LONG-TERM CARE UPDATE Volume V, No. 2 May 1999 Spotlight: Important Changes in SNF Survey Procedure & Enforcement -- Civil Money Penalties -- Complaint Investigations -- Draft State Operations Manual Survey Procedures -- HCFA Teleconference Corporate Compliance PPS Survey & Enforcement Medicare Therapy Limitations Miscellaneous RR&G News SPOTLIGHT: Important Changes in SNF Survey Procedure & Enforcement Civil Money Penalties. HCFA has promulgated a final rule that is scheduled to become effective on May 17, 1999. It will impose upon facilities fines between $1,000 and $10,000 for each serious instance of non-compliance in which a resident's health and safety is allegedly threatened. The types of non-compliance that were discussed in the rule are things such as the presence of an avoidable pressure sore or the violation of a resident's right to privacy, and the amount of fines suggested by way of example were $4,000.00 and $1,000.00, respectively. Under the rule, fines can be imposed upon a facility without any opportunity to correct given prior to the time of imposition, and they can be imposed for non-compliance that existed at the time of the survey or for non-compliance that existed any time prior to the survey even if the problem had been eliminated through quality assurance. This approach represents a significant change in the way that fines are imposed and will likely result in higher and more frequent fines against facilities. The rule also calls into question whether there is any real relief available to facilities that use quality assurance to correct problems since those facilities may be punished despite their quality assurance efforts where the noncompliance is deemed to be "egregious." Complaint Investigations. HCFA sent out a letter to State survey agency directors dated March 16, 1999 indicating that effective immediately any complaint that alleges actual harm to an individual in a certified nursing home must be investigated within ten working days of receipt by the survey and certification agency. This change will reverse the trend towards amalgamating complaints with annual surveys, and will increase the number of surveys that facilities receive. Correspondingly, the opportunities for both fines and other enforcement actions will be increased. Draft State Operations Manual Survey Procedures. Draft procedures have been published and are expected to go into effect on July 1, 1999. They articulate a number of changes in a number of different areas. Specifically, in keeping with the new initiative to survey a percentage of facilities on evenings and weekends, it will be very important that the information that the facility is to provide to the surveyors is available at off hours, and that certain staff members have access to the information on each shift. Under the draft provisions, the information that must be produced is slightly different than that which was requested in the past. Also, quality indicators (issued by HCFA) will be utilized by surveyors to identify potential problem areas prior to survey. Any problem at the 90th percentile or above will be flagged, as will any sentinel event involving fecal impaction, dehydration, or pressure ulcers developing in any low risk individual. All flagged residents still living in the facility are likely to be reviewed at the time of survey. Additionally, unnecessary drugs will be a major focus under the new survey process. The dosages that are appropriate and the types of drugs that are appropriate for the elderly are specified in the new Interpretative Guidelines. If residents are found to take unnecessary drugs or to take them in dosages which are not called for under those guidelines, the surveyors will be requested to identify through two sources, observation interview or record review, whether the resident has a functional loss that is related to the drugs. If, in fact, there is a functional loss, the facility will be cited, unless the surveyors are able to identify a reason for the drug which outweighs the risks associated with taking the drug. There will be tremendous emphasis on staffing issues in this new survey process. Specifically, nurse aides will be asked to answer questions regarding how many residents they are assigned to attend to, how they know what their assignments are, and what they do when they do not have enough time to complete their care tasks. Direct care dietary staff will also be asked how many trays are they expected to deliver, how long it takes them to deliver these trays, what do they do if the resident says they do not like what is on their plate, and what do they do if the resident complains of the food that is not at a correct temperature. Additionally, supervisors will be asked questions in the area of staffing. The person responsible for nurse staffing will be asked how she determines how many staff are needed, how she monitors whether the tasks of this staff are completed, particularly the nurse aides, and what she does to handle staffing shortages. Similar questions will be asked of the person responsible for dietary staffing assignments. Finally, there is going to be tremendous emphasis placed on a facility's policies and procedures to prevent abuse and neglect. Facilities will be asked to provide surveyors with a copy of their abuse, neglect and misappropriation policies. The following topics will be expected to be covered in all abuse and neglect policies: screening, training, prevention, identification, investigation, protection, reporting and response. Direct care givers will be asked specific questions on what sort of training they have received with regard to dealing with aggressive residents. Supervisors will be asked to discuss two or three specific abuse or neglect cases and to explain the details of how they dealt with them. They will also be asked how they monitor their staff in order to prevent abuse and neglect. Finally, personnel records will be checked by the surveyors to determine whether screening actually takes place prior to hire. HCFA Teleconference. HCFA conducted a teleconference in April in order to explain some of its State Operations Manual and other enforcement changes. Most of the information presented in that teleconference is discussed above. Other items HCFA covered are the following: that the "poor performer" definition would be eliminated, as will the concept of a "date certain." The only facilities that will be given an opportunity to correct are those that through HCFA's or the State agency's discretion are determined to be worthy of an opportunity to correct. The separate allegation of compliance requirement will be eliminated. The elements of the plan of correction will be simplified and streamlined. States, rather than HCFA, will impose the ban so that bans will be imposed faster. Additionally, there has been a good deal of talk about how HCFA may grant only one revisit within the 180 day period. If this is the case, there could be many facilities who will face termination proceedings as a result of failing their first revisit. Given the numerous changes in survey procedures, facilities would be well served to review the draft SOM and make changes now to their survey and quality assurance protocols. CORPORATE COMPLIANCE In a recent Program Memorandum, HCFA reinforced that it requires carriers and intermediaries to identify and report all cases of suspected fraud, regardless of the dollar amounts involved. Draft Compliance Guidance for the Durable Medical Equipment, Prosthetics, Orthotics and Supply Industry has been released. The OIG has determined that situations whereby a discount is offered on the Part A services that a SNF will bill to Medicare, but no discount is provided on the Part B services that the ancillary supplier bills to Medicare may violate the anti-kickback statute. The OIG has greatly improved its cumulative sanction database. The online searchable database allows users to determine whether an individual or entity is currently excluded from the Medicare or Medicaid programs. Remember that this knowledge is important because SNFs that contract with or employ excluded persons or entities may be subject to fines up to $10,000 for each item or service provided, and triple the claimed amount. Even if your facility does not have a formal corporate compliance program, it should have policies and procedures with regard to contracting with and employing excluded individuals and entities. Effective July 1, 1999, all Medicare contractors in Region V are required to print certain fraud and abuse messages in the General Information section of their Medicare Summary Notices and all Part A beneficiary notices, i.e., Notice of Utilization, Explanation of Medicare Benefits and Benefit Denial Letter, and on the Explanation of Part B Medicare Benefits. PPS Senator Domenici and others stated recently that if SNF PPS payments are not changed, then the country may be faced with mass bankruptcies and a healthcare crisis for the elderly. A town hall meeting on PPS was held on April 23, 1999 in the HCFA headquarters auditorium to provide the public with an opportunity to ask questions. Reminder: Hospitals must bill facilities for many outpatient hospital services provided at the hospital under PPS. SNFs should have entered into agreements for these outpatient services with the hospitals with which they have transfer agreements. SURVEY & ENFORCEMENT The much publicized, recent GAO Report alleges that 1 in 4 nursing homes actually harm their residents. The main point of the report is that facilities still go in and out of compliance with regularity (the so-called "yo-yo effect"), and that most are not incurring any sanctions. Recommendations were made to eliminate the opportunity to correct before fines are levied. This is largely accomplished in the final rule on civil money penalties (See Spotlight article). Yet another federal district court has stopped HCFA from terminating a SNF's participation in the Medicare and Medicaid program. Like previous courts, the District of Columbia court based its decision on the fact that residents of the SNF were not currently in "immediate jeopardy," and that terminating the facility would cause the residents irreparable harm. MEDICARE THERAPY LIMITATIONS The limitation is by beneficiary per provider - HCFA has stated that it does not condone deliberate collusion among providers to avoid the therapy caps, and that any blatant circumvention of the therapy caps would result in further investigation. A facility may not discharge a resident because the cap has been reached. A facility may not avoid the therapy cap by sending a Part B resident who has reached the cap to a hospital outpatient department to receive therapy beyond the limitation. Facilities should notify the beneficiary of the therapy cap and when the beneficiary reaches the $1,500 limit. This allows the beneficiary to decide about continuing therapy at the beneficiary's expense, or changing to another provider or to an outpatient facility that is not subject to the caps. Please note that the Ohio Medicaid program will meet therapy costs once the $1,500 limit is reached for those individuals who are jointly eligible. Once a resident reaches the cap and decides to continue receiving rehabilitation services, the SNF is not restricted to the Medicare fee schedule for billing the resident for therapy services. YEAR 2000 Only 8 months until "D-Day"! HCFA has established a "Y2K Outreach" toll-free line: 1-800-958-HCFA (4232). All bills submitted by healthcare providers for services to Medicare must now be Y2K compliant, i.e., the bill must be submitted using 8-digit dates or else the claims will be rejected. RR&G has developed a program to address the Y2K problem in a long-term care facility, which includes template forms and letters. Let us know if you need assistance. MISCELLANEOUS The IRS published new regulations, which will become effective on June 8, 1999, that require tax exempt organizations (other than private foundations) to provide copies of their applications for federal tax exemption and their 3 most recent Forms 990 to anyone requesting them. Beginning April 1, 1999, Medicare began requiring providers to make itemized statements available to beneficiaries on request. The law requires providers and suppliers to furnish itemized statements within 30 days when requested in writing. Providers cannot charge beneficiaries for the statements. The statement must include the beneficiary's name, the date of service, a description of the item or service furnished, the number of services provided, the provider or supplier charges, an internal reference or tracking number, and the name and telephone number of a person to contact for more information. Circuit courts continue to split over the issue of whether charge nurses are supervisors under the National Labor Relations Act. In the past few months, the 4th Circuit reversed an earlier decision and ruled that LPNs who direct the activities of nurse's aides are supervisors, and are thus precluded from joining a labor union bargaining unit. The D.C. Circuit, however, recently reached the opposite determination. To date, the 3rd, 4th, 6th and 7th Circuits have held that charge nurses are supervisors, while the D.C., 8th, and 9th Circuits have reached the opposite result. A new federal law makes is illegal to evict existing Medicaid residents if the facility decides to voluntarily withdraw from the Medicaid program. Effective March 1, 1999, new rules issued by the Board of Pharmacy require "shift counts" for all Schedule III, IV, and V controlled substances, as well as for Schedule II drugs as has been the case in the past. The regulations apply to quantities of these medications that exceed a 72-hour supply. A new HCFA policy that began on April 26, 1999 may lead to rejected records. Prior to April 26, HCFA required section A3b of the MDS, which lists corrections to the MDS, to be left blank if there are no corrections. Now, HCFA is mandating that a zero be placed in that field, and all records will be rejected if it is blank. RR&G NEWS Carol Rolf and Dennis Roth will be presenting a session at the Ohio Health Care Association's Spring Convention on May 6, 1999 regarding corporate compliance programs for long-term care providers. Aric Martin will be presenting a session at the Ohio Centers for Assisted Living's Spring Symposium on May 6, 1999 regarding important legal issues facing assisted living providers in Ohio. OHCA will be publishing an article written by Carol and Aric regarding corporate compliance programs for long-term care providers in the Convention issue of the "Long Term Care Review." The Cleveland Bar Journal recently published an article written by Ira Goffman and Geoff Goss entitled, "Health Care Transactions: A Trap for the Unwary." Seth Wolf was a session chair at the Cleveland Bar Association's Health Care Law Institute on April 29th, and Ira gave a presentation entitled, "The Basics of Medicare Payment." We have recently updated our template abuse, neglect & misappropriation of resident property policy and related materials to comply with changes in the State Operations Manual. We have also developed a corporate inservice on the recent changes made to the survey and enforcement process. Let us know if you would like assistance in preparing your facility for the new requirements.    | Practice Areas | Attorney Profiles | Publications | | Seminars | Screen for Exclusion | Contact Info | | Directions | Home | Rolf & Goffman Co., L.P.A. Phone 216-514-1100 E-mail info@rolfgoffman.com