In This Issue...

AMA, AHA and ANA Report Suggests Major Job Losses from Sequester

The American Medical Association (AMA), the American Hospital Association (AHA), and the American Nurses Association (ANA) recently released a report that suggests a two percent cut in Medicare reimbursement, as required by the Budget Control Act of 2011, would result in the loss of 766,000 health-related jobs by 2021. The 2011 legislation mandates $1.2 trillion in defense and non-defense cuts by January 1, 2013 unless Congress enacts equal reductions prior to the implementation date. According to the AHA, these cuts would make it difficult for hospitals to provide many of the services their communities need. A copy of the study is available on the AHA Web site.

DOJ and HHS Suggest Hospitals Using EHR to Commit Fraud

On September 24th, the Department of Justice (DOJ) and the Department of Health and Human Services (DHHS) sent a scathing letter to five major hospital groups inferring that hospitals are using electronic health records (EHR) to overcharge the Medicare program. The Departments told the hospital organizations that:

"there are troubling indications that some providers are using this technology to game the system, possibly to obtain payments to which they are not entitled. False documentation of care is not just bad patient care; it’s illegal. These indications including potential "cloning" of medical records to inflate what providers get paid. There are also reports that some hospitals may be using electronic health records to facilitate "upcoding" of the intensity of care or severity of patients’ condition as a means to profit with no commensurate improvement in the quality of care."

In conclusion, the Departments stated that they will actively prosecute hospitals that misuse or abuse EHRs to increase their profits. The government letter was dated three days after a New York Times article reported that hospitals receiving EHR incentives between 2005-2010 billed Medicare $1 billion more through higher coding than hospitals that did not receive the incentive payments. To see the New York Times article, please go to their Web site. The DOJ/HHS letter is available on the BNA Reports Web site.

House Passes AACC-backed CLIA Referral Legislation

On September 19th, the House of Representatives passed H.R.6118, the “Taking Essential Steps for Testing Act,” which would amend CLIA’88 to give the Centers for Medicare and Medicaid Services (CMS) greater flexibility when determining what penalties to impose on a laboratory for sending a proficiency testing (PT) specimen to an outside laboratory. Currently, CMS revokes a laboratory’s certificate for two years and bars the laboratory director from directing a clinical laboratory for two years—regardless of whether the specimen was sent in error or not. H.R.6118 would permit CMS to impose lesser penalties if warranted. For a copy of the bill, please go to the congressional Web site, THOMAS, here.