The company 'aggressively recruited' dozens of surgeons with the potential to use a high volume of the company's products and hired them as paid 'consultants.'
Medical device maker Life Spine Inc., its founder and a senior executive will pay $6 million to settle allegations that the medical device maker paid millions of dollars in kickbacks to surgeons to use their implants, the Department of Justice said.
The settlement was based on financial disclosures by Life Spine, which determined the company's ability to pay, DOJ said.
The federal government in July intervened in a whistleblower lawsuit that was brought against Huntley, Illinois-based Life Spine which showed that, from 2012 through 2018, Geiber and Butler "aggressively recruited" dozens of surgeons with the potential to use a high volume of the company's products and hired them to serve as paid "consultants."
These paid consultants agreed to transfer their patents and patent applications to Life Spine in exchange for payments and promised support to bring the surgeons' new products to market, DOJ said.
Butler admitted that he tracked surgeons' use of Life Spine products to ensure that surgeons were generating sales revenues for the company and were fulfilling their "commitment" to use Life Spine products.
Life Spine admitted that it generated a report that compared surgeon consulting, royalty, and intellectual property payments to surgeon product usage levels, and then calculated an return on investment for each surgeon based on those figures. If a surgeon's usage was too low, Life Spine managers, including Butler, pressured the surgeon to use more Life Spine products.
The alleged kickbacks took the form of medical education agreements that paid surgeons to provide training and/or educational services; product development agreements that paid surgeons royalties for their positive input on new products; and intellectual property agreements that paid surgeons large up-front acquisition fees for their patents/patent applications.
The surgeons who were paid kickbacks generated half of Life Spine’s domestic sales of spinal products from 2012 through 2018. DOJ said the payments violated the Anti-Kickback Statute that ultimately resulted in false claims for payment from Medicare and Medicaid.
Life Spine said in a media release that it was "pleased" to announce the settlement.
"The company has made significant progress formalizing and strengthening its compliance program, a process that began before any discussions with the government," the company said
A Harvard study offers an alternative explanation for declines in hospital readmissions.
There's no arguing that 30-day readmissions for certain conditions targeted by a federal initiative to improve quality of care are on the decline.
The Centers for Medicare & Medicaid Services' Hospital Readmissions Reduction Program is getting a lot of credit for the decline. Since 2010, the program had dinged hospital Medicare reimbursement for a range of preventable readmissions for conditions such as pneumonia and heart failure.
However, in a study this month in Health Affairs, researchers at Harvard Medical School are offering an alternative explanation that the drop in readmissions is being driven by an overall decline in hospital admissions.
"The decline in readmission rates looked like the silver lining of pay-for-performance, but it seems to have lost its luster," said study lead author J. Michael McWilliams, the Warren Alpert Foundation Professor of Health Care Policy in the Blavatnik Institute at Harvard.
"Our study makes a strong case that what looked like achievements of the program may have been a byproduct of factors driving a broader decrease in hospitalizations across the board," McWilliams said.
McWilliams spoke with HealthLeaders about the study findings, and the use of readmissions as a quality metric. The following transcript has been edited for length and clarity.
HLM: What prompted this study?
McWilliams: This decline in admission rates had gone largely unnoticed in the literature on the HRRP. So that prompted us to do the study, particularly in the wake of other studies interpreting the decline of readmissions as a causal effect of the program. It seemed worth pointing out that there was this other broader trend going on nationwide.
HLM: So, the simplest explanation is the correct one?
McWilliams: Yeah. Occam's Razor. As a physician and health policy researcher, I'm not sure that's always true. It seems like things can get really complicated sometimes. But in this case, the falling rate of admissions is a pretty clear explanation for at least much of the decline in readmissions.
It's just because of this simple statistical relationship between the two. If there were fewer admissions per patient, and readmissions are largely independent events, simply other admissions that happened to fall within 30 days of another, then statistics tell us that as the number of admissions per patient falls, the probability that one admission falls close to another is lower.
HLM: Does this mean that efforts to reduce 30-day readmissions are a waste of time?
McWilliams: I don't think we can say it's a waste of time. We can certainly say that, whatever response has been elicited by the program, those efforts to reduce readmissions either have not been very effective, or it's possible that those efforts did prevent some readmissions, but at the same time, a lot of the efforts which involved outreach to patients may have also increased readmissions.
One interpretation–although this is speculative because it's very hard to sort out which are the prevented and which are the increased readmissions–might be that the quality of care may have gotten somewhat better. It's just not reflected in the measure.
HLM: What do your findings suggest about using readmissions as a quality metric?
McWilliams: Any utilization-based quality measure is really problematic because it begs the question, what's the right level of utilization? This is true of so-called preventable admissions as well as hospitalizations for ambulatory care-sensitive conditions. Obviously, the right amount of admissions and readmissions is not zero. So it's very hard to know if we provide optimal care what proportion of patients would be admitted or readmitted.
HLM: Based on your findings, should Medicare eliminate the financial penalties for 30-day readmissions?
McWilliams: For any given hospital, it's hard to know whether it's merited or not. There's been a lot of research in this area that has demonstrated that, while it's not clear that the program has reduced readmissions much if at all, what it has certainly done is transferred resources away from providers serving sicker and poor patients to the hospital serving the healthier, wealthier patients and in ways that are not merited, that are not due to differences in quality, but rather just due to differences in the populations that they serve.
We'd be better off without the program for that reason, and there is ongoing debate about whether the program should be scrapped altogether, whether it can be refined in a way that it could achieve its objective.
I tend to be quite skeptical of programs like this that fall in the category of pay for performance because they're just a lot of intractable problems with this approach to quality improvement of trying to bake it into the payment system.
HLM: What should be done with your study findings?
McWilliams: A good use would be to take a step back and reassess the merits of this program and other programs like it. This is not the first pay-for-performance program we've found to have minimal benefits and lots of unintended consequences. The research on the Value-based Payment Modifier, which was the precursor to the MIPS, is very similar, as is the Hospital Value-based Purchasing Program.
The best use of the findings is to take a step back and to really have a new conversation where we start thinking about ways to improve quality that is not by linking incentives to performance measures, but just thinking about what interventions and strategies help improve quality.
Sometimes we forget that the ultimate goal is quality improvement when we are so focused on measures and how they should fit into the payment system. Once we figure out how to improve quality, there'll be demand from patients for it and providers are interested in providing better quality care.
The schemers falsely told patients they had only six months to live in a ploy to collect hospice payments.
A federal jury in Texas has convicted a small-town mayor and two other healthcare executives for their role in a hospice fraud scheme that stole $154 million from Medicare by falsely telling patients with long-term incurable diseases such as Alzheimer's that they had only months to live.
After a three-week trial in San Antonio, the jury found Rodney Mesquias, 47, of San Antonio, Henry McInnis, 47, of Harlingen, and Francisco Pena, 82, of Laredo, guilty of multiple counts of healthcare fraud, money laundering, conspiracy and obstruction of justice, the Department of Justice said.
Sentencing was scheduled for June 2020.
Mesquias owned and controlled the Merida Group, which operated dozens of hospice sites across Texas. McInnis was CEO. Pena, a physician, was a medical director for the Merida Group and, at the time, the mayor of Rio Bravo, Texas.
Evidence presented at trial showed that from 2009 through 2018 the Merida Group enrolled patients with long-term incurable diseases, such as Alzheimer's and dementia, at group homes, nursing homes, and in housing projects after lying and telling them that they had less than six months to live, so that they could qualify for hospice services.
The schemers went so far as to send chaplains to lie to the patients and discuss last rites and preparation for their imminent death, DOJ said.
In actuality, the patients were not terminally ill and were in some instances walking, driving, working and even coaching athletic sporting events, trial evidence showed.
Nonetheless, the schemers kept the patients on services for multiple years to increase revenues and threatened and fired employees who refused to go along with the fraud.
When confronted about the kickbacks he accepted while in his mayoral office in Rio Bravo, Pena lied to the FBI, and schemers gave fictitious medical records to investigators to cover their tracks.
To launder the proceeds, the schemers created a company in the name of the girlfriend of a co-conspirator physician, and used the company to conceal and distribute of hundreds of thousands of dollars in kickbacks that were paid to the physician in exchange for referrals
The schemers used the ill-gained proceeds to buy exotic cars, expensive jewelry, real estate, high-end clothing, Las Vegas outings, and premium season tickets to San Antonio Spurs games.
The evidence also showed that Mesquias and McInnis spent tens of thousands of dollars wining and dining physicians at exclusive Las Vegas casinos such as Hakkasan and Omnia in exchange for medically unnecessary patient referrals.
"It's disgusting how these three made millions by lying about and manipulating people's end of life care," said U.S. Attorney Ryan K. Patrick of the Southern District of Texas. "These men won't have season tickets or nice cars where they are headed."
Program offered for medical students who'll commit to primary care at the Pennsylvania-based health system after graduating.
Geisinger and Geisinger Commonwealth School of Medicine have created the Geisinger Primary Care Scholars Programthat will offer debt-free medical school and living assistance to medical students who agree to work within primary care at the health system after they graduate.
Medical students often carry $200,000 or more in debt, which pushes them into higher-paying specialties. Geisinger President and CEO Jaewon Ryu, MD, says that removing the financial strain in exchange for a four-year commitment to practice at Geisinger will make it easier for more med students to pursue primary care.
"At Geisinger, we've been able to prove that by focusing on primary care we can improve outcomes, lower costs and improve satisfaction among patients and providers," Ryu said.
"We've built some innovative programs that expand upon the notion of what is primary care and where it is delivered. With all of these different offerings, we are thrilled to welcome anyone who shares this passion around new and exciting ways to deliver this core care," Ryu said.
"So, it's only natural that we extend that commitment to training the next generation of physicians. These scholars have the opportunity to learn and later work in Geisinger's innovative primary care environment without the worry of how they will pay for their education," he said.
The program will pick 40 first- and second-year students in each incoming medical class through a competitive application process. Selection criteria include demonstrated financial need, academic merit, diversity, passion for serving their communities, and predictors of whether the applicant is likely to stay in Geisinger's service area.
The program will provide full coverage of tuition and fees plus a monthly $2,000 stipend through the four years of medical school.
"I can't think of a better opportunity for these scholars to pursue their commitment to primary care than by providing debt-free medical schooling," said Steven J. Scheinman, MD, executive vice president and chief academic officer at Geisinger and Dean of the Geisinger Commonwealth School of Medicine.
Last year Geisinger started the Abigail Geisinger Scholars Program. Which gives 10 students in each class up to four years of tuition in the form of a loan, which is forgiven upon completion of a service commitment as a Geisinger physician in any specialty.
'D' and 'F' hospitals have nearly twice the risk of mortality of 'A' hospitals.
One third of the 2,600 general, acute care hospitals across the nation rated in The Leapfrog Group's fall 2019 Hospital Safety Grades got an 'A,' grade, while 1% flunked, the patient safety monitors said.
Leapfrog grades are based upon process and structural measures such as hand hygiene, risk mitigation, and discharge communication, as well as outcome measures such as falls, pressure ulcers, and infections.
The safety ratings' release coincides with the 20th anniversary of the Institute of Medicine's shocking report, To Err Is Human, which showed that nearly 100,000 people die every year due to preventable medical errors. Other research has shown that number could be twice as high.
"The findings of the IOM report, published two decades ago, laid the foundation of what The Leapfrog Group stands for today," said Leah Binder, president and CEO of The Leapfrog Group. "In stark contrast to 20 years ago, we're now able to pinpoint where the problems are, and that allows us to grade hospitals."
"It also allows us to better track progress. Encouragingly, we are seeing fewer deaths from the preventable errors we monitor in our grading process," she said.
Among the findings:
More than 2,600 hospitals graded with the breakdown as follows: 33% earned an "A," 25% earned a "B," 34% earned a "C," 8% a "D" and just under 1% an "F."
The five states with the highest percentages of "A" hospitals are: Maine (59%), Utah (56%), Virginia (56%), Oregon (48%) and North Carolina (47%).
There are no "A" hospitals in three states: Wyoming, Alaska and North Dakota.
Notably, 36 hospitals nationwide have achieved an "A" in every grading update since the launch of the Safety Grade in spring 2012.
Earlier this year, Leapfrog commissioned the Johns Hopkins Armstrong Institute for Patient Safety and Quality to update its estimate of deaths due to errors, accidents, injuries and infections at "A", "B", "C", "D" and "F" hospitals.
The study estimated that 160,000 lives are lost each year from the avoidable medical errors identified in the Leapfrog Hospital Safety Grade, down from 205,000 avoidable deaths in 2016.
The Johns Hopkins analysis found that "D" and "F" hospitals have nearly twice the risk of mortality of "A" hospitals, and that more than 50,000 lives could be saved if all hospitals performed at the level of "A" graded hospitals.
Trump administration's healthcare agenda delivered another setback in court.
A federal judge in Manhattan on Wednesday vacated "in its entirety" the Trump administration's so-called "conscience rule" that would have allowed clinicians to refuse to provide medical services, namely abortions, on moral or religions grounds.
In a 147-page ruling that consolidated three separate lawsuits challenging the law, U.S. District Judge Paul Engelmayer said that federal law already acknowledges the conscience rights of clinicians, and "accommodate(s) religious and moral objections to health care services provided by recipients of federal funds."
"The Court's decision today leaves HHS at liberty to consider and promulgate rules governing these provisions," said Engelmayer, an Obama administration appointee in 2011. "In the future, however, the agency must do so within the confines of the APA and the Constitution."
An HHS officials said they're reviewing the opinion.
Alexis McGill Johnson, Acting President and CEO, Planned Parenthood Federation of America – a plaintiff in one of the suits – cheered the ruling.
"Today, the Trump administration was blocked from providing legal cover for discrimination," she said. "As the federal district court made clear, the administration acted outside its authority and made false claims to try to justify this rule. This rule put patients' needs last and threatened their ability to access potentially lifesaving healthcare."
"No one should have to worry they will be denied the medical care they need simply because of their health care provider's religious, moral, or personal beliefs," she said.
U.S. Senator Ben Sasse (R-NE) called the ruling "absurd mush," and urged the Trump administration to "defend basic conscience rights all the way to the Supreme Court."
"The point of the First Amendment – especially the free exercise of religion – is to protect the conscience rights of Americans," he said. "In this country, government doesn’t get to tell you that your faith is fine on Sunday at church but not Monday at work.
The ruling was the latest setback for the Trump administration, which has seen its various attempts at healthcare reform – from Medicaid work requirements to hospital outpatient reimbursement cuts -- rebuffed by federal judges across the nation.
Last week, Health and Human Services Secretary Alex Azar announced that the government would forge ahead with site-neutral cuts under its outpatient prospective payment system, even though a federal court in September vacated the policy.
Azar said HHS would also push forward a 22.5% payment rate cuts for some drugs under the 340B program, even though that policy was vacated by a federal court in May.
The Trump administration's final rule that would require hospitals to disclose payer-specific negotiated ratesis also expected to see legal challenges from payers and providers when it's unveiled.
The failure to encrypt mobile devices results in a hefty settlement.
The University of Rochester Medical Center will pay a$3 million settlement to the federal government for losing an unencrypted flash drive and a laptop computer that contained patient information.
The flash drive was lost in 2013, and the laptop in 2017, and though URMC filed breach reports for both incidents, the Department of Health and Human Service's Office for Civil Rights said the hospital's response was inadequate.
OCR said the hospital "failed to conduct an enterprise-wide risk analysis; implement security measures sufficient to reduce risks and vulnerabilities to a reasonable and appropriate level; utilize device and media controls; and employ a mechanism to encrypt and decrypt electronic protected health information (ePHI) when it was reasonable and appropriate to do so."
URMC spokesman Chip Partner said the affected patients were notified at the time both incidents occurred.
"We have no reason to believe that any patient’s personal health information was misused," he said.
This was not the first HIPAA violation for URMC. OCR said the hospital failed to take sufficient corrective action in 2010 with a similar breach involving another lost unencrypted flash drive.
OCR said RUMC did not learn from that error and continued to permit the use of unencrypted mobile devices.
"Because theft and loss are constant threats, failing to encrypt mobile devices needlessly puts patient health information at risk," OCR Director Roger Severino said in a media release. "When covered entities are warned of their deficiencies, but fail to fix the problem, they will be held fully responsible for their neglect."
Along with the settlement, URMC will adopt a corrective action plan that includes two years of monitoring for HIPAA compliance.
Partner said URMC "is deeply committed to protecting patient privacy, and we continuously improve our IT security safeguards and staff training to reduce the risk of a privacy breach."
"As part of the settlement with HHS, we will undertake a comprehensive audit of security practices and implement any corrective actions needed to ensure our safeguards are as strong as possible," he said.
Ozuah succeeds Steven M. Safyer, MD, who is retiring after 40 years of service.
Montefiore Medicine's search for a new CEO is over, and the Bronx-based health system has chosen one of its own.
Philip O. Ozuah, MD, president of Montefiore Health System and previously served as Physician-in- Chief of the Children's Hospital at Montefiore, will take over from long-serving CEO Steven Safyer, MD, on Nov. 15.
"It will be a privilege to lead Montefiore Medicine, an organization with a clear purpose – to heal, to teach, to discover and to advance the health of the communities we serve," Ozuah said in a media release.
"Ever since first joining Montefiore in 1989, I've been inspired by our institution’s commitment to excellence. We are an organization of exceptionally talented and compassionate people."
Ozuah, a pediatrician, said an area of focus under his tenure will be "to continuing to expand inclusive access to state-of-the-art care and to furthering Montefiore's role as a global leader in healthcare and biomedical research."
Safyer, who has been with Montefiore for more than 40 years, said that with Ozuah's appointment, "I know I am leaving our institution in the best possible hands."
"I have consistently been impressed by Dr. Ozuah's strategic vision for the Montefiore Health System," Safyer said. "His appointment as CEO will guarantee a smooth transition, and I know he’ll continue to uphold the standard of excellence on which Montefiore has built its reputation."
Montefiore Medicine includes the Albert Einstein College of Medicine, 15 hospitals in the New York City and Hudson Valley area, and 200 outpatient ambulatory care sites.
Harrison will remain CEO of the Salt Lake City-based health system while undergoing treatment.
Intermountain Healthcare President and CEO Marc Harrison, MD, announced this week that he will undergo treatment for multiple myeloma.
"Cancer is never good news, of course, but I have every reason to hope for a successful outcome," Harrison said in a media release.
"I am proud and grateful that my care will be provided by Intermountain caregivers – the best in the land. I look forward to their care and support as I continue to serve our communities as CEO of Intermountain," he said.
Harrison is expected to return to the C Suite in early 2020, and will remain CEO of the Salt Lake City-based health system while undergoing treatment, Intermountain said.
"While multiple myeloma is not yet fixable, it can be managed effectively with a range of medical therapies, and today can be treated as a chronic disease," Harrison said. "Many people live successfully with chronic diseases such as diabetes, high blood pressure, and asthma. This is my chronic disease."
Harrison has been president and CEO of Intermountain since October 2016. The not-for-profit health system has operations in Utah, Idaho and Nevada, and includes 24 hospitals, 215 clinics, a Medical Group with 2,500 employed physicians, and SelectHealth insurance company.
The final rule updates the longstanding E/M documentation and coding framework used by clinicians to bill Medicare.
The federal government's efforts to reduce physician paperwork and reward coordinated care for chronically ill patients are getting a warm reception from physician associations.
The Centers for Medicare & Medicaid Services says the final rule unveiled on Friday will feature red tape reductions that will save the nation's physicians about 2.3 million hours per year in burden reduction.
The changes update the longstanding evaluation and management documentation and coding framework used by clinicians to bill Medicare for routine office visits. CMS is also increasing payment for office and outpatient E/M visits and offering enhanced payments for chronic care management.
"Historic simplifications to billing requirements mean that clinicians will be able to focus on recording the information that’s most important to keeping a patient healthy," Health and Human Services Secretary Alex Azar said in a media release.
"As we move toward a system that pays more and more providers for outcomes rather than procedures, we look forward to freeing clinicians from even more of these burdens," he said.
Robert McLean, MD, president of the American College of Physicians, said Medicare has for too long undervalued E/M codes by primary care physicians.
"At the same time, physicians were faced with excessive documentation requirements to be paid for such services," McLean said. "ACP is extremely pleased that CMS’s final payment rules will strengthen primary and cognitive care by improving E/M codes and payment levels and reducing administrative burdens, in line with ACP's Patients Before Paperwork initiative."
American Medical Association President Patrice A. Harris, MD, said the nation's largest physician association worked with CMS to complete the first overhaul of E/M office visit documentation and coding in more than 25 years.
"Physicians spend a huge amount time meeting burdensome documentation requirements during patient interactions, which takes time away from patients and contributes significantly to burnout and professional dissatisfaction, Harris said. "This new approach is a significant step in reducing administrative burdens that get in the way of patient care."
The AMA said that key elements of the E/M office visit overhaul include:
Eliminating history and physical exam as elements for code selection. While significant to both visit time and medical decision-making, these elements alone should not determine a visit's code level.
Allowing physicians to choose whether their documentation is based on medical decision-making or total time. This builds on the movement to better recognize the work involved in non-face-to-face services like care coordination.
Modifying MDM criteria to move away from simply adding up tasks to focus on tasks that affect the management of a patient’s condition.
With the final rule in place, Harris said it is "time for vendors and payors to take the necessary next steps to align their systems with E/M office visit code changes by the time the revisions are deployed on January 1, 2021."
"In the coming months, the AMA will undertake an aggressive effort to ensure that EHR providers, coders, payors and other vendors implement simplified coding so physicians no longer labor under undue documentation complexity," Harris said.
While praising the E/M reforms, the AMA said it was also "concerned about significant payment reductions" anticipated for some clinicians, including psychologists and physical therapists.
"The Association will work through the course of the next year to convince CMS that all specialties' payment for office visits should be recognized as equivalent. This was demonstrated by the survey of 50 different specialties—a survey lauded by CMS," AMA said.
McLean says the reforms could also address the growing shortage of primary care physicians.
"Fewer physicians are going into office-based internal medicine and other primary care disciplines in large part because Medicare and other payers have long undervalued their services and imposed unreasonable documentation requirements," he said. "CMS's new rule can help reverse this trend at a time when an aging population will need more primary care physicians—especially internal medicine specialists to care for them."
