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Archive for July, 2012

Tighter Controls on Diabetic Supply Claims

19 Jul

Providers and suppliers will be under greater scrutiny when submitting claims for large numbers of test strips and lancets, thanks to an Office of Inspector General (OIG) June 2012 report. The OIG report estimates contractors overpaid as much as $271 million for these types of claims in 2007. In response to the report, contractors say they have made appropriate changes, or plans to do so.

Home blood-glucose test strip and lancet supplies are covered by Medicare Part B for physicians who prescribe them for their diabetic patients.
 
While the National Coverage Determination (NCD) does not specify utilization guidelines and documentation requirements, Local Coverage Determinations (LCDs) for the four related contractors reviewed by the report (NHIC, Corp., National Government Services, CIGNA Government Services, and Noridian Administrative Services) – state that Medicare covers up to 100 test strips and 100 lancets each month for insulin-treated diabetics, and 100 test strips and 100 lancets every three months for non-insulin-treated diabetics.
 
Medicare considers 50 test strips as one unit and 100 lancets as one unit. This means a standard claim for a patient’s monthly (or three-month) allotment of these supplies would be two units of A4253 blood glucose test or reagent strips for home blood glucose monitor, per 50 strips and 1 unit of A4259 Lancets, per box of 100.
 
To be reimbursed for a claim that exceeds these guidelines, there must be documentation that supports the reason for additional supplies and documentation in the physician’s or supplier’s records that supports the frequency of testing. The doctor must also have seen the patient and evaluated their diabetic control within six months prior to ordering the excess supplies.
 
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Drug Shortage Legislation Passes the House

10 Jul

Last year, The American Society of Anesthesiologists strongly urged a federal investigation into the drug shortage problem in the U.S. healthcare system. That led to The House Energy and Commerce Health Subcommittee holding a hearing in the fall they called “Examining the Increase in Drug Shortages.” Since then, there has been considerable legislative headway.

Last month, The U.S. House of Representatives overwhelmingly passed the final version of legislation that includes important provisions that address drug shortages.
 
S.3187, also known as the “Food and Drug Administration (FDA) Safety and Innovation Act,” was written to reauthorize the operations of the FDA’s prescription drug user fee program, which allows the FDA to collect fees from drug manufacturers to support the agency’s operations. Lawmakers, with the urging of the ASA and other advocates, also used the legislation to address drug shortages by including a section with provisions to prevent and mitigate the shortages.
 
Title X of the legislation requires drug manufacturers to notify the FDA when certain drugs are expected to stop being produced. This includes drugs used in the “treatment of a debilitating disease or condition” and pain drugs used in surgery (anesthesia).
 
The Food and Drug Administration (FDA) Safety and Innovation Act also include provisions to:
 
- Direct the Secretary of Health and Human Services to establish a task force to improve the response to drug shortages and create a plan to address aspects of shortages.
 
- Require the FDA to maintain a drug shortage list and provide it to patients, providers and the public.  
 
- Authorize the Government Accountability Office (GAO) to conduct a study to examine the reasons for drug shortages and give recommendations on how to prevent or alleviate the shortage. This includes data on how the regulatory framework, manufacturing challenges, or other factors contribute to drug shortages, and recommendations to address issues.
 
Now it’s just up to the Senate to pass the legislation and the President to sign it.
 

Medicare and Insurer Revenue Growth Jumps

03 Jul

According to the Standard & Poor’s Healthcare Economic Indices, healthcare professionals and hospitals saw accelerated per capita growth in revenue from Medicare and commercial insurers in the past 12 months ending in April. S&P’s healthcare composite index for that 12-month period jumped by 6.14 percent as compared to a 5.65 percent increase for the 12 months ending in March.

Breaking revenue changes down into public and private sources, Medicare fee-for-service revenue for hospitals and healthcare professionals were up by 2.6 percent in the 12 months ending last April. Commercial revenue saw a more dramatic change with an 8.46 percent increase.

“There is a clear upward trend across all annual growth rates, which began around October 2011, and we have now reached close to the top of the range of price changes established over the last few years,” said David Blitzer, index committee chairman for Standard & Poor’s Indices, in a news release. “The April increase in the composite’s annual growth rate was largely driven by a substantial jump in commercial plans.”

According to Standard & Poor’s, one of the primary purposes of their Healthcare Economic Indices is to help medical professionals and the public as a whole better understand the costs associated with healthcare. Over the last 10 years, trends of annual cost increases have varied from mid-single digits to mid-teens.

 
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