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News to Note – February 2022

  • January 1st marked the beginning of the No Surprises Act. While this does not fall within the traditional purview of the physician advisor, it is important to be aware of this new legislation since it may indirectly impact our work. Check what your hospital is doing to notify patients of the cost of care.
  • A reminder that “medical necessity” roughly translates to “will this service provide benefit to the patient?” In some cases, it is clear- opening a clogged artery during a heart attack provides benefit. On the other hand, it is not clear that opening a clogged artery in a patient who is not having a heart attack provides benefit. Uncertainty of benefit is the genesis of many disputes. The doctor recommends doing something, but the payer doesn’t want to pay because the benefit is not proven. In the British Medical Journal, they just published a review article looking at the data supporting the clinical effectiveness of some common orthopedic procedures. There is not a lot of data supporting many procedures including arthroscopic rotator cuff repair and lumbar spine fusion. This does not mean that these surgeries don’t work. The lack of data does not mean there is lack of efficacy. This review had very strict requirements. Literature reviews like this certainly have the potential to lead to many more disputes over medical necessity but should also make us think twice about whether our care is truly benefitting patients.
  • An interesting Office of Inspector General (OIG) audit was published late December, looking at a hospital in New York. This one was interesting for two reasons. The first was that this hospital was selected because, as the OIG stated, the hospital was high risk for noncompliance based upon its refusal to enter into a Corporate Integrity Agreement after settling two False Claims Act cases. Second, this audit found the hospital was correct in 94 of 100 charts audited. A 6% error rate is unprecedented. Almost no one does that well. An audit of a Medicare Advantage (MA) plan released recently had a 65% error rate. 5 of the 6 denied charts were short stay inpatient denials. The OIG extrapolated the result and demanded a repayment.
  • The official public health emergency has been extended another 90 days.
  • As a reminder, the new Alzheimer’s dementia medication continues through the CMS review process for coverage. Aduhelm is an intravenous medication that works to reduce amyloid plaque in the brain. The problem is that the clinical trials that led to FDA approval did show reduction in plaque but no improvement in the patient’s dementia. The medical community was nearly unanimous in opposing this approval because of the reliance of the FDA on a surrogate marker. Initially the drug was priced at $56,000 a year, although the company did lower the price 50% in December. This high cost contributed to CMS to drastically increasing the 2022 part B premiums to cover the potential costs to the Trust Fund. CMS has now released a draft National Coverage Determination for the general class of medications, called monoclonal antibodies directed against Amyloid. And CMS made the safe choice, stating that these medications would only be covered by Medicare as part of an approved clinical trial. Now this is not unusual, there are several current treatments with an NCD that requires a clinical trial such as the use of leadless pacemakers or stem cell transplant for treatment of myeloma. CMS also limited it to administration in a hospital-based clinic, prohibiting doctors from administering it in the office. They are also allowing coverage of one PET scan, which is currently not a covered benefit but it is unclear how that will work since the PET scan will be covered for those enrolled in a trial but you cannot enroll in a trial unless you have plaque which is only detected with a PET scan or a lumbar puncture. Ultimately, this decision has made no one happy. The clinical trial has to be designed, patients recruited, and monitored and it could be years before there are results so this will limit usage tremendously. Advocacy groups are upset that patients won’t have access to a potentially effective drug and most physicians are upset that CMS is even allowing any Medicare money to be spent on a novel medication with no proven efficacy. If there is one bright spot, it is that CMS is requiring that any clinical trial have enrollment that is diverse and inclusive and include traditionally underrepresented groups. There was a 30-day comment period and CMS will release their final decision in April. In the meantime, CMS will be reevaluating the part B premium increases they imposed and see if they can be adjusted mid-year.
  • The Center for Medicare Advocacy is a Medicare beneficiary advocacy organization. In January they published a paper entitled “The Role of AI-Powered Decision-Making Technology in Medicare Coverage Determinations” written by Lyla Saxena. In it, she analyzes how tools like InterQual, MCG, and NaviHealth are used by payers to determine if coverage will be provided for hospital care, nursing home admission, home care services, and so on. The article is not a criticism of the tools themselves but points out their limitations, many of which the companies themselves have discussed. The article does a great job of analyzing the way these tools are misused by payers to deny covered care to patients.
  • Another interesting paper was published entitled “Addressing the Confusing Costs of Observation Hospitalizations”. This was written by several doctors including Drs Ann Sheehy, Charles Locke, and Bart Caponi. In their article they criticize the confusing way that hospital stays status are determined and paid by payers. They are especially critical of the Medicare Advantage plans and their tactics, pointing out that the MA plans will approve inpatient admissions and then retrospectively deny those same admissions. They go on to point out the fact we all know that the whole concept of observation is an artificial construct, and they call on CMS to either mandate that MA plans follow the two midnight rule or abolish the whole concept of observation and simply call every hospital patient an inpatient.
  • CMS has released an update to the manual provisions for the Important Message from Medicare effective in April.
  • Important clarifications: There does not need to be a discharge order in the chart when the patient requests an appeal, but the notes should indicate the patient is stable for discharge. Second, you must retain a copy of the follow-up Important Message that was provided to the patient with a notation of the date that it was delivered. The patient does not need to sign but someone must indicate it was delivered. If you deliver that original or follow-up copy on the day of discharge, you still have to offer 4 hours for the patient to think about appealing (though they do not have to stay the full 4 hours). If you must deliver the IM to a representative (even if via phone), you must still send them a copy and get proof of delivery. You can leave it by the bedside but that alone is not enough.
  • David Glaser, a prominent health care attorney, reported recently that the UPIC auditor CoventBridge was using an obsolete definition of inpatient, denying admissions for not requiring “an inpatient level of care.” Nina Youngstrom also wrote about it in the Report on Medicare Compliance. We should always stand up for what is proper, no matter which side made the mistake. If you face an auditor using outdated standards, speak up!
  • For the last 12 years, there has been a case in the court system about patients who were never admitted as inpatient and went to a nursing home without part A coverage and had to pay. We know one of the results of a similar situation was the NOTICE Act and CMS developing the Medicare Outpatient Observation Notice. Well in this case, the courts have determined that some patients who were admitted as inpatient and then switched to outpatient via condition code 44 have lost what is called a property right and therefore should be granted expedited appeal rights. CMS still must interpret the ruling, develop a formal notice, write manual instructions, allow public comments and so on. It took over 6 months from the NOTICE Act to the release of the MOON so we have time before we have to start a new process.


**The news above in addition to many other points of interest for Physician Advisors and other leaders in health care can be heard weekly during Dr. Ronald Hirsch’s Monday Rounds segment on RACmonitor.com’s Monitor Monday webcast/podcast. Learn More


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