2010 psow conference - healthcare reform

Healthcare Reform

Healthcare ReformHow Will it

Impact You?How Will it

Impact You?

About Your PresenterAbout Your Presenter

Jerry Miller, NREMT-PCEO/President of LifeQuest

Jerry Miller has been actively involved in the EMS and Fire industry for 31 years

TodayToday

• Ambulance Impact

• Background & Major Points

• As an Employer

TodayToday• Fraud & Abuse

• Quality Patient Care

• Funding

• Q&A

BackgroundBackground• Patient Protection &

Affordable Care Act• (PPACA)

• Became law 3/23/2010

• Healthcare & Education Affordability Reconciliation• Fixes & Corrections

• Became law 3/30/2010

BackgroundBackground• 21 states have filed Federal Lawsuits

• May be Dismissed

• Virginia• May have a Case

• At Issue:• Can the Feds force Healthcare?

BackgroundBackground

Is it a tax or isn’t it a tax?

• Argument – Restricts Personal and Economic Freedoms

BackgroundBackground• Will likely go to the

Supreme Court• Moving to strike down entire bill• Feds moving forward with

implementation

Ambulance ImpactAmbulance Impact

The Good News…The Good News…• Extends MIPPA Payments

• Through December 31, 2010• 2% Urban Ground• 3% Rural Ground• 22.6% Super Rural Ground• Air Ambulance – Rural remains the same

as they were 12/31/2006

The Good News…The Good News…• Retroactive to January 1st, 2010

• Carriers were supposed to begin reimbursement July, 2010

The Bad News…The Bad News…• Productivity Adjustment

• Effective beginning of 2011

• Already applies to other providers, applicable to everyone

• Ensure Medicare Sustainability

The Bad News…The Bad News…• Assumes efficiency each year• Reduces CPI annual updates• Allows for negative fee schedule

updates

The Bad News…The Bad News…

• What is it?• 10 year moving average

• Fee schedule amount subject to the 10 year moving average

The Bad News…The Bad News…• 2010 Negative CPI, however 0%

increase

• PPACA – would have likely been negative increase

The Bad News…The Bad News…• Example: CPI = 1%

• Productivity Adjustment = -1.5%

• Annual Increase = -0.5%

The Bad News…The Bad News…• Productivity Factor

• Difficult for EMS to provide more cost effective care

• Cost of equipment• Cost of ambulances• Cost of operations

• Cost of fuel• Cost of Supplies

• Impact on Patient Care

The Not So Bad The Not So Bad News…News…

• American Ambulance Association

• Advocates– Congress• Exclude EMS???

Background Background & Major Points& Major Points

• Pilot Programs• HHS (Four competitive grants)

• Innovative models of regionalized, comprehensive and accountable emergency care and trauma systems.

• States, Partnership of States, or Indian Tribes

Background Background & Major Points& Major Points

• States• Regionalization

• Regionalization discussions not new to Wisconsin

• Must be consistent region wide management system

Background Background & Major Points& Major Points

• Coverage– Plan to cover 32 million uninsured

• 16 million – State exchanges• 16 million – through Medicaid expansion

Background Background & Major Points& Major Points

• Estimated 23 million will still be uninsured

• How it happens:• Coverage mandates for individuals, employers

and states

Individual MandateIndividual Mandate• Most people (legal) must have

health coverage by 2014

• Penalties for Individuals• 2014 - $95.00 or 1% of taxable income• 2015 - $325.00 or 2% of taxable income• 2016 - $695.00 or 2 ½ % of taxable income

Individual MandateIndividual Mandate• Individual Mandate – Exemptions:

• Financial Hardship• Religious Objections

• 2014 - Must Prove Coverage

• Will impact tax returns

Credits & Cost SharingCredits & Cost Sharing• Eligible:

• Meet Income limits• Employees w/o sufficient coverage or pay share

exceeding 9½ % of income• Legal Immigrants during first 5 years - no Medicaid

Credits & Cost SharingCredits & Cost Sharing• Tax Credits – Income between

133-400% FPL

• Cost Sharing – Reduce Out of Pocket

Expansion of MedicaidExpansion of Medicaid• 2014 – States expand Medicaid

to cover those under 65 with incomes up to 133% of FPL

• Mandates automatic enrollment of new eligibles

Expansion of MedicaidExpansion of Medicaid• 2014 – 2016: States receive Federal

Funding for new eligibles 100%

• 2020 + : States receive Federal Funding for new eligibles 90%

Expansion of MedicaidExpansion of Medicaid• Employer:

• Large employers must offer coverage starting 2014

AmbulanceAmbulance• More good news: 32 million covered

under insurance• Better than nothing

• Down Side:• Low reimbursement rates

AmbulanceAmbulance• We must start now to increase

Medicaid rates

• Grass Roots:• Litigation• Other

AmbulanceAmbulance• Increase use of Ambulance System

• Increase abuse of Ambulance System??

• Community Paramedic Programs?

OptionsOptions• Health Insurance Exchanges

• Purchasing Options• State Exchanges (2 types)

• American Health Benefit Exchanges – No employer coverage

• Small Business Health Options Program– Small employers up to 100 employees

DetailsDetails• Four Categories/Plans

(Bronze-Platinum)• Catastrophic Plan/Under 30

(Option)• (Out of Pocket) Expense is limited

by annual income

DetailsDetails

• Exchange Rules:•Strict Marketing•Contract w/ providers•Accredited•Uniform Enrollment

DetailsDetails• Ambulance

• More affordable for small services•50 FTEs or less

• Save Money• Increase reimbursement potential

DetailsDetails• High Risk Pool

• Those with pre-existing conditions

• Effective 6/21/2010

• Wisconsin Health Insurance Risk Sharing Plan (HIRSP)

New RulesNew Rules

• No prior authorization for emergency services

• Prudent lay person (definition)

New RulesNew Rules

• No lifetime caps after 9/23/2010

• No withdrawing coverage except in cases of fraud

New RulesNew Rules

• Coverage for adult children up to age 26–Wisconsin Age 27•Any insurers current

New RulesNew Rules• No exclusion for preexisting conditions

– Children 9/23/2010, all others 1/1/2014• Process for reviewing increases for 2010• No annual limits/plans - 2014• Eliminate waiting periods for coverage

over 90 days.

New RulesNew Rules• Existing plans grandfathered

except:• Coverage up to age 27• Elimination of waiting periods• Lifetime and Annual caps• Pre-existing conditions

Medicare AdvantageMedicare Advantage• Restructure payments

• Plus 14% - Gone

• Phase in 3 – 6 years starting 2011

• Medicare advantage align with fee for service

Medicare AdvantageMedicare Advantage

•High ratings = Bonus

Medicare AdvantageMedicare Advantage

• Still capped at 12-14% (Current)

• Penalties – Poor Performance

Medicare Advantage: Medicare Advantage: AmbulanceAmbulance

• Watch your rates

• Need to cover losses

• Only mandatory reduction = productivity adjustment

Employer MandatesEmployer Mandates• 2014 – 50 or more FTEs must offer

coverage to FTEs/dependents• FTEs = Average 30 hours per week• No requirement for PT Employees

•Might see more PT employees

Employer MandatesEmployer Mandates

• Penalties:•50 or more FTEs no coverage

•$2000/FTE not including first 30

•01/01/2014

Employer MandatesEmployer Mandates• Unaffordable Coverage

• 50 or more FTE’s can not cost more then 9.5% of household income - if employee opts out•Lesser of $3,000/FTEs or•$2,000 for all FTEs

Employer MandateEmployer Mandate

• Free Choice Voucher• Employee less than 400% FPL & pay

8-9.8% of income for Ins – Employer must offer free choice voucher

• Enables employee to purchase from exchange• Voucher must equal amount employer would

have contributed

Employer MandatesEmployer Mandates

• Free Choice Voucher•Applies to all employers•Excess cost – Employee

Keeps•Tax Deductible

Employer MandatesEmployer Mandates

• Employer/200 FTEs must automatically enroll FTEs

• Give employee opt out option

Employer MandatesEmployer Mandates• 3/1/2013 – Must provide written

notice of:• Exchanges• Entitlement, Credits/Subsidies• Tax Implications• Financial Impact

Employer MandatesEmployer Mandates

• W-2 Reporting•1/1/2011- Must report value

of all Medical, Dental, Vision and Supplemental insurance coverage on W-2

Employer MandatesEmployer Mandates• 2014 – Employers w/ 50 or more

employees – file information return• Report coverage offered and status• Flexible Spending account

• 2013 – Contribution reduced to $2500/per year

• Prescription Required for OTC meds using FSA funds

Employer OptionsEmployer Options• Small Employers

• 50 or less FTEs exempt from penalties

• No duty to provide coverage• 2014 – Can purchase coverage

from small business exchange

Employer OptionsEmployer Options• Tax Credits

• 25 or less FTEs and average annual wage of 50K or less

• Must contribute at least 50% of premium

Employer OptionsEmployer Options• Small Employers

• 2010-2013 – 25 or less FTEs = 35% tax credit of their contribution into premium

• 2014 – Employers with 25 or less FTEs = 50% credit for employers that purchase through exchange

Employer OptionsEmployer Options

• 10 or less FTEs and average annual wage of less than $25K eligible for full credit of premium amount paid by employer

Employer OptionsEmployer Options• Small Employer

• Wellness Program• Grants available for establishing wellness

programs (up to 5 years/ 2011-2015)• Profit or Non-Profit

• Less than 100 employees who work 25 hours or more

• Did not provide wellness program before 3/23/10

Employer OptionsEmployer Options• Ambulance

• Small Services• Benefit from tax breaks and grants• Some increased reporting• Better Healthcare coverage of EMS

Staff/Recruitment

Here It Comes…Here It Comes…

Fraud•350 million over ten years for fraud and abuse.

Claim FilingClaim Filing• Must be submitted 1 calendar year

after date of service

• Medicare MAC creating edits to catch late filing

• Claims over 1 year automatically denied

Anti-KickbacksAnti-Kickbacks• Clarification

• Person need not have actual knowledge of this section…

• Or Specific intent to commit a violation or specific intent to commit a violation

Anti-KickbackAnti-Kickback

Must still prove defendantknew conduct was

unlawful

OverpaymentsOverpayments• New:

• Must provide system to identify overpayments along with written notification

• Must report and return 60 days after overpayment identified

• Hospital – cost based report is due

OverpaymentOverpayment

Must return government money within 60 days

False StatementsFalse Statements

• Knowingly making false statements, omissions or misrepresentation of a fact

• May cause exclusion from federal programs

PenaltiesPenalties• False statement and claims for

payment• Knowingly making false record

or statement •$50K per false statement or record

PenaltiesPenalties• Intentional delay of OIG Inspection

• $15K per day for this failure• False Claims

• 1/1/2011 anti-kickback statue no longer limited to enforcement by the government

•Blood Bath

False ClaimsFalse Claims

Whistle blower can now file suit or ask government to

intervene.

In the News…In the News…“Terms of EMS Billing Settlement Made Public”

Clinton Herald – Sept 14, 2010

The settlement details of a lawsuit that claimed Clinton fire administration overstated ambulance call claims so the department would get more money have been released through city documents.

The city has agreed as part of the settlement to pay the U.S. government $4.5 million in 10 equal yearly amounts starting Oct. 1…

http://clintonherald.com/local/x5456537/Terms-of-EMS-billing-settlement-made-public

False ClaimsFalse Claims• What is a whistle blower?

• Competitor??• Current/Former Employee??• SNF Staff??• Patient??

• Expect a flood of Litigation

False ClaimsFalse Claims

You have to ask yourself, “Is it worth dropping off

that free pizza to the ER?”

OIGOIG• New law broadens OIG authority

to obtain information

• Can include virtually anything

• Expanded subpoena authority

SuspensionSuspension

• Government may suspend payments•For credible allegations of fraud

Mandatory Compliance Mandatory Compliance ProgramsPrograms

• Should already be in place

• Remember outside audits

Recovery Audit Recovery Audit Contractors (RAC)Contractors (RAC)

• Already working in the Midwest

• States required to hire RAC’s

• RAC’s paid to find problems

Provider/Supplier Provider/Supplier ScreeningScreening

• New procedures for screening HHS- new procedures for screening• State Licensure

•Background Checks•Unannounced Visits

•Begins 9/23/2010

Provider/Supplier Provider/Supplier ScreeningScreening

• Fees for new screening:• Starting at $200.00 in 2010

• HHS can pass new rules regarding screening “At Risk Providers.”

QualityQuality

• Overall objective is to improve quality of patient care

• Greater scrutiny over healthcare services

QualityQuality• Can we demonstrate that our

services really work and are effective?

• Can we show that our services are of the highest possible quality and efficiently provided?

QualityQuality• Can we prove that we make a

difference?

• Can we measure “cost effective?”

• Even our QI Systems will come into question.

FundingFunding

•Cost:•938 Billion dollars over 10 years

FundingFunding• How will we pay for it?

• Penalties on individuals and employers• Reduction in Health Reimbursement Accounts• Taxes on HSA’s when not used for qualified

expenses• Increase in Medicare Tax on earnings over $200K• Excise Tax on “Cadillac” health plans• Annual fees on pharmaceutical manufacturing• Tax on medical devices

FundingFunding• How will we pay for it?

• 10% tax on indoor tanning• Limit on deductibility of executive

compensation - $500K• Cuts to Medicare Advantage Program• Cuts in certain hospital payments• Cuts in Medicare Home Health Payments• Cutting Fraud and Abuse

What does it Mean??What does it Mean??

• Not entirely sure•Could increase revenue

• Would certainly increase compliance risk

• Greater scrutiny for quality

Top 10 Things to DoTop 10 Things to Do10.) Watch your Medicare Rates

9.) Watch your Medicare Advantage Rates

8.) Make sure your Employee Benefit Package is Solid/Complaint

7.) Review all of your Contracts

6.) Make refunds timely/Complaint

Top 10 Things to Do Top 10 Things to Do (Cont’d)(Cont’d)

5.) Comprehensive Compliance Program

4.) Collect adequate insurance information, signatures etc.

3.) Watch timely filing limits

2.) Quality of Care

1.) Increase Medicaid Rates

Questions???Questions???

References for this presentation:

Page, Wolfberg & Wirth 2010 May 24. “2010 PWW National Healthcare Reform Webinar”. For more information, visit www.pwwemslaw.com