Nolan Auerbach & White is an experienced Medicare Fraud Law Firm helping courageous whistleblowers.
Coverage and payment for health care services begins with Medical Necessity. This term is critical to understanding Medicare coverage decisions. The origin of this term – medical necessity – is often traced to a frequently cited section of the Social Security Act with the following full and complete name: The Social Security Laws, Volume I, Social Security Act, Title XVIII (Health Insurance for the Aged and Disabled) Part E, Section 1862 (a)(1)(A) [1] [2]. This is commonly abbreviated Section 1862 (a)(1)(A), which may also be written § 1862 (a)(1)(A).
The precise wording in section 1862 (a)(1)(A) of the law is the following:
Notwithstanding any other provision of this title, no payment may be made under part A or part B for any expenses incurred for items or services which, except for items and services described in a succeeding subparagraph, are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.
This principle requires that it must be clear that a medical service is both reasonable and necessary before the Medicare entitlement provides coverage.
Some would opine that Medical Necessity, like beauty, may reside in “the eye of the beholder” [3] , and therefore may be based on the subjective point of view of either the physician or patient seeking payment and coverage for a medical procedure.
In order to remove subjective bias from determination of medical necessity (to the maximum extent possible), coverage guidelines for an intervention (or medical service) have been suggested as follows: [4]
Other standards have been suggested for medical necessity to include the following [5], namely that a service be:
An economic, or financial criterion is frequently added by private health insurers, namely that the intervention must be the most “cost-effective method available to address the medical condition.” In contrast, Medicare, for the most part, excludes the cost of a medical procedure from final decisions on Medicare coverage. [6]
In summary “medical necessity” is frequently cited in determinations of coverage by Medicare and its Administrative Contractors. Some combination of the criteria listed above are the guidelines employed for most Medicare coverage decisions.
[1] https://www.ssa.gov/OP_Home/ssact/ssact-toc.htm
[2] https://www.ssa.gov/OP_Home/ssact/title18/1800.htm
[3] http://www.phrases.org.uk/meanings/beauty-is-in-the-eye-of-the-beholder.html
[4] http://content.healthaffairs.org/content/14/4/180.full.pdf
[5] http://archive.ahrq.gov/news/ulp/evidence/ulpevdnc5.htm
[6] http://content.healthaffairs.org/content/27/6/1620.full
Kathleen Hawkins, RN MSN, had been employed by Defendant, Catholic Healthcare West (CHW) for approximately 6 years when she decided she had had enough of trying to change the hospital system from within.
CHW, a California not-for-profit corporation that operated hospitals in California, Arizona, and Nevada, was at the time the eighth largest hospital system in the nation and the largest not-for-profit hospital provider in California.
Joe Strom contacted us in 2005. We were very grateful that he did. We immediately formed an all-star legal team and a process to stop a very harmful pharmaceutical marketing strategy. It was this process we set into motion that ultimately returned hundreds of millions of dollars to the U.S. Treasury, and a portion of that, very well-deserved, into Joe’s bank account.
Joe told us a very troubling story about the off-label promotion of a pharmaceutical drug for patients who already suffered from chronic heart failure.
Bruce Moilan was a seasoned hospital systems expert by the time he contacted our Firm. At the time he decided to file his qui tam lawsuit, he was employed by South Texas Health System as a System Director for Materials Management. In this position, he oversaw $24 million in annual purchases of supplies and equipment and helped determine budget, reduction and cost analysis throughout the contract bidding and negotiations process. His job was to insure proper implementation for purchasing, receiving and management of inventory, for McAllen Hospitals, L.P.
