Tuesday, April 12, 2011

OCR Exercises Its Enforcement Discretion

Last month we had the first case in which Office of Civil Rights used it HIPAA civil money penalty power, and it is a douzy. 

See full article here.

Note to self #1: respond to subpoena from the OCR. 

Note to self #2: when responding to a HIPAA violation complaint, do not include PHI on 4,500 patients outside the scope of the complaint. 

Tuesday, March 8, 2011

Co-ops and Co-ops

Free federal money

PPACA provides for $6 billion for start up funding of Consumer Oriented and Operated Plans (Co-ops) to begin operations 1/1/2014. http://cciio.cms.gov/resources/co_op/index.html. If there are two Co-ops per state, that would be $60 million per Co-op. Rhode Island will probably be covered by a Boston Co-op, but California will likely have Coops for NorCal, SoCal, and the Central Valley, at a minimum. Given that the Co-ops are projected to only require about 25,000 members to be self-sufficient, we are looking at an acquisition and service cost per member of $2400 in the first year. Considering that risk-bearing PCMH pilots have been run successfully for $120 per year in administrative fees, 2000% of that amount should be plenty to see some of these organizations succeed.

Public benefit

Success will not be measured in terms of return on investment, however, but on number of members covered and quality of service provided. Co-ops must be nonprofit. This nonprofit requirement would be most obviously met by traditional physician-hospital constructs.  An alternative, however, would be borrowing governance models from the credit union industry. Credit unions have retained the “community owned” character envisioned by PPACA founders where Blue Cross and Blue Shield plans have foundered to varying degrees. It is little wonder that PPACA bars any form of insurance industry participation in Co-ops.

Market size and participants

Congressional testimony on Co-ops indicates that these new entities will follow the growth plan of HSAs, which went from virtually no marketshare in 2000 to 12-15% in 2010. http://cciio.cms.gov/resources/files/j_bertko_testimony.pdf The credit unions largely missed out on the HSA land rush, however, seeing banks grab 99% of the market share. Could credit unions’ philosophical underpinnings, strong bricks and mortar presence, tight employer ties, together with facility with EFTs, make them emerge as a key participant serving Co-op customers?

Sunday, January 16, 2011

Opportunity for Supreme Court to Address De-anonymized Data

Last week, the Supreme Court granted review of Sorrell v. IMS Health Inc., after the Second Circuit Court of Appeal's decision to strike down Vermont's prescription confidentiality law. The law regulates data mining companies that sell or use doctors' prescribing records containing personal information on patients. The Second Circuit concluded as a matter of fact that “The PI data sold by the data-mining appellants is stripped of patient information, to protect patient privacy.” Will the publicity surrounding de-anonymization of Netflix data will present an opportunity for the Court to scrutinize individuals’ privacy rights as well?