Category Archives: Uncategorized

TELEMEDICINE AND STATE LICENSING

According to the California Medical Board, physicians who see California patients over the internet must be licensed in California. As stated by the Board: “Physicians using telehealth technologies to provide care to patients located in California must be licensed in California. Physicians are held to the same standard of care, and retain the same responsibilities of providing informed consent, ensuring the privacy of medical information, and any other duties associated with practicing medicine regardless of whether they are practicing via telehealth or face-to-face, in-person visits.” That seems straight-forward enough.

The American Medical Association has said that a physician should not issue prescriptions or treat a patient without having physician-patient relationship, which the AMA says includes a face-to-face encounter before utilizing telemedicine.

What is the status of the telehealth industry?

LiveHealth Online Mobile. LiveHealth is an app that “gives mobile users an easy way to connect with a live doctor for an online video visit using your own mobile device.” It advertises a “live video interaction between you and a trusted, board-certified doctor.” A friend used it for his daughters illness, and viola, the daughter was given antibiotics at a local pharmacy. I logged on and there were three available physicians under Providers – CA. There names were Michael Catalano, an internist; Cameron McCoin, a family physician; and, Andrea Gabel, a family physician. No other information was posted about these physicians. The California Medical Board confirms that all three were licensed in California. However, LiveHealth does not mandate a face-to-face relationship with the patient before giving medical advice and prescribing drugs.

TeleMedicine Physician Group. Another web-based model, TeleMedicine Physician Group, offers physicians who are “U.S. trained, board certified, licensed and credentialed and typically have been practicing 10-15 years. Most are primary care physicians, certified in internal medicine, family practice, and/or pediatrics, but we also employ specialists as needed to meet the requirements of patients. All doctors are verified through the National Physician Data Base (NPDB) and the American Medical Association (AMA) for medical licensure, training and education, work history and malpractice history. Telemedicine Physician Group doctors are credentialed every 3 years, with NCQA provider credentialing standards.” There is no information about whether they are licensed in California or any other specific state. Again, I called to get a physician; a California physician called me back. TeleMedicine does not require a face-to-face meeting.

States and physicians need to continue to work together to create state policies that promote telemedicine in the best interests of patients.  Patients should be careful to make sure that physicians are properly licensed and capable of giving care with telemedicine.

Posted by Matt Kinley, Esq.

 

 

Fraudulent Claims Act: Could they investigate your office?

Physician offices sometimes feel immune to the regulatory pressures imposed by federal and state authorities. I’ve heard expressions such as “we are such a small office” or ” we deal with such small dollars” to excuse lax or ill-informed billing practices. The solution is to create an office compliance plan, to make sure your office completes all billing correctly.

Here, from the Office of Inspector General, is a report of one small physician’s office that the OIG did investigate, resulting in a $650,000 settlement. Note the investigation arose from another investigation where a doctor was banned from all federal healthcare programs for 15-years.

“12-18-2014 OIG Enforcement Case
A Medical Practice, Doctor in New York Settle False and Fraudulent Claims Case
Jennan Comprehensive Medical, P.C. (Jennan) – a medical group practice in New York – and its owner, Henry Chen, M.D., entered into a $694,887.02 settlement agreement with the Office of Inspector General (OIG) for the U.S. Department of Health and Human Services, effective December 18, 2014. The settlement resolves allegations that from May 15, 2008 to December 31, 2013, Jennan and Dr. Chen knowingly submitted or caused to be submitted false and/or fraudulent claims to Medicare for physical therapy services. Specifically, OIG alleged that these claims were false and/or fraudulent for one or more of the following reasons: 1) physical therapy services were not provided or supervised by the rendering provider; 2) group services were billed as one-on-one provider-patient physical therapy services; 3) services were performed by unqualified individuals; and/or 4) claims for time-based physical therapy services did not accurately reflect the actual time spent performing the services. Senior Counsels David M. Blank, Tamara T. Forys, and Lauren E. Marziani, along with Paralegal Specialist Mariel Filtz, represented OIG.

This case developed as a result of OIG’s prior investigation of Joseph A. Raia, M.D., a former Jennan employee. Dr. Raia entered into a settlement with OIG on February 11, 2014 for $1.5 million and agreed to be excluded from participating in Federal health care program for a minimum of 15 years.”

 

Posted by Matt Kinley, Esq.

“10 Steps for Physicians to Survive the 2015 Accountable Care Act” – by Matt Kinley

“In 2015, physicians will find themselves facing new challenges and policies related to the Accountable Care Act (ACA), which reforms healthcare by changing payment systems. Instead of traditional, pay-for-service models, new systems will pay physicians for value provided to patients. To remain viable, physicians must transform their practice to utilize new payment systems to their advantage.

Payment for value means that physicians will be rewarded for quality of care, superior technology and clear communication. Physicians will also have to be prepared to see more patients while being compensated less per patient.

Physicians who wish to succeed under the 2015 ACA should follow these guidelines:

1.Practice with New-Fangled Payment Systems

2. Utilize Technology

3.   Hire Mid-Level Professionals

4. Consolidate

5. Address Patient Financial Responsibility

6. Be Prepared for Out-of-Network Claims

7. Understand Grace Periods

8. Refer Only to In-Plan Physicians

9. Reporting

10. Establish An Effective Financial Strategy”

To read my fully published article in the Inland Empire Business Journal, Click Here: TLD – Inland Empire Business Journal 12-2014

 

 

PHYSICIAN OFFICE COMPLIANCE: PHYSICIANS SHOULD PREPARE

Compliance in Physician Offices

Compliance guidance for physician practices was issued by the Office of Inspector General in 2000. Since that time, many physician practices, especially more complex specialty practices, have developed some sort of compliance plan. Compliance covers many areas of a healthcare practice.

Although compliance plans have not previously been mandatory, they have become “industry standard” as a way to minimize risks associated with health care regulations such as the Health Insurance Portability and Accountability Act of 1996, the Medicare and Medicaid Fraud and Abuse Laws, Anti- kickback Statute, Civil Monetary Laws, False Claims Act, the Clinical Laboratory Improvement Act and all other state and federal statutes, regulations and directives that apply to the operation of a complex physician’s practice.

The Patient Protection and Affordable Care Act of 2010, in section 6401, requires Health and Human Services and the Office of Inspector General to promulgate regulations that require most healthcare providers and suppliers to establish compliance programs. The compliance programs are intended to be “effective in preventing and detecting criminal, civil, and administrative violations” under the Medicare and Medicaid laws and other laws that govern operations.

Under the Affordable Care Act, physicians and group practices, will be required to establish compliance programs as a condition of enrollment in the Medicare program.HHS is required to issue regulations creating a timetable and basic core compliance program requirement.

Physician groups should begin the process of establishing compliance programs as soon as possible and not wait for final regulations. Compliance programs are a good way for physician practices to reduce risk associated with fraud and abuse and other legal matters that present risk to their operations. It makes sense for physicians to begin development now to provide ample time for creation of appropriately scaled policies and input from various personnel in the group.

It will not be sufficient to adopt pre-written compliance policies. Rather, physician offices must establish a continuing system of review for their office. Practices may need to be modified based upon their specialization. The seven core elements of effective compliance programs have been released by the Office of Inspector General, including the Physician Practice Guidelines.
A compliance program requires the physician to perform a risk assessment in their organization and document the outcomes of that assessment. The risk assessment could take many forms. Compliance professionals talk about a “gap analysis” which is an approach to help determine the vulnerabilities of your organization. Areas of risk provide emphasis to appropriate areas of risk that are identified through your risk assessment.
The seven areas of emphasis include:
1. Adoption of written guidelines and policies to promote the organization’s commitment to compliance;
2. Identification and appointment of a high ranking individual within the organization to serve as compliance officer;
3. Establishment of anonymous reporting systems, preferably through multiple pathways, to encourage individuals to make complaints regarding compliance items without fear of retaliation;
4. Effective education and training programs for all levels of employees and others with close relationships to the organization;
5. Ongoing auditing systems to assess the effectiveness of the compliance program and to provide input into areas that require additional emphasis;
6. Mechanisms to enforce the requirements of the compliance program and to discipline employees for violations of the organization’s commitment to compliance; and
7. An ongoing system of program modification based upon audit, feedback and experience that can further adapt the compliance policies to the specific issues faced by the organization.

By Matt Kinley, Esq

ALVAKA INDUSTRIES ON HIPAA COMPLIANCE

Why Will My Company be Listed on the HHS Wall of Shame?

My friend David Cunningham at Alvaka Industries has posted a great article for providers:  When should you comply with HIPAA?   The reason to comply with HIPAA is that it is required by law.  But more than that, your patients deserve it.

See the post here.

Posted by Matt Kinley, Esq

 

GO GREEN TO ATTRACT MARKET SHARE

Physicians Need to Stand Out

Physicians who are completing new construction should consider designating their development as green construction. While there is not legislative guidance in for green development in the healthcare arena, there is the Green Guide for Healthcare.

image.axd

According to the guide, it is “healthcare sector’s first quantifiable, sustainable design toolkit integrating enhanced environmental and health principles and practices into the planning, design, construction and maintenance of facilities….[it] provides the healthcare sector with a voluntary, self-certifying metric toolkit of best practices that designers, owners, and operators can use to guide and evaluate their progress towards high performance healing environments.performance healing environments.

The guide is a project of the non-profit organizations Health Care Without Harm  and Center for Maximum Potential Building Systems.

Posted by Matt Kinley, Esq.

 

Home Healthcare: What to know about trust administration

This article was originally published on the LivHome Blog.

The Rules of Trust Administration
Top Ten Trust Administration Rules to Keep You out of Trouble
By Mark Doyle, Esq. and Monica Goel, Esq., Partners at Tredway, Lumsdaine & Doyle

People have become educated to know that estate planning is important. Without it, your life savings and estate will go through the cost and expense of probate court. With estate planning, you can do advanced tax planning to avoid the cost and expense of probate, avoid costly estate taxes, and ensure smooth transition of assets to your heirs.

Trust administration is just as important. When someone passes away, it’s imperative that the proper trust administration is done to carry out the terms of the Trust. This is demonstrated in the recent Wall Street Journal article “When Dad Amasses a Fortune.”
Now more than ever, it’s important to understand how trust administration works.  Here are 10 simple rules to follow:

1. Determine:  Who is the client?

It is extremely important to know who your client is. If you are meeting with the Successor Trustee of a Trust, meet with them alone. Do not meet with beneficiaries and give them the impression that you represent them as well or the “Trust.” You represent the Trustee of the Trust.

When a non-client believes that an attorney is their attorney, there is a risk that the non-client is now owed fiduciary duties by that attorney. If representation of the non-client presents a conflict of interests with the attorney’s current clients, then the attorney may be facing another potential ethical violation in representing conflicting interests without proper disclosure, or alternatively, the attorney is forced to withdraw from representing both clients whose interests’ conflict. Thus, it is just as important for an attorney identify to whom they owe fiduciary duties as it is for the attorney to identify to whom they do not owe such duties in order to prevent an unintended attorney/client relationship.

2. Avoid Conflicts of Interest

Be wary of known, unknown, and actual conflict of interest. You cannot represent both the Trustee and beneficiaries of the Trust. Make sure to obtain a conflict waiver if representing co-trustees. Be sure they understand that you will have to withdraw as counsel if a conflict arises between them. If you are the drafting estate planning attorney of the Trust, you cannot represent beneficiaries in their attempt to contest the Trust. Be cautious if it appears you may be a percipient witness in the matter.
An attorney has the following duties, among others, to the client he or she represents: undivided loyalty, avoiding representing adverse interests, keeping the client informed, and maintaining client confidences. Undivided loyalty and avoiding representation of conflicting interests goes hand in hand. A conflict of interest is broadly defined as a situation that interferes with a lawyer’s ability to fulfill basic duties to a client. State Bar Formal Opinion No. 1982-69.

Conflicts of interest may arise in probate and trust proceedings because of the interrelatedness of parties and the multiple roles of individual parties and beneficiaries, fiduciaries, or business associates. Consideration of potential conflicts is particularly important, because, as is common, the attorney may have represented the decedent, decedent’s spouse or family members or consulted with decedent in business transactions and these parties may have conflicting interests with regard to decedent’s estate. In trust and probate cases in particular, a conflict of interest may arise after the representation has been accepted, requiring independent counsel for the various interested persons.

3. Know the Process

We break down the trust administration process into 3 stages:
1. Notification and Marshaling Assets
2. Inventory & Appraisal
3. Allocation or Distribution

On the death of settlor/trustee, Probate Code Section 16061.7 requires that the Successor Trustee send out a notification to all heirs at law regarding their rights to obtain copies of the Trust documents and contest them. The Trustee is required to give Notice to all beneficiaries under the Trust and all heirs of the decedent. This Notice is required to be sent within 60 days of the decedent’s death. Upon the first death, the successor Trustee is only required to provide the irrevocable terms of the Trust. Some attorneys send the terms of the Trust with the Notice, although not required. If any possible litigation is anticipated, the Notification should be sent via certified mail.

It is important to obtain a new tax payer identification number for the Trust as the assets cannot remain in the social security number of the decedent nor in that of the Trustee. Complete the IRS Form SS-4. This form is required to be executed by the successor trustee prior to obtaining a taxpayer identification number for any subtrust(s) which are required to be funded. The successor Trustee will appoint the attorney as the “Third Party Designee” in order to obtain the new identification number over the IRS website.

During the initial client meeting, you should have been provided with most of the date of death statements requested in your initial confirmation letter. However, it is unlikely that any appraisals have been completed.

If an estate tax return is anticipated to be filed, a certified appraisal should be obtained based on the market value of any real property as of the date of death. Any stock holdings are valued based on the average of the high and low stock price on the date of death. The Trustee may also need to obtain the value of specific items of personal property of the decedent, such as coins, stamps, jewelry, vehicles, farm equipment, art and antiques. In determining the title of the various assets, you will want to determine if any small estate affidavits need to be prepared under Probate Code Section 13100. If a probate needs to be commenced or a petition under Hegstaad could remedy any assets not held properly in the name of the Trust.

Affidavits Re: Death of a Trustee or Co-Trustee must be recorded to allow new Successor Trustee to take title to property. Declarations must be recorded in the County where the decedent owned property. The County Assessor requires a Preliminary Change in Ownership Report to prevent reassessment upon change in Trustee. Claim for Reassessment Exclusions for Transfers Between Parents and Children must be submitted separately to each County where the decedent owned property passing to children as beneficiaries. These forms should be sent via certified mail and request the assessor confirm and return a copy of the same as proof of receipt. Failure to timely submit these forms can result in reassessment of real property and a substantial increase in annual property taxes. California Proposition 58 permits exclusion from reassessment of real property passing to children limited to the principle residence of the parent and or the first $1,000,000 of other real property. A similar exemption is available for transfers between grandparents and grandchildren only when the parent of the grandchild has predeceased the grandparent and the deceased parent was not married at the time of death.

Trust Certifications and instructions need to be provided to any financial institutions managing accounts in the name of the Trust. Since the surviving spouse is most likely named as a Co-Trustee on the accounts, the re-registration should simply involve removing the deceased spouse’s name and changing the taxpayer identification number. Not all financial institutions have the same policies and the successor trustee may be required to complete new account applications and establish new accounts.

Be sure to conclude the administration with either a sub-trust allocation agreement or distribution agreement. Strongly advise Trustees to prepare and circulate a Distribution Agreement. These agreements set forth distribution provisions. They often contains waiver of formal accounting. They set forth the value of Trust assets and distributions to individual beneficiaries or sub-trusts. When making distributions, they contain release of liability for Trustee and provides for final trust termination.

4. Know your Limits

Only take cases you are comfortable handling. If the matter requires litigation or tax expertise which you don’t have, you may need to refer the case out or associate in counsel. Do not take cases you are not experienced in handling.

5. Communicate
Communicate with your client. Make sure they understand their fiduciary duties to all beneficiaries, keep meticulous records for an accounting, and invest prudently.
Beneficiaries of an irrevocable Trust are entitled to an accounting of the Trust assets at least annually. This accounting can be waived in writing and is not required if the sole trust beneficiary and the trustee are the same person. Other people who have a future interest in the trust, even though the interest is remote, may demand and receive an accounting each year. Trust beneficiaries also have the right to request certain information such as assets on hand, sales, purchases, etc., from the trustee.

The successor trustee(s) should be advised to gather all of the decedent’s mail. Provide the post office with a certified death certificate and copies of the trustee provisions of the Trust. In this regard, a Trust Certification should suffice. The mail is essential to gathering as much information as possible regarding the assets of the decedent, especially if the decedent did not keep organized files. Request the successor trustee to bring as much information as possible to the initial meeting. The determination of their relevance can be determined by the attorney.
6. Act with Diligence

Time is of the essence. Be sure to follow up with your client and be cognizant of deadlines including the due date for the estate tax return and deadline to exercise a disclaimer. Although the length of administration is a “reasonableness period,” the longer it drags out the more likely suspicion and litigation are likely to erupt.
7. Identify Sub Trusts and Need for Administrative Trust

Trust administration is in most cases a transfer of assets which is by its nature a taxable event.
Income produced by trust assets will continue during the period of trust administration so a timely decision should be made regarding how income will be reported. Usually obtaining valuation of the assets and handling of bequests will prevent an immediate funding of marital, bypass or children’s sub trusts. In the meantime a decision must be made between either the pass through method or administrative trust method.

Under the pass through method the trust is ignored and the all trust income is taxed to the sub trusts or beneficiaries beginning with the date of death. If the estate is not large or if funding will occur within the calendar year the pass through approach saves costs and administrative time.

The administrative trust approach treats the trust estate as a separate taxpayer between the date of death and the date that the separate trusts are funded. Under this approach a separate taxpayer identification number is obtained and a 1041 fiduciary tax return filed for the administrative trust.

7. Comply with Tax Filing Requirements

Under IRC 6075(a) an estate tax return IRS Form 706 must be filed within nine months after the date of the decedent’s death. Although the return is due within nine months, an automatic filing extension of an additional six months is available. The automatic extension does relief the taxpayer of the obligation to pay estate tax due within nine months of the decedent’s death.
While a return is only due for a decedent whose gross estate exceeds the applicable exclusion amount (currently $5,250,000.00) other factors including the portability election may require filing. See Below. Generation Skipping Tax Elections are also required on a timely filed estate tax return.

9. Be Aware of the New Portability Election.

The new portability election IRC 2010(c) allows the surviving spouse to add the deceased spouse’s unused exemption amount at the second death.
This is some cases will allow a married couple to avoid using the traditional A/B trust. It gives married couples more flexibility in deciding how to use their exclusion amounts. Under IRC 23 For example, the first spouse to die could give everything to the other spouse without incurring estate tax by virtue of the unlimited marital deduction and the estate could transfer the unused exclusion to the survivor to use in making gifts or at death. However, use of a traditional two-trust plan combining a marital deduction trust with a credit shelter trust may be preferable. A credit shelter trust can prevent post-transfer appreciation in the value of the assets from being subject to estate tax on the survivors’ death. By contrast, an exclusion transferred to a surviving spouse is fixed and may not be sufficient to shield post-transfer appreciation from tax. In addition, a credit-shelter trust can protect assets from being squandered by the surviving spouse and protect against creditors. To take advantage of the portability election the surviving spouse must file a timely estate tax return for the deceased spouse.

10. Understand the Impact of Trust Funding on Income/Property Tax

Under IRC 1014 the basis of property inherited is stepped up to fair market value at the date of decedent’s death. For a couple in California with community property the entire value of the community estate receives a step up. Exceptions to this important benefit include retirement assets and assets gifted prior to death. When administering a trust also note that assets funded into an exemption trust will not receive another step up on the surviving spouse’s death.
In California careful attention needs to also be paid to avoid a real property tax assessment on the transfer to heirs. Staying within the parent child exclusion rules for Prop 13 is critical and appropriate claims should be filed with any title transfers.

 

 

 

 

CALIFORNIA MEDICAL BOARD: PHYSICIANS BEWARE OF PRESCRIPTION ABUSE

The California has posted a public service announcement video with information for physicians for prescription drug abuse.  It’s on youtube:

 

Regulatory Backdrop for Direct Primary Care: The Future of Concierge Medicine Under the Accountable Care Act.

How does the Accountable Care Act deal with cash practices?

Actually, quite well. Well, sort of.

The ACA authorizes HHS to permit qualified health plans (QHPs) to provide coverage through a qualified “direct primary care medical home” plan. The plan has to provide coverage that meets certain criteria (as developed by the Secretary of HHS) and that the QHP, meeting all other applicable requirements, ensures coordination of such services with the entity offering the QHP. Huh?
With respect to implementing guidance, this provision was addressed in 2012 in CMS Exchange/QHP final regulation, in which CMS codified the treatment of direct plans. The provision authorizes QHP issuers to provide coverage through a direct PCMH that meets the standards established by HHS, provided that the QHP meets all standards otherwise applicable. CMS in its final rule addressed comments raised during the proposed rule-making process relative to what those standards might look like, noting in the final rule that direct PCMHs need not be accredited in order to participate in QHP networks. However, CMS “encourage[d] QHP issuers to consider the accreditation, licensure, or performance of all network providers.”

CMS opted in the final rule not to set firm requirements or thresholds
that would necessitate that QHP issuers contract with a specified number or percentage of direct PCMHs. Thus, CMS in its final rule, does not direct that Exchanges create incentives for contracting with direct PCMHs; instead CMS “encourage[s] Exchanges to promote, and QHP issuers to explore innovative models of delivery along the care spectrum.” Thus, there does appear to be an opportunity for Exchanges and QHP issuers alike
to promote and include such models, but per the final guidance on this provision, there is no obligation to do so.

In California, Covered California does not explicitly recognize direct primary care.  There are attempts in the legislature to allow for these cash practices. However, it is generally agreed that practices that accept monthly payments for primary care — similar to the way insurance covers health care, but without the insurance—will pass muster in the state. Instead of filing claims through an insurer, participants — individuals and employers — pay a monthly membership fee directly to their health care providers.

The newer primary care models could come in many flavors:

• Hybrids that offer fee-for-service insurance or a flat monthly fee (not insurance);
• Access model, which charges members an annual or monthly fee for providing enhanced services and bills insurance companies; and
• Qliance’s brand of care, the direct practice model, which charges a flat fee for unrestricted access to primary care services and does not bill insurance.

Does the cash practice make sense?  Take a look at the practices on Yelp that have taken the leap.

By Matt Kinley, Esq.

 

 

 

ICD-10 Gets Moved to 2015 or…..

ICD-10 Humor