AHA: Too many regulations in healthcare
Thursday, November 09, 2017
There are too many regulations hampering health systems in the U.S., according to the American Hospital Association (AHA). If nothing else, the hospital lobbying group is going to make enough noise so that every key player — up to and including President Donald Trump — hears the cries and takes action.
Health systems, hospitals and post-acute care (PAC) providers are required to comply with 629 discrete regulatory requirements. These include 341 hospital-related requirements and 288 PAC-related requirements. These regulations are dealt to healthcare by the Centers for Medicare & Medicaid Services (CMS), the Office of Inspector General (OIG), the Office for Civil Rights (OCR) and the Office of the National Coordinator for Health Information Technology (ONC).
A new report compiled by the AHA examines the regulatory burden across nine domains: quality reporting, new models of care/value-based payment models, meaningful use of EHRs, hospital conditions of participation (CoP), program integrity, fraud and abuse, privacy and security, post-acute care and billing and coverage verification.
Health systems, hospitals and PAC providers spend nearly $39 billion a year solely on the administrative activities related to regulatory compliance in these areas. Regulatory adherence costs hospitals $1,200 each time a patient is admitted, the AHA says.
An average-sized community hospital (161 beds) spends nearly $7.6 million annually on administrative activities to support compliance with the reviewed federal regulations. That figure rises to $9 million for those hospitals with PAC beds.
An average-sized hospital dedicates 59 full-time equivalents (FTEs) to regulatory compliance, more than one-quarter of which are doctors and nurses. Physicians, nurses and allied health staff make up more than one-quarter of the FTEs dedicated to regulatory compliance, pulling clinical staff away from patient care responsibilities, the AHA notes. While an average size community hospital dedicates 59 FTEs overall, PAC regulations require an additional 8.1 FTEs.
According to the AHA, the timing and pace of regulatory change make compliance challenging.
"The frequency and pace with which regulations change often results in the duplication of efforts and substantial amounts of clinician time away from patient care," the report states. "As new or updated regulations are issued, a provider must quickly mobilize clinical and nonclinical resources to decipher the regulations and then redesign, test, implement and communicate new processes throughout the organization."
Among the nine areas reviewed, providers dedicate the largest proportion of resources to documenting CoP adherence and billing/coverage verification processes. More than two-thirds of FTEs associated with regulatory compliance are within these two domains, which also represents 63 percent of the total average annual cost of regulatory burden.
When it comes to meaningful use — a bane for many — regulations have "spurred provider investment in IT systems, but exorbitant costs and ongoing interoperability issues remain." For example, the average-sized hospital spent nearly $760,000 to meet meaningful use administrative requirements annually, and they invest about $411,000 in related upgrades to systems during the year, more than 2.9 times larger than the information technology (IT) investments made for any other domain.
Perhaps we're getting into the weeds, though. Rather, we might want to take a look at what the AHA wants for its members.
In its report, "Regulatory Overload: Assessing the Regulatory Burden on Health Systems, Hospitals and Post-Acute Care Providers," the group points out the following areas where it wants Congress and the Trump administration to immediately reduce regulatory burden:
- Suspend the hospital star ratings from the Hospital Compare website.
- Cancel Stage 3 of meaningful use of electronic medical records.
- Suspend all regulatory requirements that mandate submission of electronic clinical quality measures.
- Rescind the long-term care hospital 25 percent rule and instead rely on the site-neutral payment policy to bring transformative change to the field.
- Restore compliant codes that count to the inpatient rehabilitation facility 60 percent rule.
- Expand Medicare coverage of telehealth by removing outdated restrictions on the types of technologies covered, types of services reimbursed and locations services are provided.
- Prohibit enforcement of direct supervision requirements.
- Provide more regulatory flexibility in payment reform models, such as providing waivers for restrictive rules that stymie the redesign of episodes of care across provider settings.
- Eliminate the "96-hour rule" as a condition of payment for critical access hospitals.
- Modify Medicare conditions of participation to allow hospitals to recommend post-acute care providers.
- Create a new exception that protects any arrangement that meets the terms of an Anti-Kickback Statute safe harbor for clinical integration arrangements.
- Remove the mandatory free-text field from the Medicare Outpatient Observation Notice (MOON) and eliminate the confusing Second Important Message from Medicare.
According to the AHA, a reduction in administrative burden will "enable providers to focus on patients, not paperwork, and reinvest resources in improving care, improving health and reducing costs."
While the effort to reduce regulation may have at one time seemed out of the realm of possibility in previous administrations, the current Trump administration may not follow the same blueprint. Trump has shown early in his presidency that he dislikes overwhelming regulations.
If that's the case, there may soon be fewer business regulations tamping down healthcare operations.
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