1 Quality of Care Initiatives Quality of Care Initiatives Gaining Momentum Gaining Momentum Katie Arnholt, OIG/HHS Katie Arnholt, OIG/HHS Jacqueline C. Baratian, Alston & Bird, LLP Jacqueline C. Baratian, Alston & Bird, LLP William Mathias, Ober|Kaler William Mathias, Ober|Kaler Overview Overview OIG/AHLA Guidance for Health Care Boards OIG/AHLA Guidance for Health Care Boards of Directors of Directors OIG/HCCA Roundtable OIG/HCCA Roundtable Quality of Care Government Enforcement Quality of Care Government Enforcement Recent Enforcement Actions and Settlements Recent Enforcement Actions and Settlements Developments in Quality of Care Corporate Developments in Quality of Care Corporate Integrity Agreements Integrity Agreements Gain sharing and Pay for Performance Gain sharing and Pay for Performance Initiatives Initiatives
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Quality of Care Initiatives Quality of Care Initiatives
Gaining MomentumGaining Momentum
Katie Arnholt, OIG/HHSKatie Arnholt, OIG/HHS
Jacqueline C. Baratian, Alston & Bird, LLPJacqueline C. Baratian, Alston & Bird, LLP
William Mathias, Ober|KalerWilliam Mathias, Ober|Kaler
OverviewOverview
�� OIG/AHLA Guidance for Health Care Boards OIG/AHLA Guidance for Health Care Boards of Directorsof Directors
�� OIG/HCCA RoundtableOIG/HCCA Roundtable
�� Quality of Care Government EnforcementQuality of Care Government Enforcement
�� Recent Enforcement Actions and SettlementsRecent Enforcement Actions and Settlements
�� Developments in Quality of Care Corporate Developments in Quality of Care Corporate Integrity AgreementsIntegrity Agreements
�� Gain sharing and Pay for Performance Gain sharing and Pay for Performance InitiativesInitiatives
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2008 OIG Work Plan2008 OIG Work Plan
� “OIG will continue to examine quality-of-care issues for beneficiaries residing in nursing facilities and other care settings . . . We will expand our focus on these issues to additional institutions and community-based settings”
OIG/AHLA Guidance for Health OIG/AHLA Guidance for Health
Care Boards of Directors Care Boards of Directors
�� Released in September of 2007Released in September of 2007
�� Third in a series of guides from OIG/AHLAThird in a series of guides from OIG/AHLA
�� Joint public sector/private sector effortJoint public sector/private sector effort
�� Educational resource, not mandatesEducational resource, not mandates
�� Assists boards in exercising their fiduciary Assists boards in exercising their fiduciary
responsibilitiesresponsibilities
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Defining Quality of CareDefining Quality of Care
�� ““Crossing the Quality Chasm” Institute of Medicine’s Crossing the Quality Chasm” Institute of Medicine’s sixsix--part definition of health care qualitypart definition of health care quality�� SafeSafe
�� EffectiveEffective
�� PatientPatient--centeredcentered
�� TimelyTimely
�� EfficientEfficient
�� EquitableEquitable
�� Public and private quality initiates provide benchmarks Public and private quality initiates provide benchmarks �� National Quality Forum, Joint Commission, Leapfrog, CMS National Quality Forum, Joint Commission, Leapfrog, CMS DemonstrationsDemonstrations
�� The “Bottom Line”The “Bottom Line”
�� Quality is an essential component of the mission of health Quality is an essential component of the mission of health
care providers.care providers.
�� Quality must receive the same level of Board attention as the Quality must receive the same level of Board attention as the
�� Quality and cost efficiency are complementary, Quality and cost efficiency are complementary, notnot
contradictory, elements of an effective health care system.contradictory, elements of an effective health care system.
�� Unique opportunity for leadership and positive change.Unique opportunity for leadership and positive change.
Duty of Care and QualityDuty of Care and Quality
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OIG WANTS BOARDS TO ASKOIG WANTS BOARDS TO ASK::
1.1. What are the goals of the quality program and benchmarks used? What are the goals of the quality program and benchmarks used? How is management accountable?How is management accountable?
2. How is quality measured and by whom?2. How is quality measured and by whom?
3. How is quality integrated into policies and operations, and 3. How is quality integrated into policies and operations, and how how are they enforced? What controls are in place?are they enforced? What controls are in place?
4. Is there an education program on quality for Board members, 4. Is there an education program on quality for Board members, and do any members have quality expertise?and do any members have quality expertise?
5. What is the essential information on quality, and how frequen5. What is the essential information on quality, and how frequently tly is it received?is it received?
OIG WANTS BOARDS TO ASKOIG WANTS BOARDS TO ASK::
6.6. How do quality and compliance coordinate, and how are they How do quality and compliance coordinate, and how are they addressed in the risk assessment and action plans?addressed in the risk assessment and action plans?
7. What are the processes for reporting quality issues and 7. What are the processes for reporting quality issues and preventing retaliation? What are the guidelines for Board preventing retaliation? What are the guidelines for Board reporting?reporting?
8. Are human and other resources adequate to support quality? 8. Are human and other resources adequate to support quality? Are systems in place to account for different patient needs?Are systems in place to account for different patient needs?
9. Do competencies, training, credentialing and peer review 9. Do competencies, training, credentialing and peer review adequately focus on quality?adequately focus on quality?
10. How are adverse events identified, analyzed and reported and10. How are adverse events identified, analyzed and reported andincorporated into performance improvement? How does Board incorporated into performance improvement? How does Board address these without increasing liability exposure?address these without increasing liability exposure?
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OIG/HCCA RoundtableOIG/HCCA Roundtable
Driving for Quality in LongDriving for Quality in Long--Term Care: Term Care:
A Board of Directors DashboardA Board of Directors Dashboard
�� On December 6, 2007, OIG the HCCA coOn December 6, 2007, OIG the HCCA co--sponsored a sponsored a Government/Industry Roundtable for representatives Government/Industry Roundtable for representatives from the longfrom the long--term care industry. term care industry.
�� Provided representatives from the longProvided representatives from the long--term care term care industry an opportunity to share experiences and industry an opportunity to share experiences and inform OIG/HCCA of challenges surrounding boards inform OIG/HCCA of challenges surrounding boards of directors’ oversight of quality of care.of directors’ oversight of quality of care.
Purpose of RoundtablePurpose of Roundtable
�� Discuss issues surrounding boards of directors’ Discuss issues surrounding boards of directors’
oversight of quality of careoversight of quality of care
�� Share ideas about how to improve boards of Share ideas about how to improve boards of
directors’ oversight of quality of caredirectors’ oversight of quality of care
�� Generate ideas for a “Quality of Care Generate ideas for a “Quality of Care
Dashboard”Dashboard”
�� Purpose was NOT to set forth any specific Purpose was NOT to set forth any specific
�� One size does not fit allOne size does not fit all
�� Reliability of available quality dataReliability of available quality data
�� OpportunitiesOpportunities
�� Setting quality as a prioritySetting quality as a priority
�� Quality tied to financial performance, overall success of Quality tied to financial performance, overall success of
organization, and staff satisfactionorganization, and staff satisfaction
�� Empower Board with a toolEmpower Board with a tool
RoundtableRoundtable
�� Report of Roundtable available at:Report of Roundtable available at:�� www.hccawww.hcca--info.org/staticcontent/07OIGRoundtableReport.pdf info.org/staticcontent/07OIGRoundtableReport.pdf
�� Settled for $1.25 million Settled for $1.25 million
�� 55--year CIAyear CIA�� Quality of care provisions including independent monitor Quality of care provisions including independent monitor selected by OIG, role of medical directorselected by OIG, role of medical director
SeeSee 11 BNA’s Health Care Fraud Rep. 640 (Sept. 12, 2007)11 BNA’s Health Care Fraud Rep. 640 (Sept. 12, 2007)
�� Press Release, U.S. Attorney’s Office for the Southern District Press Release, U.S. Attorney’s Office for the Southern District of of Florida, Florida Doctor Sentenced to 18 Months in Prison for Florida, Florida Doctor Sentenced to 18 Months in Prison for Medicare Fraud (October 2, 2007).Medicare Fraud (October 2, 2007).
�� Nursing Homes: DOJ Intervenes in Whistleblower Lawsuit Against Nursing Homes: DOJ Intervenes in Whistleblower Lawsuit Against Five Five St. LouisSt. Louis--Area Nursing Homes, Area Nursing Homes, 11 BNA’s Health Care Fraud Rep. 11 BNA’s Health Care Fraud Rep. 474 (July474 (July 4, 2007).4, 2007).
�� Louisiana: State Judge OKs $7.4 Million Settlement of Claims ofLouisiana: State Judge OKs $7.4 Million Settlement of Claims ofUnnecessary Cardiac SurgeryUnnecessary Cardiac Surgery, 11 BNA’s Health Care Fraud Rep. 366 , 11 BNA’s Health Care Fraud Rep. 366 (May 23, 2007).(May 23, 2007).
�� Press Release, U.S. Attorney’s Office for the Eastern District oPress Release, U.S. Attorney’s Office for the Eastern District of f Missouri, Missouri, American Healthcare Management, its CEO & Three Local American Healthcare Management, its CEO & Three Local Nursing Homes Plead Guilty to Conspiracy Charges Involving FailuNursing Homes Plead Guilty to Conspiracy Charges Involving Failure of re of Care at Nursing FacilitiesCare at Nursing Facilities (Oct. 10, 2006).(Oct. 10, 2006).
Data MiningData Mining
� James Sheehan, New York’s Medicaid Inspector General, and a former Assistant U.S. Attorney for the Eastern District of Pennsylvania, has predicted that DOJ will begin bringing enforcement actions based on “data-mining” conducted by HHS-OIG and CMS.
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Quality of Care Corporate Integrity Quality of Care Corporate Integrity
AgreementsAgreements
�� 28 quality of care CIAs28 quality of care CIAs
�� Different from other CIAsDifferent from other CIAs
�� Meetings with corporate boardsMeetings with corporate boards
�� Periodic reports to the OIG and providerPeriodic reports to the OIG and provider
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BoardBoard--Level Obligations in CIAsLevel Obligations in CIAs
In hospital CIAIn hospital CIA
�� BoardBoard--level Quality, Compliance, and Ethics level Quality, Compliance, and Ethics Committee:Committee:
�� Review and oversee performance of the compliance staffReview and oversee performance of the compliance staff
�� Annually review the effectiveness of the compliance Annually review the effectiveness of the compliance programprogram
�� Engage an independent compliance consultant to assist Engage an independent compliance consultant to assist board in review and oversightboard in review and oversight
�� Submit to OIG a resolution summarizing its review of Submit to OIG a resolution summarizing its review of provider’s compliance with CIAprovider’s compliance with CIA
BoardBoard--Level Obligations in CIAsLevel Obligations in CIAs
�� Developing performance targets or criteriaDeveloping performance targets or criteria
�� Utilizing objective standards and performance measuresUtilizing objective standards and performance measures
�� Creating or aligning financial incentivesCreating or aligning financial incentives
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What is Gainsharing?What is Gainsharing?
�� Covers a host of different approachesCovers a host of different approaches
�� Typically involves payments from hospital to Typically involves payments from hospital to physician for designing and/or implementing physician for designing and/or implementing programsprograms
�� To improve the quality of care; and To improve the quality of care; and
�� To control hospital costs.To control hospital costs.
�� Gainsharing is designed to try to align the Gainsharing is designed to try to align the financial interests of hospitals and physicians.financial interests of hospitals and physicians.
�� Gainsharing is a subset of payGainsharing is a subset of pay--forfor--performanceperformance
Criteria for EvaluatingCriteria for Evaluating
PayPay--forfor--Performance SystemsPerformance Systems
�� Additional CostAdditional Cost
�� Over, Under, and MisOver, Under, and Mis--UtilizationUtilization
�� Quality of CareQuality of Care
�� Access to CareAccess to Care
�� Patients’ Freedom of ChoicePatients’ Freedom of Choice
�� CompetitionCompetition
�� Exercise of Professional JudgmentExercise of Professional Judgment
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Applicable StatutesApplicable Statutes
�� AntiAnti--kickback statutekickback statute
�� Stark physician selfStark physician self--referral lawreferral law
�� Civil money penalty against hospital payments to Civil money penalty against hospital payments to
reduce or limit servicesreduce or limit services
AntiAnti--Kickback StatuteKickback Statute
�� Prohibited ConductProhibited Conduct
�� Knowing & willfulKnowing & willful
�� Solicitation or receipt Solicitation or receipt oror
�� Offer or payment ofOffer or payment of
�� RemunerationRemuneration
�� In return for referring a Federal health care program In return for referring a Federal health care program patient, patient, oror
�� To induce the purchasing, leasing , To induce the purchasing, leasing , oror arranging for arranging for or recommending purchasing or leasing items or or recommending purchasing or leasing items or services paid by a Federal health care program.services paid by a Federal health care program.
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AntiAnti--Kickback StatuteKickback Statute
�� PenaltiesPenalties
�� Criminal fines & imprisonmentCriminal fines & imprisonment
�� Civil money penalty of $50,000 Civil money penalty of $50,000 plus plus 3X the amount 3X the amount
–– Reduce or Limit ServicesReduce or Limit Services
�� Prohibited ConductProhibited Conduct
�� Hospital knowingly making payments, Hospital knowingly making payments, directly or directly or indirectlyindirectly, to physician as an inducement to reduce , to physician as an inducement to reduce
or limit services to Federal health care program or limit services to Federal health care program
patient under the physician’s care.patient under the physician’s care.
�� PenaltiesPenalties
�� Civil Money Penalty of $2,000 per patient covered Civil Money Penalty of $2,000 per patient covered
by the improper paymentby the improper payment
�� Both Hospital and Physician liableBoth Hospital and Physician liable
Special Advisory BulletinSpecial Advisory Bulletin
–– CMP AnalysisCMP Analysis�� Virtually all cost savings recommendations could Virtually all cost savings recommendations could induce physicians to reduce or limit current medical induce physicians to reduce or limit current medical practices at the hospital.practices at the hospital.
�� Ignored whether current medical practices at hospital Ignored whether current medical practices at hospital were consistent with what is medically necessarywere consistent with what is medically necessary
�� OIG identified safeguards:OIG identified safeguards:�� Identified Cost Savings. Specific costIdentified Cost Savings. Specific cost--saving actions and saving actions and resulting savings were clearly and separately identified to resulting savings were clearly and separately identified to allow public scrutiny and individual physician accountability. allow public scrutiny and individual physician accountability.
�� Credible Medical Support. Credible medical support that Credible Medical Support. Credible medical support that cost savings recommendations would not adversely affect cost savings recommendations would not adversely affect patient care. Plus, periodic reviews of impact on clinical carepatient care. Plus, periodic reviews of impact on clinical care..
–– CMP AnalysisCMP Analysis�� Limited Impact on Federal Health Care Programs. Payments based Limited Impact on Federal Health Care Programs. Payments based on on surgeries regardless of payor. Federal health care program procsurgeries regardless of payor. Federal health care program procedures edures subject to cap. Cost savings based on actual acquisition costs.subject to cap. Cost savings based on actual acquisition costs.
�� Protections Against Inappropriate Reductions in Service. BaseliProtections Against Inappropriate Reductions in Service. Baseline ne thresholds established through the use of objective historical athresholds established through the use of objective historical and clinical nd clinical measures to protect against inappropriate reductions in service.measures to protect against inappropriate reductions in service.
�� Savings from Inherent Clinical and Fiscal Value. Savings from pSavings from Inherent Clinical and Fiscal Value. Savings from product roduct standardization based on “inherent clinical and fiscal value.” standardization based on “inherent clinical and fiscal value.” Physicians Physicians would have access to the same selection of devices. would have access to the same selection of devices.
�� Patient Disclosure. Hospital and the physician groups provide pPatient Disclosure. Hospital and the physician groups provide patients atients with written disclosures about the arrangements.with written disclosures about the arrangements.
�� Limits on Incentives. Financial incentives reasonably limited iLimits on Incentives. Financial incentives reasonably limited in duration n duration and amount.and amount.
�� Protections Against Disproportionate Cost Savings. Physician grProtections Against Disproportionate Cost Savings. Physician groups oups distribute profits on a per capita basis, thus limiting any incedistribute profits on a per capita basis, thus limiting any incentive for ntive for individual physicians to generate disproportionate cost savings.individual physicians to generate disproportionate cost savings.
�� No Safe Harbor protection because percentageNo Safe Harbor protection because percentage--based based compensation not set in advancecompensation not set in advance
�� OIG warned payments could be used to disguise illegal OIG warned payments could be used to disguise illegal remuneration encouraging physicians to admit more remuneration encouraging physicians to admit more federal health care program patients to hospitalfederal health care program patients to hospital
�� OIG approval based on low risk of fraud and abuseOIG approval based on low risk of fraud and abuse�� Reduced likelihood arrangement would be used to attract Reduced likelihood arrangement would be used to attract referring physicians or to increase referrals from existing referring physicians or to increase referrals from existing physicians:physicians:�� arrangements are limited to physicians on hospital’s medical staarrangements are limited to physicians on hospital’s medical staff; ff;
�� savings derived from procedures for federal health care program savings derived from procedures for federal health care program patients are capped based on prior year’s admissions; and patients are capped based on prior year’s admissions; and
�� arrangements are limited to one year.arrangements are limited to one year.
�� Profits within group are distributed on per capita Profits within group are distributed on per capita basisbasis�� Eliminates risk arrangements would be used to reward Eliminates risk arrangements would be used to reward nonnon--surgeons for referring patients to the surgeon groups surgeons for referring patients to the surgeon groups
�� Minimizes incentive for individual physicians to Minimizes incentive for individual physicians to inappropriately reduce services because inappropriately reduce services because
�� Payments are limited in amount, duration, and Payments are limited in amount, duration, and scope. scope. �� Particular actions that would generate cost savings are Particular actions that would generate cost savings are described.described.
�� Physicians may have some increased malpractice liability Physicians may have some increased malpractice liability risk from making costrisk from making cost--saving changes and it is reasonable saving changes and it is reasonable to compensate them. to compensate them.
�� Outside OIG’s AuthorityOutside OIG’s Authority�� No positionNo position
�� Position of CMS unclearPosition of CMS unclear�� Preamble to Phase III raised concernsPreamble to Phase III raised concerns
�� In discussing proposed change to “set in advance” In discussing proposed change to “set in advance” definition, CMS stated: “Percentagedefinition, CMS stated: “Percentage––based based compensation, other than compensation based on compensation, other than compensation based on revenues directly resulting from personally performed revenues directly resulting from personally performed physician services…is not considered set in advance.”physician services…is not considered set in advance.”
�� Arguably would prohibit gainsharingArguably would prohibit gainsharing
�� Preamble to Proposed Hospital IPPS regulation seeks Preamble to Proposed Hospital IPPS regulation seeks comments about need for gainsharing exceptioncomments about need for gainsharing exception
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Analytical Framework Analytical Framework
for Payfor Pay--forfor--PerformancePerformance
�� Structural IssuesStructural Issues
�� Implicate antiImplicate anti--kickback lawkickback law
�� Stark exceptionStark exception
�� Incentive designIncentive design
�� Implicates CMPImplicates CMP
�� Depends on who is paying the incentiveDepends on who is paying the incentive