Healthcare Business News

Hospital groups rip regulation efforts, urge better guidance

By Joe Carlson
Posted: July 15, 2012 - 1:00 pm ET

As the scrutiny of healthcare provider payments grows, hospital leaders say regulators are increasingly undercutting physicians' medical judgment and resorting to overly punitive corrective actions using redundant and overlapping investigations.

The sometimes-harsh criticisms of government efforts to collect money from hospitals came in response to a call from the Senate Finance Committee for provider groups to submit feedback on the best ways to cut down on fraud and abuse in Medicare and other healthcare programs.

In a July 13 letter to the committee (PDF), the Federation of American Hospitals said Congress should streamline all ongoing auditing for Medicare under one type of entity—currently three types of contractors perform the job, in addition to HHS auditors—and also provide clear guidance for how hospitals and doctors are expected to admit and classify hospital inpatients.

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The Washington-based trade group for investor-owned hospitals also suggested that physicians be held responsible in cases where errors in medical judgment lead to incorrect decisions on hospital admissions. As it stands, hospitals by and large have to comply with investigative demands and pay the penalties for errors made by admitting physicians.

The American Hospital Association in a June 26 letter to the Senate committee (PDF) made many of the same recommendations at the FAH, noting particular disappointment with recent efforts by government regulators to implement laws designed to collect Medicare overpayments by attaching large penalties and sometimes even fraud allegations under the False Claims Act.

“Predictably, mistakes are made by hospital staff, the Centers for Medicare and Medicaid Services, and program contractors alike,” the AHA wrote. “However, such mistakes are not fraud, and the powerful weapon of the False Claims Act should not be wielded in a misguided attempt to correct or prevent mistakes.”

Both the AHA and FAH criticized in particular the ongoing effort to develop the 60-day repayment rule for Medicare overpayments, which attaches a False Claims liability for payments that providers should have known need to be returned, as well as the CMS' slow-going efforts to implement the Stark Self-Referral Disclosure Protocol.

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