HEALTH LAW SUPPLEMENT Winter 2008

A couple of changes in Medicare procedure. (1) This year, Medicare changed its policy to allow healthcare practitioners to charge patients for missed appointments. Previously this was not permitted. Such charges may not be billed to Medicare of course. But now they may be billed to Medicare patients and paid out-of-pocket by them. CMS came around to believing that charging for missed sessions is justifiable because they represent “missed business opportunities.” There is a proviso to the change: Practitioners may not discriminate against Medicare recipients and must charge the same fee for missed sessions to all patients. See CMS Manual, Chapter 12, section 30.3.13.

I would add as a caveat that billing statements for missed sessions given to any patients, Medicare or otherwise, should not refer, either by CPT code or name, to the service that would have been provided had the patient shown up, but rather should indicate that the charge is for “reserved time.” We have seen instances where patients sent to their insurers claims for reimbursement with attached billing statements on which practitioners had indicated the service that was to have been provided but was missed, without it being clear that no service was actually rendered. The insurers consider this fraudulent and may consider the practitioner complicit.

(2) CMS has issued a new ABN form. ABN is an acronym for “Advance Beneficiary Notice of Noncoverage” although it might more properly be called “advance beneficiary notice of possible noncoverage.” It can be found online as form number CMS R-131, ABN-G. Beginning March 1, 2009 only the new form can be used. For those unfamiliar with the form, it is used when a practitioner believes that Medicare may deny reimbursement for a service due to a lack of medical necessity. Once patients sign the form acknowledging this possibility, they may be held personally liable for payment. Depending on the option chosen by the patient on the ABN, there may still be a right to appeal a denial by Medicare, but the patient, rather than the practitioner, assumes responsibility for any appeal. Note that the ABN must be signed by patients prior to the rendering of the questionable services. Practitioners may still seek reimbursement from Medicare for the questionable services if the practitioner believes the service is medically necessary.

An example may help explain use of the ABN. Following a retroactive audit by Medicare of medical necessity, some client-psychotherapists have been compelled to return to Medicare funds paid to them for the second of twice-a-week therapy sessions because the auditors believed that only one weekly session was necessary. Sometimes the refund occurs after a lengthy appeal process by the practitioner. Because those therapists had not sought ABN’s from their patients prior to treatment, they could not bill patients for the fees refunded to Medicare and the therapists therefore lost any payment for the second weekly sessions, including co-payments which had to be refunded to the patients. Had the therapists asked their patients to sign ABN’s indicating that the second weekly session might not be reimbursable, then following any refund to Medicare upon a finding of lack of medical necessity, the therapists could have held their patients responsible both for making any appeal and for the payments refunded to Medicare.

That new federal mental health parity law. The bill passed by the US Congress bailing out banks was for some reason accompanied by a mental health parity law that had been bandied about for over 10 years. New York State has recently passed a parity law (“Timothy’s Law, see Health Law Supplement #20), and the federal law does not preempt state laws. However, unlike state parity laws, the federal law will apply to self-funded group plans, a very significant portion of insurance plans.

There are limits on the extent of the new law though. The law does not apply to employers with 50 or less employees. It does not apply to the individual health insurance market. Although initially planned to apply to all patients with a DSM diagnosis, the final version of the law dropped that requirement to allow insurance companies to choose which mental health conditions and treatments will be covered. The law applies only to plans that include coverage for mental health; insurance companies are still free to offer no coverage at all for mental health treatment. Finally, the law doesn’t take effect until January 1, 2010. We won’t know for a while how it will be implemented.

I’m a licensed mental health professional, Do I need malpractice coverage for coaching? Coaching, as distinguished from therapy, is meant to enhance normal functioning and not to treat symptoms of illness. Personal, life and executive coaches should have malpractice, or errors and omissions, insurance. Even coaches who are not licensed healthcare professionals- no license is needed in New York State to be a coach – should have insurance to cover any potential liability for coaching. The underlying question, then, is whether the malpractice coverage already in place for licensed professionals covers their coaching activities.

There is a related broader issue, that of whether coaching conducted by licensed mental health professionals is necessarily within the scope of their professional practices. There is no legal answer to that question, or, more precisely, to the extent it’s a legal question, the answer is unclear. One California court decided that a professional serving as a life coach was subject to laws that mandate confidentiality for substance and alcohol treatment. and by implication, was acting in a professional capacity, People v. Barrett, 109 Cal App 4, 437 (2003). But a federal court found that coaching, although offered by a counseling center, was not a “health care” or professional service, Wolf v. Fauquier County Board of Supervisors (2007, ED Va).

Whether coverage is in place therefore depends on the contract the professional has with his or her insurer. Some malpractice carriers for mental health professionals include coverage for coaching and some don’t. If your carrier doesn’t then you’ll need an additional policy to cover your coaching activities. Some malpractice carriers for mental health professionals condition coverage for coaching on it being part of the professional practice of the insured; in such instances, advertising should describe coaching as a professional, albeit not therapeutic, service.

INFORMATION IN THIS NEWSLETTER IS NOT LEGAL ADVICE FOR ANY PARTICULAR CLIENT OR SITUATION. CONSULT WITH AN ATTORNEY INDIVIDUALLY FOR LEGAL ADVICE REGARDING THE SPECIFICS OF YOUR SITUATION.

𝄞 HAPPY HANUKKAH, CHRISTMAS AND NEW YEAR TO ALL! 𝄞

WE WISH YOU PEACE AND PROSPERITY AND THANK
YOU FOR YOUR TRUST AND BUSINESS DURING THE PAST YEAR!

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