Healthcare Reform Requires Even More Practice Management on Arkansas Medical News Inc.

Healthcare Reform Requires Even More Practice Management

By: BECKY GILLETTE

Tod Yeslow

Vigilance

There are many unknowns about how healthcare providers will be impacted by healthcare reform provisions of the Patient Protection and Affordable Care Act (PPACA). But there is no question that all providers will be impacted dramatically, said Lynda Johnson, a partner with Friday Law Firm, Little Rock.

“Unfortunately until the some 250 sets of regulations required to implement the law are published, we don't know the details as to exactly how they will be impacted,” Johnson said. “We expect cuts in Medicare payment rates and ‘bundling’ of hospital and physician payments, for sure. We also expect a heightened emphasis placed on quality of care and favorable outcomes. However, as we all know ‘the devil is in the details’ and until those details are published, it's hard to predict exactly what will happen.

More paperwork possibly could be offset by higher reimbursement levels.

“Some groups such as primary care, internal medicine, pediatricians and OBs may see their rate of uncompensated care go down (and revenues go up) as a result of the expansion of Medicaid, the introduction of the exchanges in 2014, and the ‘bump’ in reimbursement for primary care providers,” said John Alan Lewis, whose practice with the Mitchell Williams Law Firm in Rogers is limited primarily to physician groups and ancillary service providers affiliated with physician groups. “However, PPACA imposes more costs on the compliance side for physicians such that they will need to be even more vigilant regarding practice management and their relationships with other providers.”

PPACA makes important changes to several laws that regulate physicians. For example, PPACA amends the anti-kickback statute concerning the reporting of overpayments and the level of knowledge that a provider has regarding his or her billing practices. The new law expands the authority of the federal government to conduct fraud and abuse investigations. Providers can expect more audits of their billing practices and will face increased fines and penalties as a result of the sanctions set out in PPACA.

Another impact may be fewer independent physicians.

“It is uncertain, in my mind, if we will maintain in Arkansas and the U.S. the same number of independent physician practices we have had in the past,” Lewis said. “PPACA introduces the concept of the accountable care organization which is contemplated to be an integrated group of physicians, hospitals, and other health care providers delivering more efficient care to large groups of patients as one group or system. The benefits to the group is that the Medicare reimbursement rate to these providers will be enhanced, assuming certain clinical and financial incentives are realized.”

While there are substantial legal hurdles to the creation of accountable care organizations, Lewis said there have been assurances made that regulations are in the offing to make these organizations legally defensible.

“We shall see,” he said. “Because of the uncertainty of PPACA and for certain social reasons that permeate healthcare in general, I foresee more and more physicians and physician groups becoming employees of hospital systems or becoming more closely aligned with hospital systems.”

Healthcare providers will also be impacted regarding healthcare plans for their employees, if the provider has more than 50 employees.

“Healthcare reform requires all employers not exempted to ‘play’ and offer a minimum level of employer provided health benefits or to ‘pay’ an excise tax,” said Tod Yeslow, counsel, Mitchell Williams Law, Little Rock. “Employers are scrambling to understand the extent to which the act applies to them, decide whether they will ‘play-or-pay’ and determine how to comply with the requirements and still meet their business purposes for offering health benefits to their employees.”

Yeslow recommends five steps for employers to understand the response to the new law:

1. Put the law in perspective. While controversial, it is now the law.

2. Determine which provisions apply to you. Large employers with “grandfathered” plans are exempted from certain mandates for as long as the plan maintains its grandfathered status.

3. Understand your obligations under the act.

4. Respond strategically by considering the business objectives and benefits philosophies established by each employer.

5. Manage the response.

“Not only do all of these actions need to be taken in accordance with the laws, but, like a Rubik’s Cube, a single change to one side of the cube can affect the perfect symmetry of another,” Yeslow said. “In this final step it is appropriate to consider one’s business forecast and how the ultimate plan design will meet the projected business needs. Will an anticipated change in business structure cause the plan to lose its grandfathered status, which the success of the original design depended upon? Consult with your service providers and understand their costs, if any, for advice, systems or process changes, and implementation requirements, including communications. Meet with your administrative, management, finance, accounting and legal teams so each may identify their issues which will impact the ultimate business decision.”

Yeslow said the bottom line is all employers need to have a strategy to address the requirements. That should include a cost analysis to determine whether it makes sense to use health insurance exchanges that will be established by the state or private insurance.

“Employers need to understand their return on the healthcare dollar,” Yeslow said. “There should be some sort of strategy based on understanding the act, your business and why you are providing healthcare benefits. This gives employers the opportunity to rethink whole benefits packages as part of the total compensation package.”