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					March 2012 Health Care Compliance Update
Health Care Compliance Letter

Volume 15-3, March 20, 2012, Read the Letter

Health Information Technology

Proposed EHR and HIT certification rules released

CMS and HHS have issued proposed rules designed to assist health care providers and
institutions better adapt “meaningful use” of electronic health records (EHRs). CMS’ rule
outlines the Stage 2 criteria that eligible professionals (EPs), eligible hospitals (EHs), and
critical access hospitals (CAHs) must meet to qualify for Medicare and/or Medicaid electronic
health record (EHR) incentive payments. The HHS rule revises the permanent certification
program for health information technology (HIT) which would also enhance care coordination,
patient engagement, and the security, safety, and efficacy of EHR technology.

Meaningful use Stage 2. Under the Proposed rule, EPs must meet or qualify for an exclusion to
17 core objectives and 3 of 5 menu objectives. Eligible hospitals and CAHs must meet or qualify
for an exclusion to 16 core objectives and 2 of 4 menu objectives. Many of the objectives of
Stage 2 are the same as Stage 1 — ordering prescriptions electronically, etc. — but the
minimums for “meaningful usage” would be higher. For example, at least 60 percent of
patients must have their medications and lab tests ordered electronically during Stage 2,
instead of the 30 percent required during Stage 1. Providers under Stage 2 also must prove
their EHR system is capable of meeting a list of specific objectives outlined by CMS, such as
having the capability of exchanging a patient’s notes, medication list, allergies, and diagnostic
test results. Hospitals would have to show they have amassed the vital statistics of more than
80 percent of their patients in digital form, among other targets, to continue collecting the
incentive payments. The rules require systems to be able to transfer patient information across
platforms.

A “summary of care” — which includes past diagnoses, procedures and test results – must be
able to follow patients across referrals and changes in health care provider. The information
should be available to some patients, who under Stage 2 requirements should be able to view
their records online, as well as download and transfer information. Additionally, some patients
must be able to communicate with their doctors through a secure, online system. Under the
Proposed rule, Stage 1 has been extended an additional year, allowing providers to attest to
stage 2 in 2014, instead of in 2013.

HIT permanent certification. HHS has issued a Proposed rule revising the permanent
certification program for health information technology. The rule revises the initial set of



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standards, implementation specifications, and certification criteria related to the health
information technology permanent certification program run by the Office of the National
Coordinator for Health Information Technology. These standards and specifications were
outlined in an Interim final rule published on January 13, 2010 (75 FR 2013, Health Care
Compliance Reporter, ¶700,247) and a subsequent Final rule that was published on July 28,
2010 (75 FR 44314, Health Care Compliance Reporter, ¶700,265). According to the rule,
beginning with the EHR reporting periods in 2014, certified EHR technology would provide more
flexibility for EPs, EHs, and CAHs. These individuals and institutions would be required to have
a base EHR (EHR technology that includes fundamental capabilities all providers would need to
have) as well as additional EHR technology necessary to meet the meaningful use objectives
and measures for whatever Stage they are in. Proposed rules, 77 FR 13698 and 13832, March 7,
2012, Health Care Compliance Reporter, ¶730,164 and ¶730,165

Tax-exempt Organizations

Practitioners discuss Form 990, community benefit reporting lessons learned (Part 1)

The revised Form 990, Return of Organization Exempt from Income Tax, is challenging for
nonprofit organizations and preparers, provides data-mining opportunities for the IRS and
public scrutiny of an organization’s activities, and discloses the new community benefit
standard reporting requirement, according to Joyce Hellums, Ernst & Young, Austin. In
addition, exempt organizations will have to justify their exemptions to the IRS and others on
the form. Hellums spoke at the Ernst & Young’s 21st Annual Health Sciences Tax Conference in
Las Vegas.

Community benefit reporting. Nonprofit hospitals must meet four requirements (community
health needs assessment (CHNA), financial assistance policy, limitation on charges, and billing
and collection practices) under Internal Revenue Service (IRS) Code Sec. 501(r), in addition to
other exemption requirements, to obtain and maintain §501(c)(3) status. The CHNA will be
required for tax years beginning after March 23, 2012. A CHNA must be completed once every
three years, and the organization must adopt an implementation strategy to meet the needs
identified. The revised Form 990, Schedule H, Hospitals, raises many questions about
calculating and reporting community benefit, Hellums said. These open questions include:

       The legislative history mentions Medicare rates can be used under the “limitation on
        charges” restriction, but will Medicaid rates also be acceptable?
       How will a hospital’s “community” be defined? “We know it will include geographic
        location and the targeted population the facility is serving.”
       How often does the calculation of the “amounts generally billed” need to be updated?
       What if the statute of limitations is about to expire for collecting a bill?
       What is the “best” negotiated rate? Best for whom?
       Does §501(r) apply to joint ventures?
       What is required to make the results of the community health needs assessment
        “widely available” or to “widely publicize” the financial assistance policy?

Read the entire article. Part 2 of this article will be discussed in the April 17, 2012 issue of the
Health Care Compliance Letter.

Reprinted with permission from the CCH Tax-Exempt Advisor Newsletter, No. 451,
February 23, 2012


On the Front Lines



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Where is ICD-10 Today? by Deborah Grider

Health care is experiencing a time of uncertainty. The recent announcement that Health and
Human Services (HHS) plans to request a delay of the International Classification of Diseases,
10th Edition diagnosis and procedure codes (ICD-10) has stopped everyone in their tracks. Many
hospitals, physicians and other HIPAA-covered entities have stopped working on their
implementation plans. But NOT SO FAST – it is not time to stop the work you have begun. The
ICD-10 timeline is up for revision, not destruction. It is true that, after years of telling us that
ICD-10 would not be delayed and we better be ready on time to implement ICD-10, the
impression we are getting now is a different story. Many organizations including vendors,
business associates, health plans, hospitals, physicians, and maybe even you have spent a great
deal of time and money thus far trying to get ready. Quite honestly, delaying ICD-10 will
literally take an act of Congress. The ICD-10 mandate is a federal law and will require more
than just opposition from Marilyn Tavenner, the CMS Administrator, or a statement of intent to
delay. This came about as an attempt to appease the American Medical Association’s House of
Delegates. I am certain you have read various articles purporting that ICD-10 is delayed
indefinitely; however, that statement is inaccurate. Marilyn Tavenner, the acting CMS
Administrator, stated that the ICD-10 timeline would be re-evaluated. In addition, HHS
Secretary Kathleen Sebelius announced on February 16, 2012, that HHS will initiate a process
to postpone the date by which “certain health care entities” have to comply with ICD-10
diagnosis and procedure codes.

What exactly does the intent to postpone the date for “certain health care entities” really
mean? Will there be a delay for some HIPAA-covered entities and not all? Will the delay be one
year, two years or more? We don’t have the answer to these questions yet. Keep in mind no
delay decision has been made yet, so the October 1, 2013, ICD-10 implementation date is in
effect. Read the full story.

Journal of Health Care Compliance
The March/April issue of the Journal of Health Care Compliance mailed to subscribers on March
12, 2012, and is available to electronic subscribers. Read the Journal articles.

COLUMNS

From the Editor—Roy Snell
       Survey Reveals High Levels of Stress for In-house Compliance Professionals
Pharmaceutical—Jacqueline R. Berman
       First Amendment Off-Label Promotion Cases Work Their Way through the Courts
Electronic Resources—Catherine M. Boerner
       Two New HIPAA Security Toolkits Available Online
Best Practice—Julene Brown
      Are You Ready for Medicaid RACs?
Enforcement Activity—Winn W. Halverhout / Lisa M. Krigsten / Thomas D. Vaughn / Tiffany A.
      Hetland
       The 2012 OIG Work Plan: A Review of Key Focus Areas
Privacy—Reba L. Kieke
      The Power of Collaboration: Online Tool Allows Senior-Level Professionals to Have Candid
      Conversations about Privacy
Settlements—Megan A. McGovern
       At Last, A Day in Court for “Non-Providers”
Health Information Technology—Tatiana Melnik
       The Data Breach Lawsuits Begin: Class Action Lawsuit Filed Against Sutter Health and
      the UCLA Health System


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Physician Compliance— Robert H. Ossoff / Christopher D. Thomason
     Defusing Confrontational Situations
Coding and Billing—Melinda S. Stegman
      Wound Care in the Outpatient Setting: Coding Strategies for this Government Auditor
     Hot Spot
Health Information Management—Allison Viola
       Proposed Regulations Would Revise Hospital and CAH Requirements for Medicare and
     Medicaid Participation
Lab—Christopher Young
      OIG Fiscal Year 2012 Work Plan: What’s In It for Laboratories?

FEATURES

Edward Vishnevetsky
     ZPIC Prepayment Audit: Past, Present, and Future
Scott A. Memmott / Jennifer L. Clark
     The Proposed Rule on Transparency Reports: Shedding Light on the Sunshine Act
Derek Woo
     Health Care IT – Convergence or Chaos

FOR THE RECORD

Roy Snell
     ERC President Discusses Most Recent NBES Findings

Health Care Compliance Professional’s Manual

The Health Care Compliance Professional’s Manual quarterly update mailed to subscribers on
March 13, 2012, and is available to electronic subscribers. Report 32 included:

   A new chapter, “Addressing Improper Payments through Analytics and ‘Data Mining,’”
    written by Andrew Asher, M.P.P., CFE, provides a nontechnical introduction to analytics
    and “data mining” to address improper payments. The chapter briefly provides answers to
    key questions for health care compliance professionals, including: what analytical
    strategies and techniques are used to identify improper payments, how data mining is
    performed, how data mining results are acted upon, what actions are taken based on data
    mining results, how provider compliance personnel can work effectively with payers by
    using data mining results to improve their organization’s billing accuracy, and what does
    the future hold for data mining and analytics?

   A new chapter “ICD-10: What Compliance Professionals Need to know, written by Michael
    Sullivan, CHC, Arlene Baril, MS, RHIA, and Lynn Handy, CPC, CPC-H, CPC-I, CCS-P, LPN,
    describes the history and purpose of International Classification of Diseases (ICD) coding as
    well as its importance in the health care delivery system. It also explores the limitations of
    the current coding system and the reason for and the benefits of implementing the new
    International Classification of Diseases, Tenth Revision (ICD-10) coding system.

   An updated chapter, “Charge Description Master (CDM) Compliance,” revised by health
    care consultant Elizabeth Schaub-DeBlock, MPA, with the assistance of Laureen A. Rimmer,
    RHIA, CPHQ, CHC, defines the CDM, identifies steps in the CDM review and maintenance
    procedures, and provides advice to compliance officers, suggesting an independent
    assessment to evaluate the CDM and a CDM gap analysis to evaluate the status of the CDM.




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