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September 10, 2010
Court of Appeals Rules for Hospital in IME Research Case: The Battle Continues
By: Thomas W. Coons
Over the past several years, one of the more contentious reimbursement issues has been whether teaching hospitals are entitled to Medicare reimbursement for indirect medical education (IME) expenses related to time spent by residents in “pure research.” District courts in Ohio, Arizona, Rhode Island, Illinois and Michigan have all ruled that they are. In 2008, however, the United States Court of Appeals for the First Circuit in Rhode Island Hospital v. Leavitt, 548 Fed. 3d 29 (2008), issued a contrary decision and upheld the Secretary’s disallowance of IME for such activities. Now, another court of appeals, the United States Court of Appeals for the Seventh Circuit, has weighed in on the issue, concluding that reimbursement for such expenses is allowed. University of Chicago Med. Ctr. v. Sebelius, 09-3429 (7th Cir. Aug. 25, 2010).
At issue in these cases is how to read the regulation at 42 C.F.R. § 412.105(f), which specifies that a resident may be included in the IME full-time equivalent (FTE) count if the resident (1) is enrolled in an approved teaching program and (2) is assigned to a “portion” of the hospital subject to the prospective payment system. The dispute has principally focused on whether the word “portion” as used in the regulation refers to a geographic location within the hospital, as the hospitals have contended, or to a function that the resident is performing within the hospital irrespective of physical location, as the government has argued.Click to continue...
DMEPOS Suppliers Beware â€“ Operational Changes May Be Required to Avoid Revocation
By: Donna J. Senft
CMS continues its efforts to reign in fraudulent suppliers, catching legitimate businesses in the net that it casts. On August 27, 2010, CMS released final regulations "Medicare Program; Establishing Additional Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Supplier Enrollment Safeguards [PDF]," which expand and clarify the supplier standards. Although CMS certified that "this rule will not have a significant economic impact on a substantial number of small entities," many non-retail specialty suppliers may disagree. CMS determined it could provide this certification since the regulations "are primarily procedural and do not require DMEPOS suppliers to incur additional operating costs."
The publication of these final regulations comes just five months shy of the three-year time period CMS had to finalize the proposed rules without having to begin the process anew. The proposed rule [PDF], published on January 25, 2008, was the subject of a prior Payment Matters article, "Another Step Designed to Reign in Unscrupulous DMEPOS Suppliers." In finalizing the regulations, CMS considered 208 timely submitted comments to the proposed rule.Click to continue...