WALGREENS NO NO

An Indianapolis jury awarded $1.4M to a woman whose PHI/pharmacy information was released by her boyfriend’s other girlfriend who had accessed it in her role as a pharmacist at Walgreens, and then told their common boyfriend.

While the case is somewhat unique in its structure given that it was a jury verdict, and that Walgreens may or may not have litigated the case well, it does indicate a willingness of the appellate court, who upheld the jury verdict of $1.4M, to recognize that the disclosure of patient information may be a breach of other duties, such as the duty not to disclose private information, the duty to keep such information quiet (while not directly a HIPAA based claim, HIPAA may set the minimum standard for protection/disclosure), and for the responsibility of employers for the violations and indiscretions of their employees.

These cases should be closely watched by pharmacies, group practices and hospitals.

MEDICARE DSH PAYMENTS

Medicare DSH, or Disproportionate Share Payments, are made to hospitals that serve a significantly disproportionate number of low income patients.  Medicare calculates the DSH under either the primary or alternate special exception method.

CMS’ approach to calculating the annual DSH rate and qualification has been the subject of much dispute over the years.

This year, CMS proposes a 2.3% “rise” in DSH.  However, critics indicate that the real result of the proposed increase is more equivalent to a 3% decrease.  Automatic cuts in ACA contain arbitrary reducers such as a ½% reduction to offset assumed productivity improvements.  A similar .8% cut is made on the assumption that hospital personnel, or their outsourced billers, have become better coders.

Therefore, of the proposed 2.3% “raise”, about 1.7% or so is already taken back just by these reductions based upon assumptions which may or may not be accurate.  Other CMS strategies include reworking the formula for offsetting care delivered to the uninsured.

The point is that one should never take any statement by CMS or by an insurer at face value.

HOSPITAL TO PATIENT “PLEASE LEAVE”

Patients typically are happy to be treated and released by hospitals, and are often eager to leave.

Recently, a New York hospital sued a millionaire patient who apparently did not want to return to his home where he lived with his mother.  The 70 year old appealed to his insurer twice to stop discharge after his treatment.  Even though the insurer refused to authorize any further expenditure, the man refused to leave and refused to pay.  The hospital was required to go to court to seek the man’s eviction from his hospital bed.

2015 PENALTIES FOR INDIVIDUALS WITHOUT HEALTH INSURANCE

The health insurance exchanges have reopened for the annual enrollment of individuals without employer provided health coverage.

The penalties change in 2015 as follows:

2014: greater of $95 per adult to a maximum of $285 per family, or 1% of family AGI - $10,500 for individual and $2,300 for a married couple filing jointly.

2015: those numbers are the greater of $325 per adult or 2% of income.

2016: greater of $695 per adult or 2.5% of income.

Commentators believe that it will be 2016 before individuals truly recognize the benefits of obtaining ACA insurance coverage.  Their thinking is that penalties have not been payable by anyone yet, and that the 2015 penalties are, in general, fairly light, and will be waived in many cases.  At the end of 2015, when 2015 tax returns are filed in 2016, and the penalties have significantly increased, individuals, particularly young “invincibles” will start to understand the financial cost of not obtaining insurance, and looking to 2016, will see that those penalties are significant enough for them to finally get serious about ACA enrollment.

If the commentators are correct, then we would begin to see a significant decrease in the uninsured population which is a key to making ACA work both financially for the taxpayer, but also for the healthcare providers.  The driving of healthier, young invincibles into the market should provide significant benefits ACA wide.

This newsletter is edited by Paul Wallace of Jones ∙ Wallace, LLC, a member of the American Bar Association Healthcare Law Section and the American Health Lawyers Association who has been representing physicians and healthcare practices for over 25 years.  Mr. Wallace assists physicians in health practices in contract items, federal legal compliance, creation of practice entities, estate and wealth planning and similar issues.  Please feel free to call if you have any questions on this newsletter or legal matters at (812) 402-1600 or pwallace@joneswallace.com.