What Keeps You Up At Night? - HCCA Official Site...What Keeps You Up At Night? Compliance Issues in...

5/6/2013

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Squire Sanders | squiresanders.com

What Keeps YouWhat Keeps YouWhat Keeps YouWhat Keeps You

Up At Night?Up At Night?Up At Night?Up At Night?

Compliance Issues in ACOs

HCCA Regional Conference – May 10, 2013

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Elizabeth E.H. Trende

Healthcare

Today’s Speakers

David W. Grauer

Chair, Healthcare

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5/6/2013

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Squire Sanders | squiresanders.com 2

BASIC STRUCTUREACO – an organization characterized by a payment and care delivery model that seeksto tie quality and efficiencyto reimbursement for anassigned patient population.

• Collective accountability• Range of payment models• Compliance systems withincompliance system.


OVERVIEW

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We will discuss the ways in which an ACO Compliance Officer is:

• An Architect: Assuring structural integrity at all times; troubleshooting weaknesses.

• An Engineer: Understands how the ACOwaivers work, when they won’t work, and how to monitor their performance.

• A Geologist: Always listens at the broader fault lines – maintains awareness of broader clinical integration compliance issues (e.g. antitrust).

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ARCHITECTURAL ISSUESACO Compliance officers cannot serve as legal counsel to ACOs, but must nonetheless understand the legal underpinnings of these organizations.

• Foundation – ACA Section 3022 (Authorizing Statute)

• Schematic – 42 CFR 425 (Implementing Regulations)

• Other Applicable Building Codes –Stark, AKS, CMPs, Beneficiary Inducements, False Claims

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The problem of “compliance within compliance”

The ACO compliance

officer’s task would be

much easier if this were

your “building” – if you, as

ACO compliance officer,

were in charge of building

and supervising compliance

structures at every floor,

tier and level of your ACO –

but you probably are not.

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ACO participants (such as

individual hospitals) may

have their own

longstanding compliance

structures (and perhaps

longstanding compliance

officers) in place. Some will

be “made of steel.” There

will be debates about the

structural integrity of each.

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Even if your ACO utilizes the

same entity as an existing

provider (and therefore was

able to keep the existing

compliance officer), you

now have brand new

structural risk areas, and

will need new monitors and

mechanisms. How will you

develop and work with

them?7

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This WILL Keep You Up At Night …


ACO implementing regulations require that every level work congruously to achieve overall compliance.

• Mandatory ACO Compliance Plan Elements (42 CFR 425.300(a)):

• One person at the top – a designated compliance official

who is not legal counsel to the ACO and reports directly to

the ACO’s governing body;

• Mechanisms for identifying and addressing compliance

problems (structure-wide);

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Mandatory ACO Compliance Plan Elements (cont’d.)

• Method for employees and contractors of ACO, as well as its participants, providers/suppliers and other vendors (is that a broad enough term?), to anonymously report suspected compliance problems;

• Systemwide compliance training for ACO as well as its participants and providers/suppliers;

• Mechanism for ACO to report probable violations of law to an appropriate law enforcement agency.

• Continual updating.


How to Rest Easier – Steps to Effective Architectural Planning

Practice Tip:

� Make clear that your obligation to take on overall ACO compliance does not relieve individual participants, providers or suppliers from liability, if they do not understand and obey the ACO rules as well as you do. (In other words, the “scare tactic” approach.)

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The law says it’s all on YOU …

“Notwithstanding any arrangements between or among an ACO, ACO participants, ACO providers/suppliers, and other individuals or entities performing functions or services related to ACO activities, the ACO must have ultimate responsibility for adhering to and otherwise fully complying with all terms and conditions of its agreement with CMS …”42 CFR 425.314(c)

But that doesn’t mean each participant does not stand to topple if there is a weak compliance link.


Here’s Why:

ACO participants bind themselves to the representations made by the authorized representative of the ACO. If participants submit claims when they are out of compliance with those representations, they may be liable for violations of the False Claims Act.

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See what can happen when one ACO participant doesn’t

communicate its compliance weaknesses well to the others and

to you?


Practice Tip: It’s Not All Scare TacticsPresent ACO Compliance As An Opportunity (And Make It One)

� The ACO compliance officer should make a personal introduction to each participant – not just to lay down the law, but to find out what compliance strategies they’ve been using that have been effective.

� If an ACO is a new legal entity, it may be able to achieve cost efficiencies by leasing compliance mechanisms already in place (for example, a hotline).

� Introduction of new participants may mean introduction of new service areas – items not rendered (or billed for) before. What are the compliance pitfalls encountered in these areas? The participants who have handled them know best.

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Practice Tip: It’s Not All Scare TacticsPresent ACO Compliance As An Opportunity (And Make It One)

� Include recognition for good ideas as a component of your

mandatory training. Incentivize participation.

� Roundtable discussions on what can better the whole should

be as integral a part of your required participant meetings as

lectures.

� Build trust, build relationships, and communication will follow.


Practice Tip: Develop a Conflict Resolution Procedure

� An ACO will inevitably encounter differences of opinion

between itself and an individual participants regarding how

“things should be done” from a compliance perspective. “Our

facility has done it this way for years and never had a

compliance issue” may become a common refrain.

� Participants should be encouraged to present alternative

points of view through an established review mechanism.

� The process should include requesting an opinion of outside

counsel, if a potential compliance issue has arisen that is

significant.

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ENGINEERING ISSUES

Proper understanding of the way ACO waivers work, and maximum utilization of their protections and limitations, is the key to ACO compliance (that you won’t find in the mandatory compliance plan elements).

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ACO Participation Waiver

Protects arrangements involving an ACO, one or more of its ACO participants or ACO provider/suppliers, or a combination of thereof, and the parties to the arrangements, from liability under the Stark Law, the Kickback Law, and the Gainsharing CMP.

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What Does That Mean?

� Stark Law – Prohibits referrals by physician to any entity with

which physician has financial relationship that does not fit

within exception. Strict liability.

� Anti-Kickback Statute – Prohibits knowingly and willfully

exchanging remuneration for the referral of patients for items

or services covered by federal health care programs. Intent-

based.

� “Gain Sharing CMP” – Prohibits payments by hospitals to

physicians to reduce or limit Medicare-covered services.

� “Patient Inducement CMP” – Prohibits offer of remuneration

that person knows or should know is likely to influence

patient’s choice of provider or supplier.


The ACO Participation Waiver applies only

when the following conditions are satisfied:� The ACO has entered into a participation agreement and remains in

good standing under the agreement.

� The ACO meets the requirements under ACO regulations regarding governance, leadership and management.

� The ACO’s governing body has made and duly authorized a bona fide determination, consistent with the governing body members’ duty, that the arrangement is reasonably related to the purposes of the MSSP.

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The ACO Participation Waiver applies only

when the following conditions are satisfied:

� Both the arrangement and its authorization by the governing body are documented. The documentation must be contemporaneous with the establishment of the arrangement, and the documentation of the authorization must be contemporaneous with the authorization.

� A description of the arrangement must be publicly disclosed (except for financial or economic terms).

Interim Final Rule, 76 Fed. Reg. 67802 et seq. (Nov. 2, 2011).


Other Useful Waivers:

� Beneficiary Inducements Waiver. Covers free or below FMV

items or services provided to patients in order to incentivize

good health (but not cash or cost-sharing waivers).

� The catch:

� ACO must participate in MSSP

� There must be a reasonable connection between items or

services and beneficiary’s medical care

� The items or services provided must be:

� For preventive care (undefined)

� To advance adherence to treatment, drug regime or care

plan, or chronic disease management

42 CFR 425.304(a).

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Other Useful Waivers:

� Shared Savings Distribution Waiver

� Covers distribution of shared savings by ACO to participants, providers and suppliers

� The catch:

� Does not cover distribution of shared savings or incentives paid by commercial insurers (but these may be protected under ACO participation waiver or existing Stark and anti-kickback exceptions)


Too much flexibility all at once can be a negative.

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How to engineer your ACO to survive its new-

found freedom.

Practice Tip:

Assure that your Board takes the near-universal requirement that

a waived arrangement be “reasonably related to the purposes of

the MSSP” seriously, and documents its decision-making

rationale carefully.

The common thread running through the waivers:

In order to qualify for waiver protection, the arrangement must be “reasonably related to the purposes of the MSSP.”

�


Think of the “Einstein” Test:

“You do not really understand something unless you can

explain it to your grandmother.”

- Albert Einstein

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Practice Tip:

Institute an ACO-wide policy that any person or entity who expects waiver protection for a payment arrangement must file the arrangement with you first, and secure Board review and approval. It’s for their protection, as well as the ACO’s.

ACO Participants do not get compensation arrangements waived automatically – the Board has to give them the right to take advantage of a waiver.


For the record, the enumerated “purposes of the shared savings program” include but are not limited to, the following:

o Promoting accountability for the quality, cost, and overall care for a

Medicare population as described in the Shared Savings Program;

o Managing and coordinating care for Medicare fee-for-service

beneficiaries through an ACO;

o Encouraging investment in infrastructure and redesigned care

processes for high quality and efficient service delivery for patients,

including Medicare beneficiaries.

o Evaluating health needs of the ACO’s assigned population;

o Communicating clinical knowledge and evidence based medicine

to beneficiaries; and

o Developing standards for beneficiary access and communication,

including beneficiary access to medical records.

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Practice Tip: Patient-Centeredness RULESACO Compliance

A waiver of law application is not a general license to waive good quality care. If improving patient care is at the center of your ACO’s justification for waiver coverage for a particular arrangement, it is essential that quality not decrease as a result of the arrangement. Monitoring protocols and regular review of quality data are more important where waiver protections are at stake, not less. Look continually at how an arrangement is engineered, and how it operates in practicality.


Practice Tip: Patient-Centeredness RULESACO Compliance

Always ask: What is improving here besides our bottom line? Are we truly “patient-centered?” If not, we are out of compliance with a key component of the ACO program, regardless of waiver status.

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Practice Tip:

We recommend, in addition, that arrangements be as insulated as possible, in the event waiver protection should disappear. For example, if the government disapproves waiver coverage for a physician payment arrangement in the context of an ACO, all may not be lost if a compliance officer can produce a fair market value and commercial reasonableness opinion (both obtained before the arrangement was enacted) supporting the arrangement. Always have a back-up plan, especially for a high-risk (high pay) arrangement.


Practice Tip:

Have clear policies in place for when things fracture unexpectedly.Example: The Perfect Physician Group Participates in ACE

ACO. As part of its integration effort, ACE ACO gifts Perfect

Physicians (along with other participants) with state-of-the-

art EMR, to be implemented in the physician offices, and help

connect care systemwide. (Note that in terms of reasonable

relation to the MSSP, this effort is relatively easy call – it

facilitates care management and coordination.) All goes well

for a few months, but then Perfect Physicians leaves abruptly

leaves the ACO. What happens to the EMR?

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In all things compliance-related, documentation is paramount:

An ACO authorized representative must certify annually that

the ACO, its participants, or providers/suppliers and others

performing services for the ACO are in compliance with

program requirements, as well as certify the accuracy,

completeness and truthfulness of any information generated

or submitted by the ACO group, “including any quality data or

other information relied upon by CMS in determining the

ACO’s eligibility for, and the amount of, a shared savings

payment, shared losses or the amount owed by the ACO to

CMS.”


Practice Tip:

This is a hefty requirement, so make sure the participants

(who, remember, are in it with you) shoulder the certification

burden.

Certification of the accuracy of all reported information

should take place on every level (provider, participant,

supplier), and the ACO compliance officer’s stamp of approval

should be the last one, not the only one. Build a certification

file, not a certification photocopy.

When certification time comes, remember that participants

are in it with you – so keep them there, on paper.

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GEOLOGY: LISTEN AT THE FAULT LINES

ACO Compliance Officers should also be on

the lookout for other compliance pitfalls that

may not be on the everyday radar screen.


Antitrust:

FTC and DOJ issued guidance specific to ACOs that established

the following:

o If an ACO meets CMS’s eligibility requirements and is

approved to participate in the MSSP;

o And the ACO uses the same governance and leadership

structures and clinical and administrative processes it uses in

the Shared Savings Program to serve patients in commercial

markets;

o Then joint price negotiations with commercial insurers

will be evaluated under the rule of reason.

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The Safety Zone:

FTC and DOJ announced that —barring extraordinary

circumstances—they will not challenge Medicare

ACOs that fall within a “safety zone.” To qualify,

ACO participants must possess a combined market

share of 30% or less of each service throughout the

ACO’s Primary Service Area (PSA). In addition,

hospitals and surgery centers must be non-exclusive,

as must “dominant providers” (i.e., those with a

market share of 50% or greater) of any service.


Practice Tip:Determine whether your ACO falls within the “safety zone.” If it does not,

your arrangement is still likely to receive “rule of reason” analysis, but the

government formally cautions you to avoid the following conduct:

1. Sharing competitively sensitive data among the ACO's participants

that could be used to set prices or other terms for services provided

outside the ACO;

2. Tying sales – explicitly or through pricing policies – of the ACO's

services to a commercial payor's purchase of other services from

providers outside the ACO (and vice versa);

3. Contracting on an exclusive basis with ACO physicians, hospitals,

Ambulatory Surgery Centers (ASCs), or other providers.

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Taxation:• An ACO can conduct activities unrelated to the MSSP

without jeopardizing the status of tax-exempt

participants, in some circumstances (e.g., to further an

exempt purpose).

• The IRS recognizes that certain non-MSSP activities

may further a charitable purpose (e.g., activities

related to serving Medicaid or indigent populations).

• BUT, not every activity that supports health will support

tax exemption.

• Any charitable organization participating in an ACO

must ensure that its participation does not result in

inurement or impermissible private benefit.


Health Information Technology:• Providers’ Notice of Privacy Practices are likely to require

amendment under the Privacy Rule, and should be revised prior

to September 23, 2013.

• The NPP must include a description of uses and disclosures for

marketing and sale of PHI that require a written authorization

from the subject of the information. All health care providers must

also include a statement that they must agree to a request not to

disclose PHI to a health plan for payment or health care

operations if the services or items are paid in full out of pocket.

• In an ACO context, the ACO is a business associate of the

participants. The providers who are participants and serving on

committees would be providing services on behalf of the ACO

and would likely be considered the workforce of the ACO.

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Maintain A Birds-Eye View of Patient Traffic:

The government has vowed to closely

scrutinize “cherry picking” and “shunting”

of patients in ACO and other integrated

care models, so that cost savings are

maximized at the risk of patient care.

Again, patient-centeredness is everything. As an ACO compliance

officer, this is a safe motto.


Questions?

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