Needed or Outdated? Trump Officials and Congress Eye Healthcare Fraud and Abuse Rules

By Leonard, Kimberly | Examiner (Washington, D.C.), The, September 18, 2018 | Go to article overview

Needed or Outdated? Trump Officials and Congress Eye Healthcare Fraud and Abuse Rules


Leonard, Kimberly, Examiner (Washington, D.C.), The


Picture a scenario in which a group of surgeons are also investors in a hardware used in spinal fusion. When those doctors tell patients that spine surgery is necessary, and use the product in which they have a financial stake, should patients trust they need to go under the knife, or should they be wary that doctors are trying to make a profit?

U.S. law regulates or bans these healthcare arrangements to protect patients and government funds from conflict-of-interest and kickbacks. But recently, medical providers have been pressuring Congress and the Trump administration to take a fresh look at the rules,which have gotten in the way when different parts of the healthcare industry try to work together. It’s one of the grievances health officials hear about more than anything else.

Medical groupspoint outthat the laws were created decades ago, at a time when the healthcare system worked differently.

They saythe mismatch between practices and regulation has worsened since Congress changed how healthcare is paid for in 2015. Now, doctors and hospitals increasingly are rewarded by government programs for how well they care for patients and help them recover. In the past, they were paid according to the number of tests, surgeries, and devices they gave out, no matter the cost or the result.

“It’s the direction of the future. It’s where healthcare needs to go for healthcare to be sustainable,” said Dr. Terry Chang, associate general counsel and director of medical and legal affairs at AdvaMed, which represents medical devices and has been advocating for changes to the anti-kickback laws.

Healthcare workers have told Congress and the Trump administration that to fully shift to paying based on quality of care, different parts of the industry have to work together. They say that the way the fraud and abuse laws are written are getting in the way, and that setting up arrangements to work together can bring about scrutiny and require difficult maneuvering.

Trump officials are listening. The Centers for Medicare and Medicaid Services queried healthcare providers about potential changes to conflict-of-interest regulations, and the Health and Human Services Inspector General is gathering feedback on the anti-kickback laws.

CMS Administrator Seema Verma told the Washington Examiner that her agency would try to put out new regulations by the end of the year on the self-referral rules “to address some of the problems that providers are facing.”

“Our goal is to get as far as we can with regulations, but there could be some things after we are done with the process that we would refer to Congress,” she said.

The move is part of a broader effort by the Trump administration to cut red tape through the federal government. The self-referral regulations, Verma said, are contributing to the high cost of healthcare.

While the current regulations have dozens of exemptions to allow for some collaboration, healthcare providers say they are ambiguous and complex, requiring them to pay expensive fees to attorneys to make sure they aren’t running afoul. If they are, intentionally or not, they’ll face fines and a ban from seeing patients on Medicare or Medicaid.

Proponents of keeping the laws in place say they are necessary to protect patients and government funds. And they note that health providers are allowed to seek approval for specific financial arrangement.

“It’s not clear that our existing process prevents raising those issues,” said Claire Sylvia, a partner at Phillips & Cohen LLP who represents whistleblowers that bring cases of medical fraud and abuse to the government’s attention.

The self-referral law, Sylvia said, is “actually pretty straightforward, but whenever you’re trying to control financial impacts it’s hard to describe all the kinds that could pose a conflict of interest. …

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