CMS Rule Would Kick “Problematic” Doctors Out of Medicare/Medicaid

Last week CMS announced that beginning January 1, 2020, they assumed a new power to bar clinicians' participation if agency officials can cite potential harm to patients based on specific incidents (1). CMS created this new authority through the 2020 Medicare physician fee schedule. CMS claimed that it had no pathway to address "demonstrated cases of patient harm" in cases where clinicians maintain their licenses (2).

The rule drew criticism from multiple physician groups with none supporting it. The Alliance of Specialty Medicine said CMS has been using "vague and subjective" criteria to evaluate physicians for some time. The new revocation authority "just compounds the problem," the Alliance told Medscape Medical News (2).

In drafting the final version of the rule, CMS rejected many suggestions offered in comments about the revocation authority. The AMA pointed out that CMS hid such a major change in the annual physician fee schedule under the opioid treatment program section (2). The Association of American Medical Colleges (AAMC) said CMS should defer to state medical boards and other state oversight entities regarding issues associated with protecting beneficiaries from patient harm (2). In the final rule, CMS argued that it needs the new revocation authority due to cases where "problematic" behavior persists despite detection by state boards.

During the past week two examples of CMS’ bureaucratic nature were observed in my practice. First, I was told from a durable medical equipment provider that a new CMS requirement was that when reordering patient continuous positive airway pressure (CPAP) supplies that I would need to check, initial and date each item from a long list of supplies whether it was ordered or not. Second, an asthma patient was referred to me that was using daily albuterol. I recommended a long-acting beta agonist/corticosteroid combination but was told that the patient must fail corticosteroids alone before prescribing the more expensive combination therapy. Nearly every physician and many patients have seen some nameless and faceless clerk at CMS give them the “ol’ run around”. CMS’ argument that they are improving quality and protecting patients would be more believable if these and the many other instances of bureaucratic overreach were rare rather than common. 

Many “quality” programs have been thrust on clinicians in the past without any demonstrable improvement in healthcare for patients (3). Rather quickly these programs morph from a quality program to a hammer used to control clinicians and suppress dissent. In seems likely that CMS’ new self-assumed authority will be the same. If CMS wishes to improve care, they should deal with examples such as those above and many more instances of time wasting paper work and poor care that they mandate. Two recommendations to reduce these poor decisions are: 1. List the name of the licensed practitioner responsible for each CMS decision; and 2. Establish an efficient appeals process not controlled by CMS. These would reduce the instances of poor, anonymous decision makers hiding behind the anonymity of the CMS bureaucracy and could go a long way in improving patient care.

Richard A. Robbins, MD

Editor, SWJPCC

References

1. Centers for Medicare and Medicaid Services. November, 2019. Available at: https://s3.amazonaws.com/public-inspection.federalregister.gov/2019-24086.pdf (accessed 11/9/19). Scheduled to be published in the Federal Register on 11/15/2019 and available online at https://federalregister.gov/d/2019-24086.
2. Young KD. CMS sharpens weapon to kick 'problematic' docs out of Medicare. Medscape Medical News. November 7, 2019. Available at: https://www.medscape.com/viewarticle/920994?nlid=132505_5461&src=wnl_dne_191108_mscpedit&uac=9273DT&impID=2159379&faf=1 (accessed 11/9/19).
3. Robbins RA. The unfulfilled promise of the quality movement. Southwest J Pulm Crit Care. 2014;8(1):50-63. [CrossRef]

Cite as: Robbins RA. CMS rule would kick “problematic” doctors out of Medicare/Medicaid. Southwest J Pulm Crit Care. 2019;19(5):146-7. doi: https://doi.org/10.13175/swjpcc066-19 PDF 

Not-For-Profit Price Gouging

Kaiser Health News reports the case of Brianna Snitchler (1). She had a visible cyst on her abdomen which was biopsied using ultrasound as an outpatient at Henry Ford Health System’s main hospital. The cyst was found to be benign, but she received a $3,357.52 bill for her biopsy, ultrasound, lab tests and physician charges but the bill also included a $2,170 additional charge.

Although the initial bill from Henry Ford referred to “operating room services”, Ford later sent an itemized bill that referred to the charge for a treatment room in the radiology department. Both descriptions boil down to a facility fee, a common charge that has become controversial as hospitals search for additional streams of income, and as more patients complain to have been blindsided by these fees.

David Olejarz, manager of the media relations department of Henry Ford, said the “procedure was performed in the Interventional Radiology procedure room, where the imaging allows the biopsy to be much more precise. ...We perform procedures in the most appropriate venue to ensure the highest standards of patient quality and safety.” The need for a biopsy before removal of this cyst is questionable since the lesion had been present for years and had not changed. Furthermore, the need for the radiology procedure room and an ultrasound would seem superfluous since it could probably have been biopsied efficiently and safely in a physician’s office for considerably less money.

Ted Doolittle, with the Office of the Healthcare Advocate for Connecticut, called these facility fees “a black box” (1). In Connecticut hospitals are required to notify patients in advance about facility fees. Connecticut hospitals billed more than $1 billion in facility fees in 2015 and 2016, according to state records. Furthermore, Henry Ford would collect fees for every part of the procedure including the ultrasound, the lab tests, and probably the physician fees. Additionally, it is likely that the physician who referred Ms. Snitchler worked for Henry Ford and they would have collected a fee there, also.

Hospital officials argue that medical centers need the boosted income to provide the expensive care sick patients require, 24 hours a day, 365 days a year. However, Henry Ford Hospital already receives Medicaid disproportionate share (DSH) payments to help offset Henry Ford Hospital’s Medicaid shortfall because of its high portion of poor and Medicaid patients (2). Many “facility fees”, like Snitchler’s, are higher than would be considered reasonable or fair and are exploitative and unethical. In Snitchler’s case the facility fees nearly tripled the cost of the biopsy which despite having United Health Care insurance she will need to pay out of pocket. All this and she still has not had her cyst removed.

Hospitals appear to have solid finances. Although balance sheets are often inaccurate and misleading, most have greatly expanded their administrative personnel paying them record amounts (3). Henry Ford’s former CEO and trustee, Nancy Schlichting, was paid a salary or $4.77 million in 2016 (4). However, CEO salary is often only a portion of the total compensation with some tripling their salary through other compensation (3). Furthermore, Henry Ford lists page after page of administrative personnel which likely translates into hundreds of millions of dollars annually (5).

Henry Ford Health System was founded in 1915 by auto pioneer Henry Ford and is a leading health care provider for the poor in the Detroit area (6). Legislative action should be taken not only to notify patients of facility fees available prior to services but also to limit these fees to a reasonable amount of the total charges. The Centers for Medicare and Medicaid services could reexamine Henry Ford’s safety net designation or their tax-exempt not-for-profit status could be reexamined.

Henry Ford’s mission statement is, “We improve people's lives through excellence in the science and art of health care and healing” (6). However, as Henry Ford said, “Business must be run at a profit, else it will die. But when anyone tries to run a business solely for profit, then also the business must die, for it no longer has a reason for existence” (7). In this case, the Henry Ford Health System seems to be price gouging the poor rather than serving them. If profit is their sole goal, Henry Ford Hospital and medical centers like them have no reason to exist and are best left to perish.

Richard A. Robbins, MD

Editor, SWJPCC

References

1. Anthony C. Her biopsy report was benign. But the bill is a spot of contention. Kaiser Health News. September 30, 2019. Available at: https://khn.org/news/bill-of-the-month-facility-fees-biopsy-bill-september/?utm_campaign=KHN%20-%20Weekly%20Edition&utm_source=hs_email&utm_medium=email&utm_content=77684052&_hsenc=p2ANqtz--ET6FHWzEGP_A7C5P7POEonKEpK9CvrI-71lI6WxyIZ1hwGzbaD0LxeJv0kE7B8vvPpZqCJsYWmtxxXeGIAt4tSW_tlg&_hsmi=77684052 (accessed 10/5/19).
2. MACPAC. Fact sheet: Henry Ford Hospital. March 2017. Available at: https://www.macpac.gov/wp-content/uploads/2017/03/Henry-Ford-Hospital.pdf (accessed 10/5/19).
3. Robbins RA. CEO compensation-one reason healthcare costs so much. Southwest J Pulm Crit Care. 2019;19(2):76-8. [CrossRef]
4. Welch S. Turnover, retirements factor in big changes in nonprofit compensation. Crain’s Detroit Business. May 20, 2017. Available at: https://www.crainsdetroit.com/article/20170521/news/628871/turnover-retirements-factor-big-changes-nonprofit-compensation (accessed 10/5/19)
5. Henry Ford Health System. Henry Ford Health System governance leadership. Available at: https://www.henryford.com/-/media/files/henry-ford/about/annual-reports/2017-system-report-leadership-listing.pdf (accessed 10/5/19).
6. Henry Ford Health System. About us. https://www.henryford.com/about (accessed 10/5/19).
7. AZ quotes. https://www.azquotes.com/quote/830473 (accessed 10/5/19).

Cite as: Robbins RA. Not-for-profit price gouging. Southwest J Pulm Crit Care. 2019;19(4):121-2. doi: https://doi.org/10.13175/swjpcc063-19 PDF 

Some Clinics Are More Equal than Others

In January the Centers for Medicare and Medicaid (CMS) site-neutral policy went into effect (1). Under this policy payments to some off-campus hospital clinics were reduced to those of private practice physicians. However, Judge Rosemary M. Collyer said in her decision, "The Court finds that CMS exceeded its statutory authority when it cut the payment rate for clinic services at off-campus provider-based clinics". According to her decision, in the Bipartisan Budget Act of 2015 Congress allowed hospitals to bill CMS at the higher outpatient department rate if they existed prior to Nov. 2, 2015.

This is how hospitals gamed the system. Hospitals acquire a doctor’s office or an emergency care clinic; hire salaried doctors to staff it; and raise the charges to what CMS would allow. They were able to do this because the doctor or practice was “grandfathered” and the fees are often 2-6 times the reimbursement for private physicians’ offices (2).

This ruling is consistent with a long-standing trend in Congress to restrict free market forces in healthcare. Congress has “squeezed” physicians to an extent that most have little choice but to work for hospitals. There has been a meteoric growth in hospital-employed physicians and hospital-owned physician practices. From July 2012 to July 2015, the number of hospital-employed physicians increased 49% (3). The number of hospital-owned physician practices increased by 31,000, which amounted to an 86% growth. Today more physicians are employed by hospitals than are in independent practices.

Also consistent with Congressional action to restrict free market forces has been its drug payment policy. CMS is forbidden from negotiating drug prices and is essentially forced to pay the price set by the pharmaceutical manufacturer. Private insurance companies follow CMS’ lead and pass these increased costs to the consumer.

Several bills have been introduced in Congress to curb drug pricing. The Congressional Budget Office has repeatedly stated that in order to decrease drug prices it is necessary to allow the federal government to negotiate prices (4). However, this is apparently a “socialist” act according to Senate Majority Leader, Mitch McConnell. McConnell has long been a supporter of the pharmaceutical companies and hospitals by doing nothing to alter the present system, and thus allowing hospitals and pharmaceutical companies to avoid free market forces, fix prices, and ensure maximal profits.

The Trump administration’s site neutral policy and allowing HHS to negotiate with pharmaceutical manufacturers are good policies that would likely lower healthcare costs and benefit patients. They are not “socialist” but instead attempt to restore to healthcare a free market economy that has long been missing. In George Orwell’s “Animal Farm” the pigs control the government and proclaim that “All animals are equal, but some animals are more equal than others”. The politicians who support inequitable reimbursement for the same healthcare service or allow pharmaceutical companies to overcharge for a drug are saying much the same.

Richard A. Robbins, MD

Editor, SWJPCC

References

1. Robbins RA. Court overturns CMS' site-neutral payment policy. Southwest J Pulm Crit Care. 2019;19(3):101-2. [CrossRef]
2. Carey MJ. Facility fees: the farce everyone pays for. Medical Economics. August 16, 2018. Available at: https://www.medicaleconomics.com/blog/facility-fees-farce-everyone-pays (accessed 9/19/19).
3. Cheney C. Hospital-physician consolidation growth trends moderate. Health Leaders February 28, 2019. Available at: https://www.healthleadersmedia.com/clinical-care/hospital-physician-consolidation-growth-trends-moderate (accessed 9/21/19).
4. Cubanski J, Neuman T, True S, Freed M. What’s the latest on Medicare drug price negotiations? Kaiser Family Foundation July 23, 2019. Available at: https://www.kff.org/medicare/issue-brief/whats-the-latest-on-medicare-drug-price-negotiations/ (accessed 9/21/19).

Cite as: Robbins RA. Some clinics are more equal than others. Southwest J Pulm Crit Care. 2019;19(3):103-4. doi: https://doi.org/10.13175/swjpcc61-19 PDF 

Blue Shield of California Announces Help for Independent Doctors-A Warning

An article today in Modern Healthcare announced that Blue Shield of California is launching a new program to help physician practices remain independent while giving them tools needed to succeed in value-based care arrangements (1). The program touts that it will offer independent doctors and practices tools to improve patient health outcomes while making it easier for them to focus on care instead of administrative tasks.

Blue Shield said it plans to support physicians in moving toward value-based care by investing in their practices. Investments could range from different types of affiliations to even employing the doctors in select situations. The announcement points out that independent physicians appear to be a dying breed. Furthermore, when independent physicians join an integrated healthcare system, costs increase (2).

On the surface this announcement sounds positive but the article raises a number of concerns. First, Blue Shield California is a for-profit company which had its not-for-profit status revoked by the state of California in 2014. Blue Shield California has also been known for being less than forthcoming with details regarding their business. Second, it is unclear what type of access Blue Shield plans to gain to physicians’ practices and patient files. Third, in many instances, quality measures have been nothing more than a series of meaningless metrics whose performance have not benefited patients. However, performance of these metrics has benefited healthcare executives’ bonuses.  Blue Cross and Blue Shield pays bonuses which on average are greater than 65% of the executive’s base salary. 20-25% of the bonuses are dependent on “quality” as defined by Blue Shield.

As with any dealings with insurance companies or integrated healthcare systems, physicians should be wary. What is the cost to patients and physicians? Will the company be charging for software installation and maintenance? What role will the insurance company have in determining value measures and what access will they have to patient data? Will any contractual agreement be easily canceled or will it be prolonged with the physician paying for the installation and use of any software? Will there be a noncompete clause forcing physicians to move if they decide to leave the agreement? These and other questions need to be addressed prior to any physicians signing on this or any similar agreements. Physicians considering any agreement or contract are encouraged to have them reviewed by lawyers familiar with healthcare to determine the potential pitfalls.

Richard A. Robbins, MD

Editor, SWJPCC

References

1. Livingston S.  Blue Shield of Calif. aims to help independent doctors with value-based care. Modern Healthcare. August 29, 2019. Available at: https://www.modernhealthcare.com/payment/blue-shield-calif-aims-help-independent-doctors-value-based-care (accessed 8/29/19).
2. Baker LC, Bundorf MK, Kessler DP. Vertical integration: hospital ownership of physician practices is associated with higher prices and spending. Health Aff (Millwood). 2014 May;33(5):756-63. [CrossRef] [PubMed]
3. Blue Shield of California. 2017 executive compensation summary. Available at: file:///C:/Users/Rick/Downloads/2017-Executive-Compensation-Summary-Final%20(1).pdf (accessed 8/29/19).

Cite as: Robbins RA. Blue Shield of California announces help for independent doctors-a warning. Southwest J Pulm Crit Care. 2019;19(2):85-6. doi: https://doi.org/10.13175/swjpcc058-19 PDF 

Medicare for All-Good Idea or Political Death?

Several Democratic presidential candidates have pushed the idea of “Medicare for All” and a “Medicare for All” bill has been introduced into the US house with over 100 sponsors. A recent Medpage Today editorial by Milton Packer asks whether this will benefit patients or physicians (1). Below are our views on “Medicare for All” with the caveat that we do not speak for the American Thoracic Society nor any of its chapters.

It has been repeatedly pointed out that medical care in the US costs too much. US health care spending grew 3.9 percent in 2017, reaching $3.5 trillion or $10,739 per person, and 17.9% of the gross domestic product (GDP) (2). This is more than any industrialized country. Furthermore, our expenditures continue to rise faster than most other comparable countries such as Japan, Germany, England, Australia and Canada (2).

Despite the high costs, the US does not provide access to healthcare for all of its citizens. In 2017, 8.8 percent of people, or 28.5 million, did not have health insurance at any point during the year (3). In contrast, other comparable industrialized countries provide at least some care for everyone.

Furthermore, our outcomes are worse. Infant mortality is higher than any similar country (4). US life expectancy is shorter at 78.6 years compared to just about any comparable industrialized company with Japan leading the way at 84.1 years. All the Western European countries (such as Germany, France, England, etc.), as well as Australia and Canada have a longer life expectancy than the US (range 81.8-83.7 years).

Our high infant mortality and lagging life expectancy was not always so. In 1980, the US had similar infant mortality and life expectancy when compared to other industrialized countries. Why did we lose ground over the last 40 years? Beginning in about 1980, there have been increasing business pressures on our healthcare system. In his editorial, Packer called our system "financialized" to an extreme (1). Hospitals, pharmaceutical and device companies, insurance companies, pharmacies and sadly,  even some physicians often price their products and services not according to what is fair or good for patients but to maximize profit. By incentivizing procedures that often do not benefit patients but benefit the businessmen’s’ pockets, these practices likely account for the high costs and for our worsening outcomes.

Packer points out that in the US, intermediaries (insurers and pharmacy benefit managers) exert considerable control of payment while unnecessarily adding to the administrative costs of healthcare. Congress has been pressured to forbid Medicare from negotiating prices with pharmaceutical companies benefitting only the drug manufacturers and those that benefit from the high drug prices. Consequently, administrative costs are four times higher and pharmaceuticals three times greater in the U.S. than in other countries.

If “Medicare for All” could reduce healthcare costs and improve outcomes, it might seem like a good idea. It has the potential for reducing administrative costs and assuming the power to negotiate drug prices was restored, pharmaceutical costs. However, it will be opposed by those who financially benefit from the present system including administrators, hospitals, pharmaceutical companies, pharmacy benefit managers, insurance companies, etc. Furthermore, there is a libertarian segment of the population that opposes any Government interference in healthcare, even those that would strengthen the free market principles that so many libertarians tout. There are already TV adds opposing “Medicare for All.” It seems likely that any “Medicare for All” or any similar plan will meet with considerable political opposition. 

One solution might be to have both Government and non-Government plans. Assuming transparency in both services covered and costs, it leaves the choice in healthcare plans where it belongs-with those paying for the care. It also makes it much harder for those with financial or political interests to convincingly argue against a Government plan (although we are sure they will try). It will force insurance companies to reduce their prices and/or offer more coverage, which is not a bad thing for patients and ultimately, the healthcare system as a whole. However, it does impose a risk, i.e., that profit-driven insurance companies and those who benefit from the current infrastructure will be  replaced by bureaucrats who are primarily concerned with administrative procedure rather than patient care. Present day examples include the VA, Medicare and Medicaid systems. Close public and medical oversight of such a system would be needed.

Ideally, a healthcare system should ensure that citizens can access at least a basic level of health services without incurring financial hardship and with the goal of improving health outcomes. Such a system, would provide a middle path between the extremes of paying for nothing and paying for everything such as unwarranted chemotherapy, stem cell therapy, or unnecessary diagnostic procedures. Determining what services are covered, and how much of the cost is covered are not easy questions to answer, but promises to deliver better health for less money than our current system. Physicians, by dint of their training, and responsibility to uphold their profession and protect their patients, understand that healthcare is not a mere commodity. If we are to protect what little autonomy we have left, we need to be a part of the discussion which should not be driven solely by those in the insurance, the hospital and the pharmaceutical industries.

Richard A. Robbins, MD¹

Angela C. Wang, MD²

¹Phoenix Pulmonary and Critical Care Research and Education Foundation, Gilbert, AZ USA

²Scripps Clinic Torrey Pines, La Jolla, CA USA

References

1. Packer M. Medicare for All: Would Patients and Physicians Benefit or Lose? Medpage Today. July 10, 2019. Available at: https://www.medpagetoday.com/blogs/revolutionandrevelation/80926?xid=nl_mpt_blog2019-07-10&eun=g1127723d0r&utm_source=Sailthru&utm_medium=email&utm_campaign=Packer_071019&utm_term=NL_Gen_Int_Milton_Packer (accessed 7/10/19).
2. CMS. National Healthcare Expenditure Data. Available at: https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nationalhealthaccountshistorical.html (accessed 7/11/19).
3. Berchick ER, Hood E, Barnett JC. Health Insurance Coverage in the United States: 2017. September 12, 2018. United States Census Bureau Report Number P60-264. Available at: https://www.census.gov/library/publications/2018/demo/p60-264.html (accessed 7/11/19).
4. Gonzales S,  Sawyer  B.  How does infant mortality in the U.S. compare to other countries? Peterson-Kaiser Health System Tracker. July 7, 2017. Available at: https://www.healthsystemtracker.org/chart-collection/infant-mortality-u-s-compare-countries/#item-start (accessed 7/11/19).
5. Gonzales S, Ramirez M, Sawyer B.  How does U.S. life expectancy compare to other countries? Peterson-Kaiser Health System Tracker. April 4, 2019. Available at: https://www.healthsystemtracker.org/chart-collection/u-s-life-expectancy-compare-countries/#item-start (accessed 7/11/19).

Cite as: Robbins RA, Wang AC. Medicare for all-good idea or political death? Southwest J Pulm Crit Care. 2019;19(1):18-20. doi: https://doi.org/10.13175/swjpcc051-19 PDF