Providers say the shift will saddle patients with hefty medical bills and leave hospitals to absorb more uncompensated care when patients can't pay.

This article first appeared November 14, 2017 on Kaiser Health News.

By Michelle Andrews

If you’re poor, uninsured and fall seriously ill, in most states if you qualify for Medicaid — but weren’t enrolled at the time — the program will pay your medical bills going back three months. It protects hospitals, too, from having to absorb the costs of caring for these patients.

But a growing number of states are rescinding this benefit known as “retroactive eligibility.” On Nov. 1, Iowa joined three states that have eliminated retroactive coverage for some groups of Medicaid patients since the Affordable Care Act passed. Each state had to secure approval by the federal government.

Retroactive eligibility has been a feature of Medicaid for decades, reflecting the program’s emphasis on providing a safety net for poor, disabled and other vulnerable people. In contrast to private insurance, determining Medicaid eligibility can be complex and the application process daunting, advocates say. A patient’s medical condition also may keep families from applying promptly for coverage.

All four states — Arkansas, Indiana and New Hampshire, in addition to Iowa — have expanded Medicaid under the health law, which allowed states to include adults with incomes up to 138 percent of the federal poverty level, or about $16,000 for one person. So, in theory, most adults are required to have insurance under the ACA. In practice, each state still has a significant number of uninsured, ranging from 5 to 8 percent of the population.

The retroactive coverage “can compensate for the sorts of errors and lapses that can so easily occur on the part of both the applicant and the government bureaucracy” that delay applications, said Gordon Bonnyman, staff attorney at the Tennessee Justice Center, a public interest law firm that represents low-income and uninsured residents.

State and federal officials say eliminating the retroactive coverage helps encourage people to sign up for and maintain coverage when they’re healthy rather than waiting until they’re sick to enroll. It also fits into federal officials’ efforts to make Medicaid, the federal-state program that provides health care for low-income adults and children, more like private insurance.

But consumer advocates and health care providers say the shift will saddle patients with hefty medical bills and leave hospitals to absorb more uncompensated care when patients can’t pay. Some worry this could be the start of a trend.

In Iowa, the change applies to just about anyone coming into Medicaid — except for pregnant women and children under age 1. The change will affect up to 40,000 residents annually and save the program more than $36 million a year.

“We’re making it a lot more likely that Medicaid-eligible members are going to incur significant medical debt,” said Mary Nelle Trefz, health policy associate at the Child & Family Policy Center in Des Moines, whose organization opposed the change.

When someone has a traumatic health event, the initial focus is to get them stabilized, not figure out how to pay for it, said MaryBeth Musumeci, associate director of the Program on Medicaid and the Uninsured at the Kaiser Family Foundation. (Kaiser Health News is an editorially independent program of the foundation.)

Patients may neglect to apply immediately for Medicaid, leaving them financially responsible for days or months of care they received before they got in their application, even though they may have been eligible for Medicaid all along.

That’s not the only issue, advocates say. Unlike the commercial insurance market where re-enrollment through someone’s employer is routine, Medicaid requires that beneficiaries’ eligibility be reassesed every year.

“People fall through the cracks,” said Andrea Callow, associate director of Medicaid initiatives at Families USA, a consumer advocacy group.

In addition, complications can arise for people who might need Medicaid coverage for long-term care services. “The criteria are complicated. For a layperson to find those criteria and figure out if they’re eligible” is challenging and they may need extra time, said Musumeci. Once patients have secured coverage, they may already have accrued hefty expenses.

Maybe so, but some people argue that a 90-day retroactive eligibility guarantee is counterproductive.

“We’re trying to get people to behave more responsibly, not less responsibly,” said Gail Wilensky, an economist who oversaw the Medicaid and Medicare programs in the early 1990s under President George H.W. Bush. “That is not the signal you’re sending” with three months of retroactive eligibility. A 30-day time frame is more reasonable, Wilensky said.

In contrast to Iowa, the waivers in Arkansas, Indiana and New Hamsphire generally apply only to adults who gained coverage under the law’s Medicaid expansion. (Indiana’s waiver also applies to other groups.)

Kentucky has a request pending that, like Iowa, would eliminate retroactive Medicaid eligibility except for pregnant women and children under 1, according to KFF.

Under federal law, officials can waive some Medicaid coverage rules to give states flexibility to experiment with different approaches to providing services. And retroactive eligibility waivers in Medicaid are hardly new. A few states like Tennessee have had them in place for years. Tennessee officials eliminated retroactive eligibility for all Medicaid beneficiaries in 1994 when the state significantly expanded coverage under TennCare, as Medicaid is known there. At the time, the state even allowed uninsured people to buy into the program who wouldn’t otherwise qualify based on income, said Bonnyman.

“There was no reason for anybody to be uninsured except undocumented immigrants,” said Bonnyman. “It didn’t seem to have the potential for harm.”

But state officials revamped that program after serious financial problems. Eligibility for TennCare has become more restrictive again.

Other states that waived retroactive coverage for at least some Medicaid groups include Delaware, Maryland, Massachusetts and Utah, according to the Kaiser Family Foundation.

Bonnyman said his group frequently works with Medicaid beneficiaries who have medical bills they can’t afford that accumulated during the months before they applied for Medicaid.

“If you’re a moderate- to low-income working family, one or two days in the hospital is enough to ruin you financially,” he said.

With federal funding for state navigator programs slashed, brokers are picking up the slack.

This article first appeared November 13, 2017 on Kaiser Health News.

By Julie Appleby

Lee Nathans, like insurance brokers in many states, expects to be crazy busy for the next several weeks, fielding calls from “people who are not going to be happy.”

Open enrollment for Affordable Care Act coverage started Nov. 1, and the approximately 10 million people who buy their own health insurance are only now getting a look at what’s being offered. It’s daunting.

“There will be a lot of people who will need to use a broker,” said Nathans, of Columbus, Ohio.

The enrollment period is also shorter than in previous years, ending Dec. 15.

In many places, there are fewer health insurance carriers offering coverage — and those that remain have sharply raised prices and changed their networks of doctors and hospitals.

More perplexing for people sifting through these options is the fact that this year there’s less on-the-ground assistance to help decode those complexities because of Trump administration funding cuts.

All that means brokers are coping with what may be the most challenging sign-up period since the ACA marketplaces, also known as exchanges, debuted in 2014.

When the ACA became law, some thought the days of brokers were numbered.

The ACA’s rules and online state and federal exchanges were supposed to make comparing plans and purchasing health insurance easier.

But for many consumers — particularly those who have never bought insurance before — having help is vital.

“Yes, health insurance is complicated,” said Lisa Hamler-Fugitt, executive director for the Ohio Association of Foodbanks, which provided such help for the past four years through federal grant-funded navigator programs in the state. Navigators are trained individuals or groups that guide consumers and small businesses through the process, for free.

“[Customers] didn’t turn to us just during open enrollment, but also when they had questions about how to use their plan, about deductibles and copayments.”

This year is different.

The Trump administration, criticizing the navigator effort nationwide, slashed funding. The Ohio program learned it would get a 71 percent cut and reluctantly closed its doors for this enrollment season.

There were also cuts to other states, which varied, but averaged 40 percent nationally. In Tennessee, for example, navigator funding was reduced by 16 percent, while in Indiana it fell 82 percent.

The Department of Health and Human Services appears to be turning to brokers to fill this gap. It announced in late October that the federal online marketplace, healthcare.gov, has a new resource under its “Find Local Help” tab. Consumers can enter their contact information in the “Help On Demand” feature — and get a call back from a state licensed broker.

It isn’t known how many brokers signed up to participate, but agent John Dodd thinks it’s a good idea.

“This move of working more with brokers will help make up some of the difference [from losing the navigator program], although anytime you remove help, that’s not a positive step,” said Dodd, president-elect of the Ohio Association of Health Underwriters and owner of his own agency in Westerville.

But growing pressure on brokers — from smaller commissions to increased complexity of the health offerings — means they may be harder to find.

Last year, several big Blue Cross Blue Shield insurers cut or reduced their commissions, citing it as a cost-cutting move, following a similar action in 2015 by UnitedHealthcare. Some brokers then began charging a fee to help people enroll, while others stopped entirely.

When insurers pay commissions, the amounts are included in premiums and can be between 2 and 5 percent, depending on the carrier.

This year, “I’m still going to help my clients, but I’m not doing direct enrollments,” said Nathans. He will refer customers who need this assistance to a colleague.

There are reasons why the enrollment process is a heavy lift.

Licensed insurance broker John Jaggi of Forsyth, Ill., said he and his daughter, Anne Petri, also a broker, often spend the first 35 minutes of appointments just helping clients figure out the math to determine if they can get a premium subsidy. People who qualify earn less than 400 percent of the federal poverty level ($48,240 for an individual) and don’t have other coverage.

By that point, clients are exhausted and don’t even want to talk about the details of the plan, Jaggi said. And he’s paid “almost nothing” for his efforts.

Still, Jaggi and Petri plan to continue helping individuals with this year’s enrollment.

A Trump administration decision in October likely has created even more demand for these services. President Donald Trump said then that he was stopping federal “cost-sharing reduction” payments to insurers. These payments were used to offset the costs of coverage for certain low-income policyholders by reducing their deductibles and copayments.

Even without the federal assistance, insurers are still required to provide these cost reductions. To make up for them, insurers boosted premiums, particularly in middle-level “silver” plans. Because the cost of these plans is also the benchmark used to set the tax-credit subsidy many people receive to help pay their premiums, eligible consumers will likely receive more federal assistance this year and have more affordable options from which to choose.

In other words, people who receive the tax credits are not likely to feel a financial pinch. People who don’t, though, will likely take a hit.

“You have to feel bad for them,” said Petri. “How can they afford another $100 to $200 a month in premium?”

The individual market has always been volatile, but brokers say the situation is bad this year.

Dodd, the Westerville, Ohio-based broker, said he hopes Congress acts to stabilize the market. And soon.

Without that, “2019 could be Armageddon, off-the-charts bad,” he said.

A study of health plan claims shows that laws meant to bring parity to chemotherapy costs benefited those with lower monthly out-of-pocket spending more than others.

This article first appeared November 08, 2017 on Kaiser Health News.

By Michelle Andrews

Laws passed by many states that require health plans to charge the same cost-sharing amounts for cancer patients receiving chemotherapy — regardless of whether they get the medication intravenously or take a pill or liquid by mouth — are providing uneven pocketbook protection, according to a new study.

These “parity” laws became popular as the number of pricey anti-cancer oral medications grew, but consumers were seeing a disparity in how insurance handled the patients’ share of the treatment.

In many plans, oral anti-cancer drugs were placed in high cost-sharing tiers in patients’ prescription coverage while the drug infusions — which took place at a doctor’s office — were handled as an office visit and generally required less out-of-pocket costs for patients, sometimes just a minimal copayment.

The study, published online in JAMA Oncology this week, analyzed the health plan claims of 63,780 adult cancer patients younger than age 65. All lived in states that passed parity laws from 2008 to 2012.

State parity laws don’t apply to “self-funded” employer health plans that pay their workers’ claims directly rather than buying state-regulated insurance policies. Just under half of the patients studied were covered by self-funded plans. Researchers compared the use of oral anti-cancer medicines and out-of-pocket spending between patients in the self-funded plans and those in state-regulated plans to determine the impact of parity laws.

The study found that the laws benefited those with lower monthly out-of-pocket spending more than those whose monthly spending for oral chemotherapy drugs was higher. According to the research, the proportion of prescriptions for oral drugs that did not require a patient’s copayment grew from 15 to 53 percent over the study period in health plans that were subject to state parity laws. That was more than double the increase in plans that were not subject to parity laws, which increased from 12.3 to 18 percent.

The finding surprised researchers, said Stacie Dusetzina, an assistant professor of pharmacy and public health at the University of North Carolina-Chapel Hill, who was the study’s lead author.

At the other end of the spectrum, the number of prescriptions requiring high out-of-pocket spending grew, despite parity laws. The proportion of prescriptions filled in plans subject to parity that cost more than $100 out-of-pocket per month increased from 8.4 to 11.1 percent, the study found. That figure declined slightly for prescriptions in plans that weren’t subject to parity, from 12 to 11.7 percent.

“We are a bit concerned about that finding, because when you think about who would have been the target of the law, parity is intended to help people afford the cost of their treatment,” Dusetzina said. “The most expensive fills got more expensive after parity. That’s concerning.”

The researchers suggested that continuing growth in high-deductible plans and high coinsurance charges may have contributed to the rise in the number of patients with high out-of-pocket costs for cancer treatment, even in states that have parity laws.

The study also found that out-of-pocket spending on infused drugs, which are typically older and less expensive than oral anti-cancer therapies, remained stable during the study period and was unaffected by parity laws.

A federal law that would extend parity to the seven states that don’t have it has been proposed in the past, most recently in March. Such a law could also benefit people in self-funded plans that aren’t subject to state laws, as well as Medicare beneficiaries.

“A federal law would potentially provide a lot of benefit, because we do feel parity has a net benefit for patients,” Dusetzina said.

Spending on urine screens and related genetic tests quadrupled from 2011 to 2014 to an estimated $8.5 billion a year.

This article first appeared November 06, 2017 on Kaiser Health News.

By Fred Schulte and Elizabeth Lucas

The cups of urine travel by express mail to the Comprehensive Pain Specialists lab in an industrial park in Brentwood, Tenn., not far from Nashville. Most days bring more than 700 of the little sealed cups from clinics across 10 states, wrapped in red-tagged waste bags. The network treats about 48,000 people each month, and many will be tested for drugs.

Gloved lab techs keep busy inside the cavernous facility, piping smaller urine samples into tubes. First there are tests to detect opiates that patients have been prescribed by CPS doctors. A second set identifies a wide range of drugs, both legal and illegal, in the urine. The doctors’ orders are displayed on computer screens and tracked by electronic medical records. Test results go back to the clinics in four to five days. The urine ends up stored for a month inside a massive walk-in refrigerator.

The high-tech testing lab’s raw material has become liquid gold for the doctors who own Comprehensive Pain Specialists. This testing process, driven by the nation’s epidemic of painkiller addiction, generates profits across the doctor-owned network of 54 clinics, the largest pain-treatment practice in the Southeast. Medicare paid the company at least $11 million for urine and related tests in 2014, when five of its professionals stood among the nation’s top billers. One nurse practitioner at the company’s clinic in Cleveland, Tenn., single-handedly generated $1.1 million in Medicare billings for urine tests that year, according to Medicare records.

Dr. Peter Kroll, one of the founders of CPS and its medical director, billed Medicare $1.8 million for these drug tests in 2015. He said the costly tests are medically justified to monitor patients on pain pills against risks of addiction or even selling of pills on the black market. “I have to know the medicine is safe and you’re taking it,” Kroll, 46, said in an interview. Kroll said that several states in which CPS is active have high rates of opioid use, which requires more urine testing.

Kaiser Health News, with assistance from researchers at the Mayo Clinic, analyzed available billing data from Medicare and private insurance billing nationwide, and found that spending on urine screens and related genetic tests quadrupled from 2011 to 2014 to an estimated $8.5 billion a year — more than the entire budget of the Environmental Protection Agency. The federal government paid providers more to conduct urine drug tests in 2014 than it spent on the four most recommended cancer screenings combined.

Yet there are virtually no national standards regarding who gets tested, for which drugs and how often. Medicare has spent tens of millions of dollars on tests to detect drugs that presented minimal abuse danger for most patients, according to arguments made by government lawyers in court cases that challenge the standing orders to test patients for drugs. Payments have surged for urine tests for street drugs such as cocaine, PCP and ecstasy, which seldom have been detected in tests done on pain patients. In fact, court records show some of those tests showed up positive just 1 percent of the time.

Urine testing has become particularly lucrative for doctors who operate their own labs. In 2014 and 2015, Medicare paid $1 million or more for drug-related tests billed by health professionals at more than 50 pain management practices across the U.S. At a dozen practices, Medicare billings were twice that high.

Thirty-one pain practitioners received 80 percent or more of their Medicare income just from urine testing, which a federal official called a “red flag” that may signal overuse and could lead to a federal investigation.

“We’re focused on the fact that many physicians are making more money on testing than treating patients,” said Jason Mehta, an assistant U.S. attorney in Jacksonville, Fla. “It is troubling to see providers test everyone for every class of drugs every time they come in.”

‘It Was Almost A License To Steal’

As alarm spread about opioid deaths and overdoses in the past decade, doctors who prescribed the pills were looking for ways to prevent abuse and avert liability. Entrepreneurs saw a lucrative business model: persuade doctors that testing would keep them out of trouble with licensing boards or law enforcement and protect their patients from harm. Some companies offered doctors technical help opening up their own labs.

A 2011 whistleblower lawsuit against one of the nation’s top billers for urine tests, a San Diego-based laboratory owned by Millennium Health LLC, underscores the potential for profit. “Doctor,” one lab representative said during sales calls, according to an affidavit, “drug testing is not about medicine but about making money, and I am going to show you how to make a lot of money.”

Millennium Health, billing records show, took in more than $166 million from Medicare in 2014 despite being the target of at least eight whistleblower cases alleging fraud over the past decade. A Millennium sales manager involved in a 2012 case in Massachusetts reported earning $700,000 in salary and sales commissions in the previous year.

Millennium encouraged doctors to order more tests both as a way to lower patients’ risks and to shield the physicians against possible investigations by law enforcement or medical licensing boards, according to court filings. Millennium denied the allegations in the whistleblower suits and settled all of them with the Justice Department in 2015 by agreeing to pay $256 million; its parent company, Millennium Lab Holdings II, declared bankruptcy.

Tests to detect drugs in urine can be basic and cheap. Doctors have long used testing cups with strips that change color when drugs are present. The cups cost less than $10 each, and a strip can detect 10 types of drugs or more at once and display the results in minutes.

After noticing that some labs were levying huge charges for these simple urine screens, the Centers for Medicare & Medicaid Services moved in April 2010 to limit these billings. To circumvent the new rules, some doctors scrapped cup testing in favor of specialized — and much costlier — tests performed on machines they installed in their facilities. These machines had one major advantage over the cups: Each test for each drug could be billed individually under Medicare rules.

“It was almost a license to steal. You had such a lucrative possibility, it was very tempting to sell as many [tests] as you can,” said Charles Root, a longtime lab industry consultant whose company, CodeMap, has tracked the rise of testing labs in doctors’ offices.

Voluminous Drug Tests

The CPS testing lab in Tennessee opened in 2013, not long before a pain specialist named William Wagner moved from New Mexico to open a CPS clinic in Anderson, S.C. He was lured by the promise of $30,000 a month in salary, which would grow as the clinic added patients and revenue, along with other benefits. His contract said he could be on-site for as little as 20 percent of the clinic’s operating hours.

When the company recruited him, Wagner said, he was told the job offered “potential to earn a great deal of money” from bonuses he would receive from services he generated, including a share of collections from lab services for urine tests done at the new Tennessee facility.

That did not happen, according to Wagner. He is suing CPS, saying that it failed to collect bills for services he rendered and then closed the clinic. CPS refutes Wagner’s claims and says it fulfilled its obligations under the contract. In a counterclaim, CPS argues that Wagner owes it $190,000.

“All of their money was being made off of urine drug screens. They weren’t doing anything else properly,” Wagner said. The lawsuit is pending in federal court in Nashville.

Former CPS chief executive John Davis, in an interview, described the urine-testing lab as part of a “strategic expansion initiative” in which the company invested $6 million to $10 million in computerized equipment and swiftly acquired new clinics. Kroll, one of the owners of CPS, said the idea was to “take the company to the next level.”

Davis, who led the initiative before leaving the company in June, would not discuss the private company’s finances other than to say CPS is profitable and that lab profits “to a great degree” drove the expansion. “Urine screening isn’t the reason why we decided to grow our company. We wanted to help people in need,” Davis said.

Kroll acknowledged that urine tests are profit-makers, but stressed that verifying that patients aren’t abusing drugs gives him a “whole different level of confidence that I’m doing something right for the patients’ condition.”

He said his doctors try to be “judicious” in ordering urine tests. Kroll said some of his doctors and nurses treat “high-risk” patients who require more frequent testing. The company said that its Medicare billing practices, including urine screens, had withstood a “very in-depth” government audit. The audit initially called for repayment of $25 million but was settled in 2016 for less than $7,000, according to the company. Medicare officials had no comment.

Kroll’s orthopedic career took a sharp turn more than a decade ago after watching his brother suffer through multiple surgeries for muscular dystrophy, along with bone fractures, stiffness and pain. His brother died at age 25, and Kroll decided to switch to anesthesiology and become a pain specialist.

“It sensitized me to the plight of people with chronic conditions that we have no medical answer for,” Kroll said. His brother “battled for his whole life.”

Kroll’s career change coincided with a national movement to establish pain management as a vital medical specialty, with its own accrediting societies and lobbying and political arm to advance its interests and those of patients.

Joined by three other doctors, he formed Comprehensive Pain Specialists at a storefront in suburban Hendersonville, Tenn. It quickly gained a foothold on referrals from local doctors unsure, or uneasy, about treating unyielding pain with heavy narcotics such as oxycodone, morphine and methadone.

In 2014, when CPS was among Medicare’s major urine-test billers, Tennessee led the nation in Medicare spending on urine drug tests run by doctors with in-house labs, according to federal billing records.

How Much Is Too Much?

There is wide disagreement among legislators, medical trade associations and the state boards that license doctors over the best approach to urine testing. One association of pain specialists argued in 2008 that urine testing could be done as often as weekly, while others have balked at that frequency.

Indiana’s medical board ordered mandatory urine tests for all pain patients in late 2013, only to face a lawsuit from the American Civil Liberties Union, which argued that the policy was unconstitutional and an unlawful search. Officials backed down the next year, and current policy states that testing can be done “at any time the physician determines that it is medically necessary.”

The federal Centers for Disease Control and Prevention, wary of both cost and privacy concerns, declined to set a definitive national standard despite years of debate. In long-awaited guidelines issued in March 2016, the CDC called for testing at the start of opioid therapy and once a year for long-term users. Beyond that, it said, testing should be “left up to the discretion” of the medical professional.

Doctors who receive the lion’s share of their Medicare funds from urine drug testing would certainly raise a red flag.

Donald White, spokesman for the Department of Health and Human Services’ Office of the Inspector General

There is likewise little scientific justification for many of these new types of drug testing that have made their way onto doctors’ order sheets and laboratory menus.

Many pain patients on opioids are routinely tested for phencyclidine, an illegal, hallucinogenic drug also known as PCP, or angel dust, Medicare records show. Yet urine tests have rarely detected the drug. Millennium, the San Diego-based company that once topped Medicare billings for urine tests, found PCP in fewer than 1 percent of all patient samples, according to federal court filings.

In a tour of the CPS lab, Chief Operations Officer Jeff Hurst, who has more than two decades of experience working for commercial labs, rattled off a list of drugs ranging from cocaine to heroin and methamphetamine, which he said was “really big in East Tennessee.”

How often urine tests reveal serious drug abuse — or suggest patients might be selling some of their medications instead of taking them — is tough to pin down. Asked during a tour of the laboratory in Tennessee if CPS could provide such data, Hurst said he did not have it; Kroll said he didn’t either.

Hurst said the lab often ends up doing a “long list of tests” because CPS doctors are prescribing dangerous drugs that may be deadly if abused and “need to know what patients are taking.” Prescribed drugs, such as opiates and tranquilizers, are also measured at the CPS lab.

Government officials have criticized the explosive growth in testing for some prescription drugs, notably a class of tranquilizers known as tricyclic antidepressants. Medicare paid more than $45 million in 2014 for more than 200,000 people to be tested for tricyclic drugs, often multiple times. Medicare was billed for 644,495 tests for one tricyclic drug, amitriptyline, up from 6,173 tests five years earlier.

The Department of Justice argued in a 2012 whistleblower case that these tests often couldn’t be justified because of “low abuse potential” of the drugs and a “lack of abuse history for the vast majority of patients.”

Income Breakdown Raises ‘Red Flag’

When told that drug screens accounted for most of the Medicare income for dozens of pain doctors, federal officials said that was troubling.

“Doctors who receive the lion’s share of their Medicare funds from urine drug testing would certainly raise a red flag,” said Donald White, a spokesman for the Department of Health and Human Services’ Office of the Inspector General. “Confirmation of fraud would require federal investigation and a formal judicial proceeding.”

In a report released last fall, the watchdog office said some uptick in testing might be justified by the drug abuse epidemic, but noted that the situation also “could provide cover for labs that might seek to fraudulently bill Medicare for unnecessary drug testing.”

Medicare pays only for services it considers “medically necessary.” While that sometimes can be a judgment call, pain clinics that adopt a “one-size-fits-all” approach to urine testing may find themselves under suspicion, said Mehta, the assistant U.S. attorney in Florida.

Mehta’s office investigated a network of Florida clinics called Coastal Spine & Pain Center for alleged over-testing, including routinely billing for a second round of expensive tests simply to confirm earlier findings. In a press release in August 2016, the government argued that these tests were “medically unnecessary.” The company paid $7.4 million last year to settle the False Claims Act case. Coastal Spine & Pain, which did not admit fault, had no comment.

Four Coastal Spine & Pain doctors were among the top 50 Medicare billers during 2014, when they charged nearly $6 million for drug tests, according to Medicare billing data analyzed by KHN.

Starting in 2016, Medicare began to crack down on urine billings as part of a federal law that is supposed to reset lab fees for the first time in three decades. Now tougher scrutiny of urine testing, and cuts in reimbursements, may be threatening CPS — or at least its profits.

CPS closed nine clinics last year and told its doctors that urine-testing revenue had dropped off 32 percent in the first quarter of the year, according to a letter then-CEO Davis sent its physician partners.

Davis said the company had to “make some changes” because of cuts in Medicare reimbursements for urine tests and other medical services. A company spokeswoman told KHN that the drop in urine revenue worsened through 2016 but has bounced back somewhat this year.

Despite the cuts, privately held CPS plans to open new clinics this year. Urine testing will remain a key service — for keeping patients safe, it said. CPS is just playing by the rules of the game. “Tell us how often to test,” said Hurst, the operations officer, “and we’ll be happy to follow it.”

KHN’s coverage related to aging & improving care of older adults is supported by The John A. Hartford Foundation.