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September 15, 2014 Regulatory Developments

September 16, 2014 | No Comments
Posted by Beth Christian

Here are the most recent health care related regulatory developments as published in the New Jersey Register on September 15, 2014:

  • On September 15, 2014 at 46 N.J.R. 1968, the Division of Taxation published notice of its proposal of a new rule which is intended to clarify the categories of drugs and durable medical equipment which are exempt from New Jersey sales and use tax.

September 2, 2014 Regulatory Developments

September 11, 2014 | No Comments
Posted by Beth Christian

Here are the most recent health care related regulatory developments as published in the New Jersey Register on September 2, 2014:

  • On September 2, 2014 at 46 N.J.R. 1882, the Department of Human Services published notice of its readoption of its rules governing the Senior Gold prescription program.
  • On September 2, 2014 at 46 N.J.R. 1883, the Department of Human Services published notice of its readoption of its rules governing pharmaceutical services under the Senior Gold program.
  • On September 2, 2014 at 46 N.J.R. 1910, the State Board of Social Work Examiners published notice of its action on a petition for rulemaking filed by the New Jersey Association of Mental Health and Addiction Agencies, Inc.  The Board denied the NJAMHAA’s request that it be recognized as an approved provider of continuing education hours for social workers.

Legislature Expands Health Care Service Firm Licensing Requirements

September 5, 2014 | No Comments
Posted by Beth Christian

Recent amendments to the health care service firm law will require companies providing companion services in New Jersey to become registered as a health care service firm.  Currently, entities that place or arrange for the placement of personnel to provide health care or provide personal care services in the personal residence of a person with a disability or a senior citizen aged 60 or older must become registered as a health care service firm.  As a result of the amendments to the law, companion service providers will also need to become registered.  The term “companion services” is defined in the law as non-medical, basic supervision and socialization services which do not include assistance with activities of daily living and which are provided in the individual’s home.  Companion services may include the performance of household chores.  In addition, all registered health care service firms will be required to obtain accreditation from an accrediting body that is recognized by the Commissioner of Human Services as an accrediting body for homemaker agencies participating in the Medicaid program.  Health care service firms will also be required to submit an audit report with an unqualified opinion and a management letter.  The amendments to the law will take effect 18 months after their August 1, 2014 enactment.

Physician Compensation under Medicaid

August 29, 2014 | No Comments
Posted by Frank Ciesla

In a July 31st article in the Kaiser Health News, it reported that just six states and the District of Columbia will use their own money to sustain the level of federal Medicaid payment increase under the ACA to primary care doctors.  It also notes that two of the states extending the payment increase are Alabama and Mississippi, states that did not expand their Medicaid coverage.  The other states continuing the payment increase with their own funds are Colorado, New Mexico, Idaho and Maryland, as well as the District of Columbia.  The States of Alaska and North Dakota have been paying their primary care doctors above the Medicare payment rate even before the ACA provisions took effect in 2013.  What this means is that the payment rate to primary care physicians for Medicaid will revert back to the 2012 levels, unless the state steps in.

As can be seen in the General Accounting Office Study below, the Medicaid costs in the State of New Jersey were high even before the 2012 implementation.  This study is for the fiscal year 2008, a year in which there obviously was not the expanded Medicaid coverage under the ACA nor the bump for primary care under the ACA.  (GAO Report to Congressional Requestors, June 2014).  There is no reason to believe, with the expanded Medicaid coverage in New Jersey, that the costs are going to move closer to the national average and encourage the Legislature to implement the state funding of the higher primary care Medicaid payments.

In the GAO report (http://www.gao.gov/assets/670/664115.pdf), in listing the estimated Medicaid spending per enrollees, their report provides for New Jersey:

All Enrollees Children Adults Disabled Aged

$11,612    $2,758  $7,908 $28,393 $22,817

Compared to the state average of:

All Enrollees Children Adults Disabled Aged

$7,847       $2,973  $5,497 $19,135  $17,609

As we are all aware, while an individual may qualify for Medicaid, that does not ensure that individual access to a health care provider, since the majority of New Jersey physicians do not take Medicaid.

August 18, 2014 Regulatory Developments

August 20, 2014 | No Comments
Posted by Beth Christian

Here are the most recent health care related regulatory developments as published in the New Jersey Register on August 18, 2014:

  • On August 18, 2014 at 46 N.J.R. 1816, the Department of Health published notice of its readoption of its rules governing certificate of need and licensure requirements for regionalized perinatal services and maternal and child health consortia.

OIG Issues Unfavorable Advisory Opinion to Specialty Pharmacy For Support Service Payments

August 18, 2014 | No Comments
Posted by Beth Christian

On August 15, 2014, the OIG issued an unfavorable Advisory Opinion to a specialty pharmacy in connection with the pharmacy’s proposal to pay local retail pharmacies for support services that they provide in connection with patient referrals to the specialty pharmacy.  The specialty pharmacy dispensed specialty pharmaceuticals that are often unavailable to retail pharmacies.  Under the proposed contractual arrangement, the specialty pharmacy would pay local pharmacies for support services, including accepting new patients and recording their demographic information; recording patient-specific medication history and use and providing ongoing medication assessment; counseling patients on appropriate use of their medications and informing them about the specialty pharmacy’s services; obtaining patient consent to transfer the prescription to the specialty pharmacy; and transmitting the prescription to the specialty pharmacy.  The retail pharmacy was paid a “per-fill fee” at the time that the initial prescription was transmitted and upon each subsequent refill.

In evaluating the arrangement which was the subject of Advisory Opinion 14-06, the OIG concluded that the per-fill fees were “inherently subject to abuse” because they were paid only when the support services provided by the retail pharmacy resulted in a referral to the specialty pharmacy.  The OIG concluded that there was significant risk that the per-fill fees would represent compensation for the local pharmacies generating business (including federal health care program business), rather than compensation for bona fide, commercially reasonable services.  The unfavorable Advisory Opinion graphically illustrates the inherent risks in entering into arrangements where payments to the service provider are only made when a referral is generated.

Medicare Joins New Jersey Medicaid In Mandating Pre-Authorization for Non-Emergency Ambulance Transports

August 7, 2014 | No Comments
Posted by Beth Christian

CMS has announced that it will be transitioning to us of a prior authorization requirement for repetitive non-emergency ambulance transports.  New Jersey Medicaid already has a pre-authorization requirement. Under the prior authorization requirement, ambulance suppliers will need submit a request for provisional affirmation of coverage before a non-emergency, repetitive ambulance transport is rendered to a Medicare beneficiary and before a claim for payment may be submitted.  A repetitive ambulance service is defined as medically necessary ambulance transport services that are furnished 3 or more times in a 10 day period or at least 1 per week for 3 weeks.  Repetitive services typically arise for patients who receive dialysis, wound care or cancer treatment.  New Jersey is one of 3 states where the pre-authorization program will be initially implemented.

August 4, 2014 Regulatory Developments

August 5, 2014 | No Comments
Posted by Beth Christian

Here are the most recent health care related regulatory developments as published in the New Jersey Register on August 4, 2014:

  • On August 4, 2014 at 46 N.J.R. 1731, the Department of Banking and Insurance published notice of its proposal of amendments to its rules regarding licensure and certification of organized delivery systems.

Medicare Solvency

July 29, 2014 | No Comments
Posted by Frank Ciesla

As we have in the past years, (http://www.njhealthcareblog.com/2012/04/medicare-solvency-a-continuing-challenge-update/; http://www.njhealthcareblog.com/2013/06/2013-annual-report-of-the-board-of-trustees-of-the-federal-hospital-insurance-and-federal-supplemental-medical-insurance-trust-funds/), the following is our comment on the report recently issued in regard to the solvency of the Medicare program.  In this year’s report, if one were to review pages 276 and 277, which is the actuarial opinion, it points out some of the underlying myths as to the viability of the Medicare program projected in the report.  Obviously, the viability of the Medicare program is important to all health care providers, since a substantial number of beneficiaries of those health care services have those services paid for by the Medicare program.  I suggest that you read the entire attached statement of actuarial opinion.  It is only two pages but again, two highlights are significant.

The report states:

In past reports, the Board of Trustees has emphasized the virtual certainty that actual Part B expenditures will exceed the projections under current law due to further legislative action to avoid substantial reductions in the Medicare physician fee schedule.  Current law would require a physician fee reduction of almost 21 percent on April 1, 2015—an implausible expectation.

The report further goes on to state:

The Affordable Care Act is making important changes to the Medicare program that are designed, in part, to substantially improve its financial outlook.  While the ACA has been successful in reducing many Medicare expenditures to date, there is a strong possibility that certain of these changes will not be viable in the long range.  Specifically, the annual price updates for most categories of non-physician health services will be adjusted downward each year by the growth in economy-wide productivity.  The ability of health care providers to sustain these price reductions will be challenging as the best available evidence indicates that most providers cannot improve their productivity to this degree for a prolonged period given the labor-intensive nature of these services.

As seen by these two examples, in order to provide access to the Medicare beneficiaries, the current law, reducing payments to health care providers, cannot be enforced.  As set forth in the actuary’s opinion, and based upon prior experience, the current law will not be applied, resulting in much higher costs to the Medicare program.  Health care providers must be concerned as to the continued viability of the program since, while the program does not provide the health care, it provides the providers with the financial resources necessary for them to provide the health care.

July 21, 2014 Regulatory Developments

July 24, 2014 | No Comments
Posted by Beth Christian

  • On July 21, 2014 at 46 N.J.R. 1693, the Department of Human Services published notice of its adoption of amendments to its rules governing outpatient psychiatric services under Medicaid.
  • On July 21, 2014 at 46 N.J.R. 1694, the Department of Human Services published notice of its readoption of its regulations governing psychiatric adult acute partial hospital services.
  • On July 21, 2014 at 46 N.J.R. 1695, the Department of Banking and Insurance published notice of its readoption of amendments to its rules governing licensure and registration of third party administrators and certification of third party billing services.
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