QUARTERLY NEWSLETTER - SPRING EDITION 2014 - #11

By George Colman, Esq.

In our last newsletter, I wrote an article and listed some points related to the fact that readmission begins at admission, and the importance of implementing a care coordination program with continuing and ease of concern for your patients. Here are some additional pointers to assist in the care transitions as a healthcare provider.

Care transition is when the responsibility for a patient’s care moves from one provider to the next; when a patient moves from one point along the continuum of care to another. This can be a temporary responsibility or permanent one; it is a big component of care coordination; multiple providers must work together to ensure patients receive comprehensive care; this care transition is a subcategory of care coordination by which two or more providers carry out disparate activities in a patients’ care.

Some examples of this is when a provider refers a patient to specialty care, a patient shows up in the emergency department, or a hospital discharges a patient to an outpatient clinic or recuperative care (a medical home).

Providers’ care transition responsibilities have increased under the Affordable Care Act as well as under many new regulations issued by the state, as well as under newer network contracts (under the guise of revising the meaning of “medical necessity”). Problems uncovered by these new requirements include: poor direct communication between the hospital and a patient’s primary care provider; incomplete instructions on discharge summaries (i.e., pending test results, medication discrepancies, missing contact information, etc.), and failure to give clear concise post-discharge instructions to patients.

In the same vein, current law requires hospitals and emergency room physicians to make a reasonable attempt to determine whether private or public insurance may fully or partially cover the charges for care. The law also requires the hospital or emergency physician to provide to a patient, who has shown proof of third party coverage, with information concerning their potential eligibility under programs such as Medi-Cal and California Children’s Services Programs, along with applications for those programs. SB 1276 expands this by adding the requirement that hospitals and emergency physicians obtain information as to whether the patient may be eligible for the California Health Benefit Exchange or any other state or county funded program.

The bill would also require that if a patient has a pending application for assistance under a health coverage program at the same time he or she applies to the hospital for charity or discount payment programs, that neither application precludes eligibility for the other program.

Finally, the bill expands requirements for external debt collection entities dealing with patients who qualify under the charity or discount policies. Existing law requires such an entity to sign an agreement that they will abide by the hospital’s debt collection standards and practices underthe charity and discount policies. The new bill would require such an agreement to require the debt collection entity to adhere to the hospital’s definition of a “reasonable payment plan”. The bill provides a definition of a reasonable payment plan as one where the monthly payments are not more than 5% of the family income for a month, excluding deductions for essential living expenses. Senate Bill 1276 is authored by Senator Ed Hernandez, Chairman of the Senate Committee on Health to which the bill was recently referred.

By Rich Lovich, Esq.

Recently introduced Senate Bill 1276 seeks to expand the current scope of AB 774 (California Health & Safety Code Section 127400, et seq.) dealing with mandated charity and discount policies imposed upon hospitals and emergency physicians. The new bill seeks to do the following:

• Expand the definition of who must be covered under the charity and discount policies;

• Increases the information hospitals are required to provide to qualified individuals;

• Places additional requirements on the hospital when an external debt collection entity is used.

AB 774, which became California Health and Safety Code Section 127400, et seq., was enacted in 2007, and requires each hospital as a condition of licensure to maintain a written charity care policy as well as policiesallowing for discounts for financially qualified patients.Currently, both the charity care and discount policies must include patients who are uninsured; or patients with ‘high medical costs’ whose family income meets the financial criteria,(specified patients must also be eligible for a discount from the emergency physician).

Under the current statute, the definition of a patient with “high medical costs“ is someone whose family income is at or below 350% of the federal poverty level; whose out of pocket medical costs or expenses, paid or incurred in the previous 12 months exceed 10% of the family income;and who does not receive a discounted rate from the hospital or physician as a result of 3rd party coverage. The new Bill seeks to expand this definition by dropping the 3rd party coverage exclusionand thus extending the scope of the policy to all who qualify financially. CONT’D- On Back

CareCoordination

Senate Bill 1272 Seeks to Expand Hospital and Emergency Physician Charity and Discount

Policies Under AB 774 “Fair Billing Policies” The Importance of Easing Patient Concerns

Susannah Dahlberg

This quarter’s Spotlight is on attorney Susannah Dahlberg.

Spotlight Q&AWhat is your area of expertise within SAC?

In November 2013, I became the managing attorney of the pre-litigation department. Along with the members of my team, I try to resolve claims in the pre-litigation stage. If claims cannot be resolved, then we make sure claims are procedurally ready to be litigated, meaning they have been properly appealed. Prior to working in the pre-litigation department, I was a member of the litigation team, so I approach my work in the pre-litigation department with the knowledge of how it will affect claims that are eventually litigated.

What one piece of sage advice can you offer to our clients that can help them in the future?

As I mentioned in my article in this newsletter, it is important for hospitals to understand the affect documents (such as provider manuals) that are incorporated by reference into a contract have on the agreement. Often, I see incorporated documents materially affect the parties’ promises, and to the hospitals’ detriment. Therefore, when negotiating contracts, hospitals should consider how much leeway they want to provide payors regarding which documents are incorporated by reference. Can you talk about a recent success story of yours? What was the challenge and how were you able to overcome it?

What was the challenge and how were you able to overcome it? As the managing attorney of the pre-litigation department, I handle every settlement offer made on a claim in the pre-litigation stage. When an offer is made, I review the claim and make settlement recommendations to the client based on the claim’s strengths. Pulling from my previous experience in the litigation department, I also consider how well I think a claim would fair if it were litigated. I am not afraid to recommend making a counter-demand, or rejecting an offer, if I think a claim is strong enough. Since joining the pre-litigation department, I have been very happy to be able to reach

strong settlements for numerous claims still in the pre-litigation stage.

Do you have any hobbies or interests outside of work?

I love to travel and my favorite place in the world (thus far!) is Paris. I’ve been there five times and fall more in love with the city every time I visit. I also enjoy reading, crocheting, and playing with my daughter. Do you have any charitable causes that interest you and events you have participated in recently?

I support TinySuperheroes, an organization that honors and empowers children with severe illnesses or disabilities by sending them the personalized superhero capes they so deserve.

Do you have family and/or pets you’d like to tell us about?

I am married to my wonderful husband, Justin, whom I met in high school and started dating right after college. We have a beautiful daughter, June, who is 20 months old. I will readily admit my office is filled with pictures of her, and by her! Our family is completed by our crazy (but loving) dog, Eleanor.

Do you have any guilty pleasure television shows, movies or other activities to tell us about?

I watch every season of The Bachelor/The Bachelorette and try not to miss The Big Bang Theory. I am also a big fan of Downton Abbey and I just finished watching all seven seasons of The West Wing.

What are your favorite foods? Colors? Other favorites?

My favorite food in the world is my mom’s plum torte. It’s a super simple recipe (just 10 ingredients), but can only be made in the fall, when Italian plums are in season. I look forward to it every year. My favorite color is pink and my perfect “date” is a stroll in the park with my family.

By Susannah Dalhberg, Esq.

When entering a contract with a payor, it is important hospitals recognize the effect of incorporating provider manuals (a.k.a. operations manuals) by reference into the contract. Often, contracts that incorporate provider manuals, do not have a requirement the hospital agree to the rights the payor provides itself in these documents. Therefore, by allowing the provider manuals to be incorporated, the hospital is opening the door to the payor giving itself rights to which the hospital would not otherwise agree.

Recently, SAC has noticed some payors have required hospitals to provide notification of a patient’s admission – even if the hospital obtained pre-authorization. Pursuant to the provider manual, failure to timely provide notification means the payor can deny the claim in full or in part, depending how “untimely” the hospital provided notification of admission. Another example of incorporated provider manuals measurably changing the parties’ rights and obligations is the incorporation of Milliman Care Guidelines (the “MCG”). The payors use the MCG to deny claims as experimental and investigational. When the MCG are not incorporated by reference into a contract, SAC can make strong arguments the MCG are not controlling and can point to other scholarly sources to prove treatments were medically necessary. In contrast, when the MCG are incorporated into a contract, they become the controlling standard and a claim that is not medically necessary according to the MCG is weak.

When a hospital is faced with a denial based on a provider manual that was incorporated by reference into the contract, there are a few steps it can take. First, the hospital should look to see when the manual was written. If it post-dates the effective date of the base contract, then the hospital

CONT’D- Next Page

“SAC can make strong arguments the MCG are not

controlling and can point to other scholarly sources to prove treatments were

medically necessary. ”

The Risk of Incorporating

Provider Manuals Into

Contracts

By George Colman, Esq.

If you haven’t already treated a patient with new insurance, it is only a matter of time before one walks in your door, so here is some news, good and bad.

There are multiple opportunities that a provider can take advantage of that can significantly boost the bottom line, however there are numerous pitfalls. Therefore you should consider the following concepts and ideas:

• Identify basic services that exchanges require of you as a provider and if you really have to offer them;

• Determine if you have to serve ‘Exchange Member’ patients;

• Consider being added to a limited provider network;

• Review contract language to maximize and obtain appropriate reimbursement;

• Reduce the liability risk for nonpayment with negotiation technique and focused admitting process/procedure; in this instance coverage is approved but premiums may not have been paid;

• Consider “due diligence” steps before you take on Exchange Members;

• Know when and how you may be able to opt out of this new patient population.

60 Days Into Covered California

and Exchanges Some “SAC” Observations

The staff members of Stephenson, Acquisto and Colman were in full-force at the 2014 LA Marathon, dawning bright green in support of The Bili Project Foundation. Our staff joined in as part of the foundation’s Team Bili.

The LA Marathon brought out an impressive number of participants with more that 25,000 runners and walkers hitting the pavement and over 80 charities represented.

must check whether the contract allows the payor to incorporate new provider manuals into the contract, without the hospital’s prior approval. The hospital should also consider whether the provider manual materially changes the promises made in the contract. If it does, then there may be an argument the provider manual should not be considered part of the contract because it unilaterally changes the rights to which the parties had mutually agreed.

At SAC, we are aware of the issues caused by incorporating provider manuals into contracts and are actively fighting claims that have been unfairly denied due to provider manuals that materially change the terms of a contract. If you have any questions on this issue, we are happy to speak with you!

SAC Runs For The Bili Project Foundation at the 2014 LA Marathon

cancer and other biliary system cancers are among the most difficult to detect. If screening or testing for risk factors or silent symptoms of this type of cancer was available for Vince, perhaps he would have had a chance for successful treatment at an early stage. Inspired by Vince’s passion for education, Sue and Joy partnered with the University of California San Francisco (UCSF) medical research team and other institutions to assess how better to stop this quick and silent killer.

The Bili Project Foundation has been making significant strides in bringing attention to Hepatobiliary cancers. The Bili Project Foundation has assembled an All-Star research team from the UCSF Medical Center and had recently joined forces with The Cholangiocarcinma Foundation to advance understanding, detection, treatments and cures of Hepatobiliary cancers.

The foundation has assisted in the creation

Photo courtesy of California Symposium

The Bili Project Foundation was able to raise over $3,000 dollars, bringing us one step closer in promoting research to help detect and treat this complex disease affecting the Hepatobiliary system.

A BIG thank you goes to everyone involved, from our runners, to those who dedicated their time to help out and to those who supported our runners along the way in reaching their personal fundraising goals.

ABOUT THE FOUNDATION:The Bili Project Foundation was founded by Sue Acquisto, the wife of Vince Acquisto, and his business partner Joy Stephenson-Laws, founder and managing partner of SAC, after Vince was diagnosed and later passed from bile duct cancer. Bile duct

and implementation of the UCSF Tumor bank and believes that the creation of a tumor tissue bank specifically for Hepatobiliary tumors would significantly enhance the ability to accurately diagnose and treat patients with these debilitating diseases.

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DISCLAIMER: This newsletter is for general educational and informational purposes only. You should not act upon this information without seeking your own independent professional advice.

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We would love to hear from you! If you have questions, comments or feedback please email us at SACReview@sacfirm.com.

QUESTIONS / COMMENTS

UPCOMING EVENTS

QUARTERLY NEWSLETTERSPRING EDITION ENCLOSED

303 North Glenoaks BoulevardSuite 700Burbank, California 91502

April 16-17, 2014 - HFMA Southern California Education Outreach Go to http://bit.ly/1l8yOJt for more information

Care Coordination - CONT’D

Session 1: April 16- San Antonio Community Hospital- “Managing Covered California Patients”

Session 2: April 17- Children’s Hospital of Orange County- “Collecting More Money From Patients”

All of this contributes to hospital readmission, a preventable and costly burden on hospitals. Matter of fact statistically poor care coordination contributesto 98,000 deaths from medical errors throughout the country, without counting the other diagnosis that appear.

It is essential that hospitals and outpatient centers communicate adequately as to patient and clinical information;medication lists, and lab results must be systematically exchanged timely between providers. Furthermore, there appears to be a disregard for the patient’s preference and a lack of adequate patient education.

In conclusion, every provider MUST address the basic elements of care coordination/transition especially with patients with a high risk of readmission. The basic

elements are as follows: Communication: timely exchange of pertinent patient and/or clinical information, and follow up expectation with providers and patients; Accountability: hospitals and primary care providers must understand who is fully responsible for a patient’s care, and; Transportation: patients need a means to reach the hospital, medical home, specialty care center, or other location, and lastly; Education: Patients must be educated in their diagnosis, the use and side effects of their medication, and their discharge instructions. Patients need to demonstrate their understanding of all this before being discharged.

April 25, 2014 - HFMA Nor Cal Women’s Luncheon- Schwab Residental Center- Stanford, CAGo to www.hfma-nca.org for more information

June 22-25, 2014 - HFMA’s 2014 National Institute- Las Vegas, NVGo to http://www.hfmaconference.org/general-information/ for more information