AHA and CMS to Keep Regulatory Flexibilities in Place

COVID-19 continues to create obstacles and challenges for healthcare compliance professionals. Thriving in this environment means being agile and adaptive.

The AHA’s Requests

Last week, the American Hospital Association (AHA) asked the Centers for Medicare & Medicaid Services (CMS) to keep relaxed regulations in place. Specifically, the AHA is interested in keeping flexibility around telehealth, quality and compliance measures, and bed capacity.

The telehealth changes are ones that have been on the horizon for some time. Essentially, the AHA is asking CMS to continue to allow hospitals to provide a wide range of telehealth services, without limitations as to profession or geographic location. The AHA is also asking for flexibility on billing and payments related to telehealth to be made permanent.
More interestingly, the AHA has also asked that CMS extend regulatory relief related to some quality and patient safety regulations. These include expanding the use of verbal orders, and extending the reuse of PPE.

The AHA has also asked that CMS provide hospitals with a transition period, to allow them to more easily move from pandemic response to ordinary practice. This includes a request for temporary waivers for sanctions and penalties related to HIPAA , and flexibility on audit requirements. And, it includes a request that certain rules and requirements be delayed or suspended.

The Response From CMS

Three days after the AHA released this letter, Michael Caputo, Assistant Secretary for Public Affairs at the Department of Health and Human Services (HHS), tweeted this :

The public health emergency is currently set to expire on July 25. However, as of this writing, HHS hasn’t officially announced how long the extension will be

This means that we don’t yet know what will happen when the emergency finally does end. Will HHS give a transition period, as the AHA has requested? Will HHS continue to allow flexibility about telehealth, which they have previously indicated they would?

Staying up to date on this fluid situation is going to be a key task for compliance in the coming weeks.

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The Inefficiency of the Status Quo

When it comes to maintaining your hospital’s compliance in the face of with ever-changing regulations, the struggle is real and expensive. Hospitals of all sizes spend boatloads of money on GRC and risk solutions to stay compliant. Plus, clinical teams working on compliance –physicians, nurses, technologists – spend inordinate amounts of time away from patient-care responsibilities trying to decipher and implement the latest rules.

Do you know just how expensive it is for hospitals to stay compliant and maintain the status quo? Let’s look at state-level expenses first.

State of Shock

Last year, the Oregon Association of Hospitals and Health Systems and Pacific University collaborated on a report titled Cost Burden: Evaluating the Financial Impact of Oregon State Regulatory Compliance on Oregon Hospitals and Health Systems. Some of its key findings:

  • In 2018, Oregon hospitals spent a total of $126 million on labor to comply with over 2,000 rules created by the state
  • Of these facilities, large hospitals each spent approximately $3.9 million on labor, and smaller hospitals each spent close
    to $0.5 million
  • Staff salaries represented 85% of total compliance costs for all hospitals
  • At large hospitals, 50% of compliance departments spent 40 hours or more a week overseeing state regulations
  • Many new state laws and regulations are effective as soon as the governor signs them, giving hospitals no time to understand the new rules, train their staffs, or establish procedures — and instantly making them non-compliant

National Numbers

Costs skyrocket when hospitals in all 50 states try to meet federal regulations, as detailed in the 2017 AHA report, Regulatory Overload: Assessing the Regulatory Burden on Health Systems, Hospitals and Post-acute Care Providers. Here are just some of the average costs that community hospitals (160 beds) incurred in 2016:

  • Nearly $7.6 million on administrative activities
  • Almost $760,000 to meet meaningful use administrative requirements
  • Around $411,000 in systems upgrades
  • Approximately $709,000 annually on the administrative aspects of quality reporting

Naturally, the larger the hospital size, the greater the administrative costs. Hospitals with post-acute care beds paid $9 million, whereas large hospitals with at least 400 beds paid $18.8 million in administrative costs. Hospitals of all sizes also spent $3.1 million on administrative compliance activities related to conditions of participation for Medicare programs, plus another $1.6 million on billing and coverage verification.

In 2016, the administrative aspects of federal regulatory compliance worked out to $38.6 billion — or more than $47,000 per hospital bed. And every time a patient was admitted in 2016, hospitals would incur $1,200 in regulatory burdens alone. As high as the $38.6 billion figure is, it does not account for complying with regulations made by federal agencies, such as the FDA.

Thus, the “complete” costs of federal regulatory compliance for hospitals is likely much, much higher.

Simplifying Regulatory Compliance

The proliferation and vast amount of regulatory changes can easily exceed your hospital’s ability to understand and implement them in a timely manner. And if your hospital’s spending a lot of money but still can’t maintain compliance with state, federal, and agency regulations, that could spell disaster.

You need a more effective spend stat. Take a look at what youCompli can do to help you monitor, translate, act upon and track compliance activity throughout your hospital. Get started here.