The Affordable Care Act mandated that the Centers for Medicare and Medicaid Services (“CMS”) establish risk categories for Medicare enrollment, which are used by CMS to determine what level of scrutiny to give provider enrollment applications, which includes initial enrollment, change of ownership (“CHOW”) applications, and revalidations.  Three risk categories were subsequently created under 42 CFR § 424.518: limited, moderate, and high. Providers in the limited risk category are subject to the lowest scrutiny and those in the high risk category are subject to the most scrutiny.

Since the regulation was first effective in 2011, the providers which have been in the limited category have included physicians, ambulatory surgery centers, hospitals, rural health clinics, and skilled nursing facilities (“SNFs”).  However, on November 18, 2022, CMS published a final rule effective on January 1, 2023, which will move SNFs from the lowest risk category to the highest risk category for both new enrollments and for CHOWs and to the moderate risk category for revalidation.

The most important impact of this change for SNFs is a new fingerprinting requirement for individual owners. If a SNF is being initially enrolled, or undergoes a change of ownership, then each individual who owns, either directly or indirectly, five percent (5%) or more of the SNF must submit fingerprints in connection with the enrollment application. Fingerprinting would also be required in the event an existing SNF reports a new 5% or more direct or indirect owner of the provider.

The new high risk category (and corresponding fingerprinting requirement) will also be applied to several other provider types.  These include enrolled opioid treatment (“OTP”) centers that have not been continuously certified since October 23, 2018 by the Substance Abuse and Mental Health Services Administration (“SAMHSA”), suppliers of durable medical equipment (“DMEPOS”), Medicare Diabetes Prevention Program (“MDPP”) suppliers, and home health agencies (“HHAs”). 

CMS also issued transmittal No. R11701Pl on November 10, 2022, implementing these regulatory changes into Chapter 10 of the Provider Integrity Manual (PIM”) (CMS Publication 100-08; see copy attached) effective January 6, 2023.  Chapter 10 of PIM sets out the instructions by CMS to the MACs for Medicare enrollment.  These changes include the following:

1.         Section 10.2.1.14 states that “effective January 1, 2023, SNF’s that are initially enrolling or undergoing a change in ownership…fall within the “high” screening category under 42 CFR Section 424.518.  SNF revalidations are processed at the “moderate” screening level.

2.         There is a new requirement for site visits for initial applications and revalidations for SNFs.

The transmittal states that the MACs shall implement the new policies for enrollment applications received on or after January 6, 2023.  Based on this, the new risk categories will not be applied to 855 filings which are in the review pipeline as of January 6, 2023, but only to those filed on or after that date.

Fingerprints are taken by a vendor, LiveScan.  In order to submit fingerprints, the owner needs to visit a LiveScan location in his or her area.  LiveScan has contracted with vendors for this purpose nationwide. We have had some experience with enrollments which required fingerprints.  In some cases, the original fingerprint cards have been rejected because the print for one or more fingers did not meet the required standards.

These new requirements are likely to slow down the enrollment process for SNFs and other providers undergoing CHOWs or enrolling as new providers.  This is important to consider when structuring any transaction.  If any SNF providers are needing to add any new owners or will be having a change of ownership at the end of the year, these new requirements can be avoided if the enrollment applications are submitted before January 6, 2023. 

If you have any questions about these changes or need assistance with an enrollment application, Husch Blackwell can provide that assistance for all types of providers in all jurisdictions. 

On October 14, 2022, President Joe Biden signed Executive Order 14036, directing the Department of Health and Human Services (“HHS”) to consider innovative actions to drive down certain single-source prescription drug costs as the Biden-Harris Administration works to implement the Inflation Reduction Act of 2022 (the “Act”).

Continue Reading Inflation Reduction Act Imposes Prescription Drug Pricing Reforms

Stories can be powerful tools. Stories can create a sense of connection and have the power to shape the lives of both the storyteller and the listener. Stories also make ideas and experiences relatable and can encourage exploration or action. And it was the stories I heard from members of AHLA’s Women’s Leadership Council that inspired me to write this column as a reminder of the incredible impact of AHLA’s educational mission supported by AHLA’s philanthropic initiatives.

Continue Reading Women’s Network—Storytelling: AHLA’s Educational and Philanthropic Mission

DEA waivers regarding the Ryan Haight Act could play a major role in telehealth’s future.

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On July 26, 2022, Judge Jeremy Kernodle of the Eastern District of Texas affirmed that certain parts of the Interim Final Rule Part II implementing the No Surprises Act (the Act) were invalid. This ruling is nearly identical to Judge Kernodle’s February decision in Texas Medical Association & Corley v. US Dept. of Health and Human Services. This decision vacated a portion of the Interim Final Rule that required arbitrators to give more weight to the out-of-network rate, including what is called the Qualified Payment Amount (QPA), over other permissible factors. The rule’s requirement ultimately contradicted the Act’s direction that arbitrators consider various factors, and not weight any one more heavily than another. Continue Reading Eastern District of Texas Invalidates Parts of Implementing the No Surprises Act

Workplace violence has become a hot topic in today’s discourse; however, workplace violence is not just headline fodder for media outlets. The trend is well-documented and especially felt by the healthcare industry which continues to experience the brunt after the onslaught of COVID-19. In 2018, 73% of all nonfatal workplace violence incidents involved healthcare workers. A late 2020 survey reported that 20% of nurses reported they were facing an increase in workplace violence after the COVID-19 pandemic began. Another study reported a 14.6% increase in workplace violence at New Jersey hospitals over the prior three years. Continue Reading Code Blue! — Violence in the Workplace

Each July, the Medicare Administrative Contractors issue notices of a 2% Medicare payment reduction to those providers who did not meet quality data reporting requirements. Those notices have been sent. In this episode, Husch Blackwell’s Meg Pekarske and Jacob Harris talk about the issues providers faced in 2021 and how to pursue an appeal of the 2% payment reduction. Listen to the full episode here: https://www.huschblackwell.com/newsandinsights/hospice-audit-series-its-that-time-of-year-again-quality-data-reporting-determinations-raise-new-and-recurring-issues

Background  

In direct response to the significant challenges experienced by long term care (LTC) facilities throughout the COVID-19 pandemic, the Biden-Harris Administration announced its commitment to improving safety and quality of care. During the March 1, 2022 State of the Union address, President Biden reaffirmed the Biden-Harris Administration’s commitment to protecting residents and staff of nursing homes. The Biden-Harris Administration has since taken steps to establish new minimum staffing ratios within nursing or skilled nursing facilities (SNFs), increase scrutiny of poorly performing nursing homes, and improve quality care transparency for customers seeking a SNF. Continue Reading Employment Considerations for Long Term Care Facilities under the Biden-Harris Administration

As many hospices continue to diversify into new business lines, staying abreast of enforcement trends outside of hospice is more important than ever. Home health in particular, is receiving significant government scrutiny. In this episode, Husch Blackwell’s Meg Pekarske talks with Bryan Nowicki and Erin Burns about a new round of home health audits being conducted by the Office of Inspector General for the Department of Health and Human Services. Tune in here: https://www.huschblackwell.com/newsandinsights/beyond-hospice-the-oig-renews-its-scrutiny-of-home-health-agencies