Author: WorkCompAcademy

New California Workers’ Compensation Institute research shows the number of California workers’ compensation inpatient hospital stays fell nearly 31 percent from 2010 through 2018, fueled in large part by a steady decline in spinal fusions.

The study, authored by CWCI Senior Research Associate Stacy Jones, uses hospital discharge data from nearly 32.3 million inpatient stays compiled by the state Office of Statewide Health Planning and Development (OSHPD) to measure and compare the volume and types of California inpatient hospitalizations paid under workers’ compensation to those paid by Medicare, Medi-Cal and private coverage.

Workers’ compensation is the smallest of the 4 medical delivery systems reviewed, accounting for just 0.4 percent of all inpatient stays in 2018, which is down from 0.6% in 2010, primarily due to a surge in Medi-Cal hospitalizations after 3.7 million adult Californians were added to the Medi-Cal rolls after Affordable Care Act plans became available in 2014.

At the same time, a number of factors spurred a decline in workers’ comp inpatient stays from 2010 to 2018, including:

— Fluctuations in the number and types of claims;
— Increased use of ambulatory surgery centers;
— The adoption of utilization review and independent medical review programs requiring that treatment meet evidence-based medicine standards;
— Technological and procedural advances that allow more services to be provided in outpatient settings; and
— A 45.9 percent reduction in the number of spinal fusions since 2010, though fusions are still the top inpatient service rendered in workers’ comp, representing more than 1 in 6 injured worker hospitalizations last year.

In addition to tracking inpatient trends for California workers’ compensation, Medicare, Medi-Cal and private plans over the 9-year span of the study, other analyses and exhibits in the report provide detailed data showing:

— The breakdown of workers’ comp inpatient stays among the top 5 Major Diagnostic Categories (MDCs);
— The proportion of surgical vs. “medical” (non-surgical) hospitalizations in each of the 4 payer groups;
— The top 5 workers’ comp surgical and medical inpatient discharges by diagnostic-related group (MS-DRG);
— The breakdown of the top 10 workers’ comp MS-DRGs across payer groups in 2018;
— The volume and prevalence of spinal fusion surgeries by payer group from 2010 through 2018;
— The top 10 hospitals based on the percentage of their inpatient discharges covered by workers’ comp, and the proportion of California workers’ comp medical and surgical hospitalizations rendered at those facilities.

CWCI has released its study as a Research Update report, “California Workers’ Compensation Inpatient Hospital Trends, 2010-2018.” Institute members and subscribers can access the report in the Research section at www.cwci.org and others can purchase it from the Institute’s online Store.

The Department of Justice announced that Avanir Pharmaceuticals, a pharmaceutical manufacturer based in Aliso Viejo, California, was charged for paying kickbacks to a physician to induce prescriptions of its drug Nuedexta.

The Northern District of Ohio also announced indictments of four individuals, including former Avanir employees and one of the top prescribers of Nuedexta in the country, who were involved in the kickback scheme.

Avanir has also agreed to pay over $95 million to resolve civil False Claims Act allegations of kickbacks as well as its false and misleading marketing of Nuedexta to providers in long term care facilities to induce them to prescribe it for behaviors commonly associated with dementia patients, which is not an approved use of the drug.

In addition to the $95,972,017 being paid to resolve the United States’ civil claims, Avanir will pay an additional $7,027,983 to resolve state Medicaid claims.

Prosecutors alleged Avanir violated the Anti-Kickback Statute by paying a doctor to induce him to become a high prescriber of Nuedexta to beneficiaries of federal healthcare programs, offering him financial incentives to write additional Nuedexta prescriptions for beneficiaries of federal healthcare programs, and inducing him to recommend that other physicians prescribe Nuedexta to beneficiaries of federal healthcare programs.

Nuedexta is approved by the Food and Drug Administration for the treatment of pseudobulbar affect (PBA), which is characterized by involuntary, sudden, and frequent episodes of laughing or crying, and occurs secondary to a neurologic disease or brain injury.

The Northern District of Georgia also announced a deferred prosecution agreement resolving the charge, under which Avanir admits that it paid the doctor to induce him to not only maintain, but increase his prescription volume. Under the agreement’s terms, Avanir will pay a monetary penalty in the amount of $7,800,000, and a forfeiture in the amount of $5,074,895. The United States will defer prosecuting Avanir for a period of three years to allow the company to comply with the agreement’s terms. The agreement will not be final until accepted by the court.

Named in the 83-count indictment are: Deepak Raheja, 63, of Hudson; Gregory Hayslette, 43, of Aurora; Frank Mazzucco, 41, of Dublin, and Bhupinder Sawhny, 70, of Gates Mills. All four are charged with conspiracy to solicit, receive, offer and pay health care kickbacks. Avanir has agreed to cooperate in the prosecution of these individuals.

The civil settlement resolves lawsuits filed by former employees of Avanir, under the qui tam or whistleblower provisions of the False Claims Act. Kevin Manieri will receive $12,389,823 of the civil settlement, and Duane Arnold and Mark Shipman will receive $5,365,000 of the civil settlement.

The genetic-screening sales reps turn out at health fairs, houses of religion, parks and elder enclaves, offering seniors a chance to learn if they or their loved ones are at risk of developing cancer. All they need, the reps say, is a free cheek swab.

Reuters reports that, U.S. federal investigators say, some of the sales representatives are part of a burgeoning industry that threatens to become what multiple government investigators call the next big frontier in healthcare fraud: genetic testing, which is reaping millions of dollars from unnecessary tests that target senior citizens.

Shimon Richmond, assistant inspector general for investigations with the Office of Inspector General for the Department of Health and Human Services, said his office has seen a steady stream of complaints into genetic testing. In 2018, the inspector general’s office received about one or two complaints per week. Now, he said, the fraud hotline burns with as many as 50 calls weekly.

“We have investigations going on in this space across the country. It is not limited to one geographic region,” Richmond said in an interview. “This is touching every corner.”

In all, more than 300 federal investigations, conducted by multiple law enforcement agencies, are examining genetic testing fraud schemes, said a law enforcement official who spoke on condition of anonymity because the inquiries are not yet public. The investigative crush was sparked in part by unusual Medicare billing data patterns that started to emerge in 2015.

In the United States, genetic testing has skyrocketed. For Medicare, the public insurance program for elderly and disabled Americans, payouts for genetic tests jumped from $480 million in 2015 to $1.1 billion in 2018, a Reuters analysis found. Those figures do not include invoices for spending by state Medicaid programs, which serve the poor, or supplemental Medicare insurance programs offered by private insurers.

The investigations are examining billings submitted to federal health insurance programs. By law, all diagnostic lab tests must be ordered by a doctor treating a patient for a specific condition.

In the cases under review, investigators and patients told Reuters, marketers get elderly residents to turn over their Medicare or Medicaid information, along with their driver’s license and other identifying information, and tell them they will take a free cheek swab that can help them understand their risks of developing cancer or whether their genetics could unlock clues about how they will respond to drug treatments. They then get a doctor to sign off and approve the test and ship the swab off to a lab, which seeks Medicare payouts.

But many of the lab tests are not relevant to the patient’s history, and some of the doctors sign off on the results without conferring with the patient, said investigators familiar with the operations and patients interviewed by Reuters. Suspect companies pocket thousands, with a cut going to doctors, but the seniors get little, if any, benefit, investigators say.

Brian Benczkowski, the assistant attorney general for the U.S. Department of Justice’s Criminal Division, estimated that fraudulent billings submitted over the last few years are expected to total “north of $1 billion.” He called genetic testing of the elderly “the next big frontier in federal healthcare fraud enforcement.”

A little-explored world surrounds the marketing companies, laboratories and telemedicine companies involved in elder genetic testing. Among them is Spectrum. Another is Clio Laboratories, the Georgia-based lab that is part of an interconnected network of labs, medical billing operations, a telemedicine firm and other healthcare-related limited liability companies, company records show.

In a handful of cases, the patients who had DNA samples sent to Clio or Spectrum said they never spoke with a doctor about why the cancer or pharmacogenetic tests were medically necessary. Moreover, when test results were completed, they were mailed directly to patients’ homes. That is not the norm, say doctors and medical experts. Usually, the ordering physician receives results first, then reviews them with the patient.

In 2017, the most recent data available, Clio billed Medicare $8.6 million for genetic testing and was paid about $4.6 million.

Some of the doctors involved in the genetic testing wave also have checkered pasts.  One California doctor was signing off on genetic tests for patients even as two states had disciplined him or were preparing to do so after he was criminally convicted in Los Angeles.

Orthopedic surgeon Dr. Mitchell G. Cohen pleaded guilty in November 2015 to filing a false tax return in connection with an illegal kickback scheme, cooperated with the government’s investigation, and later served more than eight months in a halfway house in central California through March 2019, court records show. Cohen was not charged with making an illegal kickback, but pleaded guilty to making a false tax return in a case federal authorities said involved kickbacks.

Cohen was approving genetic tests for Medicare patients during his stint in the halfway house and after his probation period ended. He approved the medical necessity of genetic tests handled by labs including BioConfirm in Georgia and Elite Medical Laboratories, lab records show.  He signed off on the genetic test for Elite in September 2018, as he was serving his sentence in the halfway house, records show. He approved the medical necessity of tests sent to Bioconfirm on May 10, 2019.

Pursuant to Labor Code section 5307.1, subdivision (g)(2), the Administrative Director of the Division of Workers’ Compensation ordered that the Durable Medical Equipment, Prosthetics, Orthotics, Supplies portion of the Official Medical Fee Schedule contained in title 8, California Code of Regulations, section 9789.60, is adjusted to conform to changes to the Medicare payment system that were adopted by the Centers for Medicare & Medicaid Services (CMS) in the October 2019 Quarter 4 DMEPOS Fee Schedule update.

Effective for services rendered on or after October 1, 2019, the maximum reasonable fees for Durable Medical Equipment, Prosthetics, Orthotics, Supplies shall not exceed 120% of the applicable California fees set forth in the Medicare calendar year 2019 “Durable Medical Equipment, Prosthetics/Orthotics, and Supplies (DMEPOS) Fee Schedule” revised effective October 2019, contained in the electronic file “DME19-D [ZIP, 4MB]” which is adopted and incorporated by reference, excluding the “Former CBA Fee Schedule File”, “Former CBA National Mail-Order DTS Fee Schedule File”, and “Former CBA Zip Code File”.

The fee schedule data file (DMEPOS_OCT) sets forth two columns for California labelled: “CA (NR)” [California Non-Rural] and “CA (R)” [California Rural]. For the services on or after October 1, 2019, payment shall not exceed 120% of the fee set forth for the HCPCS code in the CA (NR) column, except the fee shall not exceed 120% of the fee set forth in the CA (R) column if the injured worker’s residence zip code appears on the DMERuralzip_Q42019 file. Where column CA (NR) sets forth a fee for a code, but CA (R) for the code is listed as “0.00” the fee shall not exceed 120% of the CA (NR) fee, regardless of whether the injured worker’s address zip code is rural or non-rural.

DME19-D [ZIP, 4MB] includes the following documents which are incorporated by reference:

— DMEBACK 2019
— DMEPOS_OCT
— DMEREAD 2019 rev 6-1-19
— DMERuralzip_Q42019

Excluding:
— Former CBA Fee Schedule File
— Former CBA National Mail-Order DTS Fee Schedule File
— Former CBA Zip Code File

The CMS Manual System, Pub 100-4 Medicare Claims Processing, Transmittal 4386, Change Request 11433, August 30, 2019 sets forth the fourth quarter changes and is relied upon in adopting this update Order.

CMS has not made second, third or fourth quarter updates to the 2019 Parenteral and Enteral Nutrition fee schedule (PEN) file. Therefore, the Administrative Director Order dated December 21, 2018 continues to be effective for Parenteral and Enteral Nutrition fees, and the DMEPEN_JAN file contained in the DME19-A remains effective for services rendered on or after October 1, 2019.

The Medicare October 2019 fourth quarter DMEPOS fee schedule revision is available on the Centers for Medicare & Medicaid Services’ DMEPOS Fee Schedule quarterly file webpage .