IN THIS WEEK’S ISSUE:
- Administrative Simplification Enforcement Rule Proposed
- Thomas Asks Tax Experts for Exemption Oversight Advice
- CMS Publishes HPSA, Physician Scarcity Payment Instructions
- SEC Delays FASB’s Rules on Expensing Stock Options
- Draft Outpatient Electronic Record Certification Requirements Released
- Long-Term Care Insurance Won’t Reduce Medicaid Dependence
- Quick Links
- New in the Resource Center
1. ADMINISTRATIVE SIMPLIFICATION ENFORCEMENT RULE PROPOSED
On April 15, HHS released for public view its proposed “enforcement” rule that would establish civil money penalties for failures to adhere to HIPAA’s administrative simplification provisions. Covered entities that are found to have violated an administrative simplification provision would face penalties of up to $100 for each violation, not to exceed $25,000 for identical violations during a calendar year.
The proposed rule outlines HHS’s general approach of pursuing a consistent enforcement and compliance policy for HIPAA provisions, and notes that HHS is “committed to promoting and encouraging voluntary compliance with the HIPAA rules through education, cooperation, and technical assistance.” The proposed rule also would clarify and discuss the investigation process, bases for liability, determination of the penalty amount, grounds for waiver, and the appeals process.
Comments on the proposed rule are due June 17, 2005.
2. THOMAS ASKS TAX EXPERTS FOR EXEMPTION OVERSIGHT ADVICE
House Ways & Means Committee chairman Bill Thomas (R-CA) told a panel of lawyers and tax experts yesterday that he was looking for help on how to address policy for and oversight of tax-exempt organizations. The comments came during the committee’s latest hearing on tax-exempt status. Central to the issue, acknowledged to be a broad one by all the panel speakers, was that current policy and the tax code do not effectively address either the criteria to qualify as a tax-exempt organization or the oversight of the tax-exempt sector. Thomas has made clear in previous hearings that he considers tax-exempt organizations a potential source of revenue for the federal government.
3. CMS PUBLISHES HPSA, PHYSICIAN SCARCITY PAYMENT INSTRUCTIONS
CMS has clarified that health professional shortage area (HPSA) “bonuses” are payable for all professional services provided by a psychiatrist in a mental health HPSA that the psychiatrist is licensed to provide. CMS had indications that some contractors were interpreting language in the claims processing manual in a way that would limit payment of the bonus to a specific group of services. Contractors that need to make payments previously withheld or have erroneously taken back what they believed to be an overpayment are instructed not to wait until the next quarterly bonus payment, but to issue funds within 30 days of the April 15 transmittal issuance date.
CMS also issued a related transmittal directed at critical access hospital (CAH) physician scarcity and HPSA bonuses. In the transmittal, CMS spelled out modifier requirements and payment calculations for CAHs electing the Method II payment methodology.
These payment changes, mandated by Section 413 of the Medicare Modernization Act of 2003, include a five-percent bonus to physicians that render service in a designated physician scarcity area, as well as an HPSA bonus payment of 10 percent for mental health physicians’ services rendered in a HPSA-designated area. The bonus payment for primary physicians will only be paid to general practice, family practice, internal medicine, and obstetrics/gynecology physicians in the designated areas. For specialty providers, the bonus payment will be paid to provider specialties other than oral surgery, chiropractic, optometry, and podiatry.
4. SEC DELAYS FASB’S RULES ON EXPENSING STOCK OPTIONS
In an unusual action, the Securities and Exchange Commission (SEC) announced the adoption of a new rule that amends the compliance dates for the Financial Accounting Standards Board’s (FASB’s) Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based Payment (Statement No. 123R). The new rule allows companies to implement Statement No. 123R at the beginning of their next fiscal year (instead of the next reporting period) that begins after June 15, 2005, or December 15, 2005, for small business issuers. This means, for example, that the financial statements for a calendar year-end company do not need to comply with Statement No. 123R until the interim financial statements for the first quarter of 2006 are filed with the SEC.
The SEC’s new rule does not change the accounting required by Statement No. 123R; it changes only the dates for compliance. Among other reasons, the SEC says that concerns were raised that the staffs at companies and accounting firms already have been stretched thin by other compliance responsibilities, such as internal controls reporting, and that implementing the new standard at the beginning of a fiscal year allows companies to change their accounting systems in a more orderly fashion.
5. DRAFT OUTPATIENT ELECTRONIC RECORD CERTIFICATION REQUIREMENTS RELEASED
The Certification Commission for Healthcare Information Technology has released for public comment proposed requirements for certifying electronic health record products for physician offices and other ambulatory care settings.
Due by May 18, the comments will be used to refine the requirements before the certification program is finalized and tested this summer. The commission has also scheduled a series of open teleconferences April 21-27 to explain the proposed requirements to various stakeholders.
6. LTC INSURANCE WON’T REDUCE MEDICAID DEPENDENCE
The limited success of long-term care (LTC) insurance means the public continues to see Medicaid as the answer to their future long-term care needs, Douglas Holtz-Eakin, director of the Congressional Budget Office suggested during a Ways & Means Health Subcommittee hearing on April 19. The hearing focused on current and future LTC service financing, the range of services available in the continuum of care, and private insurance options.
Judith Feder of the Georgetown Public Policy Institute discounted the potential for LTC insurance to reduce the government’s cost, pointing out the insurance is, and will continue to be, unaffordable to older people with modest incomes. Also, the insurance provides limited benefits in dollar terms to keep premiums affordable, and so leaves policyholders with insufficient protection. She noted that LTC insurance lacks the premium stability and benefit adequacy that can assure purchasers they will be protected against catastrophe.
7. QUICK LINKS
OIG CRIMINAL ENFORCEMENT ACTIONS. The OIG has posted lists of criminal enforcement actions for January through March 2005.
- UPDATED OIG EXCLUSIONS AND REINSTATEMENTS. The OIG has posted the full updated list of excluded individuals and entities (LEIE) database file reflecting all OIG exclusion and reinstatement actions through March 2005. This web page provides links to a downloadable database and on-line search form.
- OIG REALIGNS FUNCTIONS AND RESPONSIBILITIES. The OIG has published a notice in the April 18 Federal Register that it has realigned its functions and responsibilities to allow greater staff flexibility and to better reflect the current work environment and priorities within the organization.
- UPDATED SWING BED MDS ASSESSMENT TRAINING MANUAL CMS has published a list of the MDS Assessment Training Manual changes that are effective in May 2005. The on-line manual has also been updated.
8. NEW IN THE RESOURCE CENTER
- On May 2, 2005, HFMA's Principles and Practices Board will release a new issue analysis on the charitable attributes that merit tax-exempt status for hospitals and how to communicate those attributes to stakeholders. The April 20 HFMA Wants You to Know article, “P&P Board Examines the Relationship of Community Benefit to Hospital Tax-Exempt Status,” provides a preview of the new issue analysis.
- Order Issue Analysis 05-01: P&P Board Issue Analysis 05-01: The Relationship of Community Benefit to Hospital Tax-Exempt Status.
- HFMA LINKS – TRANSACTION STANDARDS
- The System Vendor's Role in HIPAA Implementation
- Job Security: 7 Steps for HIPAA Compliance (10/04 "hfm")
- Why Stop at HIPAA? Getting Back on the Healthcare Information Highway (9/04 "hfm")
- HIPAA Compliance Not So Great? Maybe it's Time to Coordinate (6/04 "hfm")
- Preparing the Charge Master for HIPAA: Are You Ready? (10/03 Audio Webcast)
- HIPAA Claims Compliance Options as Easy as 1-2-3 (1/03 "hfm")
Copyright 2005 Healthcare Financial Management Association, all rights reserved. HFMA Express News ISSN: 1540-0689. Volume XII, Number 16. Editor: Rob Fromberg rfromberg@hfma.org, (800) 252-HFMA, ext. 385.
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