Administrative Simplification and Healthcare Reform

In addition to enrollment transactions and demonstration projects, there are two sections in the Healthcare Reform Bill that require significant IT efforts in support of Administrative Simplification:

*Sec. 1104 � Administrative Simplification

*Sec. 10109 � Development of Standards for Financial and Administrative Transactions

Here's a summary:

Operating Rules General Provisions (1104(b)(1)�(3))

Establishes that the standards and associated operating rules adopted by HHS shall, among other things, require minimal augmentation by paper or other communication, describe all data elements (including reason and remark codes) in unambiguous terms, and prohibit additional conditions except where necessary to implement state or federal law or protect against fraud and abuse.

Defines Operating Rules as necessary business rules and guidelines for electronic exchange of information not defined by a standard or its implementation specifications.

Requires HHS to adopt a single set of consensus-based operating rules for each transaction for which standard has been adopted.

Defines criteria for qualified nonprofit entities to provide recommendations on operating rules (entities such as CAQH).

Assigns NCVHS to advise HHS on whether nonprofit entity meets criteria, and whether the recommended operating rules shall be adopted.

Operating Rules Implementation (1104(b)(4))

Requires HHS to adopt operating rules by regulation following recommendations from developer of operating rules, NCVHS and consultation with providers.

Establishes July 1, 2011 as deadline to adopt operating rules for eligibility and claim status transactions, so that they are effective no later than January 1, 2013 (may allow the use of a machine readable identification card).

Establishes July 1, 2012 as deadline to adopt operating rules for Electronic Fund Transfer (EFT) and claim payment/remittance advice transactions, so that they are effective no later than January 1, 2014. Operating rules for EFT and claim payment must allow for automated reconciliation of the electronic payment with the remittance advice.

Establishes July 1, 2014 as deadline to adopt operating rules for health claims or equivalent encounter information, health plan enrollment/disenrollment, health plan premium payment, referral certification and authorization transactions, so that they are effective no later than January 1, 2016.

Requires HHS to use expedite rulemaking (interim final rule with 60 days public comment) in applying any standard or operating rule recommended by NCVHS for the transactions noted above.

Health Plan Certification Requirements (1104(b)(5)(h))

Requires health plans to file a certification statement with HHS no later than December 31, 2013 certifying that the data and information systems for such plan are in compliance with the standards and operating rules for EFT, eligibility, claim status and health care payment/remittance advice transactions.

Requires health plans to file a certification statement with HHS no later than December 31, 2015 certifying that the data and information systems for such plan are in compliance with the standards and operating rules for health claims or equivalent encounter information, health plan enrollment/disenrollment, health plan premium payment, referral certification and authorization transactions AND health claims attachments.

Requires that documentation provided to support certification statement demonstrates that plans conduct the electronic transactions in a manner that fully complies with the regulations and that plans has completed end-to-end testing with their partners.

Requires health plans to extend requirements to business associates through Business Associate Agreements.

Requires health plans to file a certification statement with HHS certifying that the data and information systems are in compliance with any applicable revised standards and associated operating rule adopted under interim final rule promulgated by HHS.

Requires HHS to conduct periodic audits to ensure that health plans are in compliance with standards and operating rules.

HHS Review Committee Provisions (1104(b)(5)(i))

Requires HHS to establish a Review Committee no later than January 1, 2014 to advise HHS on evaluation and review of the adopted standards and operating rules. Review Committee can be NCVHS.

Requires HHS, acting through the Review Committee, to conduct hearings to evaluate and review the adopted standards and operating rules, starting no later than April 1, 2014 and not less than biennially thereafter.

Requires the Review Committee to deliver a report no later than July 1, 2014 (and not less than biennially thereafter) providing recommendations for updating and improving such standards and operating rules; a single set of operating rules per transactions must be provided, maintaining the goal of maximum uniformity in the implementation of electronic standards.

Any amendment of adopted standards and operating rules that has been approved by the Review Committee must be adopted via interim final rulemaking no later than 90 days after receipt of Committee�s report.

Effective date of amendment adopted through interim final rule shall be 25 months following the close of 60-day public comment period.

Requires HHS to adopt a single set of operating rules for any transaction for which a standard has been adopted.

Provisions on Penalty Fees (1104(b)(5)(j))

Requires HHS to assess a penalty fee against a health plan that failed to meet requirements; the fee amount equals $1 per covered life until certification is complete. Covered life for which the plan�s data systems are not in compliance and shall be imposed for each day the plan is not in compliance.

Penalty fee for deliberate misrepresentation is twice the amount imposed for failure to comply.

Penalty fee increases annually by the annual percentage increase in total national health care expenditures.

Penalty cannot exceed on an annual basis an amount equal to $20 per covered life or $40 per covered life for deliberate misrepresentation.

Unique Health Plan Identifier Provisions (1104(c)(1))

Requires HHS to promulgate final rule to establish a unique health plan identifier based on input from NCVHS in a manner that the rule is effective no later than October 1, 2012.

Electronic Fund Transfer Transaction Provisions (1104(c)(2))

Requires HHS to promulgate final rule to establish a standard for EFT no later than January 1, 2012, so that the rule is effective no later than January 1, 2014.

Claim Attachments Provisions (1104(c)(3))

Require HHS to promulgate final rule to establish a standard and a single set of operating rules for health claim attachments that is consistent with X12 version 5010 no later than January 1, 2014, so that the rule is effective no later than January 1, 2016.

Consultation with NCVHS, HIT Policy Committee, HIT Standards Committee, SDOs (10109(a)-(b))

Requires HHS to solicit no later than January 1, 2012, and not less than every 3 years thereafter, input from NCVHS, HIT Policy Committee, HIT Standards Committee and SDOs on whether there could be greater uniformity in financial and administrative activities and items; whether such activities should be considered financial and administrative transactions for which adoption of standards and operating rules would improve the operation of the health care system.

Requires HHS to solicit input no later than January 1, 2012 on the following:

Whether application process, including use of uniform application form for enrollment of health care providers by health plans can be made electronic and standardized.

Whether standards and operating rules shall apply to health care transactions of auto insurance, workers� compensation and other programs or persons not currently covered.

Whether standardized forms could apply to financial audits required by health plans, federal and state agencies, and others.

Whether there could be greater transparency and consistency of methodologies and processes used to establish claim edits used by health plans.

Whether health plans should be required to publish their timeliness of payment rules.

ICD-9 - ICD-10 Crosswalks Provisions (10109(c))

Require HHS to task the ICD-9-CM Coordination and Maintenance Committee to convene a meeting no later than January 1, 2011 to receive input on the crosswalk between ICD-9 and ICD-10 posted on CMS website and make recommendations on appropriate revisions to the crosswalk. Any revised crosswalks shall be treated as a code set for which a standard has been adopted.

Here's a implementation timeline in a simple to read table. Thanks to Walter Suarez at Kaiser Permanente for putting this together!

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David Blumenthal on health IT safety: nothing to see here, move along

At "FDA on Health IT Adverse Consequences: 44 Reported Injuries And 6 Deaths In Two Years, Probably Just Tip of Iceberg" I wrote about a meeting of the HIT Policy Committee, Adoption/Certification Workgroup on February 25, 2010. The topic was "HIT safety." The agenda, presenters and presentations are available at this link.

At this meeting FDA testimony was given by Jeffrey Shuren, Director of FDA�s Center for Devices and Radiological Health. Dr. Shuren noted several categories of health IT-induced adverse consequences known by FDA. This information was striking.

He wrote:

... In the past two years, we have received 260 reports of HIT-related malfunctions with the potential for patient harm � including 44 reported injuries and 6 reported deaths. Because these reports are purely voluntary, they may represent only the tip of the iceberg in terms of the HIT-related problems that exist.

Well, there's absolutely nothing to worry about, according to the Office of the National Coordinator and Dr. David Blumenthal. Nothing to see here. Move on.

Blumenthal has just reportedly stated that:

http://www.massdevice.com/news/blumenthal-evidence-adverse-events-with-emrs-anecdotal-and-fragmented

... [Blumenthal's] department is confident that its mission remains unchanged in trying to push all healthcare establishments to adopt EMRs as a standard practice. "The [ONC] committee [investigating FDA reports of HIT endangement] said that nothing it had found would give them any pause that a policy of introducing EMR's could impede patient safety," he said.

I ask a simple question:

• Are these the words to be reasonably expected from an academic physician/scientist?

Perhaps I'm a bit behind these postmodern times, but I once believed the perhaps now old-fashioned and obsolete view that a scientist would not base a conclusion of medical safety in national dissemination of drug, device, or whatever on some analysis of anecdotal data, whether 'preliminary' or final.

Due to reasons such as the lack of knowledge of FDA as a place to report HIT problems, as well as fear by clinicians in reporting HIT problems at all, the cited FDA data (260 HIT-related adverse events over two years, including 44 reported injuries and six deaths) is most certainly anecdotal and incomplete, and potentially (per FDA's Jeff Shuren, MD, JD) the "tip of the iceberg."

I would not take the FDA data to be anything but a possible red flag, not a source of truth, one way or the other.

For example, the scant reports of health IT bugs and defects -- many of which admittedly could cause medical error -- in another database, MAUDE, voluntarily submitted by just a tiny fraction of the HIT vendors, should give a scientist pause. They are a sentinel. (See my Oct. 2009 post "Our Policy Is To Always Have Unabashed Faith In The Computer ... Except When It Screws Up, And Then It's The Doctor's Fault" for several MAUDE database examples).

(Feb. 2011 addendum - see my more recent post about MAUDE health IT defects reports at this link.)

Obviously, the unreported, unrecognized (and therefore uncorrected) bugs and defects have the same potential. Those MAUDE reports alone should provide an impetus to call for full, rigorous, scientific, uncensored investigations on HIT safety, not make pronouncements on safety to a national audience.

Proof by lack of evidence is not what I was taught in medical school.

Blumenthal appears to be speaking not as a scientist, but as a marketer and (of course) politician.

This is quite disappointing.

However, as the man said, nothing to see here, move along.

By the way, I am assuming the "analysis" will be open to public scrutiny.

-- SS

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Board Member Blows Whistle on Health Insurance Company's Accounting

We previously posted about some of the travails of for-profit health insurance company/ managed care organization Wellcare.  In August, 2009, we posted about Wellcare's "admission" that it had made numerous questionable campaign contributions.  In May, 2009 we posted about WellCare's submission to a deferred prosecution agreemeent based on charges that it defrauded state programs by inflating its expenses. In 2007, we posted about how the state of Connecticut stopped WellCare from running a plan for poor children after the company refused to reveal what it was paying physicians, and why it was failing to pay for particular services. So WellCare has been cited for three different kinds of unethical behavior in 2007-09.

Here's a story about Wellcare with a new twist in the Wall Street Journal:

A prominent director at WellCare Health Plans Inc. resigned Wednesday and raised questions about accounting practices at the Medicare and Medicaid company.

Regina Herzlinger, the head of the board's audit committee and a professor of business administration at Harvard Business School, said internal audits found WellCare overbilled the Illinois Medicaid program by $1 million in 2009 and potentially overcharged states for almost $500,000 worth of maternity care. Additionally, the Tampa, Fla., company ran afoul of Georgia's requirements that it account for each patient visit for which it paid providers, resulting in a $610,000 fine, she said.

Ms. Herzlinger said those problems, which the company corrected last year and this year after an internal auditor discovered them, are evidence of weak accounting practices. Ms. Herzlinger said she had hoped to provide oversight, as chairwoman of the audit committee, but that the board didn't renominate her for re-election at this year's annual meeting of shareholders. Ms. Herzlinger alleges that the board forced her out for asking questions about accounting problems and corporate-governance practices.

Wellcare offered the response one might expect:

WellCare said good corporate-governance practices require it to bring in new board members periodically to provide a fresh perspective. The company said the accounting errors Ms. Herzlinger identified were relatively small and the company's own internal controls identified them, indicating that its processes are working well. The company said the board chose not to renominate Ms. Herzlinger.

'At any company, you are always going to have these kinds of immaterial amounts pop up,' said Thomas Tran, WellCare's chief financial officer, who added that it is important to 'address them and document them and learn from them to change your processes.'

That might have been more convincing were Wellcare not to have the track-record discussed above.

Every now and then we have discussed cases of whistle-blowers from within health care organizations, but I cannot remember another instance in which the whistle-blower was on the board of directors.  In our post of August, 2009, we noted Prof Herzlinger's position on the Wellcare board, and urged her, as a main stream health policy expert, "to acknowledge that health care leadership may be unaccountable, opaque, dishonest, and sometimes flagrantly corrupt."  We also urged her to "pay a bit more attention to the mischief being committed by those who answer to her."  From this new story, it looked like she did just that, and hopefully made a contribution to more transparent and honest governance of health care organizations.  Good for her!

It is time for the often well-paid and not over-worked members of the board of directors of health care corporations to take some responsibility for the actions of the corporations over which they are supposed to exercise stewardship.

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Allergy Medications on Recall List

Perhaps you heard over the week-end that McNeil Consumer Healthcare has recalled numerous medications for "not meeting quality standards". The reasons range from products that "may contain a higher concentration of active ingredient than is specified"; or products that "may contain inactive ingredients that may not meet internal testing requirements"; or products that "may contain tiny particles". Whatever the case, we all need to go through our medicine cabinets and medication pouches.

Benadryl® and Zyrtec® are on the recalled list. So is Tylenol® and Motrin®.

Check out this list of recalled medications. Print it out and compare it to what you have.

To receive a coupon for the future purchase of a product, or to get a refund for an affected product, fill out this form on McNeil Consumer's site.

I'm off to check our medicines....

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Using a Cold Frame for Spring Vegetables

Since I missed my personal blog on Thursday due to the Governor's Healthcare IT Conference, I'm posting one now.

As I've discussed in numerous previous blogs, I grow a significant proportion of my vegetables l between March 1 and October 1. The problem with New England is that the weather is very unpredictable.

How do I deal with a Spring that can be 80 degrees one day and snowing the next?

The answer is that I use Cold Frames for my Spring vegetables, especially lettuces. This year I planed Arugula, Oak Leaf, Red Salad Bowl, Red Verona Chicory, Batavian Endive and Garden Cress in March.

The Cold Frame traps the sun's heat, protects young buds from ice/snow/wind, and keeps the chipmunks from munching the tender leaves.

However, this is one caveat - you need to automatically vent the cold frame in direct proportion to temperatures above 60F, otherwise the Cold Frame becomes and oven that roasts your vegetables.

I modified my Cold Frame with an automated vent/lid opener. As the pneumatic cylinder heats, air expands and automatically opens the lid. In my case, the lid starts to open at 60F and opens fully by 80F.

For the past 3 weeks, all the greens for our family meals have come from the Cold Frame. I use scissors to harvest fresh greens minutes before they're served. In our household, we use just a touch of balsamic vinegar and no oil on our greens. They're great!

Cold Frames are definitely a gardener's friend in New England.

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Medical transcription Outsourcing: Billing method and the bottom line

The method of billing adopted by the medical transcription service provider could have a direct impact on the healthcare facility’s bottom-line

After all any healthcare facility is going for specialist medical transcription services in anticipation of cost saving benefits. It is important to pick a company, which adopts a transparent and simple method of billing.

How complicated could it be? This is an area that is worth studying in detail. According to the principles of MTIA the billing method adopted by a medical transcription service provider should be

Verifiable: The billing method used by a medical transcription service provider should be easy to verify.

Definable: The terms and parameters of the billing method used by the medical transcription service provider should be defined in clear terms.

Measurable: The formulas used by a medical transcription service provider should allow for easy understanding.

Consistent: The method of billing should be consistent for clear understanding and ease of operation. Any changes made in the method of billing should be communicated to the client to avoid inconsistencies

Fair and honest: The billing method used by a medical transcription service provider should be a fair and honest representation of charges for work executed

There are various methods, used for billing, which have been summed up below:

Page: Each page of transcribed material constitutes a billable unit. The problem arises when there is a vast disparity in the content of pages. They could end up paying the same amount for a page consisting of 10 lines, as a page consisting of 45 lines. This would not be indicative of fair payment for services rendered.

Report: The total pages of finished transcription in a report constitute a billable unit. The problem arises when there is a vast disparity in the number of pages in a report. A report could consist of anything between 1 page to 10 pages, which again is not indicative of fair payment for services rendered.

Minute: This means every minute of dictation constitutes a billable unit. This method may seem like a fair one until the healthcare facility considers the different speeds of dictation, the interruptions and distractions faced by doctors during this process. They would be billed for those too!

Gross lines: Simply put, this method consists of visually counting the number of lines. The problem with this method is that it is dependent on the method of formatting used. The amount billed could be more when a Medical Transcriptionist uses tabs and indents excessively.

Character Lines: Character lines are usually defined counting the characters in the finished report and dividing it by a fixed number, say 65. Space and returns are also included. This method is simple, fair and consistent. It has the advantage of being easily verifiable.

TransDyne offers a fair and transparent billing process. TransDyne has adopted the “Character lines” method of billing. This method consists of counting all the characters in a finished report. The total is then divided by 65 to define a Character line. The billing is done on the total number of character lines transcribed.

The process of billing is explained at the very beginning so that what is being paid for is clearly understood. At every stage of the process TransDyne’s team offers further support to explain any clarifications that may be needed. With this billing system in place it ensures that the healthcare facility can rest assured that they are being billed exactly for the services rendered in a fair and verifiable manner.

To avail low-cost medical transcription services from TransDyne, click here

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Sunday Settlement and Guilty Plea Roundup

Here we go again. 

AstraZeneca / Seroquel

We have posted frequently about allegations of devious marketing techniques used by AstraZeneca to promote its blockbuster atypical anti-psychotic drug Seroquel (quetiapine.)  See our posts here, here, here, here, and here.  Now, as reported by the New York Times, it is time for AZ to settle with the US government.

AstraZeneca has completed a deal to pay $520 million to settle federal investigations into marketing practices for its blockbuster schizophrenia drug, Seroquel, the Attorney General, Eric Holder, said at a news conference Tuesday afternoon.

'AstraZeneca paid kickbacks to doctors as part of an illegal scheme to market drugs for unapproved uses,' Kathleen Sebelius, secretary of health and human services, said at the event in Washington. She said the company promoted drugs for unapproved uses by children, the elderly, veterans and prisoners.

AstraZeneca agreed to sign a corporate integrity agreement with the federal government over its marketing of Seroquel for unapproved uses, but will not face criminal charges, company and federal officials said.

The company, based in London, has been accused of misleading doctors and patients by playing up favorable research and not adequately disclosing studies that show Seroquel increases the risk of diabetes.

Of course, an AZ spokesperson had a different take on it.

Glenn Engelmann, AstraZeneca�s U.S. general counsel, released a statement saying the company denies the allegations but settled the investigation with the payment.

'It is in the best interest of AstraZeneca to resolve these matters and to move forward with our business of discovering and developing important, life-changing medicines � while avoiding the delay, uncertainty, and expense of protracted litigation,' Mr. Engelmann said.

Johnson and Johnson / Topamax

On the other hand, the issue of how Johnson and Johnson marketed Topamax (topiramate), a drug approved for treating seizures, is a new one for Health Care Renewal.  Here is the story, via Bloomberg.

Two units of Johnson & Johnson will pay more than $81 million to resolve criminal and civil claims over illegal promotion of the epilepsy drug Topamax, the U.S. Justice Department said.

Ortho-McNeil Pharmaceutical LLC agreed to plead guilty to a misdemeanor and pay a $6.14 million criminal fine for misbranding the drug, the government said. Ortho-McNeil-Janssen Pharmaceuticals also will pay $75.37 million to resolve civil allegations that it illegally marketed Topamax and caused false claims to be submitted to government health programs.

While the Food and Drug Administration approved Topamax for the treatment of partial onset seizures, Ortho-McNeil Pharmaceutical promoted the drug for unapproved psychiatric uses, the government said. The company hired physicians through its 'Doctor-for-a-Day' program to join sales representatives in visiting doctors and to speak to colleagues about unapproved uses and doses, according to the government.

In this case, the company admitted wrong-doing as part of the specific plea agreement.

Under the plea agreement, Ortho-McNeil Pharmaceutical will admit that from 2001 to 2003 it promoted Topamax 'for certain uses not approved' by the FDA, according to a statement by Ortho-McNeil-Janssen.

The company 'voluntarily discontinued the program at issue before receiving the government�s first subpoena in the investigation,' according to the statement.

Ortho-McNeil-Janssen also will sign a five-year corporate integrity agreement with the U.S. Health and Human Services Department.

Summary

Once more, with feeling ....  We have discussed a series of legal settlements and criminal convictions and guilty pleas resolving cases of alleged wrong-doing by health care organizations. Almost none included any penalties for people who authorized, directed or implemented the bad behavior. None of the financial penalties were so big as to be more than another cost of doing business for the organizations involved. Corporate entities, but very rarely people have pleaded guilty or been convicted (almost always of misdemeanors), Some of the cases included gimmicks, like a subsidiary constructed only to plead guilty, that otherwise seemed to lessen accountability.

If we truly want health care that is accessible, of high quality, at a fair price, and more importantly, if we want health care that is honest and focused on patients, we need to provide health care leaders with clear, rational incentives in these directions, and make them fully accountable for their actions, and the courses of their organizations under their leadership.

ADDENDUM (2 May,2010) - See also comments on the Hooked: Ethics, Medicine, and Pharma blog by Dr Howard Brody on the AZ settlement.

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