In This Issue
Welcome to Health News Update
On the Front Lines
House conducts hearing on patient relief from collapsing health markets
AG veto power absolute in voluntary FCA settlements
$5.5M, 3-year CAP to settle audit failures
Experts tackle meaningful use, internal departmental audits, and health care IT contracts
New York improperly billed Medicaid for dentists’ services
FQHC association entitled to attorney’s fees in wraparound payments dispute
AMA Coding Guidance: December 2016 CPT® Assistant
GOP moves to stabilize marketplace for 2018
Changes proposed for submission and posting of rate filing justifications
Preemption of Depakote® patient’s failure to warn claim affirmed
Claims that Takeda blocked Teva’s generic version of diabetes drug revived
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On the Front Lines
By Harold Bishop, J.D.
The House Committee on Energy and Commerce, Subcommittee on Health, held a hearing on four bills designed to improve the health insurance markets, established under section 1301 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), and ensure taxpayer dollars are only spent on those eligible for assistance. The first three bills were introduced in the last Congress and are aimed at improving the functioning of the insurance markets through reforms to special enrollment periods (SEPs), grace periods, and age rating. The fourth bill is newly introduced and is designed to ensure that patients with pre-existing conditions will always have access to coverage and care.
The bills before the subcommittee can be summarized as follows:
- H.R. 706, Plan Verification and Fairness Act of 2017. Introduced by Rep. Marsha Blackburn (R-Tenn.), this bill would require patients who seek enrollment outside of the open enrollment period (OEP) (i.e., using a SEP) to provide pre-enrollment verification to the exchange before the plan takes effect. The bill would also require the Inspector General of HHS to conduct a study to better understand the number of individuals who seek enrollment using SEPs.
- H.R. 710, Health Coverage State Flexibility Act of 2017. Introduced by Rep. Bill Flores (R-Tex.), this bill would align grace periods (currently 90 days under the ACA) with the grace period a state allowed in its individual market prior to the enactment of the ACA or one month. Currently, ACA plans cannot discontinue coverage for nonpayment of premiums. This means that patients receiving the advance premium tax credits and cost-sharing reductions can pay for only a few months of health insurance, but receive a full year of coverage. This bill would decrease gaming by these individuals who do not pay their premiums and reenroll during the following OEP.
- H.R. 708, State Age Rating Flexibility Act of 2017. Before the ACA, many states were using a 5:1 age rating ratio, meaning that the most generous plan could cost five times more than the least generous plan when it came to a patient’s age. The ACA moved this ratio to 3:1 for all states, regardless of their unique patient needs or circumstances. Understanding that the federal and state exchange instability is largely the result of a lack of young, healthy enrollees, and with the true cost of health care for the average 64-year-old roughly 4.8 times higher than the average 21-year-old, Rep. Larry Bucshon, M.D. (R-Ind.) introduced a bill that would place age rating at a standard 5:1 ratio across the country, but give states the flexibility to widen or loosen this formula.
- Pre-Existing Condition Protection and Continuous Coverage Incentive Act of 2017. This discussion draft, offered by Chairman Greg Walden (R-Ore.), is based on H.R. 5328 from the 113th Congress, then-entitled "Guaranteed Health Coverage for Pre-Existing Conditions Act of 2014." The legislation aims to maintain important pre-existing conditions safeguards following the repeal of ACA. The draft bill includes a placeholder for language that will offer new patient protection in the individual and small group markets for maintaining continuous health care coverage. This placeholder language will be designed to incentivize individuals to maintain coverage and reduce adverse selection and risk pool imbalances.
Subcommittee Chairman Walden’s introductory statement outlined the subcommittee’s current concerns with the ACA as follows:
- Patients in 21 states have seen average premium increases of 25 percent or more in 2017.
- Seven states will experience premium increases of 50 percent or more in 2017.
- In 2016, 225 counties had one insurer. This year, there are 1,022 counties with just one insurer – one-third of the entire country.
- Five entire states just have one insurer offering coverage on the exchange.
- Only five of the original 23 health insurance CO-OPs remain in business.
The subcommittee heard from the following witnesses: Doug Holtz-Eakin, President, American Action Forum; J.P. Wieske, Deputy Commissioner of Insurance, State of Wisconsin; and J. Leonard Lichtenfeld, M.D., Deputy Chief Medical Officer, American Cancer Society.
Eakin. In his testimony, Eakin conveyed the following points:
- Doing nothing is not an option. The ACA is in a downward spiral. Prices will continue to rise and insurers will continue to leave unless significant changes are made.
- These reforms (contained in the four proposed bills) are good policy regardless of the performance of the markets or the political climate. They should receive bipartisan support.
- While the proposed changes will help, they will not be enough to produce a vibrant individual market. More will need be done to stabilize the market until a replacement plan can be fully implemented.
Wieske. Wieske testified that Wisconsin had a well-functioning health insurance market prior to the passage of the ACA. It had competitive individual and small group markets with numerous choices, including co-ops, health maintenance organizations (HMOs), not-for-profit plans, and traditional health insurance options. For consumers who could not meet the underwriting requirements of private coverage, Wisconsin offered a high-risk pool which provided relatively affordable health insurance coverage while offering a choice of plan designs, and provided subsidies for those with family incomes up to $34,000.
According to Wieske, since the ACA was implemented, the Wisconsin consumer has fewer choices, rates have increased significantly, a number of its insurers have seen a significant loss in capital, insurers have left the individual market, and those that remain have reduced service areas and plan offerings. In the long run, he believes that the ACA market is not sustainable. He believes that health insurance should be primarily regulated at the state level and states should have the ability to determine what is best for their market. He pointed out that: "A return to the states does not mean an unregulated health insurance market. Indeed, the ACA includes many standards that were first implemented at the state level."
Lichtenfeld. Lichtenfeld testified that the four bills before the committee "appear to work together to address concerns expressed by the insurance industry about the viability of the individual and small group markets." And while he recognized the importance of strengthening the health insurance markets, he expressed concern about how these bills might impact care and access to adequate and affordable coverage for individuals with cancer.
He stated, on behalf of the American Cancer Society, that any legislative changes should be grounded in the following principles to ensure that cancer patients have access to the care they need for their cancer treatment:
- Protecting patients. The patient protections contained in ACA should be retained, including the prohibition on pre-existing condition exclusions, the prohibition on annual and lifetime limits, the maximum out-of-pocket limits, and the prohibition on insurance policy rescissions.
- Comprehensive coverage. Insurance should cover the major health needs of cancer patients and survivors, including hospitalization, specialty cancer care, physician services, prescription drugs, rehabilitative care, and mental health services.
- Affordable coverage. Affordable premiums and cost-sharing (including deductibles, copays and coinsurance) should be retained to ensure that persons with cancer and survivors can buy and maintain insurance coverage.
- Equitable coverage. Changes should guarantee that people at all income levels have access to an affordable and consistent standard of coverage in every state.
- Preventive care. Preventive care coverage should be maintained as a substantial number of all cancer deaths can be prevented and the substantial cost of the treatment of advanced disease can be reduced through the use of existing evidence-based prevention and early detection strategies.
Future subcommittee actions. The subcommittee has plans to take up legislation sponsored by Rep. Gus Bilirakis (R-Fla.) and Rep. Kurt Schrader (D-Ore.) that would incentivize generic drug development and increase competition in the market. H.R. 749, entitled "To increase competition in the pharmaceutical industry," introduced on January 30, 2017, would require the FDA to prioritize and expedite the review of generic applications for drug products that are currently in shortage or where there are few manufacturers on the market. The bill also would increase transparency around the current generic backlog at the FDA.
By Patricia Hammond, J.D.
The U.S. Attorney General possesses an absolute veto power over voluntary settlements in False Claims Act (FCA) (31 U.S.C. §3729) qui tam actions, the U.S. Court of Appeals for the Fourth Circuit has concluded. A South Carolina district court’s ruling that the government possesses unreviewable veto authority over the action’s proposed settlement despite not intervening in a qui tam action involving various operators of elder care facilities that allegedly fraudulently billed Medicare for services that were not provided, or were provided to patients who were not eligible for them was affirmed on interlocutory appeal.
Unreviewable veto power. In affirming the lower court’s unreviewable veto power decision (see Between a rock and a hard place: U.S. won’t help with trial but blocks settlement, June 29, 2015), the Fourth Circuit relied on the plain language of 31 U.S.C. §3730(b)(1)—that a qui tam action "may be dismissed only if the court and the Attorney General give written consent to the dismissal and their reasons for consenting." The Fourth Circuit noted that §3730(b)(1) does not overtly require the government to satisfy any standard or make any showing reviewable by the court. Further, the Attorney General’s absolute veto authority is entirely consistent with the statutory scheme of the FCA, according to the Fourth Circuit, because—even where the government declines to intervene—the United States is the real party in interest in any FCA suit.
Statistical sampling. Former employees of the elder care facilities operators also challenged the district court’s finding that statistical sampling would be improper to prove their case (see AHA urges Fourth Circuit to strike down false claims extrapolation, March 28, 2016), but the Fourth Circuit concluded that this aspect of the former employees’ appeal was improvidently granted. The district court concluded that the use of statistical sampling evidence could sometimes be permissible, but was not appropriate in this case based on the particular facts and evidence. This conclusion, however, did not raise a pure question of law that is subject to interlocutory appeal. U.S. ex rel. Michael v. Agape Senior Community, Inc., No. 15-2145, February 14, 2017
By Anthony H. Nguyen, J.D.
Memorial Healthcare Systems (MHS) paid the HHS $5.5 million to settle potential violations of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy and Security Rules and agreed to a three-year corrective action plan (CAP). MHS is a nonprofit corporation which operates six hospitals, an urgent care center, a nursing home, and a variety of ancillary health care facilities throughout the South Florida area.
In 2012, MHS submitted a breach report to HHS indicating that two MHS employees inappropriately accessed patient information, including names, dates of birth, and social security numbers. Subsequently, MHS submitted an additional addendum breach report to notify HHS that during its internal investigation, it discovered additional impermissible access by 12 users at affiliated physician offices, potentially affecting over 115,000 individuals in total. Some of these instances led to federal charges relating to selling protected health information (PHI) and filing fraudulent tax returns.
As such, MHS failed to implement procedures to regularly review records of information system activity, such as audit logs, access reports, and security incident tracking reports, as required by 45 CFR Sec. 164.308(a)(l)(ii)(D). MHS also failed MHS failed to implement policies and procedures that establish, document, review, and modify a user's right of access to a workstation, transaction, program, or process, as required by 45 CFR Sec. 164.308(a)(4)(ii)(C).
As part of the resolution agreement, MHS entered into a CAP that requires it to provide the HHS with a risk analysis and management plan within 60 days of the effective date of the CAP. In the event that MHS breaches the CAP, the CAP may be extended and civil monetary penalties may be imposed. Resolution agreement, February 14, 2017
Health care experts have updated and expanded the content of The Health Care Compliance Professional’s Manual (the Manual) in the March 2017 quarterly report to address changes in meaningful use of electronic health records (EHRs), provide practical solutions to internal departmental audits that professionals can put to work immediately, and identify legal solutions for risks involved in information technology contracts for health care software and computer systems. The Manual, which is endorsed by the Health Care Compliance Association (HCCA), now includes the following new and revised chapters:
HITECH Act—Meaningful Use of Electronic Health Records, updated by Angela Alton, CHPC, Deputy Chief Privacy Officer, Sutter Health, and Jacki Monson, J.D., CHC, CHPC, VP and Chief Information Privacy and Security Officer, Sutter Health, provides an overview of the Medicare and Medicaid Electronic Health Record (EHR) Incentive Programs, or meaningful use programs. The chapter provides a synopsis of the various stages of the meaningful use programs, covering both historical developments and current requirements for eligible professionals (EPs), eligible hospitals, and critical access hospitals (CAHs). It also provides information regarding penalties and incentives.
Creating or Enhancing Internal Departmental Audits, written by Glena Jarboe, Compliance Program Manager, and Catherine Masoud, Compliance Manager for External Affairs, Office of Corporate Compliance, University of Kentucky, provides information on how to begin the process for reviewing provider-based and ambulatory clinics that may not be fully integrated with the main hospital as well as free standing clinics that need guidance and structure to meet compliance requirements effectively. This chapter covers how to review contractual arrangements with third parties, satellite activities, research compliance, and provider audits. The authors note that frequently changing regulatory requirements can be addressed through a departmental annual assessment, which can help identify potential areas of risk and provide opportunities to put controls in place that can improve patient care and reduce the chances of external audits.
Addressing Legal Risks in Health Care IT Contracts, a new chapter written by William A. Tanenbaum, Co-Chair of the Technology Transactions practice at Arent Fox LLP, and Randall Stempler, counsel in the Technology Transactions practice at Arent Fox LLP, identifies specific risks present in information technology (IT) agreements for health care software or computer systems and provides legal strategies to address such risks. The chapter covers the roles played by requests for proposals (RFPs), Statements of Work (SOWs), and Master Service Agreements (MSAs) and contains a discussion of the benefits and risk associated with using open-source software and proprietary software.
Health Care Fraud and Abuse Compliance Manual will make you aware of your crucial obligations and options—each chapter describes what the law requires, how it applies in context, and what the penalties are for failure to comply.
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By Jeffrey H. Brochin, J.D.
The HHS Office of Inspector General (OIG) conducted a series of reviews of claims submitted for Medicaid reimbursement by the New York State Department of Health (NYSDH) for dental services billed by two dentists and determined that in both practices, noncompliance issues resulted in unallowable reimbursements totaling $166,000. In both cases, one involving a Westchester County dentist and the other one a Queens dentist, the OIG audits found that dental colleagues who were not enrolled in the Medicaid program provided services for which claims were filed, and adequate documentation to support the services billed was lacking. The reports recommended refunds of the improper payments as well as re-education of the dentists involved as to Medicaid billing requirements.
Dental services. Medicaid covers essential dental services for Medicaid-eligible beneficiaries. In an April 2012 hearing on government efforts to address Medicaid fraud, Congress noted its concerns on waste, fraud, and abuse of certain Medicaid program services, including dental services. Based on Congress’ concerns, the OIG conducted a series of reviews of claims submitted for Medicaid reimbursement by the NYSDH for dental services billed by dentists identified as being potentially at risk for noncompliance with certain federal and state requirements. In the course of the reviews, the OIG identified two dentists who were at risk for billing a potentially excessive number of services during the audit periods.
Westchester County dentist. The Westchester County dentist provided dental services to underserved urban and rural populations at two fixed locations and multiple mobile dental units. The dentist employed or contracted with approximately 25 dentists during the OIG’s audit period of January 1, 2010, through June 30, 2012. During the audit period, the dentist received Medicaid reimbursement totaling $1,927,875 for diagnostic, preventive, endodontic, and restorative dental services provided to 9,804 beneficiaries. Of those beneficiaries, the OIG selected a random sample of 100 beneficiaries and reviewed corresponding claims documentation.
The OIG found that out of the 100-beneficiary sampling, claims associated with 22 of those beneficiaries did not comply with federal and state requirements. For 14 of the 22 beneficiaries, the dentist who performed the services was not enrolled in Medicaid. For services provided to eight other beneficiaries, the dentist did not provide documentation to support the services billed. The OIG estimated that the NYSDH claimed at least $84,437 in federal reimbursement for unallowable dental services billed by the Westchester County dentist.
Queens dentist. The Queens dentist operated a group practice that provided pediatric dental services to underserved urban populations at four locations throughout the borough of Queens. The practice employed several dentists during the January 1, 2010, through June 30, 2012 audit period, during which time the dentist received federal Medicaid reimbursement totaling $918,765 for diagnostic, endodontic, general services, oral surgery, periodontics, preventive, and restorative dental services provided to 4,192 beneficiaries. The OIG again used a random sampling of 100 beneficiaries as the basis for its claims review, and found that 33 of those beneficiaries had dental services performed on them by dentists who were not enrolled in Medicaid. As a result of the non-compliance, the OIG estimated that the NYSDH claimed at least $82,967 in federal Medicaid reimbursement for unallowable dental services.
OIG recommendation. In both cases, the OIG recommended that the NYSDH refund the amount of the claims that were based on unallowable dental services, and the state agency take measures to ensure that future reimbursement claims are only submitted for services rendered by dentists who are enrolled in the Medicaid program. This latter recommendation would require re-educating the dentists as to proper Medicaid billing requirements. OIG Report, No. A-02-13-01033, January 26, 2017; OIG Report, No. A-02-13-01034, January 26, 2017
By Jeffrey H. Brochin, J.D.
A federally qualified health center (FQHC) association that prevailed in a lawsuit challenging New Jersey’s wraparound payments methodology was properly awarded $175,655 in attorney’s fees and costs, a federal district court in New Jersey ruled in an unpublished decision. The association successfully litigated the crucial issue in the litigation and was therefore correctly designated as the prevailing party.
Background: In 2011, the New Jersey Department of Human Services (DHS) changed its methodology for calculating supplemental (wraparound) payments to FQHCs. Under the new system, wraparound payments became contingent upon prior payments by a managed care organization (MCO). New Jersey Primary Care Association (NJPCA), an FQHC association, filed suit alleging that the new methodology violated the federal Medicaid statute, state Medicaid regulations, and the FQHCs’ rights. In July 2012, the court granted NJPCA’s motion for a preliminary injunction requiring the emergency recompense of wraparound payments based on the previous method, and their motion for summary judgment (see Court strikes NJ's changes to FQHC Medicaid payments, July 16, 2012). DHS appealed; however, during the pendency of the appeal, the court awarded NJPCA $175,655 in attorney’s fees and costs and noted that both parties considered the NJPCA the prevailing party for purposes of attorney’s fees.
The Third Circuit affirmed the decision in part after determining that the requirement of prior MCO payment before processing a wraparound reimbursement, absent an effective process by which FQHCs could challenge improperly denied claims, violated the federal Medicaid statute’s requirement that FQHCs receive full and timely wraparound payments. However, it reversed the district court’s decision with respect to the remaining claims upon which the court had granted summary judgment to NJPCA (see New Jersey’s requirement that FQHC wraparound payments be contingent on prior MCO payments violated the federal Medicaid statute, July 10, 2013). DHS then contended that in light of the partial reversal, NJPCA could no longer be considered the prevailing party and thus was not entitled to attorney’s fees. DHS argued in the alternative that the award should be reduced to no more than 10 percent of the original amount. A magistrate judge’s Report and Recommendation to the court recommended that the attorney’s fees be awarded, but that they be reduced by 30 percent.
Award to prevailing party. Under 42 U.S.C. §1988, the court has the discretion to grant reasonable attorney’s fees to a prevailing party, which is defined as one in whose favor a judgment has been rendered, regardless of whether the party has recovered its entire claim or a portion thereof. A prevailing party is one who succeeds on any significant issue in litigation that achieves some of the benefit sought in bringing the lawsuit. Based on this definition, the court found that NJPCA was the prevailing party.
Related versus unrelated claims. DHS argued that NJPCA’s claims should be segregated into two categories: data collection claims and prior payment claims. DHS further argued that the association was unsuccessful on its data collection claims and only partially successful on its prior payment claims, and that therefore only attorney’s fees related to successful claims should be awarded. The court rejected those arguments, noting that the court was not required to tally how many claims were successful or unsuccessful, rather, it considered related versus unrelated claims. Where claims and fees were interrelated, the court’s approach has been to determine whether the claims were based on related legal theories arising from a common core of facts.
Significance of the relief obtained. The court acknowledged that NJPCA did not prevail on all of its claims, however it did prevail on the crucial issue in the dispute. The heart of the dispute was the effort to invalidate DHS’s policy shift requiring prior MCO payment before processing wraparound reimbursements, and to that end, NJPCA was successful. The lawsuit was not to be viewed as a series of discreet claims, but rather, the court was obligated to focus on the significance of the relief obtained—the result being what mattered. Accordingly, the court found it inappropriate to reduce the award and ordered DHS to pay the full amount of attorney’s fees previously awarded. New Jersey Primary Care Association, Inc. v. New Jersey Department of Human Services, Civil Action No. 12-413 (MAS) (TJB), February 10, 2017
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By Paul Clark
Revised Bunionectomy Coding for 2017
Hallux valgus (bunion) is a common forefoot deformity, which typically comprised of a bony prominence at the distal metaphysis (head) of the first metatarsal, lateral deviation of the great toe (hallux) at the first metatarsophalangeal joint, and valgus rotation of the hallux. When symptomatic, this deformity may result in pain, difficulty wearing shoes, and limitation in weight-bearing activities. With over 100 variations of procedures described, Current Procedural Terminology (CPT®) bunionectomy codes are distinguished not only by the severity of the bunion deformity and specific contributing deformities or pathology, but also by the surgical techniques performed to correct those deformities.
The CPT 2017 code set includes significant revisions to the coding and descriptions of hallux valgus (bunionectomy) procedures. Bunionectomy procedures include, if performed, the following intraoperative component procedures: first metatarsophalangeal joint capsulotomy; arthrotomy with or without removal of loose bodies or bursal tissue, synovectomy, and/or synovial biopsy; resection of medial, dorsomedial, dorsal, and/or dorsolateral bone prominences at the metatarsal head and proximal phalanx base; excision of associated osteophytes; articular shaving or drilling; extensor and/or flexor tenorrhaphy, adductor hallucis tendon transfer or tenotomy, and/or tenolysis; placement of internal fixation; intraoperative supervision and positioning of imaging and/or monitoring equipment by surgeon or assistant; first metatarsophalangeal joint capsule plication and/or repair; closure of surgical site; and the applications of initial dressing, splint, and/or cast.
CPT code 28290 has been deleted for 2017. To report, use code 28292.
Nuclear Medicine Parathyroid Gland Studies
A parathyroid gland study is used in nuclear medicine to identify and localize abnormally functioning parathyroid gland tissue. The parathyroids are four small glands lying close to or embedded in the back surface of the thyroid gland, which is situated in the front of the neck. All nuclear medicine diagnostic tests are functional studies. Nuclear medicine parathyroid studies primarily are used to localize hyperfunctioning parathyroid tissue (usually adenomas) in patients with persistent or recurrent disease. Since 2013, parathyroid imaging techniques, proto-cols, and use of a variety of diagnostic radiopharmaceuticals (also called radiotracers or isotopes) have evolved.
It is important to understand the definitions of some terms often used in parathyroid study report:
- Planar imaging is two-dimensional functional imaging;
- Single photon emission computed tomography (SPECT) is three-dimensional functional imaging; and
- SPECT/CT is a SPECT study that utilizes computed tomography (CT) for both attenuation correction and for anatomical localization assistance.
As with all nuclear medicine Current Procedural Terminology (CPT®) codes, a SPECT or SPECT/CT study includes limited planar imaging, and it is not reported separately. “Dual-phase” or “double-phase” imaging refers to the acquisition of both early and delayed imaging, while “dual-isotopes” or “subtraction” imaging refers to proto-cols using two different diagnostic radiopharmaceuticals. “Non-imaging” or “probe technique” includes the injection of a radiotracer followed by the use of a gamma probe to detect the location of the radiotracer. This technique is often used by a surgeon during an operative procedure and may be performed with or without imaging.
Psychiatry Changes for 2017
In 2013, the Psychiatry section of the CPT® code set has been significantly revised. This section continues to evolve to provide granularity to allow appropriate reporting of these services. For 2017, code revisions have been made to distinguish the reporting of codes 90832, 90833, 90834, 90836, 90837, and 90838 for “individual psychotherapy” and codes 90846 and 90847 for “family psychotherapy.” Also, related guidelines have been revised to provide direction on how to report the time spent providing these services. This article provides an overview of these changes.
90832 Psychotherapy, 30 minutes with patient
90833 Psychotherapy, 30 minutes with patient when performed with an evaluation and management service (List separately in addition to the code for primary procedure) (Use 90833 in conjunction with 99201-99255, 99304-99337, 99341-99350)
90834 Psychotherapy, 45 minutes with patient
90836 Psychotherapy, 45 minutes with patient when performed with an evaluation and management service (List separately in addition to the code for primary procedure) (Use 90836 in conjunction with 99201-99255, 99304-99337, 99341-99350)
90837 Psychotherapy, 60 minutes with patient (Use the appropriate prolonged services code [99354, 99355, 99356, 99357] for psychotherapy services not performed with an E/M service of 90 minutes or longer face-to-face with the patient)
90838 Psychotherapy, 60 minutes with patient when performed with an evaluation and management service (List separately in addition to the code for primary procedure) (Use 90838 in conjunction with 99201-99255, 99304-99337, 99341-99350) (Use 90785 in conjunction with 90832, 90833, 90834, 90836, 90837, 90838 when psychotherapy includes interactive complexity services)
90846 Family psychotherapy (without the patient present), 50 minutes
90847 Family psychotherapy (conjoint psychotherapy) (with patient present), 50 minutes
Flexible Laryngoscopy (31575-31579)
For 2017, changes have been made to the Larynx’s Endoscopy subsection of the Respiratory System section of the CPT® code set, which resulted from a CMS high-volume screen to identify potentially misvalued codes. Codes 31575 and 31579 were identified by CMS as being potentially misvalued. As a result of this identification, the entire Respiratory System flexible laryngoscopy code family has been reviewed and revisions and appropriate deletions have been made. Among other changes, codes 31575-31577 have been revised by removing the word “fiberoptic” from the code descriptors. This specific change is intended to clarify that both flexible fiberoptic and flexible distal-chip laryngoscopes may be used to perform these procedures. In addition, codes 31572-31574 have been established to report flexible laryngoscopy with ablation and destruction of lesion, therapeutic injection(s), and injections for augmentation, respectively. Thus, a significant number of services previously reported with unlisted code 31599 will be represented by one of the new codes. Therefore, the overall intent of these changes is to update this code family to reflect current practice. In addition, in concert with these changes, several parentheticals have been revised as well.
Reporting Mammography Services
In the CPT® 2017 code set, the breast mammography imaging codes have been restructured. Changes occurred in the mammography family with respect to the conversion from analog to digital imaging and the prevalence of computer-aided detection (CAD). CAD is now typically performed with mammography. Thus, three new codes (77065, 77066, and 77067) have been added to combine mammography and CAD into single codes, reflecting the current standard of care. As a result of this bundling, the previous mammography CPT codes 77055, 77056, and 77057 and CAD add-on codes 77051 and 77052 have been deleted.
Mammography services with CAD are used for both the detection of breast cancer in asymptomatic patients (screening) and evaluation of patients with an abnormal mammogram or signs and symptoms of breast cancer (diagnostic).
To aid the user, three instructional parentheticals following codes 77062, Digital breast tomosynthesis; bilateral, and 77063, Screening digital breast tomosynthesis, bilateral (List separately in addition to code for primary procedure), have been revised to crosswalk to the new codes.
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 “December 2016.”
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By Harold Bishop, J.D.
Before President Trump and Congressional Republicans fulfill their promises to repeal and replace the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), they need to stabilize the ACA until a new plan is enacted and takes effect. To that end, the Trump Administration issued a Proposed rule designed to stabilize the individual and small group markets by addressing some of insurers' concerns in hopes of keeping them in the marketplace. The Proposed rule would change the standards relating to special enrollment periods (SEPs), guaranteed availability, the timing of the annual open enrollment period (OEP) in the individual market for the 2018 plan year, network adequacy and essential community providers for qualified health plans (QHPs), and the rules around actuarial value requirements. It also announces upcoming changes to the qualified health plan certification timeline.
Need for stabilization. CMS asserts in the rule that the viability and competitiveness of the marketplaces have been threatened by insurer exit and increasing rates in many geographic areas.
Guaranteed availability of coverage. Section 1201 of the ACA requires health insurance issuers offering non-grandfathered coverage in the individual or group market to offer coverage to and accept every individual and employer in the state that applies for such coverage unless an exception applies. However, due to concerns of gaming the system by non-payment of premiums, the rule proposes allowing an issuer to collect premiums for prior unpaid coverage, before enrolling a patient in the next year’s plan with the same issuer. This is designed to incentivize patients to avoid coverage lapses.
Initial and annual open enrollment periods. Section 1311(c)(6)(B) of the ACA gives the HHS Secretary the authority to set the dates for annual enrollment periods. The rule proposes to change the change the OEP for plan year 2018 so that it begins on November 1, 2017, and ends on December 15, 2017. Under the rule, all consumers who select plans on or before December 15, 2017 would continue to receive an enrollment effective date of January 1, 2018. CMS believes that this OEP would align better with many OEPs for employer-based coverage, as well as the OEP for Medicare.
Special enrollment periods. Section 1311(c)(6)(C) of the ACA requires the Secretary to provide SEPs to ensure that people who lose coverage during the year, or who experience other qualifying events such as marriage or the birth of a child, have the opportunity to enroll in new coverage or make changes to existing coverage. In many cases, CMS has permitted individuals to self-attest to their change in circumstances and to enroll during SEPs without further verification.
The rule proposes to expand pre-enrollment verification of eligibility to individuals who newly enroll through SEPs. This proposed change would help make sure that SEPs are available to all who are eligible for them, but will require individuals to submit supporting documentation, a common practice in the employer health insurance market. It is hoped that this requirement will help place downward pressure on premiums, curb abuses, and encourage year-round enrollment.
Level of coverage (actuarial value). Section 1302 of the ACA directs issuers of non-grandfathered individual and small group health insurance plans, including QHPs, to ensure that these plans adhere to the levels of coverage specified in section 1302(d)(1) of the ACA. A plan’s coverage level, or actuarial value (AV), is determined based on its coverage of the essential health benefits for a standard population. Section 1302(d)(1) of the ACA requires a bronze plan to have an AV of 60 percent, a silver plan to have an AV of 70 percent, a gold plan to have an AV of 80 percent, and a platinum plan to have an AV of 90 percent. Section 1302(d)(3) of the ACA authorizes the Secretary to develop guidelines to provide for a de minimis variation in the actuarial valuations used in determining the level of coverage of a plan to account for differences in actuarial estimates.
CMS believes that further flexibility is needed for the AV de minimis range for metal levels to help issuers design new plans for future plan years, thereby promoting competition in the market. Therefore, CMS proposes amending the definition of de minimis to a variation of -4/+2 percentage points, rather than +/-2 percentage points for all non-grandfathered individual and small group market plans that are required to comply with AV. CMS believes that a de minimis amount of -4/+2 percentage points would provide the necessary flexibility to issuers in designing plans while striking the right balance between ensuring comparability of plans within each metal level and allowing plans the flexibility to use convenient and competitive cost-sharing metrics.
Network adequacy. Section 1311(c)(1)(B) of the ACA gives the Secretary the authority to establish minimum criteria for network adequacy that health and dental plans must meet to be certified as QHPs. In recognition of the traditional role states have had in developing and enforcing network adequacy standards, the rule proposes, in the review of QHPs, to defer to the states’ reviews in states with the authority and means to assess issuer network adequacy.
Certification calendar update. In light of the need for issuers to make modifications to their products and applications to accommodate the changes proposed in the proposed rule, CMS plans to issue separate guidance to update the QHP certification calendar and the rate review submission deadlines to give additional time for issuers to develop, and states to review, form and rate filings for the 2018 plan year that reflect these changes.
Comments on the Proposed rule must be submitted by March 7, 2017. Proposed rule, 82 FR 10980, February 15, 2017
By Kayla R. Bryant, J.D.
Under the parameters posed in a draft insurance standards bulletin, insurers planning to participate in the marketplace for the 2018 plan year must submit proposed rate filings by state-established dates, which the Center for Consumer Information and Insurance Oversight (CCIIO) recommends be no later than June 21, 2017. The dates proposed in this bulletin would supersede dates originally established in December 2016.
New deadlines. States are able to set their own due dates for rate filings for single risk pool coverage, as long as the date is not later than June 1, 2017 for states that do not have an effective rate review program. States with an effective rate review program may set a date up until July 17, 2017. The CIIOO proposes requiring states with this program to post relevant information for proposed rate increases subject to review no later than August 1, 2017. CMS intends to post information on proposed rate filings on this date.
The new deadlines would require insurers to finalize all qualified health plan (QHP) rate filings by August 16, 2017. Rate filings that contain only non-QHPs would be due October 6, 2017. On November 1, 2017, CMS would post final rates for all single risk pool coverage, and states would then be required to post this information in turn. CCIIO Draft Bulletin, February 17, 2017
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By John W. Scanlan, J.D.
Failure to warn claims brought by the mother of a child who was born with physical deformities and cognitive disabilities after she used an anti-epileptic drug while pregnant were preempted by federal drug labeling law because the evidence indicated that the U.S. Food and Drug Administration (FDA) would not have approved a stronger warning on the label prior to the child’s birth, the U.S. Court of Appeals for the Sixth Circuit ruled in an unpublished decision affirming an federal district court’s grant of summary judgment favoring the drug manufacturer.
The patient began taking the prescription medication Depakote® and a second drug in 1988 to treat her life-long epilepsy. She became pregnant with her fifth child in 2003, and continued to take Depakote and the other drug during her pregnancy. This child was subsequently diagnosed with physical deformities and cognitive disabilities, including Fetal Valproate Syndrome. Alleging that the Depakote was responsible, she brought various state law claims in 2013 against Abbott Laboratories, the manufacturer of the drug.
The district court limited the testimony of three of her experts by not allowing them to testify as to what warnings or information should have been included in the label for Depakote. The court further determined that her failure to warn claim was preempted by federal drug labeling law to the extent this claim was based on Abbott’s failure to warn of the risk of developmental delays. Later, the court granted summary judgment on her breach of warning claims, but allowed her negligent design, strict liability failure to warn, negligent failure to warn, failure to conform to the manufacturer’s specifications, and punitive damages claims to go to trial. Finally, a federal jury found for Abbott on her remaining claims. The patient appealed the district court’s rulings and asked for a new trial.
Preemption. The lower court did not err in finding that her failure to warn claim was preempted because the evidence showed that FDA would not have approved a stronger warning prior to the patient’s use of Depakote during her pregnancy. The FDA twice rejected attempts by Abbott to strengthen the warnings on the label that the drug adversely affected the development of children exposed to it in utero: once in 2006 in response to Abbott’s Prior Approval Supplement (PAS) submission, and a second time in 2008 in which the FDA stated that “the data do not provide sufficient evidence to support [Depakote] labeling changes at this time.” Given that the agency did not approve Abbott’s request for a label change with a developmental delay warning until 2011, six years after originally requested by Abbott, the Sixth Circuit court reasoned that with even less data available in 2003, the FDA would have rejected such a warning. Therefore, it would not have been possible for Abbott to provide a developmental delay warning in compliance with Ohio product liability law prior to the patient’s 2003-2004 pregnancy while still following FDA’s unwillingness to allow such a warning.
Expert testimony. Although the patient argued that she was entitled to a new trial because she was prejudiced by erroneous rulings limiting the testimony of her experts, the Sixth Circuit upheld these limitations because they were based on its reasonable assessment of the experts’ limitations and were consistent with the rulings of other courts. The patient argued that the district court should have allowed her neurologist, geneticist, and epidemiologist experts to testify as to the adequacy of the Depakote label, but the lower court correctly found that their expertise did not extend to regulatory questions like the patient proposed for them to answer; the Sixth Circuit observed that the experts were permitted to opine on the risks and benefits of Depakote and to compare them to the label. It also was reasonable to prohibit a regulatory expert from testifying that Depakote was known to be the most teratogenic drug as of 2003 because she was not qualified to give that testimony; even if this testimony had been excluded in error, it was not prejudicial because the patient’s other experts were able to provide the same testimony.
Jury instructions. The patient was not entitled to a new trial based upon the district court’s rejection of four of her proposed jury instructions because the instructions given to the jury either substantially covered her instructions or at least did not prejudice her case. Rheinfrank v. Abbott Laboratories, Inc., February 21, 2017
By Jeffrey May, J.D.
Drug purchasers who allegedly were forced to pay monopoly prices for the diabetes drug ACTOS can pursue claims that Takeda Pharmaceuticals, which had held a patent on the active ingredient in ACTOS, unlawfully delayed generic competition from Teva Pharmaceutical Industries, Ltd. in the market, the U.S. Court of Appeals in New York City has decided. However, the plaintiffs could not proceed with monopolization and attempted monopolization claims based on efforts to delay other generic manufacturers. A decision of the federal district court in New York City dismissing the suit with prejudice was affirmed in part, vacated in part, and remanded for further proceedings.
A number of generic manufacturers had attempted to compete with Takeda in the market for ACTOS. According to the plaintiffs, Takeda delayed mass generic entry into the market until more than two years after the patent on the active ingredient in ACTOS expired by falsely describing two patents to the FDA.
Takeda settled pending patent infringement suits with the generic manufacturers, including Teva. Under the settlements, the first three generic manufacturers that filed (all on the same day) an abbreviated new drug application (ANDA) to market a generic version of the drug, as well as Teva, were kept out of the market until August 2012. Teva was permitted to distribute Takeda-manufactured ACTOS product beginning in August 2012, and otherwise enter the market 180 days later. The other six later-filing generic manufacturers were kept from the market for another 180 days after that, i.e., until at least February 2013. January 17, 2011, was the earliest point at which generic forms of ACTOS could have been marketed.
All of the generic drug companies, except Teva, filed a "Paragraph IV certification," certifying that each of the brand’s patents "is invalid or will not be infringed by the manufacture, use, or sale of the new drug for which the application is submitted." The plaintiffs claimed that but for Takeda’s false patent descriptions, the generic applicants (other than Teva) would not have been forced to make Paragraph IV certifications, no 180-day "bottleneck" delay would have arisen, and one or more generics would have entered the market as early as January 2011.
Teva had sought approval via another regulatory mechanism, known as a Section viii ANDA, which is used primarily when the brand’s patent on the drug compound has expired and the brand holds patents on only some approved methods of using the drug. The FDA first preliminarily approved Teva’s application, which would have avoided the 180-day "bottleneck" delay for late filers. Later, the FDA entertained a citizen petition from another drug maker arguing that Teva’s Section viii application should not be approved and seeking to force all applicants to make Paragraph IV certifications. In connection with the citizen petition, Takeda confirmed to the FDA that its patents had been correctly described as both drug product and method-of-use patents in its ACTOS new drug application (NDA). As a result, the FDA announced that all generic manufacturers would be required to take the bottlenecked route. The FDA’s announcement was expressly based on Takeda’s representations that it had correctly described its patents.
The appellate court rejected the plaintiffs' theory based on the delay in the marketing of generic alternatives to ACTOS by all of the generic applicants other than Teva. That theory was implausible because it rested on a necessary premise that those generic applicants were aware of Takeda’s allegedly false patent descriptions when they filed their applications, which was not supported by well-pleaded factual allegations, according to the appellate court. The plaintiffs were required to allege that the generic applicants were aware of Takeda's false descriptions when they filed their ANDAs. Even though the plaintiffs amended their complaint several times, they failed to allege facts in support of the theory. Thus, the plaintiffs’ theory of causation based on the delay of generic applicants other than Teva failed.
Teva’s delayed entry. On the other hand, the plaintiffs’ theory as to Teva did not require any knowledge of the false patent descriptions. The FDA’s announcement that it would consider any ANDA referencing ACTOS that lacked appropriate Paragraph IV certifications ineligible for final approval was itself expressly based on Takeda’s repeated and allegedly false patent descriptions. Thus, Teva's Section viii ANDA was derailed because the FDA credited Takeda’s allegedly false claims. Finding this theory highly plausible, the appellate court rejected the defendants’ assertions that the plaintiffs were required to rule out a litany of alternative possible causes of Teva’s delayed market entry. "Dismissal at this early stage on the basis of speculation about possible and not inherently more plausible alternative causes would be premature," the court explained. In re Actos End-Payor Antitrust Litigation, February 8, 2017
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