is not used to provide Medicaid medically necessary services to recipients, but to compensate CEOs $400,000 or allow alleged extortion.
For example, in obstetrics, if the national Medicaid reimbursement rate for ob/gyn visits is $1.00, here, in NC, Medicaid reimburses ob/gyns 88¢. Which is why only 34% of North Carolina ob/gyns accept Medicaid.
If it is imperative for the Medicaid reimbursements to increase (to, at the very least, cost, if not a slight profit), then how do we accomplish such an insurmountable task?
There are two options: (1) lobbying (which, obviously, has not been successful thus far); and (2) litigation.
Section 30(A) of the Medicaid Act requires that a state provide Medicaid reimbursement rates at a level to “assure that payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population…”
In an article entitled “Nurse Staffing Levels and Medicaid Reimbursement Rates in Nursing Facilities,” written by Charlene Harrington, James H. Swan, and Helen Carrillo, the authors found that the Medicaid nursing home reimbursement rates were linked to quality of care, as to both RN hours and total nursing hours.
“Resident case mix was a positive predictor of RN hours and a negative predictor of total nursing hours. Higher state minimum RN staffing standards was a positive predictor of RN and total nursing hours while for-profit facilities and the percent of Medicaid residents were negative predictors.” Id.
Numerous other articles have been published in the last few years that cite the direct correlation between reimbursement rates and quality of care.
How do we stop Medicaid reimbursement rates from dropping and the executives of those companies charged with managing Medicaid funds from lining their own pockets?
According to the Supreme Court, suing under the Supremacy Clause is not the answer.
In Armstrong v. Exceptional Child Services, providers of habilitative Medicaid services sued the State of Idaho for Medicaid reimbursements rates being too low as to violate Section 30(A) of the Medicaid Act.
In the Armstrong decision from last year, the Supreme Court, Scalia found that, in enacting §1902(a)(30)(A) Congress had empowered the HHS Secretary to withhold all Federal funds from states that violate federal law. According to Armstrong, this “express provision of an administrative remedy” shows that Congress intended that the Secretary be the enforcer – not the courts. In other words, the Supreme Court held that
“The sole remedy Congress provided for a State’s failure to comply with Medicaid’s requirements—for the State’s “breach” of the Spending Clause contract—is the withholding of Medicaid funds by the Secretary of Health and Human Services.” Armstrong.
In other words, according to Armstrong, the sole remedy for health care providers who demand higher Medicaid reimbursement rates, will be for the Secretary of HHS to withhold Medicaid funds from the state. Such a drastic measure would undoubtedly cause the state such a budgetary shortfall that the state would soon be in a position in which it could not reimburse health care providers at all. Therefore, the providers go from receiving woefully low reimbursement rates to receiving none at all. That seems hardly the situation that the Supreme Court would want.
There are still litigation options for health care providers to sue in order to increase the Medicaid reimbursement rate. Just not through the Supremacy Clause.
I have a joke: What goes down, but never goes up?
A recent State Auditor report found that DHHS “had approximately 2,500 non-competitively bid contracts with a value of approximately $2.4 billion between state fiscal year 2012 through 2014. The value of the no-bid contracts accounts for more than 32% of all contracts during the same period.”
No bid contracts are exactly that – the company awarded the contract received the contract without competition, or a bid process. Think of a no bid contract as a try out for a professional football team, but only one person is trying out. Generally, competition breeds better results because people try harder when they compete, rather than a solo act.
In contract bidding, rivalry also breeds a lower contract price. It’s only logical. If you know that other companies are submitting bids, you are going to submit the lowest number possible.
So how is DHHS allowed to award no bid contracts?
NC Statute dictates that the AG or the AG’s attorney shall review “all proposed contracts for supplies, materials, printing, equipment, and contractual services that exceed one million dollars…” as of June 27, 2011. See NCGS 114-8.3 as amended by Session Law 2011-326 and Session Law 2013-234.
But – Per 09 NCAC 06B .0901, “…competition may be limited or waived where a factual basis demonstrates support of one or more of the conditions set forth in Paragraph (b) of this Rule. If the procurement is within a purchasing agency’s general delegation, then the purchasing agency may waive competition in conformance with this Rule. If the procurement is greater than the agency’s delegation, requests for limited or waived competition shall be submitted to the State CIO for approval.”
Here are the exceptions found in 09 NCAC 06B.0901(b):
(b) Competition may be limited or waived under the following conditions:
- Competition is not available;
- A needed product or service is available from only one source of supply;
- Emergency action is indicated;
- Competition has been solicited but no responsive offers have been received;
- Standardization or compatibility is the overriding consideration;
- A donation stipulates the source of supply;
- Personal or particular professional services are required;
- A product or service is needed for a person with disabilities and there are overriding considerations for its use;
- Additional products or services are needed to complete an ongoing job or task;
- A particular product or service is desired for educational, training, experimental, developmental or research work;
- Equipment is already installed, connected and in service, and it is determined advantageous to purchase it;
- Items are subject to rapid price fluctuation or immediate acceptance;
- There is evidence of resale price maintenance or other control of prices or collusion on the part of persons or entities that thwarts normal competitive procedures unless otherwise prohibited by law;
- A purchase is being made and a price is available from a previous contract;
- The requirement is for an authorized cooperative project with another governmental unit(s) or a charitable non-profit organization(s); or
- A used item is available on short notice and subject to prior sale.
Did all the no bid contracts that DHHS procured between state fiscal year 2012 through 2014 to equal approximately $2.4 billion fit within 1 or more of the above referenced exceptions?
At least, according to the State Auditor – No.
Here are the key findings of the State Auditor’s Report:
- Many no-bid contracts lacked required review and approval to protect state interests
- Many no-bid contracts lacked documentation of negotiations to improve pricing or terms
- Many no-bid contracts lacked adequate written justification to waive competition, which increases the risk of favoritism, unfavorable terms, and poor performance
It appears that DHHS failed this audit. Should we extrapolate?