OMIG’s 39-page Guidance is the first in what is expected to be a series of similar publications focusing on different types of Medicaid providers.  According to OMIG, the Guidance is “intended to serve as a resource to the industry and indicate how OMIG may interpret New York’s mandatory compliance obligation ….”  It is also meant to help hospitals to create and maintain effective compliance programs.  As such, the Guidance is an essential reference document for New York’s hospitals and those who work in the compliance industry. 

In the Guidance, OMIG lays out each of the elements and requirements mandated under New York’s law and regulations.  It then provides a series of recommendations relating to each of these obligations. 

A copy of OMIG’s Guidance may be found at:  http://www.omig.ny.gov/data/images/stories/compliance/compliance_program_guidance-general_hospitals.pdf.  

Please feel free to contact us with any questions that you may have about the Guidance or your compliance program. 

~Submitted by Peter Hoffman

In our earlier blog posts, we noted that New York had changed its law to permit an expansion of the definition of assets against which a Medicaid claim could be made, thereby making previously protected assets vulnerable.  The regulations under consideration would have expanded the definition of assets to include, among other options, IRAs, life estates, trusts and certain exempt transfers.  Under the revised Health Budget Bill, the definition of “estate” has returned to its former narrow definition, meaning that Medicaid can only recover from assets in the Medicaid recipient’s probate estate.  

Another major victory is that the proposal to eliminate “spousal refusal” has been abandoned.  Spousal refusal is a commonly used Medicaid planning tool that allows a Medicaid applicant’s spouse to refuse to provide financial assistance to another spouse, which may enable the ill spouse to be Medicaid-eligible.  While this issue is likely to be revisited in future years, it remains available at this time.

The importance of these changes in the law cannot be overstated. It allows for important planning opportunities for those facing expensive, long-term care.  As many find out too late, careful advance planning can avert difficult and onerous financial situations that can arise in caring for family members.  Please contact us with any questions about these planning options.

 ~Submitted by M Salzman

Otherwise, the Proposed Rule expands the threshold requirements of existing measures (e.g., the threshold for computerized provider order entry increases from 30% of only medication orders to 60% of medication orders plus laboratory and radiology orders.) and increases the number of core objectives providers must meet.   Under the Proposed Rule, eligible professionals must meet, or qualify for an exclusion to, seventeen core objectives and three of five menu objectives, and hospitals must meet, or qualify for an exclusion to, sixteen core objectives and two of four menu objectives. 

The Proposed Rule also provides guidance on how providers can avoid negative payment adjustments, which begin in 2015, for failing to demonstrate meaningful use of electronic health records.  In order to avoid payment adjustments providers can argue that they qualify for an exception because: (i) there is a lack of availability of internet access or barriers to obtaining IT infrastructure, (ii) they qualify for a time-limited exception for newly practicing providers or new hospitals; (iii) there are unforeseen circumstances such as natural disasters; or (iv) they meet other specified criteria such as lack of face-to-face or telemedicine interaction with patients or lack of control over the availability of EHR technology at their practice locations.

HHS and CMS also propose to expand the definition of what constitutes a Medicaid patient encounter, which is a required eligibility threshold for the Medicaid incentive program, by including encounters for individuals “enrolled” in a Medicaid program, which ensures that patients enrolled in a Medicaid program are counted, even if the Medicaid program did not pay for the service. 

 ~Submitted by Z Cohen

BCBS timely reported a breach to OCR on November 3, 2009 after 57 unencrypted hard drives were stolen from a network data closet on or about October 2, 2009.  These hard drives contained audio and video recordings of customer service calls with included protected health information of over $1 million insurance plan members including their names, insurance member numbers, dates of birth, and social security numbers.  The network closet was secured by biometric and keycard scan security with a magnetic lock and additional door with a keyed lock.  Although BCBS received an alert on October 2, 2009 that the server at the network closet was unresponsive, it wasn’t until Monday, October 5, 2009 that the theft was identified. 

OCR’s determined that BCBS failed to implement appropriate physical safeguards by not having adequate facility access controls, despite the security measures mentioned in place at the network closet. OCR also found BCBS lacked administrative safeguards by not performing the required security evaluation to adequately protect the data stored in the network closet.  As part of the settlement, BCBS agreed to a 15 month corrective action plan which requires BCBS to update their HIPAA security policies, conduct training to employees with access to patient information, and to conduct monitor reviews  to ensure compliance.  For more information see the resolution agreement here. 

This settlement sends a strong message that OCR expects covered entities to have a well designed and implemented HIPAA compliance program.  Please do not hesitate to contact your regular GW contact if you need assistance in updating, evaluating or implementing your HIPAA compliance program. 

~Submitted by T Hubbell

More on this case Click Here

~Submitted by S Klein

~Submitted by T Hubbell

The Bad News:
The Governor’s Budget Bill (i.e., the proposed 2012-2013 New York State Executive Budget Health and Mental Hygiene Article VII Legislation, “Governor’s budget bill”) proposes significant changes to the Medicaid program which may restrict access.  While the proposed changes may not be enacted in current form, they support our belief (as discussed in our December 2011 blog entry) that restrictive changes are afoot, and that putting Medicaid and estate planning in place is prudent.

Spousal refusal.  The Governor’s Budget Bill would severely restrict the “spousal refusal” technique for obtaining Medicaid for an ill spouse.  Spousal refusal is a commonly used Medicaid planning tool when a Medicaid applicant’s spouse signs a written statement refusing to pay for the medical expenses of the applicant.  With a “spousal refusal,” the assets of the spouse may not count as a resource for the Medicaid applicant, thereby allowing the Medicaid applicant to qualify for Medicaid if he or she is otherwise eligible.  While the well spouse may under certain circumstance be held accountable to pay for Medicaid expenditures paid on behalf of the Medicaid recipient, the Medicaid rate for healthcare services is far lower than the private pay rate.

There have been numerous attempts over the years to repeal or eliminate the “spousal refusal” Medicaid planning tool.  The proposed Governor’s budget bill allows for spousal refusal only if the spouse is both absent and refuses to provide support.  The word “absent” is not defined in the budget bill and it is unclear whether the statute will provide a definition.  We also understand that the “spousal refusal” issue is under negotiation and it is unclear at this time whether this provision of the budget bill will remain.

Regulations to be issued. As we discussed in our December 2011 blog entry, there has been an expansion of the definition of assets against which Medicaid can make a claim to recover for healthcare expenditures made on a Medicaid recipient’s behalf.  The regulations for expanded recovery are still under consideration.  There is much speculation that the regulations will consider IRAs and other retirement funds, life estates and Medicaid income only trusts as assets against which Medicaid can make a claim.  However, until the regulations are proposed and finalized, it is anyone’s guess as to what types of assets will be subject to the expanded recovery rules.

Planning Considerations.  While the Medicaid law will continue to change, careful advance planning can assist in many circumstances.

~Submitted by E Koopersmith, D Martin & M Salzman

             IRS Extension until March 30th for Electronic Filers with Form 990s due in January or February 2012.  The IRS announced that it is granting filing extensions to organizations that file electronically and whose Form 990 is due in January or February 2012. Those organizations have until March 30, 2012 to file their Form 990s.  Information about the extensions is posted at http://www.irs.gov/charities/article/0,,id=251096,00.html.

             New York State Attorney General’s Office grants similar extension.  The Attorney General’s Office will grant the same extension to organizations that file with the Charities Bureau.  An organization that qualifies for the IRS extension will similarly have until March 30, 2012 to file its CHAR500, IRS Form 990 and, if applicable, financial audit or review. To be eligible for the extension, an organization must send an email to the Charities Bureau at charities.extensions@ag.ny.gov stating that (1) it files electronically with the IRS, (2) its annual report is due to be filed in January or February 2012, and (3) it will file the report with the Charities Bureau on or before March 30, 2012.  The organization should put its name and Charities Bureau Registration Number in the subject line of the email.

Click Here for more information

~Submitted by M Salzman

~Submitted by D Martin

Click Here for the NJ Senate bill (S-2197) and Click Here for a sample NJ POLST form.  A standardized form for NJ is not yet available.

~Submitted by E Sibley