This report originally appeared in the August 2009 issue of DOTmed Business News

National: Patient-Centered Outcomes Bill Introduced

Senator Max Baucus (D-MT) has introduced S. 1213, the Patient-Centered Outcomes Research Act of 2009, now, referred to the Committee on Finance. The bill would establish a nonprofit corporation, the `Patient-Centered Outcomes Research Institute'. The purpose of the Institute would be to assist clinicians and others in making informed health decisions through advancing the quality of evidence on how diseases, disorders and other health conditions can be prevented or diagnosed through research and evidence. The findings of clinical outcomes/effectiveness and appropriateness of the medical treatments or services would be disseminated to the industry.

The Institute will be required to identify national priorities for comparative clinical effectiveness research. It will take into account various factors such as disease incidence, prevalence and burden, evidence gaps in terms of clinical outcomes, the potential for new evidence concerning certain categories of health care services or treatments to improve patient health and well-being and the relevance to assisting patients and clinicians in making informed health decisions.

The Institute will also be required to provide support and resources to help patient and consumer representatives on the Board. It will also provide expert advisory panels appointed by the Institute to effectively participate in technical discussions regarding these complex research topics. The support would include continuing education and may include regular, ongoing opportunities for patient and consumer representatives to interact with each other.

Federal/State: 9th Circuit Ruling Allows Disability Discrimination Damages Regardless of Intent

A recent Ninth Circuit ruling in California may carry significant effect on disability accommodation rights. In Munson v. Del Taco, Inc., Case No. CV-05-5942, the court held that a plaintiff who establishes a violation of the Americans with Disabilities Act (ADA) need not prove intentional discrimination in order to obtain damages.

The original case claimed that Munson had been unable to use the restroom of the restaurant because the door was too narrow to accommodate a wheelchair, as well as other architectural barriers. Del Taco had appealed to the District Court holding it liable under California's Unruh Civil Rights Act on the basis that intent to discriminate is required under the Act. However, the Court noted that previous cases under the Unruh Act had been dismissed due to the requirement for intent, until the California legislature amended the Act to include a provision that any violation of the ADA would also constitute a violation of the Unruh Act. Because the ADA does not require proof of intentional discrimination, the Court held that the provision in the Unruh Act likewise does not require such proof.

If other courts follow the 9th Circuit's lead, disabled plaintiffs may find collecting damages easier as they would be spared the burden of proof of intent, an often difficult standard in discriminatory law. Disability discrimination attorney Felix Orraca explained to DOTmed that "The ruling is an instructive influence on other state courts and legislatures, in that state laws need to be in compliance with federal laws, in this case the ADA, and it's a progressive step in favor of affording legal protection to our disabled citizens."

State: Connecticut Passes Law Restricting Use of Ultrasound

In June's Law and Order, we mentioned the New York bill under consideration prohibiting use of ultrasound for entertainment purposes. Now, Connecticut Governor M. Jodi Rell has signed similar legislation into law. The law simply states that "No person shall perform an obstetrical ultrasound procedure unless such procedure is (1) ordered by a licensed health care provider, acting within the scope of such provider's authority, and (2) for a medical or diagnostic purpose."

A state Congressional Public Health Committee report earlier this year supporting the legislation noted the concerns of groups such as the American Institute of Ultrasound in Medicine and others in the professional medical community about the proliferation of "storefront entertainment ultrasound facilities." A physician in the report stated these storefront operations were at the "fringe" of medical practice, and that individuals performing the scans may not be trained professional sonographers.

Other medical professionals had further concerns, including the FDA's view that the promotion, sale or lease of ultrasound equipment for making 'keepsake' fetal videos is an unapproved use of medical device; and those who subject individuals to ultrasound exposure, a prescription device, without a physician's order may be in violation of State or local laws. In addition, nonmedical ultrasound may falsely reassure women of good fetal health and development, and biological effects of ultrasound overexposure may possibly be identified in the future.

National: Rep. Speier Introduces MRSA Bill to Screen for Infections

California Congresswoman Jackie Speier (D-CA) has introduced HR 2937, the MRSA Infection Prevention and Patient Protection Act. The Act provides for the Secretary of Health and Human Services to create regulations for best practices for preventing MRSA infections and other such antibiotic resistant pathogens. The act will also provide screening, recordkeeping and other requirements, as they relate to reductions in MRSA infections.

In addition, hospitals would have new responsibilities with regard to MRSA, including a requirement to have contact (barrier) precautions when treating patients who test positive for MRSA colonization. The hospital would need to isolate or cohort patients colonized or infected with MRSA, or notify patients with whom the infected patient may room. The hospital will also need to control and monitor the movements of such patients within the hospital and take preventative steps for other patients. Hospital staff would be educated concerning modes of transmission, use of protective equipment against MRSA, disinfection policies and procedures, and other preventive measures.

Congresswoman Speier said in a press release on her web site, "At a time when we are focused on expanding health care coverage to include all Americans and making our overall health care system more efficient, it is absolutely necessary that the care provided is safe, smart and cost-effective. Screening for and preventing MRSA infections in our hospitals will not only save tens of thousands of lives and billions of dollars each year, but will increase patients' confidence in the ability of their local hospitals to make them well."

State: Florida AG's Office Uncovers Major Medicaid Fraud, Neglect

Florida Attorney General Bill McCollum has announced action in a major Medicaid fraud case in the state - the arrest of a clinic provider for fraud totaling over $44,000. In addition, the AG's Medicaid Fraud Unit has uncovered an unlicensed living facility allegedly neglecting several disabled persons.




In the first case, a Miami-Dade County man, Oscar Gonzalez, partner of the Rehab & Treatment Center in Miami, was arrested on charges of allegedly defrauding the Florida Medicaid Program out of more than $44,000. The Center is an HIV/AIDS clinic established to provide Medicaid and Medicare recipients with infusion/injection services. The investigators found that Gonzalez and others were paying Medicaid recipients for the use of their recipient numbers, enabling the clinic to order infusion treatments and bill Medicaid. According to the AG, many patients claimed they were never seen by Gonzalez or even received treatments.

In the second case, the owner of the unlicensed assisted living facility, Gwendolyn Ann McClain, was arrested on charges that she allegedly neglected the welfare and health of five disabled adults, operated the facility without a license and engaged in nursing without a license. The AG's office says the investigation discovered the residents living in a condemned and uninhabitable mobile home with exposed wires, no running water, inadequate heat and air conditioning, no operational bathroom, kitchen or telephone. McClain also allegedly administered medications to the residents and made medical decisions for them, while taking the residents' Supplemental Security Income and Disability checks as payment for services.

Federal: DOJ Settles with Texas Disability Facilities

The Department of Justice (DOJ) has announced a simultaneous lawsuit and settlement with the state of Texas, regarding care of residents in the state's facilities for persons with developmental disabilities. An independent monitor will be appointed to oversee the state's compliance with the settlement agreement while the U.S. District Court in Austin, TX will retain ultimate jurisdiction.

The agreement, subject to the approval of the court, addresses concerns about the facilities. The DOJ had been investigating potential violations of the Civil Rights of Institutionalized Persons Act. "The Justice Department is committed to protecting the fundamental rights of all our citizens. This agreement reflects that principle by protecting the civil rights of some of Texas's most vulnerable residents," said Attorney General Eric Holder in the DOJ's press release.

The state of Texas fully cooperated with the DOJ investigation. Under the terms of the settlement, the state has agreed on measures including: providing a safe and humane environment, providing adequate medical and nursing care, nutritional and physical support; adequate psychological, psychiatric and behavioral services, adequate habilitation, and ensuring that residents are free from undue bodily restraint. The remedial agreement had the cooperation and commitment of the Governor Rick Perry, and various Texas state agencies.

State: Vermont Enacts Strong Law on Physician Influence

Governor Jim Douglas has signed strong measures into law to limit the pharmaceutical industry's influence over physicians. The law bans gifts from manufacturers of prescribed products or wholesale distributors of medical devices. This includes payment, food, entertainment, travel, subscriptions, advances or services. The law also requires annual disclosure from all manufacturers of the recipient of any allowable expenditures and gifts, as well as who is responsible for compliance with the law.

The legislative findings in the law expressed concern over increases in medical spending of 8.7% between 2002 and 2007. The findings noted evidence that physicians are influenced by the marketing efforts of pharmaceutical companies and that "drug detailing" encourages doctors to prescribe newer, more expensive and potentially more dangerous drugs rather than maintaining evidence-based treatment guidelines. In addition, the findings referenced a 2009 report from the Institute of Medicine of the National Academies stating that acceptance of meals and gifts and other relationships are common between physicians and pharmaceutical, medical device and biotechnology companies and may influence physicians to prescribe a company's medicines.

Sharon Treat, Director of the National Legislative Association on Prescription Drug Prices (NLARx), commented in a press release: "Vermont now joins Minnesota and Massachusetts in tackling head-on the pervasive influence of payments and gifts on medical practitioners through a ban on many gifts. Once again, NLARx members have taken the lead." Several legislators involved with the legislation are NLARx members.

Federal: Hospital Exec Pleads Guilty in "Skidrow" Kickback Scheme

Robert Bourseau, former co-owner and board chairman of City of Angels Medical Center, has pleaded guilty in a United States District Court in Los Angeles to paying illegal kickbacks for patient referrals. According to a press release from the Central California U. S. Attorney's Office, Bourseau has admitted to paying illegal kickbacks as part of a scheme to defraud Medicare and the California state Medi-Cal system.

Bourseau and Dante Nicholson, a former senior vice-president at City of Angels, were indicted earlier this year along with Intercare Health Systems, Inc., the company through which Bourseau and a partner operated City of Angels. The indictment alleged that Intercare, Bourseau, Nicholson and others conspired to recruit homeless people, mostly from Los Angeles' Skid Row, to fraudulently receive unnecessary health services.

Bourseau's guilty plea includes admissions of a scheme to refer the Skid Row Medicare and Medi-Cal beneficiaries for in-patient hospital stays at City of Angels, even if not medically necessary. City of Angels then entered into contracts intended to conceal the illegal kickbacks paid for the referrals and billed Medicare and Medi-Cal for in-patient services to the homeless recruits. Bourseau's charges carry a statutory maximum penalty of 10 years in federal prison and Bourseau, who will be sentenced later this year, has agreed to pay over $4.1 million in restitution.

National: Congressmen Introduce Medicare Payment Fairness Act

Representatives Keith Ellison (D-MN) and Tim Walz (D-MN) have introduced legislation to reform the Medicare fee-for-service practice. The Medicare Payment Fairness Act of 2009 (H.R. 3074) changes the Medicare payment structure by adding a value index. The bill has been referred to the Committee on Energy and Commerce.




Currently, Medicare reimburses on the basis of number of procedures completed and number of patients handled, which Rep. Ellison says often leads to unnecessary medical services. The proposed reforms in the bill change incentives in Medicare by rewarding regions based on a quality to cost ratio. There would be a value index of each fee schedule area and hospital service area. The value index would be a ratio of a quality component (a composite score reflecting quality measures available on a State or fee schedule/hospital service area basis. The measures would compare health outcomes and status for the Medicare population, (patient safety and patient satisfaction) to the cost component (ratio of the cost per beneficiary for such area to the national average cost per beneficiary).

"Minnesota is a national leader in providing high quality health care at a lower overall cost," Rep. Ellison stated in a press release on his web site. "Meaningful health care reform requires fundamental changes in how our country pays for health care and I believe that the nation can learn from Minnesota as we tackle health care reform."