Highlights of the AHLA Conference in Virginia Health Care News.
On Tuesday and Wednesday of this week, I was in Arlington, Virginia, participating in the American Health Lawyers Association (“AHLA”) conference entitled “Healthcare Reform: The Law and Its Implications.” I was 1 of 8 practicing health law attorneys from Florida participating in the conference. The number of legal issues and implications of the new law (the Patient Protection and Affordable Care Act, or “PPACA”) discussed was overwhelming; the following are a few highlights of changes most likely to impact physicians and other providers:
- Bye, Bye Fee For Service. The greatest change for providers and suppliers will be the shift from the fee for service model to bundled, global and capitation payments (yes, the return of capitation payments, although that term is not used in the PPACA) in an effort to share responsibility for quality and costs. The federal programs will pay providers and hospitals a bundled payment for an episode of care, which will include all care provided 3 days prior to the date of hospital admission, during the hospital stay and 30 days post discharge. The payment will be distributed as predetermined by the providers through a contractual arrangement or an employment model.
New Models. Hospitals will continue to acquire physician practices as well as home health agencies in order to control the delivery and quality of care. There will be penalties for re-admissions and bonuses for cost savings and quality. Evidence-based medicine and best practices will prevail, with the Mayo Clinic and Geisinger Medical Center serving as the models of quality and efficiency. Over the next 4 years, demonstration and voluntary pilot projects across the country will refine and define the contours of the actual system.- Accountable Care Organizations (“ACOs”). In connection with the shared responsibility theme of PPACA, the law calls for the establishment of ACOs, to be comprised of providers and hospitals responsible for the care of a set number of Medicare beneficiaries enrolled in that ACO. Each ACO will have a minimum of 5,000 Medicare beneficiaries and contract with CMS for 3 years using a capitation type payment. Many questions about ACOs remain unanswered, but they are likely to have their own medical staff bylaws and a closed medical staff (unlike a hospital medical staff).
- Quality Control. Each provider and hospital will be subject to reporting requirements regarding certain quality data. This will be burdensome and require capital investments in technology and the establishment of additional executive positions on hospital management teams, including Quality Officer positions to be filled by physicians.
- Payment Trends. The payment system will drive the legal and operational structure of our healthcare system. My predictions are (i) that we will continue to see hospital-provider integration, which can be achieved using a variety of legal structures, but the consensus of hospital systems is that in order to control quality and costs, the hospital systems will need to employ physicians directly (employment is not integration, however, without physician involvement in governance and quality measures); and (ii) that private medicine will flourish, creating a two-tiered system similar to that in the UK. Small physician practices will struggle to maintain independence. The paramount legal issues associated with integration and consolidation in the industry will be the anti-kickback, Stark, and anti-trust laws and the corporate practice of medicine doctrine.
- Implications for Consumers. For consumers, the PPACA contains a mandate that they obtain insurance or be subject to certain tax penalties (there is a good argument that this is unconstitutional; however, many legal scholars are skeptical that it will be overturned by the courts). In connection with this mandate, insurance rates will be transparent but not specifically regulated. This will be accomplished using a web portal exchange. For an example, go to the Massachusetts Health Connector website at www.mahealthconnector.org.
- Big Brother is Watching. Several high level government officials from CMS and HHS reminded us that it is a privilege and not a right for a physician to participate in Medicare and Medicaid. There will be in-depth background checks associated with each application, and, yes, stepped-up enforcement of fraud and abuse rules, as evidenced by increased budgets and staffs for the enforcement agencies.
Stay tuned!!
