Important Dates
From the Statehouse
From the Third Party Payer Consultant
From the Legal Counsel
Asset
Protection
Important Dates
2010 Annual
Meeting
April 17, 2010
The Westin Princeton
2011 Annual
Meeting
April 16, 2011
The Westin Princeton
More details to
come!
From the Statehouse....Beverly
J. Lynch
The 214th legislative session has recently convened (January 12)
and we have sworn in a new Governor (January 19). We are
awaiting appointments to key administrative offices. As we go
to print, Tom Considine, formerly of MetLife, has been named
Commissioner of the Department of Banking and Insurance, and Dr.
Poonam Alaigh to serve as Commissioner of Health and Senior
Services.
Dr. Alaigh is the Executive Director at Horizon Blue Cross Blue
Shield of New Jersey where she is responsible for the major
clinical areas that ensure the delivery of healthcare. Prior to
joining Horizon BCBSNJ, Dr. Alaigh served as National Medical
Director for GlaxoSmithKline and was working with health plans
on a number of national issues, including better use of health
care technology, the reduction of disparities in health care and
healthcare access to the under and uninsured population. Dr.
Alaigh continues her clinical work at the New Jersey Veterans
Administration at Lyons, providing direct patient care and is an
Assistant Professor in the Department of Family Practice at
UMDNJ / Robert Wood Johnson University Medical School. Dr.
Alaigh has had publications in the field of vascular disease and
population health. She is a board certified internist with a
specialty in vascular diseases and is certified as a Diplomate
in Internal Medicine and licensed to practice in New York and
New Jersey. She graduated from the University of Delhi, New
Delhi, India and received her MD and her Masters in Health Care
Policy and Management at State University of New York at Stony
Brook, NY.
The "lame duck" session was frenetic and several bills that were
important to the physician community were acted upon. As
expected, we were playing "offense" and "defense" during this
lame duck session. Of utmost importance to the physician
community, the "wrongful death" legislation was
not considered by either house. Thanks to the many physicians
who answered our "call to action" and worked to support our
opposition to this onerous measure.
Assignment of
Benefits (S-114/A-132)
Finally....after years of negotiating and lobbying, an
assignment of benefits bill was signed by the Governor
on January 16. This law provides that, with respect to a
carrier that issues a managed care plan with an out-of-network
benefit, in the event that the covered person assigns, through
an assignment of benefits, his right to receive reimbursement
for medically necessary health care services to an
out-of-network health care provider, the carrier shall remit
payment for the reimbursement directly to the health care
provider in the form of a check payable to the health care
provider, or in the alternative, to the health care provider and
the covered person, as joint payees, with a signature line for
each of the payees.
Any payment made only to a covered person rather than the
out-of-network provider under these circumstances shall be
considered unpaid under the prompt pay law and, unless remitted
to the health care provider within the time frames established
under the prompt pay law, shall be considered overdue and
subject to an interest charge as provided in that law.
Many physician and provider groups have worked hard to gain
passage of this important initiative....and while we agree it's
not perfect, it is considered by the supporters to be a
significant victory for the provider community.
The Committee chairman, Assemblyman Gary Schaer (D-Passaic)
stated publically he plans to work next on the issue of "out of
network" costs, so we have new challenges ahead.
Medical Marijuana
(S-119)
This controversial measure, which Gov. Corzine signed on January
18, made New Jersey the 14th state to allow patients with
debilitating medical conditions to use marijuana to relieve
severe pain. Under the New Jersey Compassionate Use Medical
Marijuana Act, people suffering from conditions such as cancer,
glaucoma, HIV, AIDS, seizures, muscle spasms and multiple
sclerosis would be protected from arrest, prosecution and
penalty.
Alaska, California, Colorado, Hawaii, Maine, Michigan, Montana,
Nevada, New Mexico, Oregon, Rhode Island, Vermont and Washington
have laws that effectively removed state-level criminal
penalties for medical marijuana.
Under the law, a patient diagnosed by their doctor as having a
qualifying debilitating medical condition would be allowed to
receive medical marijuana, with a limit on the amount that can
be accessed in one month, with approval from a physician through
a state registry system.
The state will establish a registration program authorizing
non-profit alternative treatment centers to produce and dispense
marijuana for medical purposes. A patient would only be able to
register at one alternative center at a time and would have to
use the prescription within one month of it being written.
Patients will be allowed to use a courier or delivery option to
receive the medical marijuana from the alternative center, and
the state will have to license at least two centers in each of
the state's north, central and south regions.
Only qualified doctors with ongoing responsibility for the
ongoing treatment of the condition triggering the need for
medical marijuana would be able to prescribe it, and physician
recommendations would be tracked similar to current law
requiring tracking of drugs under the New Jersey Controlled
Dangerous Substances Act.
Medical Liability
Rate Oversight (A-4245)
Put forward by the NJ Department of Banking and Insurance, this
legislation would create more predictability in New Jersey's
volatile medical malpractice liability insurance industry and
ease pressures on high-risk health care. The bill, which was
signed by the Governor on January 16, will require the
Department of Banking and Insurance (DOBI) to annually designate
a flexible "rate band" for medical malpractice liability
insurance rate increases. Under the law, DOBI will specify a
range of rate change - either an increase or decrease between
five and fifteen percent - in regards to medical malpractice
liability insurance rates. Any rate, supplementary rate
information, or change or policy amendment filed by an insurer
or rating organization which proposes a rate change exceeding
the designated flexible rate band would be subject to DOBI
approval.
Electronic Prescription Transmittal (A-4229)
This new law (signed on January 17, 2010) authorizes the use by
prescribers of electronic health record (EHR) programs to print
New Jersey Prescription Blanks for transmission to a
pharmacist. Specifically, the law provides that a practitioner
or health care facility licensed in New Jersey may utilize an
EHR program to imprint the practitioner's name and license
number or the unique provider number assigned to a health care
facility on a blank New Jersey Prescription Blank for
transmission to a pharmacist, provided that:
-
the EHR
program will imprint on the blank form all such identifying
information about the prescriber as is required by
regulation of the Director of the Division of Consumer
Affairs (DCA) in the Department of Law and Public Safety;
and
-
the blank form
is obtained from a vendor approved by DCA, bears an
identifiable logo or symbol approved by DCA, and bears a
preprinted serial number as specified by DCA.
The law takes effect on the 180th day after enactment, but
authorizes the Director of DCA to take anticipatory
administrative action in advance as necessary for its
implementation.
ASC Reporting
(S-2312)
This legislation, which also passed late in lame duck and was
signed by the Governor on January 17, designates a common
billing form for all ambulatory care centers that would be given
to each patient. In addition, a uniform reporting system for
the licensed ambulatory centers concerning their financial and
patient data (including facility-associated infection rates)
will be established by the Department of Health and Senior
Services. Finally, the measure would require all physicians who
perform services for the free-standing ambulatory care centers
to be identified. The law previously had required much more
extensive financial reporting, that would mirror hospital
requirements, but that was deleted in the Assembly committee.
For information on these or any legislative measures, please
contact me at
BLYNCH@BLYNCHASSOCIATES.COM or 609-392-7553.
From the Third Party Payer
Consultant....James McNally, CPC
Medicare Fees for
January – February 2010 Posted to Highmark Medicare Services
Web Site
The fees that are now posted on the Highmark Medicare Services
(HMS) web site are the correct fees to use during January and
February 2010.
These fees were recalculated using the 2009 Conversion Factor,
since the President signed the Medicare freeze into law on
December 21, 2009.
Therefore, claims released after January 15, 2010 by HMS will be
paid using these fees for dates of service January 1, 2010
through February 28, 2010.
They reflect the consultation policy change and other increases
in the practice expenses for certain other services. In
addition, this temporary calculation is based on the 2009
Conversion Factor and will be in play until February 28, 2010 or
until Congress makes any additional changes.
To download a copy in PDF, Excel, or Text format, go to the link
below and click on the appropriate links under “2010 January 1 -
February 28 - New Jersey Fee Schedule”.
https://www.highmarkmedicareservices.com/partb/reimbursement/feedb-2010.html
Medicare Announces New
Non-Covered Modifiers for ABN Usage
CMS has announced plans to update the ABN modifiers effective
April 1, 2010.
Modifier GA should be used for items or services that may be
denied as not reasonable or necessary and has been revised to
read, “Waiver of liability statement issued as required by payer
policy.” You’ll use this when a required ABN was issued as
dictated by instructions in an LCD.
The Advanced Beneficiary Notice (ABN) and the GA modifier must
be used each time a procedure or service is provided. An example
would be when a test is performed more often than the Local
Coverage Determination (LCD) policy allows or a diagnosis is not
on a Covered Indications list for a given procedure.
Modifier GX — GX is a new modifier and has been created with the
definition “Notice of Liability Issued, Voluntary under Payer
Policy” which should be used to report when a voluntary
ABN was issued for a service.
Modifier GX should be used when you expect that the item or
service will be denied because it is program exclusion or does
not meet the definition of any Medicare benefit such as
refraction, cosmetic surgery, or a personal comfort item.
No Medicare ABN is needed. You add the GX modifier when
submitting a claim at the patient’s request, since the patient
needs the Medicare denial before submitting a claim to a
secondary insurance.
You may use the –GX modifier to provide beneficiaries with
voluntary notice of liability regarding services excluded from
Medicare coverage by statute, and in these cases, you may report
it on the same line as certain other liability-related
modifiers. Please note that the –GX modifier must be submitted
with non-covered charges only, and your FI or A/B MAC will deny
the claim as a beneficiary liability.
Please note that you don’t have to issue an ABN and submit the
claim to your carrier with a modifier appended for services that
are statutorily non-covered or program exclusions such as
refraction and routine exams under Medicare.
To read more, see the MLN Matters article at:
http://www.cms.hhs.gov/MLNMattersArticles/downloads/MM6563.pdf
Physicians Get Direction
on Earning EHR-Adoption Bonus
The Department of Health and Human Services (HHS) recently
released an interim and proposed rule on its electronic health
record (EHR) incentive program, and the initial set of EHR
technology standards and certification criteria. Beginning in
2011, physicians can earn up to $44,000 in incentives for
demonstrating “meaningful use” of certified EHR systems as
outlined at the link here.
See Table 1 – Page 12 -
http://edocket.access.gpo.gov/2010/pdf/E9-31217.pdf
In order to receive the incentive, a provider has to
demonstrate meaningful use of a certified EHR:
Meaningful use will be defined in three stages through
rulemaking: stage 1 starts in 2011, stage 2 in 2013 and stage 3
in 2015. Stages 2 and 3 will be defined in future CMS
rulemaking. In order to qualify for the incentive during
stage 1 (see link below), a provider’s certified EHR must
See Table 2 – Page 25 -
http://edocket.access.gpo.gov/2010/pdf/E9-31217.pdf
Providers will have to attest that they use certified EHR
technology to report on a core set of measures and a subset of
clinical measures most appropriate to their specialty.
Those who do not adopt and become “meaningful users” by 2015
face financial penalties in 2016.
Reminder on Ordering/Referring
Physician PECOS Mandate
Physicians are reminded that effective April 2010, the
Ordering/Referring Physician PECOS mandate goes into effect and
claims will begin to be denied as per the following scenarios.
-
During
Phase 2, (April 5, 2010 and thereafter): If the billed
item or service requires an ordering/referring provider and
the ordering/referring provider is not in the claim, the
claim will not be paid. It will be rejected. If the
ordering/referring provider is on the claim, Medicare will
verify that the ordering/referring provider is in PECOS and
eligible to order and refer. If the ordering/referring
provider is not in PECOS, the carrier or Part B MAC will
search its claims system for the ordering/referring
provider. If the ordering/referring provider is not in PECOS
and is not in the claims system, the claim will not be paid.
It will be rejected. If the ordering/referring provider is
in PECOS or the claims system but is not of the specialty to
order or refer, the claim will not be paid. It will be
rejected.
-
In both
phases, Medicare will verify the NPI and the name of the
ordering/referring provider reported in the claim against
PECOS or, if the ordering/referring provider is not in
PECOS, against the claims system. In paper claims, be sure
not to use periods or commas within the name of the
ordering/referring provider. Hyphenated names are
permissible.
-
Providers who
order or refer may want to verify their enrollment in
PECOS as Medicare may already have entered your enrollment
information into PECOS if you made any changes to your
enrollment information over the last 6 years. They may do so
by accessing the Internet-based PECOS web site at:
https://pecos.cms.hhs.gov/pecos/login.do
If
you have made NO changes to your enrollment information
over the last 6 years, you may not be in the PECOS system but
may want to set up a record on a going forward basis as any
future changes can then be done on-line instead of through the
cumbersome paper application process.
Before using Internet-based PECOS, providers should read the
educational material about Internet-based PECOS that is
available at the link here:
http://www.cms.hhs.gov/MedicareProviderSupEnroll/04_InternetbasedPECOS.asp
Once at that site, scroll to the downloads section of that page
and click on the materials that apply to you and your practice.
For guidance on this issue, contact us through the Third Party
Insurance Help Program.
Legal Report...Kern
Augustine Conroy & Schoppmann, P.C.
Proposed Regulations Define Meaningful Use for EHR
Incentive Payment Programs
The Centers for Medicare & Medicaid Services (CMS) has proposed
a regulation that, if adopted, will define "meaningful use" of
electronic health records (EHR). Being able to meet meaningful
use is essential for physicians to receive payments of $40,000
or more each for implementing EHRs in their offices. The
proposed rule calls for a roll out of the criteria for
meaningful use in three stages over the next several years.
Stage 1, beginning in 2011, requires that eligible physicians
meet twenty five objectives or measures, most of which are
already incorporated into many of the commercially available EHR
programs. For a list of the criteria, go to:
www.drlaw.com/meaningfuluse/
CMS has not indicated when it will issue specifications for
Stages 2 and 3, nor the deadlines to meet these requirements.
Physicians are urged to begin implementation of EHR immediately,
since delay can jeopardize receiving the substantial available
government payments. For more information on EHR, contact Kern
Augustine.
Governor's Transition Subcommittee Targets Out-Of-Network
ASCs
On January 22, 2010, NJ Governor Chris Christie unveiled his
transition report. Included within the report, the Health
Subcommittee takes a scathing swipe at ASCs and other ambulatory
care centers for trying to fight back against low-paying network
contracts. The report accuses some ASCs of "egregious billing
practices" when they choose to terminate their network
agreements with payors. The Subcommittee includes in its
attack: "Some ASCs and ACCs are organized and owned by a group
of in-network specialty physicians who perform the surgical or
other procedure at the out-of-network facility. By waiving the
out-of-network deductible, coinsurance or co-payment, the
out-of-network provider eliminates the disincentive for a
patient to use an often more costly provider. Medicare considers
the waiver of member liability per se fraud except in hardship
cases." To penalize these provider and patient choices, the
Subcommittee recommends placing a cap on out-of-network charges,
prohibiting waiver of member liability except in hardship cases,
making ASCs subject to the same regulations as hospitals,
requiring public posting of list prices charged to uninsured
patients by all ASCs/ACCs, and imposing additional assessments
on ASCs to provide financial support to distressed hospitals.
The Banking and Insurance Subcommittee calls payments to
out-of-network providers a "problem with no light at the end of
the tunnel" made worse by the enactment of the new assignment of
benefits law which is favorable to providers. This Subcommittee
also laments the Office of Insurance Fraud Prosecutor as
ineffective, underutilized, and uneven because it has not
produced a volume of prosecutions commensurate with its funding,
including a lack of prosecutions in Camden, Atlantic City, Cape
May and Trenton. Structural changes are recommended to beef up
prosecutions. The report also notes that the Medicaid Fraud
Unit suffers similar ineffectiveness except in the area of False
Claims Act prosecutions which have been very cost-effective for
the state, generating "tens of millions of dollars" while
utilizing relatively few resources. The report is at:
http://www.state.nj.us/governor/news/news/55_2010/approved/20100122a_reports.html
Tort Reform Would Save $54 Billion
A new study by the non-partisan Congressional Budget Office (CBO)
finds that health care costs would be reduced by $54 billion
over the next ten years if Congress were to pass a common
package of tort reforms. The study also found no clear evidence
that tort reform would diminish health care. According to the
CBO, tort reform would lower costs for health care both
directly, by reducing medical malpractice costs by $13 billion,
or ten percent, and indirectly, by $41 billion, by reducing the
use of health care services through changes in the practice
patterns of providers. That amounts to a 0.5 percent reduction
in total national health spending. Hopefully, this new report
will re-energize efforts to reform our tort system.
NJ Physicians Take Note: MultiPlan Persuaded to Modify
Fee Negotiation Agreement Forms
MultiPlan of New York has agreed to revise agreements that led
to confusion among physicians regarding reimbursement rates for
out-of-network benefits. Physicians reported receiving "fee
negotiation agreements" or "expedited fee negotiation
agreements" by facsimile after verbally negotiating the rate of
an out-of-network service provided to a patient, or sometimes,
for no reason at all. MultiPlan informed out-of-network
providers that entering into these agreements would expedite
reimbursement. Some physicians reported to the American Medical
Association that MultiPlan threatened to reduce reimbursement
rates and take longer to process claims if they did not respond
to or enter into these agreements. Many physicians executed the
agreements not realizing that they were agreeing to a fixed
reimbursement rate and that they could not balance bill their
patients. The efforts of the AMA and state medical societies
resulted in MultiPlan's acquiescence to revise the agreement
forms, and provide clarifying information which will minimize
the instances of physicians falling prey to these deceptive
practices.
CMS 2010 Physician Fee Schedule Reminder
As previously reported, the 2010 Medicare Physician Fee
Schedule, effective January 1, 2010, contains several critical
changes including ending payment for nearly all consultation
codes. The Centers for Medicare and Medicaid Services (CMS) is
also undertaking aggressive efforts to determine if Part B
suppliers have provided accurate and updated enrollment
information to CMS. Failure to timely respond to correspondence
from CMS regarding revalidation could result in nonpayment of
claims, suspension of billing privileges, and a one year bar on
re-enrollment. Providers and suppliers are encouraged to review
all correspondence received from CMS as well as review billing
and coding practices to ensure compliance.
For more information on any of the above items, visit
www.drlaw.com.
Asset Protection: Most Common
Planning Mistakes and Oversights...Dave Vargo, CFP, CMFC
As
I mentioned in December's article, the most common types of
ownership for vacation/Second homes are Joint Tenancy with Right
of Survivorship (JTWROS) and Tenants in Common (TIC). In the
event of a lawsuit neither of these types of ownership would
afford you much, if any, protection from creditors.
A
better strategy could be to have your home owned by a Qualified
Personal Residence Trust (QPRT). If set up and funded properly,
a QPRT will not only provide you with excellent protection from
potential creditors but can also reduce the size of your taxable
estate thereby reducing estate taxes.
Here's how it works. You gift the residence to an irrevocable
trust for the benefit of your children and retain the right to
live in the home for a fixed number of years. At the end of the
term, assuming that you are still living, your children will now
own your home. The value of your home is discounted because it
is based on its remainder interest. The amount of the discount
will be based on your age at the time of the gift and length of
the trust term. Once gifted, all future capital appreciation is
removed from your estate.
Here is an example of a recent QPRT that we did for a client's
vacation home in Long Beach Island. Prior to the recent real
estate market decline the home was valued at $1,750,000. A
recent appraisal valued the home at $1,450,000. The remainder
interest discount brought the value of the gift down to
$950,000. Assuming that you outlive the term of the trust, the
$800,000 of assets are transferred to your kids free of gift and
estate taxes. Furthermore, the value of all appreciation on the
residence during the term of the trust is also removed from your
estate.
When the term of the trust ends, if you want to remain in the
residence, you will have to pay fair market rent to your kids.
This might not sound appealing but actually provides further
estate planning advantages because rental payments are removed
from your estate and are not subject to gift taxes.
This is a very complicated strategy that I have just touched the
surface on. If you would like to discuss in further detail
please contact me at (877) 972-7900 or
dvargo@varbeco.com.
David J. Vargo, CFP®, CMFC
President, Varbeco Wealth Management,LLC
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