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Systems Engineering and Health Care Reform - Boston

Friday, July 18, 2014

By: Michael C. Fee, Esq. and William M. Mandell, Esq.

While reasonable minds may debate the methodologies and cost shifting associated with the Affordable Care Act, it is undeniable that millions of individuals have gained access to the health care system this year as a result of its implementation.  Increased access brings many challenges for professionals at all levels to provide high quality care that focuses first on the needs of individual patients and their families.

In a provocative article published in the Journal of the American Medical Association on Monday, Doctors Christine K. Cassel and Robert S. Saunders argue that the health care system needs to aggressively implement systems engineering in order to improve efficiency and reliability.  They note growing traction for the concept, as the President’s Counsel of Advisors on Science and Technology (“PCAST”) recently issued a report describing systems engineering tools for health care in detail, but also noting significant impediments to implementation, especially in rural and small practice settings.

The PCAST makes a variety of recommendations, including payment incentives that are tied to outcomes (as opposed to the current predominant fee for service system); increased access to health data and analytics, including vast pools collected by the U.S. Department of Health and Human Services; greater technical assistance in systems engineering approaches especially for small practices; and encouraging Accountable Care Organizations to collaborate more broadly with community health organizations and other providers outside of their traditional sectors.

The authors conclude that health care delivery transformation is essential to achieving the primary goals of affordability, quality and creating healthy communities.  As the Affordable Care Act is further implemented over the next several years, systems engineering science, broadly supported by the Federal government, is likely to become a core function for improving the health care delivery system. Moreover, as reform begins to transform the insurance driven aspects of the system, improved quality and coordination of care imperatives will likely motivate physicians, medical groups, hospitals and other providers to explore new types of contracting relationships, integration and expansion strategies.  Massachusetts continues to be at the forefront of these developments, having implemented health care reform well ahead of the Affordable Care Act.

Read the Cassell/Sanders article, and check out the PCAST recommendations.

Lawyers in Pierce & Mandell’s Health Law Department provide creative, effective advice to hospitals, physicians, medical practices and professionals on a broad range of business, compliance and litigation matters. www.piercemandell.com/health-law.html.

Pierce & Mandell, P.C. to Sponsor the Annual Schwartz Center Health Attorneys Breakfast - Boston

Wednesday, March 19, 2014
Pierce & Mandell, P.C. is proud to be a sponsor law firm for the Annual Schwartz Center Health Policy Breakfast, to be held on Friday, April 4. This year’s program will focus on the Schwartz Center's Call to Action, which outlines seven guiding commitments to create a more compassionate healthcare system. Peter Slavin, MD, CEO of MGH; Sandra Fenwick, CEO of Boston Children’s Hospital; and Kevin Tabb, MD, CEO of Beth Israel Deaconess Medical Center, will comment on the Commitment to Compassionate Healthcare Leadership.
The Schwartz Center for Compassionate Healthcare, named after Boston healthcare attorney and patient compassion advocate, Ken Schwartz. Ken was an excellent health lawyer and a wonderful person who left us tragically way too early. His family, friends and colleagues have established a fitting and enduring organization in his honor. The Schwartz Center is a nationwide non-profit organization with a long and respected history of providing patient-centered, compassionate care while striving to strengthen the relationships between patients and providers.  

In 1995 Ken wrote about his experience as a cancer patient in an article for the Boston Globe Magazine entitled “A Patient’s Story.”  In it, he cited how doctors and nurses can make “the unbearable bearable” for patients with “the smallest acts of kindness.” This article was a source of strength and solidarity for my late father who was undergoing cancer treatment at that time.

Please take a moment to learn about the history and remarkable work of The Schwartz Center for Compassionate Care and we encourage all of you who care about improving the training and resources available for compassionate care to support the Schwartz Center.

The HIPAA/HITECH Mega Rule Compliance Deadline is Fast-Approaching

Monday, September 09, 2013
By Karen Rabinovici, Esquire

The September 23, 2013 deadline for compliance with the final Omnibus Rule which amends HIPAA and the HITECH Act, called the “Mega Rule,” is just 15 days away.  The Mega Rule, which became effective on March 26, 2013, calls for medical providers to update and revise privacy policies, procedures and notices, business associate relationships and agreements, and employee training.  The Mega Rule affects both Covered Entities and Business Associates.  

What is Protected Health Information (“PHI”)?

PHI refers to individually identifiable health information.  Individually identifiable health information is information that can be linked to a particular person.  This can relate to an individual’s past, present, or future physical or mental health or condition, the provision of health care to an individual, or the past, present, or future payment for the provision of health care to an individual.  Common identifiers are names, social security numbers, addresses, and birth dates.

What is a Covered Entity?

A Covered Entity is a health care provider, a health plan, or a health care clearinghouse.  A health care provider is a Covered Entity only if the provider transmits information in an electronic form in connection with transactions that involve the transmission of information between two parties to carry out financial or administrative activities related to health care.  Simply put, a Covered Entity is any entity that handles and transmits health information.
What is a Business Associate?

A Business Associate is a person/entity who, with respect to a Covered Entity, performs or assists in the performance of a function or activity involving the use or disclosure of PHI, or provides management, administrative, accreditation, or financial services to or for a Covered Entity, where such services involve the disclosure of PHI by a Covered Entity to a Business Associate.

The definitions of Covered Entity and Business Associate can be found at 45 CFR 160.103.  

What are the main Mega Rule requirements of which Covered Entities and Business Associates should be aware?

The following are the main components of the Mega Rule of which Covered Entities and Business Associates should be aware and should incorporate into their practices.  This is not a complete list.

1. Extension of HIPAA privacy and security requirements to Business Associates and Subcontractors of Business Associates
Before the Mega Rule, Subcontractors who used or disclosed PHI were not subject to HIPAA.  Now, both Business Associates and third-party Subcontractors can be held accountable for unauthorized disclosures under the Mega Rule.  Business Associates and Subcontractors of Business Associates can be subject to compliance requirements and civil penalties for unauthorized disclosures.  Business Associates and Subcontractors must update Business Associate Agreements to reflect these changes. 
2. Breach redefined
When an impermissible access, acquisition, use or disclosure of PHI occurs, the Mega Rule presumes such transaction is a breach.  Prior to the Mega Rule, such transaction was not a breach unless it posed a significant risk of financial, reputational or other harm to the individual.  In order for a Covered Entity not to be required to notify the patient of the breach, it must demonstrate that there is a low probability that the information was compromised.  This is determined by examining the type and extent of the PHI involved, to whom the disclosure was made, if the PHI was actually acquired or accessed, and if the risk of unauthorized disclosure was mitigated.  This review must be documented according to the Covered Entity’s established policies and procedures.  If Covered Entities do not follow these guidelines, or have established policies and procedures, they could face monetary penalties for willful neglect.  
3. Updates to Notice of Privacy Practices (“NPPs”) and redistribution of NPPs
Covered Entities must update their NPPs, and redistribute the updated NPP.  The updated NPP must include a description of the disclosures that do and do not require authorization, the fact that:  patients can opt out of fundraising and marketing communications, patients can request disclosure restrictions, patients can access their PHI, and Covered Entities are legally required to notify patients whose PHI is breached.  It must also state that any disclosures not described in the NPP may only be made with authorization, and that relevant PHI may be disclosed to a deceased’s family member, friend, or representative if that person was involved in the patient’s care or payment for services (unless the patient expressed otherwise). 
4. Expansion of patient privacy and patient empowerment

The Mega Rule empowers patients to request further restrictions on disclosure of their PHI.  Covered Entities must comply with such requests if the disclosure is for payment or health care operations purposes, the disclosure is not required by law, or if the requested restriction applies to disclosure of a service which has already been paid for in full by someone other than the health plan.

Patients may also specify to whom PHI may or may not be disclosed (friends, family members, etc.).  In addition, patients have the right to access their PHI.  If the Covered Entity maintains PHI in electronic format, the Covered Entity, upon request, must provide the patient with electronic access to the PHI.  Covered Entities may charge patients a reasonable fee limited to the cost of supplies, labor, and postage.  Furthermore, if patients wish to amend their PHI, they have the right to do so (although there are several limited circumstances where this request may be refused). 
5.    More rigorous HIPAA enforcement
Under the Mega Rule, the Department of Health and Human Services is responsible for investigating private complaints of non-compliance alleging unauthorized disclosures due to willful neglect.  As required by the HITECH Act, these investigations and reviews may result in increased and tiered civil money penalties.  The penalties take into account whether Covered Entities or Business Associates should have known of the violation, if the violation was due to willful neglect or reasonable cause, whether the violation was corrected within 30 days, and whether the Covered Entity or Business Associate mitigated the harm.
6.    Option for patients to opt out of receiving fundraising and marketing communications  
When Covered Entities communicate with patients regarding fundraising, they must notify the patient clearly of the patient’s option to opt out of receiving such communications.  In addition, Covered Entities cannot sell patient information for fundraising and marketing purposes without authorization.  When seeking such authorization, the patient must be made aware that the provider will receive remuneration for disclosing PHI.  However, Covered Entities may continue to receive financial remuneration to provide refill reminders, or to send out other communications about a drug currently used by the patient as long as the remuneration is related to the costs of making the communication.

What should Covered Entities and Business Associates do before September 23?

Covered Entities and Business Associate should use the several days left before the compliance deadline to update policies and procedures, train staff accordingly, and become familiar with the Mega Rule in order to ensure compliance and avoid lofty penalties.  For further assistance, please contact one of the health law practice area attorneys at Pierce & Mandell, P.C.

Read William Mandell's Most Recent Article in Boston Bar Association's Health Law Reporter

Wednesday, July 10, 2013

William M. Mandell who heads Pierce & Mandell’s Health Law Practice authored an article entitled: “Should I Tell Someone?” Permissible Disclosures by Massachusetts Health Providers and the Need for Greater Statutory Clarification which was  published in the Boston Bar Association's Health Law Reporter Summer 2013 edition.  To read this article, click here.


Monday, July 01, 2013

The federal HHS Office of Civil Rights recently adopted final HIPAA regulations covering a broad range of topics, to strengthen privacy and security protections for individual health information.  This blog is another in a series examining these new regulatory requirements.   

By Dean P. Nicastro, Esq.

The new HIPAA Final Rule for Privacy, Security, Enforcement and Breach Notification (adopted in January 2013) creates new obligations for Business Associate Agreements (“BAA”) between physicians, hospitals and other health care providers (“Covered Entities”), and those contractors who perform services for them involving the use or disclosure of Protected Health Information (“PHI”).

As was mentioned in a previous blog, HIPAA now defines “Business Associate” (“BA”) to include a BA’s subcontractors who create, receive, maintain or transmit PHI on the BA’ behalf.  The new Final Rule goes on to require that a BAA between a Covered Entity and its BA must require the BA to ensure that the BA’s subcontractors comply with HIPAA privacy and security requirements.  Effectively, and as a mandate, this means that the Covered Entity’s BA must have in place a separate BAA with the BA’s subcontractor.

HIPAA makes clear that the Covered Entity need not have a BAA in place directly with the BA’s subcontractor. However, the Final Rule puts the burden on the Covered Entity to arrange for subcontractor compliance, by requiring the BA to obtain compliance assurance from its subcontractor.  Thus, HIPAA BAA’s between health care providers and their servicing vendors need to be revised and updated to include these “downstream” subcontractor compliance obligations.

Care should be exercised when drafting the updating revisions: for example, the main BAA should require that the downstream BAA mirror the BA’s privacy and security obligations; additionally, it may be advisable to expressly disavow any relationship of agency between the Covered Entity and the subcontractor.

Finally, when updating a BAA template, it would be helpful to include language of compliance with Massachusetts law and regulations that protect the security and disposal of data that contains personal information, like names and social security or financial account numbers.  Massachusetts consumer regulations require that a service provider contract be in place with vendors who access such data, so it is a good idea to have the HIPAA BAA serve as such a contract as well.  

In general, the HIPAA Final Rule must be complied with by September 23, 2013.  The federal HHS Office of Civil Rights has posted some helpful sample language for BAAs on its website.

Please contact the health law professionals at Pierce & Mandell for additional information on this subject.

CMS and OIG Propose to Amend Stark and Anti-Kickback Rules for EHR Donations

Wednesday, May 01, 2013
By Dean P. Nicastro

Last month, the Centers for Medicare & Medicaid Services (CMS) and the Office of Inspector General of the U.S. Department of Health and Human Services (OIG) proposed similar amendments to the Stark exception and to the Anti-Kickback safe harbor for the donation of electronic health records (EHR).  The current rules permit hospitals, group practices and other entities to donate technology-related items and services to physicians, to be used to create, maintain, transmit or receive EHR.  Highlights of the proposed changes:

  • Eliminate the requirement that EHR must include an electronic prescribing component or interface ability
  • Change the procedure for deeming EHR software “interoperable,” so as to follow the current certification process employed by the Office of National Coordinator for Health Information Technology (ONC); and eliminate the 12-month prior timeframe for certification
  • Postpone the EHR sunset from December 31, 2013 to December 31, 2016

The two agencies believe that “sufficient alternative policy drivers” exist to advance electronic prescribing, and that the ONC certification program (which certifies to any edition of EHR certification criteria that is identified in the regulatory definition applicable at time of donation) is consistent with the objective of ensuring that EHR products are certified to the current standard of interoperability when they are donated.  In addition, the sunset extension is thought needed in order to help achieve more widespread adoption of EHR in the healthcare industry (the December 31, 2016 date corresponds with the closing timetable for Medicare/Medicaid EHR incentive programs; the agencies even suggest an extension to December 31, 2021).

The agencies have invited comment on the proposed amendments through June 10, 2013.  Also, they seek comment on whether to limit the class of permitted donors, so as to exclude certain ancillary suppliers, such as lab companies, durable medical equipment suppliers and independent home health agencies, and on other suggestions for preventing “data and referral lock-in” and for encouraging the free exchange of data.

The proposed changes are contained in the April 10, 2013 Federal Register.  Please contact the health law professionals at Pierce & Mandell for additional information on this subject.

New HIPAA Limitations and Changes

Monday, April 01, 2013


(I)The United States Department of Health and Human Services Office of Civil Rights final modified HIPAA regulations under the HITECH Act are now in effect and health care providers must achieve compliance with all of the new requirements by September 23, 2013. This is one in a continuing series of blogs from Pierce & Mandell, P.C. describing some of the major changes health and dental practices, hospitals and other health care facilities must be following by that date.   

By Kate Auerbach, Esq., Rebecca Merrill, Esq.  and William Mandell, Esq.


The modified HIPAA Privacy Rule redefines ‘marketing’ and increases the limits on the use and disclosure of protected health information (“PHI”), including patient contact information, by health care providers to do marketing.

Previously, marketing was defined as communication about a product or service to encourage individuals to purchase or use the product or service. While providers previously had to obtain a patient’s written authorization before using or disclosing their contact information for marketing purposes, the HIPAA Privacy Rules has allowed for several broad exceptions to securing patient authorization, including any communication about products or services offered by the provider itself or that recommended alternative treatments.  

Under the modified Privacy Rule, starting on September 23, 2013, providers will now have to secure their patients’ written authorization in order to use their contact information for marketing about health-related products or services if the provider or its business associates receive any financial remuneration in exchange for making the marketing communication from or on behalf of the third party whose product or service is being described. The modified rule does include an exception for refill reminders or communications about a medication being prescribed as long as the only remuneration received is reasonably related to costs of making the communication (labor, supplies, & postage). For example, if a medical practice sent a mailing without advance patient authorization about a new medication on the market and received compensation the practice could violate HIPAA (such remuneration, however, could raise fraud and abuse compliance issues). However, if the practice sent information about refilling a prescription and was reimbursed for the cost of the mailing it would not need to secure written authorization from the recipient/patients.

Under the modified Privacy Rule, marketing authorization forms must disclose to the patients the remuneration received by the provider from the third party and must also state that the patient may revoke the authorization at any time.     

There are exceptions to this authorization requirement.   If a communication is made face-to-face by a practitioner to a patient or if a promotional gift of nominal value is given, then advance patient written authorization is not required.  Additionally, refill reminders, adherence reminders and delivery system instructions are allowed without pre-authorization, as long as the remuneration received is reasonably related to the cost of making the communications, and the provider does not make a profit.  


The original HIPAA Privacy Rule allowed non-profit providers to use, or disclose to a business associate or an institutionally related foundation, specific types of information about patients for fundraising activities without advance authorization, including demographic information and dates of service.   

The modified Privacy Rule creates additional categories of PHI that can be used for targeted fundraising communications.  These categories include: (i) department of service (general department of treatment); (ii) treating physician information; (iii) outcome information, and (iv) health insurance status.  This expanded scope of permissible information flow for fundraising related uses and disclosures is intended to permit non-profit providers to develop more focused fundraising efforts to particular individuals.    

However, HIPAA now requires starting on September 23, 2013 that fundraising communications to patients include a clear and conspicuous opportunity for the patient to “opt out” of receiving further fundraising communications.  The opt-out method can be chosen by the provider but it must not cause an “undue” burden” to patients and they cannot be required to write letters to the provider in order to opt-out of having their PHI used for fundraising purposes. Once a patient elects to opt-out the provider is absolutely prohibited from sending any more fundraising communications.  Non-profit providers are also prohibited from conditioning treatment or payment on a patient’s choice not to receive fundraising communications.

Obviously, these new requirements and limitations imposed on providers that do fundraising will add to their administrative burden and cost as a result of the need to avail patients of an opt-out or opt-in system and to track and ensure properly targeted marketing to patients and their families.   

Sale of PHI.

The modified HIPAA Privacy Rule also prohibits the sale of PHI by a covered entity or business associate. “Sale” is defined as the receipt of remuneration, directly or indirectly, in exchange for PHI, without patient written authorization, unless the sale meets a specified exception.  

There are eight exceptions to this sale of PHI prohibition, which include: (1) for public health activities; (2) for research, where the only remuneration received by the covered entity is a reasonable, cost-based fee to cover the cost to prepare and transmit the PHI for such purpose; (3) for treatment and payment purposes; (4) for the sale, transfer, merger or consolidation of all or part of the covered entity and related due diligence; (5) to or by a business associate, if the only remuneration is provided by the covered entity to the business associate for the performance of its contracted services; (6) providing an individual with access to his or her PHI; (7) for disclosures required by law; and, (8) for any other purpose permitted by and in accordance with the applicable requirements of the Privacy Rule, where the only remuneration received by the covered entity is a reasonable, cost-based fee to cover the cost to prepare and transmit the PHI for such purpose, or a fee otherwise expressly permitted by other laws.

Modification to Notice of Privacy Practices and health Information Policies and Procedures

No later than September 23, 2013 all providers that are covered entities under HIPAA must modify their required HIPAA Notice of Privacy Practices (“NPP”) and Health Information Policies and Procedures to incorporate the above mentioned changes on the patient privacy rights as to the use and disclosure of their health and personal information for marketing, fundraising and sales purposes, as well as the other new rights established under the HIPAA modified Privacy Rule. These include:

  • Right to limit any use or disclosure of PHI for certain sales, marketing and fundraising purposes before granting written authorization
  • Right to restrict disclosure of PHI to a health plan when the patient opts to pay the provider in full directly out of pocket
  • Right to be informed by a provider or other covered entity of any breach of unsecured PHI
  • Right to obtain electronic copies of PHI
  • Any uses and disclosure of PHI for treatment, payment or operations not stated and described in the NPP may only be upon patient written authorization.
  • Any prior written authorization granted may always be revoked.

Providers should be moving forward now to update their NPPs and Policies to reflect the new requirements in the modified HIPAA Privacy Rule. Care should be taken in the drafting of the modified NPP as it will now dictate if written authorization is needed for certain uses an disclosures even beyond those otherwise required under more stringent applicable state privacy laws. The new form of the NPP does not have to be shared with existing patients. It only needs to be posted on the provider’s website and in prominent place in its office or facility and given to all new patients during their first encounter or admission starting no later than September 23, 2013.

Please feel free to contact the health law attorneys at Pierce & Mandell if you desire additional information on this subject.

New HIPAA Regulations Impact Health Care Providers and Business Associates - Boston, MA

Monday, March 18, 2013
The federal HHS Office of Civil Rights recently adopted final HIPAA regulations covering a broad range of topics, to strengthen privacy and security protections for individual health information.  This blog is Part 1 in a series.   

By Dean P. Nicastro, Esq.

Business Associates.

The new HIPAA regulatory amendments make business associates directly liable for various requirements in the HIPAA Privacy and Security Rules.  In particular, the amendment to the general applicability provision at 45 C.F.R. §160.102(b) states: “Where provided, the standards, requirements, and implementation specifications [of HIPAA privacy and security] apply to a business associate.”  Similar language has been added for both the Security Rule and the Privacy Rule (including particularly with respect to the protected health information (PHI) of a covered entity) at 45 C.F.R. §164.104(b) and 45 C.F.R. §164.500(c).  In effect, this means that business associates must implement administrative, physical and technical safeguards, and implement and document reasonable and appropriate policies and procedures, to protect PHI and electronic PHI under both the Security Rule and the Privacy Rule.

The amendments go on to expand the definition of a “business associate.”  The term now includes Health Information Organizations, E-prescribing Gateways, personal health record providers, and, most significantly, subcontractors of a business associate that create, receive, maintain or transmit PHI on behalf of the latter.  A definition of “subcontractor” has also been inserted: "a person to whom a business associate delegates a function, activity or service.”  HIPAA obligations thus now reach downstream entities that access or handle PHI of the main covered entity.

Additionally, the amendments add business associates to the HIPAA Enforcement Rule, in order to implement the imposition of liability for civil money penalties (CMPs) upon business associates for various HIPAA violations.

The new rules for business associate compliance become effective on March 26, 2013, and must be complied with by September 23, 2013.  Existing business associate agreements that were compliant with pre-existing regulations are deemed compliant with the new rules until the earlier of September 22, 2014 or the date the agreement is renewed or modified on/after September 23, 2013.

HIPAA Enforcement Rule.

The HIPAA regulatory amendments also strengthen HIPAA enforcement:

  • Private Complaints - HHS will investigate complaints about non-compliance filed by private persons when preliminary review of facts indicates possible violation due to willful neglect
  • Compliance Reviews - HHS will conduct a compliance review when preliminary review of facts indicates possible violation due to willful neglect
  • resolution of such investigations or compliance reviews can result in the imposition of CMPs or a determination of no violation
  • HHS may, for criminal or civil law enforcement activities, share PHI obtained in an investigation or compliance review with other legally-permitted governmental agencies (including state attorneys general)
  • Covered entities liable for violations by their business associates, and vice versa
  • governed by federal common law of agency
  • Increased tiered CMP penalty structure for violations, that takes into account whether the covered entity or business associate would have known of the violation, whether the violation was due to willful neglect or reasonable cause, and was corrected within 30 days
  • HHS will determine CMP amounts, considering mitigating or aggravating factors
    • nature and extent of violation (number of affected individuals, time period)
  • nature and extent of harm (physical, financial, reputation, patient’s ability to obtain health care)
  • prior compliance/violations
  • financial condition
  • other matters as justice may require

Covered entities and their business associates should be moving forward now that these final rules have been issued to review and update their business associate agreement templates and compliance policies accordingly.

Please contact the health law attorneys at Pierce & Mandell for additional information on this subject.

Health Law Provider Alert: New Notice Requirement for Material Change to Provider Operations or Governance

Friday, March 15, 2013
By: Rebecca Merrill, Esq.

Massachusetts hospitals and medical groups contemplating a proposed acquisition, integration or affiliation must be aware of a new governmental reporting mandate and cost/market based oversight unique to Massachusetts that has just gone into effect.

The Massachusetts Cost Containment Law, passed last year, establishes a new requirement that every Massachusetts provider and provider organization must submit notice at least 60 days in advance of any proposed “material change” to its operations or governance structure to (1) the Massachusetts Attorney General, (2) the Center for Health Information and Analysis (“CHIA”), and (3) the new Health Policy Commission (“HPC”) established under the 2012 Cost Containment Law.   

 “Provider” is defined as “any person, corporation, partnership, governmental unit, state institution or any other entity qualified under the laws of the commonwealth to perform or provide health care services.”   

“Provider organization” includes “any corporation, partnership, business trust, association or organized group of persons, which is in the business of health care delivery or management, whether incorporated or not that represents 1 or more health care providers in contracting with carriers for the payments of heath care services; provided, that ‘provider organization’ shall include, but not be limited to, physician organizations, physician-hospital organizations, independent practice associations, provider networks, accountable care organizations and any other organization that contracts with carriers for payment for health care services.”

The rather limited statutory definition of “Material Change” includes, but is not limited to:

  • Corporate mergers;
  • Acquisitions or affiliations of a provider or provider organization and a carrier;
  • Acquisitions of insolvent provider organizations; and
  • Mergers or acquisitions of provider organizations resulting in provider organization having near majority of market share in a given service or region.

HPC has been charged with adopting regulations for administering these notice and review requirements and for further defining key terms including “material change” and “non-material change.”  While the notice and market impact review regulations are presently being developed by HPC and have not yet been issued, HPC has just released some Interim Guidance.      

In the Interim Guidance HPC has clarified that the following events constitute a Material Change for notification purposes:

  • A Merger or affiliation with a carrier;
  • An Acquisition of or by a carrier;
  • A Merger with or by a hospital or a hospital system;
  • Any other acquisition, merger or affiliation with another provider or provider organization that would result in an increase in annual patient service revenue of the provider or provider organization of $10 million or more;
  • Any clinical affiliation with another provider or provider organization that has an annual patient service revenue of $25 million or more in the preceding fiscal year; and
  • Any formation of a partnership, joint venture, common entity, accountable care organization, or parent corporation created for the purpose of contracting on behalf of one or more provider or provider organizations.

HPC has announced that only those providers and provider organizations with at least $25 million in net patient service revenue in the preceding fiscal year that propose a Material Change to close after March 12, 2013 must file the notice. Acquisition targets with less than $25 million in net patient service revenue could still be party to a reportable proposed transaction if the acquiring provider is in excess of the reporting threshold. Also, all material changes completed on or before March 12, 2013, will not be subject to this notice requirement.

The intent of the new notice requirement and review process is to empower and enable the HPC to conduct cost and market impact reviews with the ultimate goal of improving the quality of care in Massachusetts while simultaneously reducing cost through increased collaboration, transparency and innovation.

In reaction to the rapidly evolving Massachusetts health care market, most hospitals and medical groups in Massachusetts are considering their affiliation and integration options and joining ACOs.  Not all considered ventures and initiatives will trigger the new notice of Material Change under the Interim Guidance, however, providers and their legal counsels must be aware of what types of proposed new relationships and transactions will trigger the required notices and review. These reviews are in addition to already required applicable reviews and approvals by federal and state agencies regarding licensure, DON, closure of facilities, Medicare and Mass Health participation, change in charitable status and anti-trust.  

The requisite Material Change notice must be submitted electronically at least 60 days in advance of the proposed material change. HPC will develop a notice template that will include instructions, definitions, and explanations for all requested information and the form will soon be available online at www.mass.gove/hpc. In the interim, providers and provider groups seeking to submit notice should request the form directly from HPC at HPC-Notice@state.ma.us.  

Stay tuned for developing regulations on Massachusetts Cost Containment Provider Material Change notice and reporting requirements for hospitals, other facilities, medical groups and health plans.  If you have questions about the reporting requirements or need assistance in evaluating affiliation and integration options or joining ACOs, health law attorneys at Pierce & Mandell, P.C., are here to assist you.

Dental Law - Dentists Participating In MassHealth Take Note! - Boston, MA Lawyers

Wednesday, March 13, 2013
By: Kate L. Auerbach, Esq.

All dental providers that participate in MassHealth must understand that while they may code for the services they perform using the federally mandated American Dental Association’s (“ADA”) Code on Dental Procedures (the “Code”), MassHealth will look to 130 CMR 420.000 and 450.000 which contain the specific state regulations governing dental services. All dental providers participating in MassHealth must comply with MassHealth regulations, including but not limited to 130 CMR 420.000 and 450.000.

It is the dental provider’s responsibility to be attentive of any and all Massachusetts dental regulations, including MassHealth Transmittal Letters that will form the basis for what is or is not reimbursable.  Massachusetts State Auditor Suzanne Bump has been continually performing audits of the MassHealth dental system since 2010, and has put pressure on MassHealth to be a better job of screening claims for payments from dental providers.  Most recently, an audit focused on 19,274 claims of “detailed oral screenings.”  Based on the results of the audit, it seems there is confusion with the code for a “detailed oral screening” because many dental providers use D0160, which in the ADA’s description of services states is a “detailed and extensive problem focused evaluation [which] entails extensive diagnostic and cognitive modalities based on the findings of a comprehensive oral evaluation.”  The ADA guideline, found in the Code, contains no requirements that a MassHealth patient must be undergoing radiation treatment, chemotherapy or organ transplant in order for the provider to be reimbursed for rendering an extensive oral evaluation.  However, 130 CMR 420.456(B)(1) says it will pay for oral screenings for members that are “undergoing radiation treatment or chemotherapy,” and the State Auditor has declared that MassHealth wrongly reimbursed providers who were treating individuals who were not undergoing radiation or chemotherapy.

Massachusetts State Auditor Suzanne Bump’s office has sought refunds from dental providers to recover monies paid as a result of this discrepancy, requiring dental providers to defend themselves.  If dental professionals do not pay close attention to the specific MassHealth rules and regulations, then they may be subject to audits, claims for refunds, or even worse, penalties or civil and criminal prosecution and exclusion from the program.   MassHealth dental providers should never assume that they can perform a service simply because it meets their view of the standard of care or good clinical practice.  Rather, the services must fall into an acceptable Massachusetts policy as to what is reimbursable.  

Please contact the dental law professionals at Pierce & Mandell for further information.

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