A whistleblower lawsuit in Jackson, TN involving two area health systems has attracted the attention of the U.S. Department of Justice, which has ordered that the four-year-old case be unsealed and the complaint served within 120 days.
The case involves two prominent cardiologists, two area health systems, and a radiologist and centers on allegations of overutilization of cardiac medical services, kickbacks, and a self-referral scheme.
In June 2007, Wood M. Deming, M.D., filed a suit individually and on behalf of Regional Cardiology Consultants PC charging Elie H. Korban, M.D., with "blatant overutilization" of medical services, including angiography, angioplasty, and stenting with the intent to defraud government insurance programs.
The suit, which filed in the U.S. District Court for Western Tennessee, also charged Joel Perchik, M.D., and executives at Jackson-Madison County General Hospital and Regional Hospital of Jackson with engaging in "a bilateral kickback and self-referral scheme."
Dr. Deming contends that the hospital CEOs were aware of the overutilization and went so far as to shield Dr. Korban "from any scrutiny by the hospitals' clinical quality improvement mechanisms." In addition, Deming charges that the hospital CEOs and Dr. Perchik "individually engaged in a pattern of bad-faith peer review of any physician who chose to oppose the hospitals' drive for excess and inappropriately collected remuneration…such that such physicians were eliminated from the medical staff if they chose to speak out as whistleblowers concerning any aspect of the scheme."
According to court documents, an order was filed on June 2, 2011 notifying the defendants of the government's intention to intervene in that "part of the order which alleges claims against Elie H. Korban for false and fraudulent billing for unnecessary cardiac stent procedures." The government declined to intervene on any other part of the lawsuit against Korban or in any of the claims against the hospitals or their CEOs.
That means that although the DOJ will not pursue those charges, Dr. Deming may continue those parts of the lawsuit on his own.
In a statement issued to the Jackson Sun, a spokesperson for the Regional Hospital of Jackson said "Regional Hospital of Jackson is pleased that the U.S. chose not to intervene in the portion of the relator's lawsuit which named the hospital and a former administrator. The hospital remains committed to providing high-quality, appropriate health services for patients and the community."
The DOJ's interest in the case may reflect renewed interest on the part of Congress and the Department of Health and Human Services in uncovering and pursuing fraud in the Medicaid and Medicare programs, especially in terms of stent usage.
In December 2010 the U.S. Senate Committee on Finance issued a staff report on cardiac stent usage at a Maryland hospital. The report looked at the case of a doctor who reportedly implanted nearly 600 potentially medically unnecessary stents from 2007 through mid-2009. The report found that the questionable implants cost the Medicare program $3.8 million during that period.
That report noted that between 2007 and 2009, the Medicare Part A program paid an estimated $11.1 billion for cardiac stent procedures.
The DOJ would not comment on its involvement in the lawsuit. The government will file its complaint within 60 days, according to a statement filed by the U.S. Attorneys' Office.
The Pension Benefit Guaranty Corporation has filed a brief in the U.S. Court of Appeals for the Second Circuit in Manhattan seeking $25 million in damages from Morgan Stanley Investment Management Inc. over investments made in mortgage-backed securities for New York's Saint Vincent Catholic Medical Centers' pension plan and its participants.
The appeal stems from a 2010 ruling by a U.S. District Court, which dismissed a lawsuit brought by St. Vincent's that raised the issue that Morgan Stanley knew the financial instruments were too risky, and that investing in them violated the pension plan's guidelines.
That ruling left PBGC responsible for paying benefits to Saint Vincent's 9,500 workers and retirees.
In its appeal PBGC argues that the district court erred by misreading the complaint and overlooking key facts. PBGC notes that the district court's order incorrectly asserts that Morgan Stanley invested only 9% to 12% of the pension plan's fixed-income portfolio in mortgage-backed securities, which the court ruled "was not excessive" and represented "appropriate diversification."
According to the appeal, Morgan Stanley "irresponsibly concentrated approximately 50% of the plan's fixed-income assets in the single asset class of mortgage-backed securities, even as MSIM became aware in 2007 and 2008 of the rapid and dramatic deterioration of the mortgage-backed securities market."
In addition, "between 9% and 12.6% of the overall fixed-income portfolio was invested in a subclass of mortgage-backed securities known as 'non-agency mortgage-backed securities'…a particularly risky subclass of mortgage-backed securities because the loans underlying these securities were not guaranteed by Fannie Mae or Freddie Mac."
PBGC contends that the "firm was aware those investments were risky and contrary to Saint Vincent's instructions."
PBGC wants the Second Circuit to reverse the ruling and require the district court to hear the case on its merits. If that happens, the agency will seek $25 million in damages from Morgan Stanley on behalf of Saint Vincent's pension plan and its participants.
The legality of physician-owned distributorships or PODs, a growing part of the medical device industry, has come under the scrutiny of the Senate Finance Committee.
Typically, medical devices are sold to hospitals or surgery centers through manufacturer representatives. In a POD the physician-investor serves as a middleman between the manufacturer and the hospital or surgery facility.
The Senate Finance committee issued a report, Physician-Owned Distributors: An Overview of Key Issues and Potential Areas for Congressional Oversight, examining the structure and activities of PODs within the medical device supply chain. The committee is concerned that PODS may exist for no other reason than to give physician investors the opportunity to profit from the sale and utilization of the medical devices they use for their patients and sell to hospitals.
In a letter dated June 9, a bipartisan group of five senators headed by Sen. Orrin Hatch (R-Utah) asked Donald R. Levinson, Inspector General of the Department of Health and Human Services, to conduct an inquiry to determine "how these arrangements square with federal law."
Joining Sen. Hatch in seeking an investigation are Max Baucus (D- Mont.), who chairs the Senate Finance Committee, Bob Corker (R-Tenn.), Charles Grassley (R-Iowa) and Sen. Herb Kohl (D-Wis.) The senators asked CMS to respond by July 15 and set Aug. 12 as the deadline to receive a report from the Inspector General.
The group also sent a letter dated June 9 to Donald Berwick, M.D., administrator of the Centers for Medicare & Medicaid Services, requesting that CMS address PODs as it finalizes reporting requirements for the Patient Payments Sunshine Act and rules for accountable care organizations. The letters were accompanied by the report prepared by Senate Finance Committee staff.
According to the report, which is based on interviews and the review of thousands of pages of documents, PODs first appeared in 2003 in Northern California and have now expanded to 21 states where there are an estimated 150 PODs. Proliferation of PODs is attributed to the reduction in physician reimbursements, which have sent physicians seeking alternative revenue sources. The POD distributor model is being used "very aggressively" in rural areas, the report says.
The report notes ancillary evidence concerning the increased utilization of spinal fusion surgery has coincided with the expansion of PODs. The report cites an April 2010 study in the Journal of the American Medical Association that found a 15-fold increase in the number of spinal fusion surgeries performed for Medicare patients between 2002 and 2007.
And there is a lot of money is involved. Kim Grant, chief healthcare investigative counsel for the Senate Finance Committee, said that in 2008 spinal fusion surgery was a $15 billion industry with Medicare accounting for $2 to $3 billion of that amount. Grant says that while not all PODs are necessarily bad, in rural areas there were cases where the same surgeons were performing 100% of the surgeries and then pocketing 100% of the revenues from the sale of the medical devices to their patients and hospitals. "Hospitals said they felt like hostages because the surgeons would threaten to leave if the hospital complained about the POD."
The Levinson letter requests that the structure of PODs be reviewed in terms of the federal anti-kickback laws, which are designed to protect patients and federal healthcare programs from the potential influence of financial arrangements. The letter also asks Office of Inspector General to clarify its stance on PODs in terms of "policy statements, guidance or visible enforcement proceedings that demonstrate…the extent of the government's concerns with the ways that PODs differ from physician joint ventures to provide legitimate healthcare services."
The Berwick letter asks CMS to review ACO regulations to make sure there are no inadvertent loopholes that allow "less reputable POD models to fall under the Stark and Anti-Kickback law waiver." It also requests that the ACO regulations "prohibit ACOs from purchasing products or services from entities that are owned by physicians participating in the ACO."
Chris White, general counsel and executive vice president for AdvaMed, a trade organization for medical device manufacturers, issued this statement regarding the committee's actions: "AdvaMed welcomes this inquiry and looks forward to reviewing the final results. We have long expressed concerns that physician owned distributorships raise ethical and legal concerns, specifically issues relating to the anti-kickback statute." He added that "AdvaMed supports the Senators' view that physician owned distributorships should be held to the same Physician Payments Sunshine transparency standards as physician owned manufacturers and physician owned GPOs."
The Department of Health and Human Services has proposed a federal rule that would require hospitals, physicians, and health insurers to let patients know when their electronic medical records are accessed.
The rule would be a statutory requirement under the Health Information Technology forEconomic and Clinical Health Act (HITECH). It would apply to any hospital, physician office, or health plan employees who have access to patient records.
Highlights of the proposed disclosure rule:
Applies to any medical and healthcare payments records as well as any records used to make medical decisions about a patient.
Includes all electronic health information and not just electronic health records.
Excludes peer review files used only to improve care for the general patient population.
Requires that access information be kept in access logs and include the name and address of the person, a brief description of the type of health information disclosed, and the date and time of the access. In addition, any changes to the record, including modifications, must be disclosed.
No reason for accessing the record need be disclosed.
A fee may be charged for the information. However, the first 12 months of a request must be provided free of charge.
Information requested must be provided within 30 days in a form and format that can be reproduced by the individual requesting the information.
Hospitals, physicians, and health insurers will not be liable for the information once it is delivered.
HHS began considering the rule after it issued in May 2010 a request for information to determine the public's interest accounting for any EMR disclosures. Of the 170 comments received from healthcare stakeholders, more than 120 said EMR disclosures would require substantial administrative and staffing commitments and create a financial burden. More than 60% said the information was of minimal benefit.
HHS is accepting comments on the proposed rule until Aug. 1, 2011. If approved, the rule would go into effect in January 2013.
So-called 'Pioneer' accountable care organizations, healthcare systems already providing coordinated care and seeking a fast track to participate in the shared savings program, now have more time to apply for program participation.
Citing the "suggestions of the stakeholder community," the Centers for Medicare & Medicaid Services announced the deadline extension this week.
The deadline to submit a letter of intent to participate in the Pioneer ACO program is now June 30, 2011. Applications must be postmarked on or before August 19. Any provider interested in the program must first submit a letter of intent. No application will be accepted from a potential participant unless an LOI is on file. The LOIs and applications will not be publically released.
Despite the application extensions, CMS still hopes to implement Pioneer ACOs in the third or fourth quarter of 2011. About 30 applicants will be selected.
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CMS is tight-lipped about industry interest in the Pioneer ACO program. In a telephone interview, spokesperson, Ellen B. Griffith, would say only that CMS is "is very pleased with the level of interest in the Pioneer ACO model and with the number of letters of intent we have already received."
The Pioneer ACO was announced last month by the CMS Innovation Center in an effort to overcome the tepid response to the Medicare shared savings ACO model introduced by CMS in April.
The Pioneer model was developed for organizations that are already experienced in coordinating patient care and managing risk. It was developed after industry leaders such as Cleveland Clinic, Mayo Clinic announced that they would likely sit out the ACO process.
CMS' Griffith declined to disclose whether either the Cleveland Clinic or Mayo Clinic have expressed interest in participating as Pioneer ACOs.
She did say that a CMS conference call on Tuesday to provide more information to interested parties about the Pioneer ACO Model attracted more than 850 participants.
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CMS holds the conference calls, which are called "Open Door" forums, as part of the ACO promotion. The calls, which typically last 30 to 60 minutes, include brief presentations by CMS representatives followed by a question and answer session.
The announcement by Blue Shield of California this week that it will voluntarily limit its earnings to 2% of its revenue is garnering mixed reviews from industry analysts and consumer advocates. On Wednesday the Blues plan said it will return any excess revenue over 2% to many of its 3.3 million policyholders and providers. This year it will return about $180 million.
"Anytime an insurer voluntarily refunds money to a consumer is a good thing," stated Gerald F. Kominski, PhD, associate director of the UCLA Center for Health Plan Research in an interview with HealthLeaders Media.
Kominski isn't sure if other competitors will emulate the Blue Shield action. "If the health insurance industry worked like other big industries, then price-cutting by one major player would be followed by others in the industry. But group rates are locked in for 12 months at a time, so it isn't as if a company can immediately switch to Blue Shield."
There's no doubt, he says, that this is a great public relations move by the insurer. "I think it actually increases their bargaining position in terms of contracting with physicians and hospitals. They can say 'Look at us; we did this. We're limiting our profits and you want us to pay you more?' They can probably earn back in contracting what this costs them."
The Blue Shield announcement garnered attention from Washington, D.C. where U.S. Health and Human Services Secretary Kathleen Sebelius praised the action in a press statement calling it a "great step forward" and noting the health insurer's commitment to "providing better care at prices that better reflect underlying medical costs."
Closer to home however, politicians and consumer advocates weren't as kind. In an e-mail exchange, a spokesperson for the California Department of Insurance said that DOI commissioner Dave Jones would not release a statement specific to Blue Shield's latest announcement.
She did, however, provide a statement Jones made during earlier media interviews: "Blue Shield's announcement is essentially an admission by the insurer that it is…making excessive profits. This non-profit insurer more than doubled its profits from $148 million in 2009 to $315 million in 2010. If anything, Blue Shield's announcement simply serves to underscore, yet again, why the insurance commissioner needs the authority to reject excessive health insurance rate hikes in California."
Jones supported AB 52, a California bill, which would give his office the power to review and reject insurance rate hikes. The bill passed through the legislature this week and awaits the governor's signature.
In an editorial in the San Francisco Chronicle, Jamie Court, the president of Consumer Watchdog, called the 2% announcement a "last-ditch attempt to discourage legislators" from passing AB 52. "For a not-for-profit health insurance company like Blue Shield, which has more than $3.6 billion in reserves, that's 2% too much."
The company's reserve of $3.6 billion is a sticking point. The DOI's Jones said the $3.6 billion is considerably in excess of what is required to meet state financial solvency requirements. In media interviews he has said the amount begins the question. "If Blue Shield has this much in its reserves, then why is it not giving more money back to its policyholders?"
Consumers Union reported in 2010 that over the past decade, nonprofit Blue Cross and Blue Shield health insurers across the country stockpiled billions of dollars in surplus--while raising premiums for consumers by as high as 20% annually.
The Vermont legislature has been basking in the healthcare limelight for the past few weeks. On May 26, Gov. Peter Shumlin (D) signed into law a bill known simply as H202. If everything proceeds as expected, Vermont citizens will be covered by a single-payer health insurance system sometime in 2017. Yep, six years from now.
Actually it's not a real single-payer system because it incorporates universal coverage, but that's the terminology being used to describe the Vermont law.
In all the ballyhoo following the signing of H202a lot of people have lost sight of what the bill actually does: It creates a process which will – fingers crossed – result in the implementation of the single-payer system….eventually.
There is a lot to be accomplished before the first proud Vermonter presents his or her Green Mountain Care membership card to a provider. The Burlington Free Press identified almost 40 questions involving at least seven state agencies that need to be answered before the state can begin bring this insurance law to life.
Here's a sampling:
What healthcare payment and delivery reforms would best control the rate of growth in healthcare costs and maintain healthcare quality?
What state law changes are needed to integrate the private insurance market with the health benefit exchange?
How might the state reorganize and consolidate health-related functions in agencies and departments across state government?
Should the state adopt a prescription drug formulary to be used by all insurers, public and private, with some variations allowed for Medicaid?
Should non-residents employed by Vermont businesses be eligible for Green Mountain Care?
Then there's the matter of the federal waiver the state will need, the health exchange that must be created, and the financing package that will be necessary to fund the insurance law. The devil definitely is in the details.
Vermont has been easing into healthcare reform since 2006 when the legislature adopted the state's Blueprint for Health, which set into set into motion a series of initiatives to look at chronic condition prevention and care management. Each year since then legislation has been enacted related to a host of healthcare issues, including healthcare cost containment, care coordination, and the adoption of electronic health records.
But the patchwork approach didn't deliver the results state officials felt were necessary to bring healthcare coverage to the almost 200,000 uninsured and underinsured in the state. In 2010, William Hsiao, PhD, a professor of economics at the Harvard University School of Public Health, was hired to develop three design options for a statewide healthcare system that would provide coverage for Vermont residents. Legislation set the parameters for the designs: state-run universal coverage and single-payer plan; a public option to compete with private plans; and a third plan that would be politically and practically viable.
When Hsiao unveiled his plan for universal coverage and a single-payer system in February 2011, newly elected Gov. Peter Shumlin and much of the legislature were already onboard. Shumlin had campaigned on the issue and once in office delivered a five-page strategic plan that detailed the administrative and legislative steps to make Hsiao's design a reality. That plan pretty much morphed into the 213-page H202.
The next step is to get the five-member Green Mountain Care Board up and running. That is the healthcare board charged putting together the nuts and bolts of statewide healthcare reform and ensuring that H202 delivers what it promises, including cost containment and payment reform. A nine-member committee, packed with reform supporters, has been appointed to vet potential GMC board members.
The Green Mountain Care Board will have a great deal of power. Beginning in January 2012 it will review insurance rate requests and later on in the year it will turn to hospital budgets. In between it will set the benefit package for the program. And yet with the exception of a few whimpers, the provider and payer industry has remained quiet on the issue. The Vermont Medical Society and the Vermont Hospital Association supported the reform efforts.
On the payer side, even the giant Blue Cross Blue Shield of Vermont supported the proposal.
Kevin Outterson, an associate professor in law and public health at Boston University has studied H202 and followed the legislative process. In an interview with HealthLeaders Media, he attributed the provider and payer support to the long standing connections within the small state as well as the size of Vermont's provider market.
He notes that the Blues plan has a deep relationship with the physicians and hospitals throughout the state and that there are only four significant hospital systems in Vermont. "The state needs every hospital to participate in the single payer so Green Mountain isn't going to squeeze out or bankrupt the hospitals."
In addition, BCBSVT hopes to snag the contract for the payment system for the new single-payer plan.
Major employers such as IBM are more reticent, according to Outterson. "They are worried about the cost and taxes." Financing is a huge unknown, but payroll or income taxes and some pooling of federal funds such as Medicare and Medicaid is expected. In media interviews Gov. Shumlin has expressed a preference for getting the cost containment measures in place first and then turning to the financing issues.
The timeline for the introduction of the single-payer plan stretches across seven years because of some federal waivers Vermont will need. Especially critical will be waiver request to replace the health benefit exchange required by the Affordable Care Act with a health insurance plan that could cover all 600,000 Vermont residents. The feds won't let Vermont apply for that waiver until 2015 and it won't go into effect until 2017.
Outterson, who also blogs about healthcare reform for The Incidental Economist, says Vermont officials are very aware that their progress in developing a single payer system is being closely watched by other states to see if the model really can hold down insurance costs. "Something the governor has done very well is to convince businesses to let this experiment go forward. His pitch is that if this works, Vermont will have the lowest healthcare costs in the country. That's a tremendous enticement for economic development in the state."
Vowing to help solve the problem of rising healthcare costs, Blue Shield of California said Tuesday it will limit its income to 2% of revenue and hand back about $180 million to policyholders, physicians, hospitals and the Blue Shield Foundation.
The pledge was made during a teleconference with Blue Shield CEO Bruce Bodaken, and Paul Markovitz, the company's executive vice president and COO.
Bodaken, whose salary was $4.6 million last year, said the company is taking the step to help "solve the seemingly intractable problem of rising healthcare costs."
Calling the cap a "paradigm shift for a health plan" Bodaken added that he hoped other health plans would follow suit.
He said the company began considering this step last summer. When the 2010 margin came in at 3.1% the company board decided to retroactively begin the program in 2010 rather than wait for the 2011 numbers. When company profits exceed 2% of revenue, Bodaken explained, a credit will be distributed each October to customers who are fully insured by Blue Shield in the previous May.
The average credit depends on monthly premiums:
Individual customers will be credited an average $80. For a family of four the average credit will be about $250.
Group customers will be credited between $110 to $130 per employee. Employers who pay part of the premium will decide whether and how to apportion the credit.
Small groups (2 to 50 employees) will be credited $125 per employee and about $340 for a family of four.
The announcement comes on the heels of the passage by the California Assembly of AB52, which would give state regulators the power to reject or modify excessive health insurance premium increases. The bill now moves to the state Senate.
Blue Shield COO Markovich conceded that the credits were not as large as some of the rate increases recently requested by Blue Shield but said the move demonstrates the insurer's commitment to "do all we can to make healthcare affordable."
In March Blue Shield withdrew a request that would have boosted premium rates by as much as 17% for some of its members.
Markovich stated that in the past the insurer has posted margins in the 2% to 5% range. He said the company will remain committed to the 2% cap as long Blue Shield can remain financially solvent and make the investments necessary to stay competitive.
Bodaken, responding to questions, said the credit was not related to the Affordable Care Act's medical loss ratio requirement that health plans spend at least 80% of premium revenue on reimbursements for clinical services and activities that improve health care quality. Health plans that don't meet that requirement may have to provide rebates to their customers "We have no idea if we will need to pay a rebate next year or not. This credit reflects our longstanding opinion that healthcare is a right."
Blue Shield posted net income of $315 million in 2010 on revenues of $10 billion.
Add the Mayo Clinic to the growing list of health systems experimenting with partnership and affiliation models.
Driven in large part by healthcare reform and the need to improve services while cutting costs, the venerable clinic is looking at ways to extend its brand across the southeast and upper-Midwest as well the Phoenix area. Plans call for eventual expansion across the country.
This is a significant change for Minnesota-based Mayo, which has historically stuck to the tried and true organizational structure of hospital ownership. Mayo Clinic Health System includes 19 owned hospitals in Minnesota, Iowa, and Wisconsin, as well as two owned hospitals in Phoenix and Jacksonville.
But implementation of the federal Affordable Care Act and the introduction of accountable care organizations have brought some uncertainty to the provider industry.
"The entire healthcare market is up in the air right now," says William Rupp, M.D. the CEO of Mayo Clinic Jacksonville in Florida in an interview. "Everyone is looking at new models of cost-effective care. We think our model of integrating physicians and hospitals works very well. We're getting calls from other providers who want to learn more about how our system can help them."
Rupp is charged with identifying possible Mayo Clinic affiliates across the southeast. There is no timeline for signing new affiliates.
Known internally as the affiliated practice network, the new strategy is to extend the Mayo Clinic's geographic reach without building costly new facilities, spending money to acquire hospitals or consolidating with another health system.
Mayo signed its first agreement in mid-May with Altru Health System in Grand Forks, N.D. Terms are still being worked out, but it is expected that Altru will make some change in its name to reflect the Mayo affiliation. Altru will gain access to Mayo Clinic physicians, as well as to Mayo's disease management protocols, clinical trials, and clinical care guidelines. Mayo will not hold an ownership position in Altru Health; the system will remain community owned and will maintain its local management control.
Prior to joining the affiliated practice network Altru and Mayo collaborated on a number of projects, including pediatric and cancer services.
There will be a vetting process for participation in the affiliated practice network. "We're looking for places that have a similar culture and share the Mayo philosophy for patient care," explains Rupp.
Geography will also play a role to allow Mayo physicians to easily travel to treat patient at an affiliate or to enable patients to travel to a nearby Mayo Clinic for medical care. Grand Forks, the home of Altru Health, is about 350 miles from Mayo's Rochester facilities.
Mayo is playing it close to the vest in terms of discussing any financial arrangements with affiliates. Rupp says simply "we have to cover our costs but this is new so we don't know what the numbers will be."
Rupp says the affiliation program does not involve any health plans "at this time."
Like the Mayo Clinic, other hospitals and health systems are looking at different models of affiliations. In February, Duke University Health System Inc. and LifePoint Hospitals announced a partnership to create "flexible affiliation options" that could range from joint ventures to ownership of community hospitals in North Carolina.
Meanwhile the University of Texas M. D. Anderson Cancer Center is moving forward with its partnership with Banner Health in Arizona to develop M. D. Anderson Banner Cancer Centers in the state.
Mayo Clinic announced earlier this year that it would not participate in the ACO program and recent changes in that program have been widely viewed as an effort to make ACOs attractive to health systems like Mayo.
"We're going to see a lot of different delivery models tested and it could be years before we find the models that work," said Rupp.
The Federally Qualified Health Center Advanced Primary Care Practice demonstration project will pay an estimated $42 million over three years to as many as 500 FQHCs to coordinate care for Medicare patients, the Department of Health and Human Services announced on Monday.
The project, to be operated by the Centers for Medicare & Medicaid Services in partnership with the Health Resources Services Administration, will test the effectiveness of doctors and other health professionals working in teams to improve care for up to 195,000 Medicare patients.
The initiative is part of the Affordable Care Act.
The purpose of FQHC-APCP demonstration is to show how the patient-centered medical home model can improve quality of care, promote better health, and lower costs. Participating FQHCs must implement electronic health records, help patients manage chronic conditions, and coordinate care for patients. FQHCs will agree to adopt care coordination practices recognized by the National Committee for Quality Assurance.
To help cover any investments in patient care and infrastructure, FQHCs will be paid a monthly care management fee of $6 for each eligible Medicare beneficiary receiving primary care services. CMS and HRSA will provide technical assistance.
“The transformation to a patient-centered medical home is designed to improve the coordination of care for Medicare beneficiaries by helping doctors and other health professionals work in teams,” Mary Wakefield, M.D. and HRSA Administrator, said in a statement. “FQHCs in this project can increase access to important primary care services and thus reduce the need for costly hospitalizations or emergency department visits.”
FQHCs that have provided medical services to at least 200 Medicare beneficiaries, including dual-eligibles, in the previous 12-month period will be invited by letter to apply to participate in the demonstration, which will begin Sept. 1, 2011 and end on Aug. 31, 2014.
CMS is using a web-based application process for this demonstration. Eligible FQHCs will find an application form and instructions here. Applications will be accepted through August 12, 2011.
“FQHCs provide essential primary care services to seniors and others in underserved communities,” said Donald Berwick, M.D. and CMS administrator. “This project will go a long way toward creating comprehensive and coordinated healthcare opportunities for the many people with Medicare who rely on FQHCs as their primary medical providers.”