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Health News Update

A comprehensive resource for professional healthcare information and solutions

In This Issue
Welcome to Health News Update

We have updated and consolidated our Health NetNews emails into one of the most comprehensive sources of professional health care information and solutions. Covering important monthly developments in the areas of Health Care Compliance, Medicare and Medicaid Reimbursement, Coding, Health Reform, and Food and Drug Law, we hope this resource provides useful content and features.


On the Front Lines
Brett Kavanaugh nominated to replace Justice Kennedy on Supreme Court

By Susan Smith, J.D., M.A.


After a selection process that started with a list of 25 potential nominees to the Supreme Court, President Donald J. Trump selected Judge Brett M. Kavanaugh of the U.S. Court of Appeals for the District of Columbia Circuit as his nominee to fill Justice Anthony M. Kennedy's seat on the Supreme Court, the White House announced. Leigh Ann Caldwell, Capitol Hill reporter for NBC, tweeted that Justice Kennedy had provided the White House with a list of who he believed to be acceptable replacements before announcing his retirement, which included his former law clerk, Kavanaugh.


Kavanaugh's background. In 2006, President George W. Bush appointed Kavanaugh to the U.S. Court of Appeals for the District of Columbia Circuit. Before becoming a judge, Kavanaugh served in the Bush Administration in the role of Associate Counsel and, subsequently, as Assistant to the President and Staff Secretary. Kavanaugh graduated from Yale College and Yale Law School and clerked on the Supreme Court for Justice Kennedy. He also clerked for judges on the Third and Ninth Circuit Courts of Appeals. In addition, he was Counsel for the Office of Independent Counsel under Ken Starr and was a Partner at Kirkland & Ellis, LLP.


Democrats' concerns. Kavanaugh has authored more than 300 opinions, including 11 that have been affirmed by the Supreme Court. Opinions that are of specific concerns to Democrats include how Kavanaugh would rule on such issues as abortion, environmental protection, provisions of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), and the Consumer Financial Protection Bureau (CFPB) and corporate accountability. For example, Elizabeth Warren (D-Mass) tweeted that "Brett Kavanaugh's record as a judge and lawyer is clear: hostile to health care for millions, opposed to the CFPB & corporate accountability, thinks Presidents like Trump are above the law – and conservatives are confident that he would overturn Roe v. Wade."


According the Atlantic, Democrats want to know how Judge Kavanaugh will rule. Senate Minority Leader Chuck Schumer (D-NY) emphasized that a nominee to replace Justice Kennedy "has an obligation...to share their personal views" on a range of contentious legal issues such as the role of money in politics, a woman's constitutional right to an abortion, and the ACA. Schumer said that the most pressing question from Democrats is whether Kavanaugh would vote to overturn Roe v. Wade.


CNN reported that Kavanaugh has never directly ruled on abortion and has not publicly said if he favored overturning Roe v. Wade, however, his dissent on an appeals court decision that allowed a pregnant teenaged illegal immigrant who was in federal custody to have an abortion will likely draw scrutiny from Democrats. In his dissent in Garza v. Hargan, Kavanaugh noted that the Supreme Court has held that "the government has permissible interests in favoring fetal life, protecting the best interests of a minor, and refraining from facilitating abortion." He added, however, that "all parties to this case recognize Roe v Wade and Planned Parenthood v. Casey as precedents we must follow."


CNN also reported that Kavanaugh has "established a reputation as a skeptic of regulatory action supported by the Environmental Protection Agency (EPA) under the Obama administration" as well as skepticism of broad agency power. In his dissent of opinions issued by the court, Kavanaugh was critical of the EPA in a challenge addressing regulations of greenhouse gases and he opposed independent agencies such as the CFPB run by a single director, stating that independent agencies pose a significant threat to individual liberty and to the constitutional system of separation of powers and checks and balances.


Health care reform cases. In Priests for Life v. HHS, the D.C. Circuit denied a nonprofit organization a rehearing en banc regarding its objections to the accommodation allowing religious nonprofits to pass the burden of providing contraceptives (see ACA §1302) to which they object on religious grounds to a third party. Kavanaugh dissented stating that the panel contradicted the Burwell v. Hobby Lobby decision, which stated that regulations requiring organizations to act contrary to their religious beliefs or pay significant fines substantially burdens religion. His dissent focused on the "extremely strong signals" provided by the Supreme Court in cases like Wheaton College v. Burwell, and argued that allowing organizations to provide notice to HHS directly was a less restrictive way to further the government's interest in providing contraception. Kavanaugh also wrote in his dissent that Supreme Court precedent "strongly suggests that the government has a compelling interest in facilitating access to contraception for the employees of these religious organizations (see We've heard enough: court draws the line at accommodation, denies rehearing, May 27, 2015).


In Sissel v. HHS, the D.C. Circuit denied an artist's petition for rehearing en banc. The artist claimed that the individual mandate of §1501 of the ACA violated the Commerce and Origination Clauses of the U.S. Constitution. His claims had been rejected by both the trial and appellate courts. Although Kavanaugh and three other judges agreed with the outcome, they did not agree with the panel's reasoning. In the dissent, Kavanaugh stated that the original panel's interpretation of the Origination Clause was incorrect, would upset the balance of power in Congress, and affected personally liberty; however, he agreed that the ACA did not violate the Origination Clause because it properly originated in the House. Three judges issued a concurrence responding to the dissenters' allegations noting that the panel's analysis was supported by the text of the Origination Clause, its history, congressional practice, and U.S. Supreme Court precedent (see No en banc rehearing for individual mandate challenge, August 12, 2015).


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Compliance
OIG strategies to combat Medicare fraud

By Wolters Kluwer Editorial Staff


HHS Office of Inspector General's (OIG) Deputy Inspector General for Audit Services, Gloria L. Jarmon, testified before the House Oversight Subcommittee concerning the OIG's strategy to promote program integrity and combat Medicare fraud. After discussing the enormous scope of the problem, the Deputy discussed schemes that have been used to bilk Medicare. The OIG will continue to develop technologies to prevent and detect fraud and waste and perform evaluations to reduce improper payment, as well as monitor CMS's efforts to improve its fraud prevention system (FPS). The OIG also noted that using advanced data analytic techniques and risk assessments, will allow the agency to detect potential vulnerabilities and fraud early and target resources to areas most in need of oversight. Finally, the OIG will continue to focus on enforcement to hold malfeasors accountable.


Scope of task. Medicare and Medicaid accounted for $88.6 billion, or about 98 percent, of the $90.1 billion in improper payments that HHS reported in its 2017 fiscal year; not all improper payments are due to fraud. Traditional Medicare fee-for-service accounted for $36.2 billion, or about 40 percent, of the improper payments that HHS reported. About 9.5 percent of total Medicare fee-for-service payments were improper. HHS attributed about 66 percent of Medicare fee-for-service improper payments to documentation errors. Medical necessity errors accounted for another 18 percent of the errors. Although improper payments likely occur in all areas of health care, home health, skilled nursing facilities and inpatient rehab facilities represent an estimated one-third of improper Medicare payments.


Need to improve FPS. The OIG takes a three-pronged approach to fighting fraud, waste, and abuse. This approach focuses on prevention, detection, and enforcement. CMS's FPS is an important tool for preventing the payment of improper claims which, according to the Deputy Inspector General, needs improvement. The OIG evaluations have determined that HHS might not be able to trace savings from administrative actions back to the FPS model that generated the savings. Also it was determined that CMS did not use all pertinent performance results because it did not ensure that contractors' adjusted savings reported to CMS reflected the amounts certified by the OIG, and CMS did not evaluate FPS model performance on the basis of the amounts expected to be recovered or prevented.


Use of data analytics. Advanced data analytics examine millions of claims and billions of data points helping the OIG assess risk and pinpoint resources. The data gathered assists in demonstrating patterns and trends and helps identify potential fraud suspects. The OIG was careful to note that as it is becoming more technologically sophisticated, so are criminals. Consequently, advanced data analytics, while enormously helpful, are not a "silver bullet."


Recent enforcement success. The testimony highlighted last month's arrest of over 600 defendants nationwide who were implicated in schemes which bilked health programs of approximately two billion dollars and included the 32 doctors charged with illegally prescribing opioids and other narcotics. More than 1000 law enforcement personnel were involved in this case, including 350 OIG special agents.


Risk-based oversight. The OIG uses risk assessments to develop and prioritize its oversight work. Among the risk factors related to fraud considered by OIG are governance and culture, strategy and objective setting, performance, review and revision of practices to enhance entity performance, and information, communication and reporting. The OIG uses other information to identify and prioritize needed audits, including an environmental scan that considers the expectations of external stakeholders. Rather than composing a static annual Work Plan, using risk evaluations, the OIG Work Plan now reflects a dynamic ongoing process. OIG Testimony, July 17, 2018




Home Health, Hospice: Compliance risks, enforcement activities, best practices

By Susan Smith, J.D., M.A.


Home health agencies (HHAs) and hospices have been the target of government enforcement activities since the 1990's and continue today, in part because hospice spending has been increasing at a high rate annually and the population of individuals likely to receive home health and hospice care also is increasing. In 2017, enforcement activities against HHAs resulted in approximately $214,295,670 in expected receivables and 125 provider exclusions. Enforcement activities in 2017 against hospices resulted in approximately $132, 827,400 in expected receivables and 10 exclusions. In a session at the American Health Lawyers Association (AHLA) 2018 annual meeting, Brian Bewley, Member, Bass, Berry & Sims PLC, Nancy Brown, Senior Counsel, HHS Office of Council to the Inspector General, and Kathleen Hessler, Director, Compliance & Risk, Simione Healthcare Consultants, LLC, provided the current climate of government enforcement activities, key compliance risks, lessons learned from recent corporate integrity agreements (CIAs), and best compliance practices for post-acute care providers.


The CMS demonstration project. Bewley provided details of a revamped CMS demonstration project that would require review of 100 percent of HHA pre-claims or 100 percent of postpayment claims for payment. Providers in the demonstration states may participate in either the pre-claim review or postpayment review. Providers who do not wish to participate in either pre-claim or postpayment reviews have the option to submit the associated claim for payment home health services furnished without undergoing reviews; however, they will receive a 25 percent payment reduction on all claims submitted and may be eligible for review by a recovery audit contractor. On May 31, 2018, CMS issued an information collection Notice (see 83 FR 25012, May 31, 2018), seeking comments on the revision of a currently approved information collection for the pre-claim review demonstration for home health services. The demonstration project would include Illinois, Ohio, North Carolina, Florida, and Texas with an option to expand to other states in the Palmetto/JM jurisdiction.


Key compliance risk areas. Risk areas for HHAs include medical necessity of skilled services, eligibility of the home health benefit (specifically, homebound status), sufficiency of documentation, compliance with federal health care program requirements, financial relationships with referral sources, marketing practices, ICD-10 coding, OASIS (the Outcome and Assessment Information Set) documentation, face-to-face encounters, and employment of excluded individuals, Bewley said. Risk areas for hospice, include eligibility for the hospice benefit (services to patients who were not terminally ill), level of hospice care (services that were not necessary or not provided in accordance with requirements), documentation sufficiency, compliance with federal health care program requirements, financial arrangements with referral sources, and quality of care.


CIAs. To resolve allegations of improper billing or false claims allegations, OIG often requires providers to enter into a CIA, which requires the health care organization to have a formal compliance program. Brown discussed requirements of recent CIAs between the OIG and HHAs and hospices, including:

  • Risk assessment and internal review process. This annual process requires the provider to identify and address risks associated with federal health care programs based on input from compliance, legal, and department leaders and involves development and implementation of internal audit work plans and corrective actions plans.

  • Management certifications. Key management-level employees must certify that their oversight and authority are in compliance with applicable federal health care program requirements and the CIA.
  • Board compliance expert. Providers must engage an expert in corporate governance and compliance to assist the governing body in its oversight function.
  • Chief quality officer. The provider must engage a senior management member who (1) is responsible for monitoring day-to-day quality of care and patient safety activities, (2) reports to the compliance officer, and (3) has the authority to directly report to the governing body on quality assurance.

Hospice CIAs include a claims review requirement that provides for an eligibility review and an appropriate level of service review. In addition, the hospice must review its systems and processes to identify specific problems or weaknesses that may have led to errors discovered by an independent review organization (IRO). In addition, CIAs based on allegations of false claims require annual clinical record and claims audits by an IRO, while CIAs based on allegations of anti-kickback violations require annual audits of contracts and arrangements.


Best practices. Hessler and Bewley noted that a compliance and ethics plan should help mitigate risk when an HHA or hospice is negotiating with the government regarding enforcement actions. Specifically, Hessler recommended that attorneys assist providers to establish and maintain a compliance and ethics program that includes the seven elements of an effective compliance program identified by the OIG. In addition, the governing board, executive team, marketing team, human resources, revenue cycle and billing staff, as well as others must be involved in and educated as appropriate about the compliance program.


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Reimbursement
Injunction stands prohibiting HHS reduction of DSH reimbursements

By Wolters Kluwer Editorial Staff


The federal Court of Appeals for the Fourth Circuit determined that an HHS policy, requiring Medicaid reimbursements for disproportionate share hospitals (DSH) be reduced by payments received from private health insurance, constituted a "legislative rule." Consequently, the Administrative Procedures Act (APA) mandated that HHS establish this policy only through notice-and-comment rulemaking. The Fourth Circuit, accordingly, affirmed the lower court's judgment enjoining HHS from enforcing this policy. The appellate court declined to reach the substantive challenge by Children's Hospital to the policy and vacated the part of the district court's opinion addressing whether that policy conflicts with statutory language.


DSH reimbursement and FAQ 33. Children's Hospital of The King's Daughters, Inc. is a not-for-profit pediatric hospital. A majority of its inpatient cases were eligible for Medicaid. The hospital served a disproportionate number of low-income patients with special needs and therefore participated in the DSH reimbursement program. In 2008, CMS promulgated a rule implementing a statutory reporting and auditing requirement for each DSH hospital. In January, 2010, CMS posted on its website FAQs regarding these requirements. FAQ 33 provided that in calculating each hospital's DSH limit, a state must subtract payments received from private health insurance. In October, 2016, the hospital learned that FAQ 33 seriously jeopardized its funding, and in February, 2017, it was informed that it had 33 days to repay $19.1 million in DSH payments.


Lawsuit. The hospital brought a law suit by which it sought an order enjoining collection of this money and the enforcement of this rule as interpreted by FAQ 33. The district court ruled for the hospital and granted the requested injunctive relief. The district court found that when issuing the FAQ 33 policy, HHS failed to comply with the Administrative Procedural Act (APA), and the FAQ 33 policy contradicted the language of the governing statute (see Children's hospital entitled to injunctive relief over $19.1 million repayment demand by HHS based on FAQ 33 DSH adjustment June 28, 2017). HHS appealed.


Lack of notice-and-comment. The Fourth Circuit upheld the lower court's judgment prohibiting the enforcement of the policy enunciated in FAQ 33. At issue was the distinction between legislative rulemaking and interpretative rulemaking. Interpretative rules simply state what an agency thinks a statute means, and remind affected parties of existing duties, whereas, legislative rules have the force of law, and create new law or impose new rights or duties. Legislative rules may only be adopted according to the terms of the APA. APA procedures do not apply to making interpretative rules. Despite HHS's argument to the contrary, the Fourth Circuit found that the policy issued via FAQ 33 was a legislative rule because the policy of requiring DSHs to account for private insurance payments in calculating a DSH reimbursement did not derive from the statute or prior rule and HHS incorrectly relied on its statutorily delegated authority to determine what constituted "costs incurred for purposes of calculating a DSH's payment adjustment as the legal basis for supporting its policy." Since it was a legislative rule, HHS was obligated to afford notice and an opportunity for interested parties to be heard before issuance. Since notice and a hearing opportunity were not afforded prior to issuing FAQ 33, it was invalid and unenforceable. Because it was unnecessary for the appellate court to address the claim that FAQ 33 was inconsistent with HHS's statutory mandate, it vacated the lower court's judgment concerning that issue. Children's Hospital Of The King's Daughters, Inc. v. Azar, No. 17-2237, July 23, 2018



Report recommends plan to increase reporting for Medicare lab tests

By Wolters Kluwer Editorial Staff


In an effort to set Medicare payment rates for clinical diagnostic lab tests, which accounted for $6.8 billion in Medicare Part B spending in 2016, a new report by the HHS Office of the Inspector General (OIG) recommends strategies to increase reporting for labs. While the report shows that the Protecting Access to Medicare Act of 2014 (PAMA) initial implementation resulted in lower Medicare payment rates for most lab tests, many labs reported difficulty in determining whether they met criteria and needed to report data. The OIG recommends enhancing outreach to labs and developing a process to address labs to do not comply with reporting requirements, including a plan to issue civil monetary penalties.


Findings. The report focuses on CMS's initial implementation of Medicare's new payment system for clinical diagnostic laboratory tests mandated by PAMA. PAMA's initial implementation resulted in lower Medicare payment rates for most lab tests. Specifically, the study found that 75 percent of rates decreased. More than 60 percent of Part B payments in 2016 were for the top 25 tests. The study, based on interviews with CMS staff and representatives from lab industry associations along with a review of lab-reported data, follows up on a previous report which evaluated progress through August 2016. Medicare Part B covers most lab tests ordered by physicians and pays 100 percent of allowable charges. Beneficiaries do not have a copay for lab tests under either the new payment system or the previous one. Labs, however, reported difficulty in determining whether they met criteria and needed to report data. The report identified at least 20 high-volume independent labs that did not report their data in 2017.


Recommendations. The OIG recommends strategies to improve data quality to ensure increased reporting in the future. The OIG first suggests enhancing outreach to labs to ensure that labs know whether they meet criteria and report data. CMS could use feedback from labs and industry associations to create responsive guidance to ensure that labs know about and understand reporting requirements.


The OIG also suggests enhanced data quality assurance activities to help ensure that labs report as required. CMS could assess the effectiveness of its data quality assurance activities and adjust as necessary. In the future, CMS could develop a process to address labs that do not comply with reporting requirements, including a plan to issue civil monetary penalties. PAMA gives CMS the authority to issue civil monetary penalties if labs fail to report or misrepresent data. CMS stated in 2016 that it did not intend to issue civil monetary penalties for the first data reporting period. CMS allowed labs more time to collect and report their data by adding a 60-day enforcement discretion period to the end of the data reporting period. OIG Report, No. OEI-09-17-00050, July 2018.


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Coding
Changes to bone marrow biopsy; cognitive function interventions, laryngeal injections, hereditary peripheral neuropathy testing CPT® codes

Edited by the Wolters Kluwer Editorial Staff


The May 2018 CPT® Assistant provides an overview of recent changes to bone marrow biopsy and aspiration codes; cognitive function interventions coding, percutaneous laryngeal injections, and hereditary peripheral neuropathy testing. In addition, the monthly report includes frequently asked question (FAQ) section.


Bone Marrow Biopsy and Aspiration. The requirements for bone marrow specimens have significantly changed, with the addition of immunophenotyping, cytogenetics and molecular diagnostics being commonly requested in addition to more traditional hematopathologic interpretation. These expansions in the use of bone marrow specimens required changes in coding to differentiate the work of bone marrow aspiration for diagnostic purposes from the work performed during therapy. A number of code revisions have been made to the Hemic and Lymphatic Systems subsection of the Current Procedural Terminology (CPT®) 2018 code set. CMS requested a review of code 38221, Diagnostic bone marrow; biopsy(ies), which was identified as a code with high total expenditures and not recently reviewed. Codes 38220, Diagnostic bone marrow; aspiration(s), and 38221 were revised and code 38222 was added. In addition, code 20939 was added to the Musculoskeletal System subsection to report aspiration of therapeutic bone marrow for bone grafting limited to use in spine surgery. Effective January 1, 2018, code 38220 is no longer reported for bone marrow aspiration to be used as a therapeutic autograft in conjunction with a spine procedure. New add-on code 20939 is reported for this procedure in conjunction with the appropriate spinal code(s). Code 20999, Unlisted procedure, musculoskeletal system, in general, should be reported for aspiration of bone marrow for the purpose of bone grafting, other than spinal surgeries.


Cognitive Function Interventions. In a 2016 review, it was determined that CPT® code 97532, Development of cognitive skills to improve attention, memory, problem solving (includes compensatory training), direct (one-on-one) patient contact, each 15 minutes, did not reflect current practice. As a result, code 97532 was deleted and new code 97127 was added to the CPT® 2018 code set to report therapeutic interventions that focus on cognitive function and compensatory strategies. Unlike deleted code 97532, code 97127 is not time-based, it is designed as a service-based code. Code 97127 may be reported only once per day, regardless of the amount of time spent with the patient. Note that CMS does not recognize code 97127 for Medicare payment, use code G0515 to report cognitive function intervention services, effective January 1, 2018. Code G0515 is a time-based code and can be billed multiple times on the same day based on the length of time required to complete the service.


Coding Update: Percutaneous Laryngeal Injections. CPT® codes 31573 and 31574 were created to report percutaneous laryngeal injections using flexible endoscopy for procedural guidance. Code 31573 is reported for therapeutic injection(s) of medication(s), such as a corticosteroid or chemodenervation agent, in the vocal cord for tumors, neurogenic abnormalities, or other vocal conditions. The visualization into the larynx is obtained with a flexible laryngoscope and the therapeutic injection is performed through the skin (percutaneous), with a curved needle placed through the mouth (transoral), or with a needle passed through a separate channel in the flexible laryngoscope. Generally, these medications are relatively thin (less viscous). Code 31574 is reported for percutaneous or transoral injection(s) of a filler for augmentation. The visualization is provided with a flexible laryngoscope, but because these fillers are thicker (more viscous), they must be injected through a larger bore needle, thus limiting the approach to percutaneous or transoral routes. Both codes 31573 and 31574 indicate "unilateral" in their code descriptors. If the procedures are performed bilaterally, append modifier 50, Bilateral Procedure.


Hereditary Peripheral Neuropathy. A new genomic sequencing procedure (GSP) code was established in the CPT® 2018 code set to describe hereditary peripheral neuropathy testing. Prior to 2018, this service was reported with multiple Tier 1 and Tier 2 codes for each gene tested (eg, 81325, 81403-81408), as well as code 81479 for the balance of any unlisted genes. Hereditary or inherited peripheral neuropathy is a group of neurological disorders that affect one in 2500 people. Reporting multiple codes for a single laboratory procedure is burdensome for health care professionals and third-party payers. To streamline and clarify reporting for this specific test, the CPT Editorial Panel approved one new GSP code (81448) to improve consistent reporting efforts for the laboratories that perform this service.


Frequently Asked Questions


Surgery: Musculoskeletal System


Question: How do I report decompressive laminotomy/foraminotomy when performed with an interspinous process distraction device placement and fusion at the same level (eg, L5/S1)?


Answer: CPT® code 63047, Laminectomy, facetectomy and foraminotomy (unilateral or bilateral with decompression of spinal cord, cauda equina and/or nerve root[s], [eg, spinal or lateral recess stenosis]), single vertebral segment; lumbar, should be reported for the decompressive laminotomy/foraminotomy. Code 22899, Unlisted procedure, spine, should be reported separately for the interspinous process distraction device placement and fusion because there is no specific code that accurately describes this service. When reporting an unlisted code to describe a procedure or service, submit supporting documentation with the claim to provide an adequate description of the nature, extent, and need for the procedure; and the time, effort, and equipment necessary to provide the service.


Surgery: Cardiovascular System


Question: Replacement of plasma volume is required during therapeutic plasma exchange. How should these additional services be reported?


Answer: Patients who are undergoing plasma-exchange treatments require simultaneous replacement of the volume of plasma removed. The plasma-exchange treatment using albumin in saline (5 percent albumin) and/or fresh frozen plasma may be reported with code 36514, Therapeutic apheresis; for plasma pheresis. The agent used for colloid-volume replacement may be reported separately with the appropriate HCPCS Level II code(s).


Surgery: Nervous System


Question: Facet joint injections are made to the median branch nerves at L3-4, L4-5, and L5-S1 on both the right and left sides on the same day. How is this reported?


Answer: Codes 64493, Injection(s), diagnostic or therapeutic agent, paravertebral facet (zygapophyseal) joint (or nerves innervating that joint) with image guidance (fluoroscopy or CT), lumbar or sacral; single level and add-on codes 64494, second level (List separately in addition to code for primary procedure) and 64495, third and any additional level(s) (List separately in addition to code for primary procedure), should all be reported. Modifier 50 should be appended to each code to indicate that bilateral injections were performed.


Question: The procedure described in code 63047 was performed for decompression, which was documented in the operative note. In addition, the procedure described in code 22633 was also performed at the same interspace. How should this be reported?


Corrected Answer: In the Frequently Asked Questions (FAQ) section of the October 2016 issue of CPT® Assistant, the Surgery: Nervous System answer incorrectly stated that codes 22633, Arthrodesis, combined posterior or posterolateral technique with posterior interbody technique including laminectomy and/or discectomy sufficient to prepare interspace (other than for decompression), single interspace and segment; lumbar, and 63047, Laminectomy, facetectomy and foraminotomy (unilateral or bilateral with decompression of spinal cord, cauda equina and/or nerve root[s], [eg, spinal or lateral recess stenosis]), single vertebral segment; lumbar, may not be reported for the same interspace. On further analysis of this issue, it was demonstrated that this recommendation was inconsistent with previously published CPT® Assistant advice, which is that codes 22633 and 63047 may be reported for the same interspace when additional work is required to complete a decompression at a single spinal level. It is also appropriate to report codes 22633 and 63047, if the two procedures are performed at different interspaces. Modifier 59, Distinct Procedural Service, should then be appended to indicate that these are two distinct procedures. Codes 22633 and 63047 may be reported for the same interspace when additional work is required to complete a decompression at a single spinal level. It is also appropriate to report codes 22633 and 63047, if the two procedures are performed at different interspaces. Modifier 59, Distinct Procedural Service, should then be appended to indicate that these are two distinct procedures.


To view these articles via Coding Comply, search from the Search Code Sets tab in Coding Comply for any of the codes listed above, view the Related Documents by clicking on the paper icon next to the code, then select the article. To view these articles in The Coding Suite, go to the CPT® Assistant Archives folder and in the Search field within this folder and enter "May 2018."


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Reform
CMS announces safe harbor to 90-day requirement for product discontinuation notices

By Sheila Lynch-Afryl, J.D., M.A.


CMS announced an enforcement safe harbor for product discontinuation notices in connection with the open enrollment period for coverage in the 2019 benefit year. Instead, issuers are required to provide notice pursuant to the time frames for renewal notices, which, for non-grandfathered, non-transitional plans, is before the first day of the next annual open enrollment period, and for grandfathered health plans and transitional plans is at least 60 days before the date of renewal.


Under the guaranteed renewability provisions of Public Health Service (PHS) Act §2703, as added by Sec. 1201(4) of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), as well as PHS Act §2712 and §2742 and 45 C.F.R. §146.152, §147.106, and §148.122, a health insurance issuer that elects to discontinue offering a particular product in the group or individual market generally must provide notice of the discontinuation at least 90 calendar days before the date of the discontinuation. However, many issuers were unable to finalize their plan offerings until after this deadline because of the timing of qualified health plan certification for the 2015, 2016, 2017, and 2018 benefit years. As a result, consumers could receive product discontinuation notices without enough time to promptly shop for new coverage.


Consistent with previous guidance, CMS provided that it will not take enforcement action against health insurance issuers that fail to send a product discontinuation notice with respect to individual market coverage in the 2019 benefit year at least 90 days prior to the discontinuation. CMS urged the states to offer flexibility to insurers. CMS Center for Consumer Information & Insurance Oversight Letter, April 9, 2018




Report details possible effects after individual mandate penalty eliminated

By Wolters Kluwer Editorial Staff


When the elimination of financial penalties associated with failing to comply with the individual mandate goes into effect in 2019, the RAND Corporation (RAND) estimates a decline in coverage between 2.8 million and 13 million. In more than half of the possible scenarios studied by RAND, eliminating the penalty resulted in an increase in the federal deficit, but, overall, eliminating the mandate has uncertain effects on the federal deficit.


Individual mandate. The individual mandate of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) requires most Americans to enroll in health insurance, reducing the likelihood of adverse selection in the insurance markets, under which insurers could charge higher premiums or deny coverage to sicker and older people, leading to higher premiums overall. Under the ACA, individual market insurers in every state were required to offer comprehensive coverage, without restrictions on preexisting conditions, to all applicants. In 2017, Congress eliminated the individual mandate penalty effective January 1, 2019. The Congressional Budget Office (CBO) estimated that eliminating the penalty would reduce health insurance enrollment by between 3 million and 6 million and increase premiums by between three and 13 percent.


Response to elimination of penalty. Based on a study of 10 scenarios, RAND estimates that eliminating the penalty will result in a decline in coverage between 2.8 million and 13 million. Though there is relatively limited literature on the individual mandate, the empirical studies RAND identified showed consistent evidence that insurance mandates increase health insurance enrollment. However, there is a lack of consensus on the drivers of consumers' response to the individual mandate. Despite economic theory that suggests individuals would be more responsive to a large penalty, compared to a smaller one, studies found compliance does not vary with the penalty's size. Other factors of influence include awareness of the law, framing the mandate as a penalty versus a tax, and political ideology. RAND hypothesized that consumers' responses to the change will depend on factors such as the value they place on being insured, out-of-pocket costs, the size of the penalty, and their desire to comply with the law.


Impact on deficit. RAND found that the effect of the elimination of the individual mandate on the federal deficit depends on how enrollees eligible for premium tax credits and Medicaid (i.e. those with little financial reason to drop coverage) respond to the elimination of the penalty. RAND predicted that the impact on the federal deficit will range from a reduction of $8 billion to an increase in $3.6 billion. In six of the 10 scenarios studied by RAND, eliminating the penalty resulted in an increase in the deficit.


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Life Sciences
Strengthened controlled substance quota system announced to help combat opioid crisis

By Wolters Kluwer Editorial Staff


In an effort to strengthen controls over diversion of controlled substances and improve the controlled substance regulatory quota system, the Drug Enforcement Administration (DEA) published a new Final rule. The Final rule updates provisions of the Controlled Substances Act (CSA) to reflect changes in the manufacture of controlled substances, changing patterns of substance abuse and markets in illicit drugs, and the challenges presented by the current national crisis of controlled substance abuse.


Determining quotas. The existing regulation directs the Administrator of DEA to consider a number of factors and determine the total quantity of each basic class of controlled substance listed in schedule I or II needed in the calendar year for medical, scientific, research, and industrial needs. To ensure that the allowed aggregate production quota is limited to that needed to provide adequate supplies for legitimate needs, the final rule directs consideration of the extent of any diversion of the controlled substance in the class. Additionally, relevant information from HHS and its components, including FDA, the Centers for Disease Control and Prevention (CDC), and CMS must be considered.


The Final rule also provides that information from the states should be considered as they are critically situated to provide information about the extent of legitimate and illegitimate use of controlled substances because of the responsibilities for drug enforcement within their jurisdictions. This will be accomplished by transmitting notices of proposed aggregate production quotas, and final aggregate production quota orders to the state attorney general, and if the state objects to the proposed quota a hearing will be held.


Issuing quotas. The existing regulation directs the Administrator to issue procurement quotas for individual manufacturers and manufacturers that use controlled substances to put them into dosage form or to make other substances. The applicants for procurement quotas must provide some standard information, and the Final rule clarifies that the Administrator may require additional information from applicants that may help to detect or prevent diversion, including customer identities and amounts of the controlled substance sold to each customer. The Final rule also includes consideration of the extent and risk of diversion of controlled substances as a factor the Administrator may deem relevant in fixing individual manufacturing quotas.


Discussion of comments. Some commenters argued that the large increase in overdose deaths was due to illicitly manufactured fentanyl, heroin, and synthetic opioids rather than prescription opioids. Other commenters similarly argued that prescription opioids were not the problem since there has been a downward trend in prescribing of controlled substances over the past several years. While others argued that the DEA does not have reliable measures to calculate diversion of controlled substances or scientific data to support the claim that quota reductions decrease diversion of controlled substances.


The DEA believes that overdose deaths from heroin, fentanyl and prescription opioids are inextricably linked, noting that roughly 75 percent of heroin users reported no medical use of prescription opioids before using heroin while the vast majority of individuals misusing prescription opioids do not go on to use heroin. The DEA also pointed out that the decreased prescriptions is largely due to the stepped up civil, criminal, and regulatory enforcement efforts of the agency. While there is a downward trend in prescribing, these prescription opiates continue to have a high potential for abuse and dependence and require the annual assessment of quotas. Finally, HHS studies the use and misuse of controlled substances, and CDC and CMS have information related to the patterns of drug abuse and diversion of controlled substance, which will all be considered by the DEA when setting the aggregate production quota.


Most commenters were concerned about the regulations affecting their ability to get their prescriptions and the possibility of drug shortages being created because of the Proposed rule. Some commenters were specifically concerned about a shortage of injectable opioids that are routinely used for surgeries and cancer treatment. However, there are already regulations in place stating, when there is a shortage, the DEA will increase the aggregate and indicate production quotas and any ingredients therein to the level requested. Final rule, 83 FR 32784, July 16, 2018




Smaller font proposed for calorie information on vending machine food packages

By Wolters Kluwer Editorial Staff


The FDA is proposing to revise the type size labeling requirements for front of package (FOP) calorie declarations for packaged food sold from glass front vending machines from at least 50 percent of the size of the largest printed matter to at least 150 percent the size of the net weight declaration on the package. According to the FDA, when enacted, this proposal will reduce regulatory burdens on vending and packaged foods industries and continue to require that consumers be provided with calorie information for certain articles of food sold from vending machines.


ACA-FDC Act-food labeling. Section 403(q) of the federal Food, Drug and Cosmetic Act (FDC Act) requires that food offered for sale must adhere to labeling requirements and include a variety of information such as serving size and calories. Section 403(q) previously exempted certain items from these labeling requirements. Section 4205 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) removed the exemption for restaurants, retail food establishments, and vending machine chains with 20 or more locations, and requires these establishments to disclose the calories for the items prepared and the suggested daily caloric intake specified by HHS. Under §403(q)(5)(H)(viii) of the FDC Act, if an article of food is sold from a vending machine that does not provide visible nutrition information at the point of purchase, the vending machine must have a prominent sign near the food item or the selection button that includes the number of calories contained in the item.


Current rule. In 2014, the FDA issued a Final rule, which became effective on December 1, 2016, implementing the vending machine labeling requirements. This rule describes which foods are subject to the calorie declaration requirement and establishes type size, color, and contrast requirements for vending machines calorie declarations. The Final rule also clarifies that vending machine operators do not have to provide calorie information if a consumer can view certain calorie information on the front of the package. As it currently reads, the rule requires that by July 26, 2018, this FOP calorie labeling print be at least 50 percent of the size of the largest printed matter on the label (see Vending machine labeling requirements released with menu labeling rule, December 3, 2014).


Proposed rule change. Since the publication of the Final rule, industry representatives indicated that the 50 percent type size requirement for FOP calorie labeling presented significant challenges by making the calorie declaration too large on some products and making label redesign difficult. The industry representatives related that many packaged food manufacturers who wish to help vending machine operators comply with the regulations by providing packaged foods with FOP labeling will have to redesign their labels at great expense. Also, several existing voluntary FOP labeling programs have calorie and other nutrition information presented in a FOP type size that ranges from 100 to 150 percent of the size of the net quantity of contents statement.


These labeling programs do not meet the FDA's type size requirements, and compliance would significantly disrupt their FOP nutrition labeling programs because there would no longer be enough room to accommodate both the voluntary FOP nutrition information and the calorie labeling requirement. Industry representatives indicated that the existing FOP labeling is nonetheless visible to consumers and in most cases, industry would be able to comply with a rule that linked the FOP type size for calorie labeling if it were no larger than 150 percent of the type size of the net quantity of contents statement. After considering these concerns, the FDA has proposed a rule reducing the required type size from fifty percent of the largest type to at least 150 percent the size of the net weight declaration. Proposed rule, 83 FR 32221, July 12, 2018


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