How far can providers go?
Skip to main content
MDHC_Logotype_white
Subscribe
  • My Account
  • Login
  • Subscribe
  • News
    • This Week's News
    • COVID-19
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • People
    • Regional News
    • Digital Edition
    • Ohio to save $240M in Medicaid drug costs by running its own PBM
      MACPAC approves recommendations on specialty drugs, behavioral health
      Top R.I. state official will take over, review hospital agency
      No region in the world spared as virus cases, deaths surge
    • No region in the world spared as virus cases, deaths surge
      We're losing engaged providers, and healthcare will pay the price
      J&J vaccine problems hamper U.S. military vaccines overseas
      U.S. suicides dropped last year, defying pandemic expectations
    • Calls mount for Biden to track U.S. healthcare worker deaths from COVID
      Front-line workers want more assistance after a year of COVID-19
      Healthcare providers enter Philadelphia's legal fight to enact gun laws
      Taking population health expertise to the market
    • Cigna and Oscar expand their small business partnership
      5 things to know about Agilon Health's proposed IPO
      More than a half million Americans gain coverage under Biden
      Insurance auto-retention policies could halve number of people kicked off coverage
    • MACPAC approves recommendations on specialty drugs, behavioral health
      No region in the world spared as virus cases, deaths surge
      CMS wants to bump pay for hospices, SNFs next year
      MACPAC wants to cut Medicaid spending on high-cost specialty drugs
    • Outgoing UHS chief made almost 50% less in 2020 than 2019
      A hundred dollar bill cut into strips with a colorful background.
      Population health still at odds with fee-for-service
      Private equity could increase long-term Medicare spending, MedPAC says
      Jeb Bush, Marilyn Tavenner getting in on healthcare SPAC frenzy
    • Healthcare data breaches
      By the Numbers: National health information service providers
      Health systems are navigating the digital divide and vaccine access
      woman doctor shaking hands with nurse and smiling
      Sponsored Content Provided By Philips
      A stronger healthcare system requires bold new ways of working together
    • Fight against STDs lost amid coronavirus testing blitz
      Beyond the Byline: Kids' unchecked mental health needs pose long-term consequences
      Hospitals vary widely in reducing C-section rates, but some progress in other maternal health metrics
      Home improvement to be provided by ProMedica's new healthy homes initiative
    • Novant Health adds chief payor performance officer
      Kaiser Permanente names Comer chief IT officer
      Mass General Hospital's Slavin to retire as CEO
      UnitedHealthcare names Thompson as new CEO
    • Midwest
    • Northeast
    • South
    • West
  • Insights
    • ACA 10 Years After
    • Best Practices
    • Special Reports
    • Innovations
    • The Affordable Care Act after 10 years
    • A close-up of a woman receiving a COVID-19 vaccine.
      Providers in underserved communities work toward equitable vaccine distribution
      Josh Bradshaw
      How one rural Illinois county vaccinated 84% of its senior citizens by early March
      Dr. John Fischer
      Patient-reported outcomes tool for hernia surgery helps physicians improve care
      New care model helps primary-care practices treat obesity
    • A family photo of the the Hangens.
      Stressing the already burdened pediatric behavioral health system
      Jennifer Pannone and her daughter Victoria.
      Mental health access for children needs attention
      What's next for on-demand telehealth companies?
      A CalOptima PACE vaccination clinic.
      Will COVID-19 be the catalyst for creating a more sustainable healthcare system?
    • Ryan McGinnis
      Finding efficiencies in the OR using tech
      Dr. Daniel Hall
      UPMC pilots machine learning, telehealth to inform patient transfers
      A woman being recorded using her inhaler on a smartphone.
      Digital check-ins, connected inhalers help control asthma
      A phone screen showing the question, "Mary we hope this information was helpful and we'd like to keep guiding you. Are you interested in knowing when it's your turn to receive the vaccine?"
      Chatbots, texting campaigns help manage influx of COVID vax questions
  • Transformation
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Nearly 1 in 5 Americans skipped care due to cost last year
      COVID-19 long-haulers need holistic treatment, providers say
      Amazon expanding employee clinics into two more states
      What's next for on-demand telehealth companies?
    • Malpractice premiums peak in 2020, AMA survey shows
      A rendering of a cancer research institute at the University of Southern California that will include 5G.
      Healthcare providers determine how to best use ultrafast 5G
      Two-thirds of largest hospitals aren't complying with price transparency rule
      'Silver lining': Hospitals keep practices born in COVID rush
    • Addressing long-standing barriers needed for mental and physical health integration
      A close-up of a woman receiving a COVID-19 vaccine.
      Providers in underserved communities work toward equitable vaccine distribution
      The waiting room of a Kaiser Permanente clinic at a Target location.
      Health systems revamp their approach to retail clinics
      Josh Bradshaw
      How one rural Illinois county vaccinated 84% of its senior citizens by early March
    • CMS wants to bump pay for hospices, SNFs next year
      CMMI pauses new Direct Contracting model applications
      CMS wants to boost payments over 2% for inpatient rehab, psych facilities
      40 Oregon providers, insurers sign value-based care pact
  • Data/Lists
    • Rankings/Lists
    • Interactive Databases
    • Data Points
    • Health Systems Financials
      Executive Compensation
      Physician Compensation
  • Op-Ed
    • Bold Moves
    • Breaking Bias
    • Commentaries
    • Letters
    • Vital Signs Blog
    • From the Editor
    • Dr. Alan Kaplan
      The risks, rewards of taking organizations 'where they haven’t gone before'
      Wellstar CEO calls adapting for the pandemic her bold move
      Howard P. Kern
      Recognizing the value of telehealth in its infancy
      Dr. Stephen Markovich
      A bold move helped take him from family doctor to OhioHealth CEO
    • Drs. Hal Paz and Joshua J. Joseph
      Mobilized to fight the COVID crisis: a blueprint for community and academic partnerships
      Dr. Stephen Markovich
      Making sure we're aligned along the path to achieving inclusion
      Barry Ostrowsky
      Ending racism is a journey taken together; the starting point must be now
      Laura Lee Hall and Gary Puckrein
      Increased flu vaccination has never been more important for communities of color
    • We're losing engaged providers, and healthcare will pay the price
      Dr. Chris DeRienzo
      How COVID-19 broke health systems and made them stronger
      Bonnie Castillo and John Welton
      Dueling opinions: The role of mandated nurse staffing ratios
      Still crossing the quality chasm: a look at the IOM's seminal report 20 years later
    • Letters: Eliminating bias in healthcare needs to be ‘deliberate and organic’
      Letters: Maybe dropping out of ACOs is a good thing for patients
      Letters: White House and Congress share blame for lack of national COVID strategy
      Letters: VA making strides to improve state veterans home inspections
    • Sponsored Content Provided By Optum
      How blockchain could ease frustration with the payment process
      Sponsored Content Provided By Optum
      Three steps to better data-sharing for payer and provider CIOs
      Sponsored Content Provided By Optum
      Reduce total cost of care: 6 reasons why providers and payers should tackle the challenge together
      Sponsored Content Provided By Optum
      Why CIOs went from back-office operators to mission-critical innovators
  • Awards
    • Award Programs
    • Nominate
    • Previous Award Programs
    • Other Award Programs
    • Voting Open - 50 Most Influential Clinical Executives
      Nominations Open - Top 25 Innovators
      Nominations Open May 24 - Top 25 Emerging Leaders
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top 25 Innovators
    • Minorities in Healthcare
      • - Luminaries
      • - Top 25 Minority Leaders
      • - Minorities to Watch
    • Women in Healthcare
      • - Luminaries
      • - Top 25 Women Leaders
      • - Women to Watch
    • Excellence in Nursing Awards
    • Design Awards
    • Top 25 COOs in Healthcare
    • 100 Top Hospitals
    • ACHE Awards
  • Events
    • Conferences
    • Galas
    • Webinars
    • COVID-19 Event Tracker
    • emburse certify modern healthcare custom media webinar logo lockup
      Sponsored Content Provided By Emburse
      Webinar: Making it easy to manage costs
      virtualmed staff modern healthcare custom media logo lockup
      Sponsored Content Provided By VirtualMed Staff
      Webinar: Best practices for creating a successful telepsychiatry program
      telehealth visit man touching neck while speaking to doctor on computer
      Sponsored Content Provided By Accumen
      Webinar: How telehealth has evolved into a standard of care
      modern healthcare custom media and trimedx custom webinar logo lockup
      Sponsored Content Provided By TRIMEDX
      Webinar: Bridging the gap between clinicians and administration to improve capital equipment planning
    • Women Leaders in Healthcare Conference
    • Social Determinants of Health Symposium
    • Healthcare Transformation Summit
    • Leadership Symposium
    • Virtual Briefings
      • - Hospital of the Future
      • - Mental Health
      • - Patient Safety & Quality
      • - Strategic Marketing
      • - Virtual Health
      • - Workplace of the Future
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Minority Leaders Gala
    • Top 25 Women Leaders Gala
  • Listen
    • Podcast - Next Up
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Video Series - The Check Up
    • Sponsored Video Series - One on One
    • Dr. Chris DeRienzo
      Next Up Podcast: Building team spirit in the wake of COVID-19
      Mikelle Moore
      Next Up Podcast: Mikelle Moore on recognizing all hospital workers during the pandemic
      Empty boardroom
      Next Up Podcast: What's going to happen tomorrow? Succession planning during emergencies
      Next Up Podcast: Educating patients on the COVID-19 vaccine with Tanya Andreadis
    • Beyond the Byline: Kids' unchecked mental health needs pose long-term consequences
      Beyond the Byline: How COVID-19 has impacted hospital finances
      An older man sitting on a hospital bed with his back toward the camera.
      Beyond the Byline: Upcoding could explain why hospitals are increasingly billing for the most complex treatment
      Beyond the Byline: Insurers are betting on virtual-first plans as COVID-19 shifts care pathways
    • James garvert neustar healthcare insider podcast image
      Building on basics
      Healthcare Insider Podcast Episode Art - Premier
      Why Roger Weems and other consultants are leaving the big firms to join Premier
      James garvert neustar healthcare insider podcast image
      Outreach during COVID-19
      ann barnes healthcare insider podcast image
      Leading with intention to promote diversity and inclusion
    • The Check Up: Matt Eyles
      The Check Up: Matt Eyles of AHIP
      The Check Up: Dr. Tom Shanley
      The Check Up: Dr. Tom Shanley of Lurie Children’s Hospital of Chicago
      The Check Up: Dr. Harold Paz
      The Check Up: Dr. Harold Paz of Wexner Medical Center at Ohio State University
      The Check Up: Pat Schou
      The Check Up: Pat Schou of the Illinois Critical Access Hospital Network
    • ivana naeymi-rad one on one intelligent medical objects
      Video: Ivana Naeymi Rad of Intelligent Medical Objects
  • MORE +
    • Advertise
    • Media Kit
    • Newsletters
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Law & Regulation
September 20, 2010 01:00 AM

How far can providers go?

Regulators grapple with antitrust, fraud-and-abuse issues under reform

Gregg Blesch
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    In a speech to the American Medical Association's House of Delegates, Federal Trade Commission Chairman Jon Leibowitz acknowledged that accountable care organizations and other new delivery models could affect antitrust enforcement.

    The architects of the national health reform law infused the legislation with ideas intended to gradually fix the incentives in healthcare delivery so that hospitals and physicians are rewarded for delivering better care for less money.

    Integration and coordination are at the heart of these provisions, and they may conflict with principles underlying the way the government polices financial incentives and competition in healthcare. The reform law did nothing to bring that legal framework into alignment with its payment and delivery experiments, except to note occasionally that the HHS secretary shall have the authority to issue waivers as deemed necessary to get the government out of the way of its new course.

    “All the rules we've been living by—or all the altars we've been worshipping at—are really either obstacles or speed bumps,” says Howard Hahn, a lawyer in Omaha, Neb., working with the Accountable Care Alliance, a nascent accountable care organization involving the Nebraska Medical Center and Methodist Health System. “I tend to think if the lawyering is done well, they are speed bumps,” Hahn says.

    Now six months since President Barack Obama signed the Patient Protection and Affordable Care Act into law, the federal agencies responsible for interpreting and enforcing the nation's antitrust and healthcare fraud-and-abuse laws are doing much the same thing as providers: They are scrambling to understand a changing landscape as it morphs around them.

    Under the healthcare reform law, by no later than 2012 Medicare must be rewarding providers that work together in ACOs to manage and coordinate care, if they meet quality benchmarks and achieve savings measured against what the government would expect to spend on beneficiaries with a similar mix of characteristics (as with many elements of the law, to be determined later).

    The law also establishes a five-year national pilot program on payment bundling—the subject of an existing demonstration project—and extends a demonstration project on gain-sharing, a cousin to the “shared savings” payment mechanism built into the ACO provision. The most-integrated ACOs might also share partially capitated rather than fee-for-service payments for their Medicare beneficiaries.

    The Federal Trade Commission, the CMS and HHS' inspector general's office say they are working through the issues collaboratively and plan to stage a workshop Oct. 5 that would bring together officials, stakeholders and policy experts at CMS headquarters in Baltimore.

    “From our point of view this is really an opportunity for the FTC to learn more how providers want to put together ACOs,” says Susan DeSanti, director of the FTC's office of policy planning. “Because antitrust is so fact- specific, we think it would help a lot to hear from providers, payers and other participants in the marketplace.” It's important that agencies work together, she says, to avoid situations in which the CMS might, for example, reward the performance of an ACO while the FTC hits the same providers with an antitrust complaint and the inspector general's office questions whether the referrals among the ACO's members are tainted by kickbacks.

    Asked if the FTC and fellow antitrust enforcers in the U.S. Justice Department might end up revising or amending their seminal “Statements of Health Care Antitrust Enforcement Policy” issued in 1996, DeSanti says, “That is just something we can't know at this point.”

    FTC Chairman Jon Leibowitz acknowledged in a June speech delivered to the American Medical Association's House of Delegates that accountable care organizations and perhaps other models encouraged by the reform law could affect antitrust enforcement, particularly as providers extend them beyond Medicare into their contracts with private payers.

    “Such a transition could indeed raise competition issues, and we want to work with you going forward,” Leibowitz told the AMA delegates, a group that has long prodded the government for greater leeway or at least more detailed guidance for independent practices seeking to contract jointly with health plans. Price-fixing is not a risk if an ACO exists only in the realm of care and reimbursement for Medicare beneficiaries on the government's terms, though the accumulation of market power as big players merge or form joint ventures could draw a different sort of antitrust scrutiny. The FTC, however, hopes providers will form ACOs on a scale that pits them against one another for business.

    Leibowitz emphasized that the goals of many provisions in the Patient Protection and Affordable Care Act—improvements in the quality and efficiency of healthcare delivery—are the same goals that drive antitrust policy and enforcement. He noted, for example, that bundled payments—in which Medicare and Medicaid reimbursement will be divvied up among various facilities and physicians contributing to a single episode of care—provide a level of financial risk-sharing that might allow alliances of competing providers to contract with private payers without drawing price-fixing allegations.

    Provisions of the reform law might also technically set up providers to violate, at least technically, the anti-kickback statute, which bars any type of remuneration tied to the volume or value of referrals, and what's known as the Stark law, intended to prevent Medicare referrals tainted by a physician's financial interest. Another hurdle might be the authority of HHS' inspector general's office to penalize providers for creating incentives to limit or withhold care.

    “What are kickbacks going to look like in this integrated world?” Vicki Robinson, chief of the industry guidance branch of the inspector general's office, posed to a session this summer at the annual meeting of the American Health Lawyers Association. She suggested that new payment models always give rise to conflict about how organizations pick their business partners, and those motivations will be scrutinized. It's unclear, though, whether the government will conceive a new framework to judge them.

    “These ACOs are going to be a way to reward physicians and move patients to more efficient providers,” says W. Bradley Tully, a partner in the law firm Hooper, Lundy and Bookman in Los Angeles. “I would say the idea of doing ACOs hits the heart of all this. CMS has been very concerned historically about financial considerations influencing physicians in any way, and now from another perspective they're saying, let's rethink this—let's see if we can get physicians to provide more efficient care.”

    Tully says it has been rumored that the CMS plans to issue some sort of regulation that would provide broader guidance than advisory opinions to individual applicants, yet stop short of defining “template transactions” that would tell providers exactly how to structure deals that steer clear of trouble.

    A CMS spokesman declined to comment on the agency's course, responding in an e-mail that “these are some of the issues that we are considering, and the relevant agencies are working together.”

    J. Peter Rich, a partner in the Los Angeles office of the law firm McDermott Will & Emery, says providers looking to federal agencies for clarity on the antitrust and fraud-and-abuse issues arising from the healthcare reform law won't find it yet. “I'm not sure there are any answers,” says Rich, who contributed to a recent newsletter his firm issued on the payment and delivery provisions of the law.

    Rich says what's deterring providers more than any legal uncertainty is whether embarking on something as complex as an ACO will pay off, particularly because the statute allows Medicare patients assigned an ACO to seek care outside the network of providers ostensibly being held accountable. “There are a lot of question marks here,” Rich says. “Everybody's excited about doing something, but they're waiting to see what that something is.”

    That may be so, but quite a few healthcare organizations are not waiting and have announced plans to form ACOs in order to be ready for whatever materializes. Among providers that have announced plans, in addition to the Accountable Care Alliance in Omaha, are 10-hospital Baylor Health Care System, Dallas; 25-bed Bell Hospital in Ishpeming, Mich., with 315-bed Marquette (Mich.) General Health System; and CaroMont Health, the parent of 397-bed Gaston Memorial Hospital in Gastonia, N.C.

    Hahn, the lawyer working with the participants of the Omaha ACO, says he has attempted to draft flexible documents. to allow the alliance to evolve with federal policy and the marketplace. “My notion was, we don't know what's going to be coming, so let's build them as flexible as possible,” says Hahn, a partner in the law firm Husch Blackwell.

    The Omaha alliance is made up of the established physician-hospital organizations of 511-bed Nebraska Medical Center and two-hospital Methodist Health System. The ACO will adopt uniform clinical protocols and benchmarks, but each PHO will be responsible for collecting and distributing the money, Hahn says. A more intimate financial mingling might happen down the road, Hahn says, adding, “That presents potentially its own set of antitrust issues.”

    Hahn says the alliance is essentially working to shoehorn its mechanism for distributing savings accomplished by the alliance into advisory opinions in which HHS' inspector general's office has revealed its views of properly conceived safeguards for arrangements that the government calls “shared savings” and are more commonly known as gain-sharing. “They're all a lot the same and they're all pretty rigid,” he says of the advisory letters, which are specific to more than a dozen similar gain-sharing programs that have won a favorable response (applicants retract their applications before a negative opinion sees daylight).

    The CMS, meanwhile, last year proposed a Stark exception for shared-savings arrangements but withdrew it after providers balked at the complexity of meeting it. That exercise illustrates the challenge regulators face in providing a balance of clarity and flexibility.

    “Hopefully, the government's view will come around to match up with what we think is a new social policy,” Hahn says. “They need to have the law match the social policy.”

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    U.S. allows two more over-the-counter COVID-19 home tests
    U.S. allows two more over-the-counter COVID-19 home tests
    N.Y. social service agency sued for not allowing X gender mark
    N.Y. social service agency sued for not allowing X gender mark
    Sponsored Content
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS
    • Instagram

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    MDHC_Logotype_white
    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • News
      • This Week's News
      • COVID-19
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition
    • Insights
      • ACA 10 Years After
      • Best Practices
      • Special Reports
      • Innovations
    • Transformation
      • Patients
      • Operations
      • Care Delivery
      • Payment
    • Data/Lists
      • Rankings/Lists
      • Interactive Databases
      • Data Points
    • Op-Ed
      • Bold Moves
      • Breaking Bias
      • Commentaries
      • Letters
      • Vital Signs Blog
      • From the Editor
    • Awards
      • Award Programs
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top 25 Innovators
        • Minorities in Healthcare
          • - Luminaries
          • - Top 25 Minority Leaders
          • - Minorities to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Nominate
      • Previous Award Programs
        • Excellence in Nursing Awards
        • Design Awards
        • Top 25 COOs in Healthcare
      • Other Award Programs
        • 100 Top Hospitals
        • ACHE Awards
    • Events
      • Conferences
        • Women Leaders in Healthcare Conference
        • Social Determinants of Health Symposium
        • Healthcare Transformation Summit
        • Leadership Symposium
        • Virtual Briefings
          • - Hospital of the Future
          • - Mental Health
          • - Patient Safety & Quality
          • - Strategic Marketing
          • - Virtual Health
          • - Workplace of the Future
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Minority Leaders Gala
        • Top 25 Women Leaders Gala
      • Webinars
      • COVID-19 Event Tracker
    • Listen
      • Podcast - Next Up
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • MORE +
      • Advertise
      • Media Kit
      • Newsletters
      • Jobs
      • People on the Move
      • Reprints & Licensing