HHS Publishes Additional Terms and Conditions for Provider Relief Fund and FFCRA Payments – HHS has published additional Terms and Conditions associated with the acceptance of payments made from the $100 Billion Provider Relief Fund established pursuant to the Coronavirus Aid, Relief, and Economics Security Act (P.L. 116-136) (the CARES Act), as well as payments made for COVID-19 testing of uninsured individuals made pursuant to the Families First Coronavirus Response Act (P.L. 116-127) (FFCRA). The published Terms and Conditions apply to the initial $30 Billion general distribution based on net patient revenue that was made beginning April 10; the additional $20 Billion allocated to the general distribution and made beginning April 24; reimbursement from the Relief Fund for COVID-related treatment of the uninsured; and FFCRA payments for testing of uninsured individuals.
All of the Terms of Conditions relating to these distributions and service payments include the following agreements, acknowledgements and certifications by the provider receiving the funds (the Recipient):
- Eligibility. The Recipient certifies is not currently terminated from participation in Medicare or precluded from receiving payment through Medicare Advantage or Part D; is not currently excluded from participation in Medicare, Medicaid, and other Federal health care programs; and does not currently have Medicare billing privileges revoked.
- Non-Permitted Uses of Funds. The payment will not be used to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse. In addition, Recipients of payments for treatment or testing of uninsured patients agree not to include costs for which the payment was received in cost reports or otherwise seek uncompensated care reimbursement through federal or state programs for items or services for which the payment was received.
- Reports. All Recipient are required to submit reports as specified by the Secretary in future program instructions. In addition, Recipients that receive more than $150,000 total in funds under the CARES Act, FFCRA, or any other Act primarily making appropriations for the coronavirus response and related activities, are required to submit detailed quarterly reports to the Secretary and the Pandemic Response Accountability Committee.
- Recordkeeping and Audits. To substantiate the reimbursement of costs, Recipients are required to maintain appropriate records and cost documentation including, as applicable, documentation described in HHS grant rules relating to Financial Management and Record Retention and Access (45 CFR §§ 75.302, 75.361 - 75.365), and other information required by future program instructions. Recipients agree to submit copies of records and cost documentation upon the request of the Secretary, and to cooperate fully in all audits by the Secretary, Inspector General, or Pandemic Response Accountability Committee.
- Balance Billing. Recipients of the $50 Billion general distribution funds certify that they will not seek to collect from the patient out-of-pocket expenses in an amount greater than what the patient would have otherwise been required to pay if the care had been provided by an in-network Recipient. Recipients of funds for COVID- related treatment or COVID-19 testing of uninsured patients agree to accept the payment as payment in full, and not to charge the patient any type of cost-sharing.
- Accuracy of Information. The Recipient certifies that all information submitted as part of its application, as well as all information and reports provided in the future at the request of the Secretary or Inspector General, “are true, accurate and complete, to the best of its knowledge.” The Recipient further acknowledges the penalties that may apply if this certification is false. (This provision was not included in the original published version of the Terms and Conditions applicable to the initial $30 Billion general distribution but does appear in the current version of the Terms and Conditions applicable to that distribution.)
- General Conditions of 2020 Appropriations. A number of restrictions on use of the funds that apply to all 2020 appropriations are also incorporated in all of these Terms and Conditions. These general appropriation terms include limitations on use of the funds for executive pay above a specified level, or for certain lobbying activities. The general appropriations conditions also prohibit requiring employees or contractors seeking to report fraud, waste or abuse to sign internal confidentiality agreements prohibiting the lawful reporting of such matters to a Federal department or agency authorized to receive such information.
Additional Terms and Conditions that apply to Recipients of the initial $30 Billion and more recent $20 Billion general distribution from the Relief Fund include the following:
- The Recipient certifies that it billed Medicare in 2019, and provides (or provided after January 31, 2020) diagnoses, testing or care for individuals with possible or actual cases of COVID-19.
- The Relief Fund payment will only to used to prevent, prepare for, and respond to coronavirus, and reimburse the Recipient only for health care related expenses or lost revenues that are attributable to coronavirus.
- In addition, the Terms and Conditions associated with the $20 Billion general distribution specify that the Recipient consents to HHS publicly disclosing the payment Recipient may receive from the Relief Fund, and acknowledges that “such disclosure may allow some third parties to estimate the Recipient’s gross receipts or sales, program service revenue, or other equivalent information.”
Recipients submitting claims for treatment or testing of uninsured patients also agree to the following Terms and Conditions:
- The Recipient certifies that the items and services reflected on the claims form were provided to the uninsured individual identified in the claim; that the dates of service occurred on or after February 4, 2020; that all items and services were medically necessary; and that the individual was a qualifying “Uninsured Individual” (as defined under the applicable program) at the time of service.
- The Recipient agrees that all claims will be full and complete (i.e., no interim or corrected claims) and all payments are final.
- Payment will be “generally” be made at 100% of the Medicare fee schedule. A calculated average rate will be used if there is no Medicare standard rate.
- HHS may publicly disclose the payment made to the Recipient from the Relief Fund.
Reporter, Kim H. Roeder, Atlanta, +1 404 572 4675, email@example.com.
CMS Issues New Round of Waivers and Rule Changes In Response to COVID-19 – Last week CMS issued a new round of regulatory waivers and rule changes in response to the COVID-19 public health emergency, including its Interim Final Rule with comment period, CMS-5531-IFC. The key changes relax certain regulatory requirements and aim to expand services—including telehealth and testing services, expand workforce and capacity, and otherwise loosen certain rules to give Medicare providers flexibility during the public health emergency. CMS has also made significant changes to its Shared Savings Program for Accountable Care Organizations (ACOs). The new temporary measures build on the other waivers and rules announced on March 30 and April 10, 2020. The changes and waivers apply immediately without an application process.
Lab Testing for COVID-19
CMS had previously announced it will pay laboratories for technicians to collect samples for COVID-19 testing from homebound beneficiaries and those in certain non-hospital settings. Now, CMS will also pay hospitals and practitioners for assessment and sample collection, as well as making separate payment when that is the only service received. Medicare will now cover COVID-19 diagnostic tests when ordered by any healthcare professional authorized to do so under state law, not just the treating physician or other practitioner. Further, Medicare will pay for COVID-19 tests performed by pharmacists as part of a laboratory enrolled in Medicare. In addition to diagnostic tests, Medicare and Medicaid will now cover certain serology (antibody) tests and laboratory processing of certain FDA-authorized tests that beneficiaries self-collect at home.
These updates are included in the CMS fact sheet for laboratories available here.
CMS further expanded flexibilities for telehealth services. For instance, CMS has waived limitations at 42 CFR § 410.78(b)(2) regarding the types of clinical practitioners who may furnish and bill for Medicare telehealth services as distant site providers so they now include physical therapists, occupational therapists, and speech language pathologists.
CMS has expanded which telehealth services can be furnished as “audio-only.” Generally, 42 CFR § 410.78(a)(3) requires that certain telehealth services must be furnished using, at minimum, audio and video equipment that allows two-way real-time interaction with the patient. CMS had previously announced an initial list of services that Medicare would pay for if furnished via audio-only telephone methods and has now broadened that list to include certain behavioral health and patient education services. That list is available here.
CMS is also increasing payments, retroactive to March 1, 2020, for these telephone visits to match payments for similar office and outpatient visits, thus incentivizing the use of telehealth. This would increase payments for these services from a range of about $14-$41 to about $46-$110.
Per the Cares Act, CMS is now paying for Medicare telehealth services provided by rural health clinics and federally qualified health clinics which previously could not be paid to provide telehealth expertise as distant sites.
Additional Provider-Specific Updates Under CMS Waivers
CMS has again updated its list of blanket waivers, here, with certain relevant updates highlighted below.
Teaching hospitals will also no longer face reduced payments for indirect medical education (“IME”) by increasing the number of temporary beds.
Additionally, a teaching hospital that sends residents to other hospitals will be able to continue to claim those residents in the teaching hospital’s IME and direct graduate medical education (“DGME”) FTE resident counts, if certain requirements are met. Specifically, for DGME, the presence of residents in non-teaching hospitals will not trigger establishment of per-resident amounts (“PRA”) at those non-teaching hospitals.
Finally, CMS is freezing the Inpatient Psychiatric Facility (“IPF”) teaching status adjustment payments at their values prior to the public health emergency. CMS intends this measure to incentivize accepting patients from an inpatient acute care hospital without being penalized by lower teaching status adjustments. In other words, a teaching IPF’s teaching status adjustment payments will be the same as they were on the day before the COVID-19 public health emergency was declared. The same applies to rural health clinic payments for the hospital systems that include rural health clinics.
These updates are included in CMS’s fact sheet for teaching hospitals, located here.
Hospital Outpatient Departments
Previously, hospitals were required to provide outpatient services within their respective existing outpatient departments, whether those were on-campus or off-campus. Now, in response to the need to keep patients isolated in order to minimize transmission of the COVID-19 virus, CMS will allow hospitals to provide outpatient services in other temporary sites that are typically not a part of the existing hospital. In the March 30 IFC, CMS waived the provider-based requirements set forth at 42 C.F.R. § 413.65 to allow hospitals to consider these temporary locations to be considered “provider-based” departments during the course of the public health emergency.
These temporary expansion locations so far have included converted hotels, parking lots, and even patients’ homes with temporary hospital designations. Under the new IFC, CMS will consider certain services, like behavioral health services, wound care, and drug administration to be considered “hospital outpatient department” services payable under Medicare when delivered at these temporary “provider-based” locations.
In 2015, Congress required “new” off-campus departments to be paid under non-OPPS reimbursement methodologies. Congress granted an exception for existing off-campus departments that billed under OPPS at that time. Since then, CMS has stated that excepted off-campus departments that relocate to another physical location would lose their special status. In the new IFC, CMS has adopted flexible rules which allow these “excepted off-campus” provider-based facilities to temporarily relocate and still receive OPPS reimbursement for their services. They can relocate to one or more temporary facilities, including the patient’s home. The relocation is temporary and lasts only for the duration of the public health emergency. Finally, providers do not need to seek permission from CMS for relocation. Rather, they must notify CMS of their need to relocate and the new location it considers to be “provider-based.”
These updates and other details are included in CMS’s fact sheet for hospitals, located here.
Inpatient Rehabilitation Facilities (IRFs)
As required by the CARES Act, CMS will now except freestanding inpatient rehabilitation facilities from certain regulatory requirements, including the 3 hour rule under which IRFs are required to provide a minimum amount of therapy per week to admitted inpatients. The purpose of this waiver is to enable free-standing IRFs to more easily accept patients from acute-care hospitals experiencing a surge in patients, including patients that do not require rehabilitation care.
This update is included in CMS’s fact sheet for IRFs, located here.
Ambulatory Surgery Centers (ASCs)
CMS is waiving the medical staffing requirement at 42 C.F.R. § 416.45(b) that medical staff privileges must be periodically reappraised, and the scope of procedures performed in the ASC must be periodically reviewed. CMS believes that loosening this requirement will allow physicians whose privileges will expire to continue practicing at the ambulatory surgical center, without the need for reappraisal, and for ASCs to continue operations without performing these administrative tasks during the public health emergency.
Long-Term Care Facilities (LTCFs) and Skilled Nursing Facilities (SNFs) and/or Nursing Facilities (NFs)
CMS added additional waivers and flexibilities for long-term care facilities related to provision of physician services at these facilities.
- CMS is modifying certain requirements in 42 CFR § 483.75 relating to the requirement that long-term care facilities develop, implement, evaluate, and maintain an effective, comprehensive, data-driven Quality Assurance and Performance Improvement (“QAPI”) program. Specifically, CMS is narrowing the scope of the QAPI program requirements under § 483.75(b)–(d) and (e)(3) to allow LTCFs to focus on adverse events and infection control related to COVID-19.
- CMS is postponing the deadline for completing the nurse aide training requirements at § 483.95(g)(1) for SNFs and NFs. The regulation requires the aide to receive at least 12 hours of in-service training annually. The training requirements will go back into effect at the end of the first full quarter after the declaration of the public health emergency concludes.
- CMS is waiving the discharge planning requirement for LTCFs under § 483.21(c)(1)(viii) to allow the them to more rapidly discharge patients and otherwise expedite the movement of patients among care settings. Normally, the regulation requires LTCFs to assist residents and their representatives in selecting a post-acute care provider using data, such as standardized patient assessment data, quality measures and resource use. At this time, CMS is not waiving any of the other discharge planning requirements.
- CMS is expanding the timeframe by which LTCFs must provide a resident a copy of their clinical records when requested by the resident. The regulation at 42 CFR § 483.10(g)(2)(ii) normally requires a two-working-day timeframe. Under the waiver, however, the timeframe is now ten working days.
These updates are included in CMS’s fact sheet for LTCFs and SNF/NFs here.
Home Health Agencies (HHAs) and Hospice
- Previously, Medicare and Medicaid beneficiaries could only receive home health services with the certification of a physician. Nurse practitioners, clinical nurse specialists, and physician assistants can now provide the home health services, as mandated by section 3708 of the CARES Act. These physicians/practitioners can: (1) order home health services; (2) establish and periodically review a plan of care for home health services (e.g., sign the plan of care), (3) certify and re-certify that the patient is eligible for Medicare home health services.
- CMS is modifying the requirement at 42 C.F.R. § 484.80(d) for home health agencies that each home health aide receives 12 hours of in-service training annually. The training requirements will go back into effect at the end of the first full quarter after the public health emergency concludes.
- CMS is waiving the discharge planning requirement for HHAs under 42 CFR § 484.58(a) to allow the them to more rapidly discharge patients and otherwise expedite the movement of patients among care settings. Normally, the regulation requires HHAs to provide detailed information regarding discharge planning to patients and their caregivers, or the patient’s representative, in selecting a post-acute care provider. At this time, CMS is not waiving any of the other discharge planning requirements.
- CMS is expanding the timeframe by which HHAs must provide residents a copy of their clinical records when requested by the patient. The regulation at 42 CFR 42 CFR § 484.110(e), normally requires a four-working-day timeframe. Under the waiver, however, the timeframe is now ten working days.
- For HHAs and Hospice, CMS is waiving the requirement at 42 CFR § 418.76(h)(2) for Hospice and 42 CFR § 484.80(h)(1)(iii) for HHAs, which require a registered nurse, or in the case of an HHA a registered nurse or other appropriate skilled professional, to make an annual onsite supervisory visit (direct observation) for each aide that provides services on behalf of the agency. All postponed onsite assessments must be completed by these professionals no later than 60 days after the expiration of the public health emergency.
- For HHAs and Hospice, CMS is modifying the QAPI requirements under 42 CFR § 418.58(a)–(d) for Hospice and § 484.65(a)–(d) for HHAs to narrow the scope of the program to allow concentration on infection control issues. This modification is designed to reduce the burden associated with maintain a full, broad-based QAPI program during the public health emergency, allowing providers to focus on COVID-19.
- For hospice, CMS is modifying the annual training regulation at 42 CFR § 418.100(g)(3), which requires hospices to annually assess the skills and competence of all individuals furnishing care and provide in-service training and education programs where required. The waiver postpones this requirement until the end of the first full quarter after the declaration of the public health emergency concludes. CMS has not waived, however, the minimum personnel requirements at 42 CFR § 418.114.
Community Mental Health Centers (CMHCs)
- CMS is modifying the QAPI requirements under 42 CFR § 485.917(a)-(d) to allow CMHCs to use their QAPI resources to focus on challenges and opportunities for improvement related to the public health emergency by waiving the specific detailed requirements for the QAPI program’s organization and content. The modification is designed to allow CMHCs to reconfigure their QAPI programs, as needed, to adapt to specific needs and circumstances that arise during the public health emergency. CMS notes that these flexibilities may be implemented provided that they are consistent with a state’s emergency preparedness or pandemic plan.
- CMS is waiving the requirement at 42 C.F.R § 485.918(b)(1)(iii) that prohibits CMHCs from providing partial hospitalization services and other CMHC services in an individual’s home. The waiver is intended to allow individuals to safely shelter in place while continuing to receive care and services from the CMHC.
- CMS is waving the “40 percent rule,” the requirement at § 485.918(b)(1)(v) that CMHC provides at least 40 percent of its items and services to individuals who are not eligible for Medicare benefits. CMS intends this measure to facilitate the provision of services to Medicare beneficiaries without restrictions on the proportion of Medicare beneficiaries that they are permitted to treat at a time.
Blanket Waivers Applying to Multiple Providers
CMS is waiving the physical environment Condition of Participation for required scheduled inspection, testing and maintenance (ITM). The waiver applies to the regulations for hospitals (42 CFR § 482.41(d)), CAHs (§ 485.623(b)), inpatient hospice (§ 418.110(c)(2)(iv)), intermediate care facilities (§ 483.470(j)) and SNFs/NFs (§ 483.90). Under the waiver, CMS will permit facilities to adjust scheduled ITM frequencies and activities for facility and medical equipment.
Relatedly, CMS is also waiving certain Conditions of Participation for providers regarding compliance with life safety and healthcare facility code requirements to the extent that the facilities need to adjust their ITM schedules. CMS is temporarily modifying waiving these ITM provisions except for the following, which are considered critical.
- Sprinkler system monthly electric motor-driven and weekly diesel engine-driven fire pump testing.
- Portable fire extinguisher monthly inspection.
- Elevators with firefighters’ emergency operations monthly testing.
- Emergency generator 30 continuous minute monthly testing and associated transfer switch monthly testing.
- Means of egress daily inspection in areas that have undergone construction, repair, alterations or additions to ensure its ability to be used instantly in case of emergency.
Finally, CMS is allowing providers to maximize their space by waiving the requirement that these facilities have an outside window or outside door in every sleeping room. This waiver is designed to allow providers to utilize facility and non-facility space that is not normally used for patient care to be utilized for temporary patient care or quarantine.
CMS is making adjustments to the financial methodology, and other requirements, to account for COVID-19 costs for ACOs. These changes include:
CMS will remove all Parts A and B payment amounts for episodes of care for treatment of COVID-19 from the determination of benchmark year and performance year expenditures. CMS intends this measure to help mitigate the potential for windfall shared savings and mitigate the potential for shared losses due to COVID-19.
Participation in the Shared Savings Program
CMS will forgo an application cycle in 2020 for an agreement start date of January 1, 2021 and offer a voluntary 1-year agreement extension for ACOs with agreement periods ending on December 31, 2020, including Track 1+ Model ACOs. Further, CMS will offer BASIC track ACOs participating in the glide path the option to forgo the first automatic advancement along the glide path’s increasing levels of risk and potential reward. BASIC track ACOs electing this option will be automatically advanced for performance year 2022 to the level at which they would have otherwise participated under automatic advancement if they hadn’t elected the option. Eligible ACOs may make voluntary elections to either extend their agreements, and/or maintain (or “freeze”) their current BASIC Track level for performance year 2021 starting June 18, 2020, and the anticipated final date to make these elections is September 22, 2020.
Telehealth and Beneficiary Assignment
For performance year 2020 and any subsequent performance year that starts during the public health emergency, CMS is including additional codes within the definition of primary care services used in determining beneficiary assignment under the MSSP. Specifically, when performing claims-based assignment, CMS will include services billed by an ACO professional consistent with the current definition of primary care services in § 425.400, but will also include remote evaluation of patient video/images HCPCS code G2010 and virtual check-in HCPCS code G2012, online digital evaluation and management services (e-visit) CPT codes 99421-23, and telephone evaluation and management service CPT codes 99441-43.
These updates are included in CMS’s fact sheet for MSSP, located here.
Supreme Court Rules HHS Must Pay $12 Billion to Insurers – On April 27, 2020, the Supreme Court ruled in Maine Community Health Options v. United States that the government must pay over $12 billion to individual and small group health insurers who had claimed losses under the Risk Corridors program established by Section 1342 of the Affordable Care Act (ACA). The Risk Corridors program created a temporary framework to compensate insurers for unexpectedly unprofitable plans during the ACA’s first three years.
The Risk Corridors program sought to limit profits and losses for insurance companies and set a formula for calculating payments. In short, if insurers made more money than allowed by the formula, the insurers had to pay some money back to the government; if insurers lost money, then the insurers were owed money by the government. The ACA neither appropriated funds for these yearly payments nor limited the amounts that the government might pay. Congress subsequently enacted an appropriations rider that prohibited HHS from using its funding to make risk corridors payments.
As background on the litigation, four insurers sued for damages in the Court of Federal Claims under 28 U.S.C. § 1491 (known as the Tucker Act), which grants jurisdiction to the court to hear specialized claims against the government. The insurers asserted that their plans were unprofitable during the Risk Corridors program’s three-year term and that, under § 1342, the HHS Secretary still owed them hundreds of millions of dollars. Only one insurer prevailed before the Court of Federal Claims, and a divided panel of the United States Court of Appeals for the Federal Circuit ruled for the government in each appeal.
The Supreme Court consolidated the cases for review and reversed the Federal Circuit’s decisions. In an 8-1 decision, the Supreme Court held that the government was required to pay all amounts owed under the Risk Corridors program, which exceeded $12 billion. Additionally, the Supreme Court held that insurers may sue the government under the Tucker Act, which has a six-year statute of limitations, to recover that obligation. The enactment of the appropriations rider did not defeat the insurers’ claims for payment, as those claims funds will be satisfied instead by the Judgment Fund, a statutorily-created fund that pays court judgments and compromise settlements of lawsuits against the government where another source of appropriated funds is not available.
The Court’s decision in Maine Community Health Options will have an effect in the near future on insurers’ calculations under the ACA’s Medical Loss Ratio provision. Under this provision, insurers that cover individuals and small businesses must spend at least 80% of their revenue on health-care costs (large-market insurers with more enrollees must spend at least 85%) or write rebate checks to their enrollees. According to data from the Kaiser Family Foundation, without any additional payment from the Risk Corridors program, insurers are already on track to issue an estimated $2.7 billion in rebates to their enrollees for 2020. The rebates are calculated based on a three-year rolling average, i.e., the rebate checks for 2021 will be calculated using their insurer’s financial data from 2018, 2019, and 2020. Medical Loss Ratio calculations are based on the timing of the insurer’s receipt of revenues. Accordingly, even though the judgments in the Risk Corridors cases will be for funds owed to insurers for prior years, these judgments will mean that insurers will have substantially more revenue for 2020, leading to even bigger rebates.
Reporter, Ahsin Azim, Washington, D.C., +1 202 626 9262, firstname.lastname@example.org.
King & Spalding Client Alert: Florida Oncology Provider to Pay $100 Million Fine in DOJ Criminal Antitrust Investigation
On Thursday, April 30, 2020, Florida Cancer Specialists & Research Institute LLC (FCS), the largest independent medical oncology/hematology practice in the U.S., agreed to pay a $100 million fine to resolve a criminal antitrust investigation brought by the Antitrust Division of the U.S. Department of Justice (DOJ). DOJ charged FCS with antitrust violations under Section 1 of the Sherman Act, stemming from FCS’ alleged involvement in a conspiracy to restrict competition for the care of cancer patients. FCS also entered into a deferred prosecution agreement (DPA) with DOJ to resolve the charges. This marks the first time in decades that DOJ has pursued a criminal antitrust enforcement action against a healthcare provider, and one of only a few that have ever been brought against a provider. FCS had also agreed to pay an additional $20 million in disgorgement as part of a parallel settlement with the Florida Attorney General’s Office. More.
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King & Spalding Business Recovery Task
Healthcare organizations now must navigate the challenge of both resuming and continuing work in the context of the ever-changing “new normal.” To help our healthcare clients address this challenge, the King & Spalding Coronavirus Business Recovery Task Force has created a tool for healthcare organizations to assess and strengthen their recovery response. Access the COVID-19 Recovery Response Assessment for Healthcare Organizations here. Access the Coronavirus Business Recovery – Return to Work Hub here.
Survey of State Shelter-in-Place / Stay-at-Home Orders
As the COVID-19 public health emergency continues, King & Spalding has compiled a survey addressing the range of State orders that have been issued to date, including orders with minimal restrictions up to orders affirmatively ordering individuals to “shelter in place” or “stay at home” with all non-essential business operations ceasing. The survey is available here.