A judge warned California Gov. Arnold Schwarzenegger to be careful not to disobey court orders in his battle to ease the state's minimum nurse-to-patient staffing ratios, but the judge canceled a pending contempt hearing. Superior Court Judge Judy Hersher in Sacramento said that while Schwarzenegger and the state's top two health officials violated court orders by reissuing an emergency regulation to loosen the staffing requirements, they did not do so willfully. "Further violations ... will not be viewed in the same light," Hersher wrote. The state issued the emergency regulation a third time after Hersher ruled in June that the regulation was illegal. A spokeswoman said the administration was attempting to protect its right to appeal. The state first issued the emergency regulation in November 2004 and readopted the regulation in March when it expired. In each case, the California Nurses Association sued. Also, the judge halted a one-day strike by as many as 9,000 University of California nurses. Superior Court Judge Loren McMaster in Sacramento ordered the CNA to delay the strike until the court determines if a walkout would violate California labor law. A hearing was scheduled for Aug. 11. The university alleged that the union failed to take certain steps required in the bargaining process. "Our position has always been that such strikes are illegal and contradict the duty to negotiate in good faith through the entire bargaining process, including impasse proceedings," the university said in a news release. The university said it met with the union 22 times since contract talks began in January without reaching an impasse. In reaction to the order, nurses staged early-morning and lunch-hour pickets. "It's very shortsighted of the university to take such a hard line," CNA spokesman Chuck Idelson said.
N.C. sets up Medicaid fraud unit
North Carolina's Medicaid agency launched its own 10-person unit to investigate fraud and abuse in the $2.3 billion program. The effort "will not duplicate any efforts under way" with the Medicaid Fraud Control Unit in the state attorney general's office, said Mark Benton, senior deputy director and chief operating officer at the state Division of Medical Assistance. "They're charged with prosecuting criminal acts of fraud and abuse and have higher evidentiary standards," Benton said. "But in the past, while we're waiting, those providers could continue to bill the program. Historically, we have not taken administrative actions against them, and we needed the teeth to do something in the interim." The unit, created out of existing staff from the division, will identify and then visit providers whose billings far exceed state averages, state Medicaid Director Allen Dobson said in a news release. Dobson said providers found by an administrative review to have committed fraud and abuse will see their Medicaid payments and enrollment eligibility suspended while criminal proceedings take place. North Carolina is one of a number of states trying harder to crack down on Medicaid fraud as spending grows.
Hospital pays $3.6 million fine
Simi Valley (Calif.) Hospital and Health Care Services agreed to pay the federal government $3.6 million to settle allegations that it routinely billed Medicare for more complex cases of pneumonia, sepsis and kidney infections than was documented between 1993 and 1998. The 197-bed hospital, owned by Adventist Health, also signed a three-year corporate integrity agreement with the HHS' inspector general's office. Simi Valley did not admit wrongdoing. The settlement stems from a national investigation of pneumonia upcoding begun by HHS in 2000, based on a whistle-blower lawsuit naming more than 100 hospitals. Most of the hospitals have since settled. Simi Valley was not among the hospitals named in the whistle-blower lawsuit. In a news release, the hospital said it decided "to avoid the inconvenience and expense of protracted litigation." The hospital also said it was increasing education for coding staff.
Bill would lower rehab standard
The admissions standard for qualifying as a rehabilitation hospital would be lower under a new House bill, a companion to legislation introduced in the Senate earlier this month. Under the bill, only 50% of a hospital's admissions would have to meet one of 13 conditions for the hospital to qualify for inpatient rehab fees, which are higher than standard Medicare reimbursement. The bill would restore rehab-hospital status to facilities that ceased to qualify when the threshold rose to 60% July 1, and the higher payments would be applied retroactively. The lower threshold would apply until July 2007. A new 17-member panel would advise HHS on future policy for rehab hospitals. The legislation, introduced by Rep. Frank LoBiondo (R-N.J.), corresponds to a Senate bill sponsored by Jon Corzine (D-N.J.). Ben Nelson (D-Neb.) and Rick Santorum (R-Pa.). Both bills are backed by the hospital industry. Under current regulations, known as the "75% rule," the threshold is set to rise to 65% next July and to 75% in July 2007.
Tenet delays 2nd quarter report
Tenet Healthcare Corp., Dallas, will delay its second-quarter report to the Securities and Exchange Commission to investigate an accounting issue stemming from an SEC review of Tenet's disclosures to investors prior to 2003. Tenet said a former employee alleged that three Tenet hospitals in California recorded improper contractual allowances for managed-care contracts through at least fiscal 2001. Tenet said its independent outside counsel is investigating the allegations and whether other Tenet hospitals may have followed similar practices. If some allowances are deemed improper, some past operating revenue figures would be affected. But the company said it does not expect material changes to its current financial status or 2004 and 2005 results. The outside counsel's investigation won't be completed in time for Tenet's outside auditor, KPMG, to sign off on the company's quarterly securities filing. Tenet said it would report some second-quarter financial results on Aug. 2.