The rapidly-evolving field of health care has been moving lately towards a single-minded goal – coordination of patient care in the name of efficiency and efficacy. Hospital systems are more and more often merging with other medical practices to better achieve the standards and goals of the Patient Protection and Affordable Care Act (“ACA”). The Ninth Circuit Court of Appeals, however, recently provided a stark reminder that the ACA isn’t the only law hospitals need to consider compliance with in these mergers.

Rural communities in Kentucky are still largely underserved by health care providers. With the expanded range of Medicaid and Medicare services now available as a result of the Patient Protection and Affordable Care Act (“ACA”), rural health care infrastructure needs a shot in the arm to meet the demand. Fortunately, several programs exist to incentivize the provision of rural health care, and Kentucky providers in underserved areas should begin taking advantage of them.

As more and more providers adopt electronic health records (“EHRs”) systems (and with new regulations concerning their required use for purposes of Medicare billing for chronic care management, their popularity can only continue to grow), a myriad of compliance issues continue to surround them. To that end, the federal government has stepped up auditing programs to ensure compliance with HIPAA/HITECH as well as making sure taxpayer money has been invested wisely through the Meaningful Use program. The bent of these audit programs is clearly along the lines that applicable covered entities and business associates should be preparing with a “when” mindset, rather than “if,” as these audits are going to happen.

In the last days of 2014, the IRS released regulations that finalized the compliance requirements for charitable hospitals. These new 2014 IRS regulations relate to the Community Health Needs Assessment (CHNA or needs assessment) requirements for nonprofit hospitals or nonprofit organizations operating a hospital contained in Section 501(r) of the tax code, which was created by the Patient Portability and Affordable Care Act (“ACA”). Section 501(r) requires that thorough CHNAs be conducted every three years in order to maintain their 501(c)(3) nonprofit status. These needs assessments must define the community served by the hospital, the needs of the community, and a strategy addressing the identified community needs. Since each facility that fails to meet CHNA requirements loses its nonprofit status and has to pay a $50,000 excise tax, nonprofit hospitals and networks need to pay special attention to the changes and incorporate these new requirements into their needs assessments.

In the last post, the subjects of collaborative agreements and autonomy were discussed in relation to how they affect mid-level practitioners. Today’s post now turns to how HRSA designation and limited services clinics will ultimately influence that workforce as well.

As more Kentuckians gain access to health care as a result of the Affordable Care Act, healthcare workforce shortages for primary care providers becomes problematic particularly in rural Kentucky. Never before have mid-level practitioners been more important. The Health Resource and Services Administration (“HRSA”) estimates that there will be a shortage of 20,400 primary care ­physicians by 2020, but this number could be drastically reduced – as low as 6,400 – with an abundant increase in the autonomous practice of mid-level providers[1]. The same HRSA study concluded that a fully-utilized workforce of mid-level practitioners could account for 28% of all primary care by 2020. Three factors make mid-level practice more attractive than ever in Kentucky.

By January 2015, Walmart will be operating dozen primary care clinics across the U.S. Six of these have already opened in South Carolina and Texas. Currently, some Walmart stores include acute care clinics that are operated through leases with local hospital operators. The new primary care clinics are distinct from the existing ones in several ways. The new clinics will be fully-owned by Walmart, offer a broader range of services, and be open seven days a week with longer operating hours. Walmart is partnering with QuadMed nationally to operate the clinics, rather than with local partners. The primary care clinics will be staffed primarily by nurse practitioners and medical assistants and will be supervised by a physician.

In January 2013, the Department of Health and Human Services (“HHS”) published its Final Rule, which significantly increased the privacy and security responsibilities for the “business associates” of “covered entities,” as those terms are defined by HIPAA. A provision within the Final Rule mandated that all covered entities and their business associates revise their business associate agreements to reflect the new responsibilities. Specifically, a business associate must now, among other things:

Community Health Systems (“Community”), which operates 206 hospitals in 29 states, recently notified 4.5 million of its patients that online hackers had stolen personal data information from its systems in a period between April and June 2014. The data included names, addresses, birthdates, telephone numbers and Social Security numbers—all of which are protected under HIPAA. According to Community, the data did not include financial or medical information.

On March 10, 2014, the Centers for Medicare & Medicaid Services (“CMS”) issued a memorandum to Part D Plan Sponsors and Medicare Hospice Providers entitled, "Part D Payment for Drugs for Beneficiaries Enrolled in Hospice – Final 2014 Guidance" (“Guidance”).   The Guidance, effective since May 1, 2014, requires a prior authorization process for Hospice and Part D providers to determine their respective responsibility for drug coverage. The Guidance followed a 2012 OIG report entitled "Medicare Could Be Paying Twice for Prescription Drugs for Beneficiaries in Hospice,” which found that Medicare Hospice patients’ medications were sometimes paid for by Part D rather than by the patient’s Hospice program.