Posts Categorized: Fall/Winter 2012

IN THIS ISSUE: Health Law Reporter Fall/Winter 2012

Sontag, DavidJerry Tichner Bio photoDavid Sontag and Jerry Tichner, Co-editors

In light of national and local focus on electronic health record-related and medical privacy issues, BBA Health Law Section Members and readers of the Health Law Reporter have increasingly expressed interest in articles relevant to the world of eHealth and electronic medical information.  Through their contributions to this issue, a number of our authors address these topics head on.  In particular, this issue features articles discussing the Massachusetts Health Information Exchange, recent privacy-related enforcement actions, and a policymaker profile of the Director of Massachusetts’ eHealth Institute.

Not to be overshadowed, this issue also includes insightful articles addressing the significant growth of the Medical-Legal Partnership model (which involves collaboration between health care and legal aid providers) and a recent CMS demonstration project addressing individuals dually eligible for Medicare and Medicaid coverage.  These articles, combined with four case briefs addressing recent decisions, further our efforts to keep our readers up-to-date as to current trends and issues in our industry.

We thank each of our authors for their significant efforts and contributions!

Opinion Pieces:

The Massachusetts Healthcare Information Exchange – An Inside Look at the Policy and Technology
By:  John D. Halamka MD, CIO Beth Israel Deaconess Medical Center; Manu Tandon, CIO EOHHS; Micky Tripathi, CEO, Massachusetts eHealth Collaborative; and Laurance Stuntz, CEO, Massachusetts eHealth Institute.

HIPAA Enforcement Trends: Growing Civil Enforcement
By: Cassandra H. Arriaza and Sarah W. Walsh (LibbyHoopes, P.C.)

From Practice to Theory: Medical-Legal Partnership Enters its Third Decade
By:  Samantha Morton, Executive Director, Medical-Legal Partnership | Boston 

The “Dual Eligibles” Demonstration: Massachusetts Becomes First in the Nation to Implement a New Health Care Model for Medicare-Medicaid Beneficiaries
By: Margaretta Homsey Kroeger, Esq.

Policymaker Profile:

Laurance Stuntz, Director of the Massachusetts eHealth Institute.
By:  David Sontag, Associate General Counsel, Beth Israel Deaconess Medical Center

Case Briefs:

Boston Medical Center Corporation & Another vs. Secretary of The Executive Office Of Health and Human Services (and a Consolidated Case ). 463 MASS. 447 (denying multiple hospitals’ claims alleging that EOHHS has failed to adequately reimburse for services rendered to MassHealth)
By: Andrew Rusczek (Verrill Dana)

Commonwealth vs. Dung van Tran (463 Mass 8) (discussing the application of the psychotherapist-patient privilege, and the standards for waiver of that privilege, in the context of a Murder trial)
By: Margaret Schmid (Donoghue, Barret & Singal)

Paula Tartarini vs. Department of Mental Retardation (82 Mass. App. Ct. 217) (discussing the mental capability standards for determining eligibility for DMR services).
By: Devin Cohen (McDermott Will & Emery)

Joseph A. Grocela, M.D., et. al. vs. The General Hospital Corporation dba Massachusetts General Hospital et al. (30 Mass. L. Rep. 176) (denying Plaintiff’s claims that the Hospital’s application of its intellectual property Policy resulted in unfair restraint on trade and violations of privacy.)
By: Sophie Wang (Choate, Hall & Stewart)

The Massachusetts Healthcare Information Exchange – An Inside Look at the Policy and Technology

Introduction:

In December of 2011, John Halamka’s wife visited a suburban community hospital for a diagnostic mammogram.   The study was highly suggestive of a tumor and she wanted to follow-up with a treatment team of oncologists, surgeons, and radiation oncologists at a downtown academic medical center.   She was told that there is an information superhighway in Massachusetts – the Mass Pike.   For 25 cents a page she could get a copy of her medical records on paper and then drive them into Boston.

In September of 2012, John’s mother broke her hip and because the hospital had no access to her outpatient records, she was placed on 22 different medications based on pill bottles John’s father collected.   She takes only 2 medications, which are clearly documented in her primary care physician’s electronic health records.

Both of these scenarios illustrate that we do not have a healthcare system in the United States.  Rather, we have a disconnected set of information silos – hospitals, clinics, labs, and pharmacies – that lead to redundant, unnecessary and error prone care.

But there is hope.

On October 16, 2012 at 11:35am Governor Deval Patrick officially “flipped the switch” on the Massachusetts state Healthcare Information Exchange, called the HIWay, enabling electronic records to be sent from provider to provider  throughout the Commonwealth with patient consent.

This event, held in the Ether Dome of the Massachusetts General Hospital, was the culmination of years of hard work by many stakeholders and experts in the Commonwealth.   Here is their story.

Historical Efforts:

In 1995, Massachusetts stakeholders convened through the Massachusetts Health Data Consortium (MHDC) to found the Chief Information Officer (CIO) Forum. The CIOs from payers, providers, and employer groups, agreed to meet on a monthly basis to discuss the use of IT to streamline health care commerce, reduce costs, and enhance care delivery processes. Early work included common privacy/security guidelines, common data sets for describing clinical encounters, and early discussions of how organizations could collectively address HIPAA compliance issues as a region rather than a series of disjoined efforts.

In 1997, at an MHDC-sponsored security conference, several CIOs of the payers and providers of Massachusetts gathered at dinner to discuss the creation of a network for the exchange of claims, referrals, and benefits/eligibility transactions in Massachusetts. The group named the effort the New England Healthcare Electronic Data Interchange Network or NEHEN.

Three provider organizations (Partners Healthcare, CareGroup, and Lifespan) and two payer organizations (Tufts Health Plan and Harvard Pilgrim Health Care) worked together to formally create NEHEN LLC as an independent organization. Computer Sciences Corporation (CSC) was hired to manage a region-wide administrative data exchange effort, and by October 1998, with prior patient consent, eligibility data began flowing among these early NEHEN members. Boston Medical Center joined in December 1999. University of Massachusetts Memorial and Boston Children’s Hospital joined in February 2000. As of 2012, more than 100 million administrative health care transactions in Massachusetts flow over the collaborative NEHEN network annually.

This early work on transaction exchange built trust among the CIOs and established a business model that all could understand — cost avoidance. Before NEHEN, administrative transactions such as claims cost $5.00 each in labor to submit via paper, fax, phone and e-mail. After NEHEN, these transactions could be exchanged electronically for pennies apiece. The payers and providers in the Commonwealth recognized that IT collaboration reduced costs for everyone.

Over the past 5 years, NEHEN added e-prescribing and clinical data exchange functionality, enabling data to flow among more than 60 institutions in the commonwealth.

Over the same time period, advances in technology and incentives from the American Recovery and Reinvestment Act funded Meaningful Use stimulus program encouraged practices of all sizes to install electronic health records.    NEHEN was optimized for larger organizations with significant IT resources and was generally perceived as too expensive for small practices and providers in the rural parts of the Commonwealth.    Additionally, State government was not involved with NEHEN as officials feared conflicts of interest while serving as a board member of a private multi-stakeholder organization.  NEHEN needed to evolve into a state-wide, low cost, government engaged model.

Creating the Massachusetts HIWay:

In September of 2011, the Secretary of Health and Human Services Dr. JudyAnn Bigby created the HIE-HIT Advisory Committee as a mechanism to channel advice and recommendations to the HIT Council, the healthcare information technology governance body established by Chapter 305 of the Acts of 2008. Comprising 24 public and private sector experts from a broad range of perspectives, and 92 individuals in its working groups, the Advisory Committee has provided substantive advice to the HIT Council in a wide variety of areas, including architecture, phasing, technical specifications, consumer priorities and concerns, provider adoption, financing of the statewide HIE, and legal/policy considerations.

The 5 working groups were as follows:

•     Consumer & Public Engagement Work Group – To raise awareness of the HIT-HIE program among consumers, to engage consumers in the program, and to ensure that consumer input is considered for all critical recommendations and Advisory Committee decisions.

•     Provider Engagement & Adoption Work Group – To raise awareness of the HIT-HIE program among providers, to encourage adoption of HIT-HIE among providers, and to ensure that provider input is considered for all critical recommendations and Advisory Committee decisions.

•     Technology & Implementation Work Group – To plan and develop technical and operational requirements and approaches for statewide HIE activity conducted through publicly-funded or -supported programs. To develop strategies, standards, and requirements for an enhanced statewide HIE architecture that leverages existing networks, shared services, and standardized regional services to enable broad adoption and use of statewide HIE services

•     Finance & Sustainability Work Group – To recommend financing and business models for implementing and sustaining statewide HIE infrastructure and services.

•     Legal & Policy Work Group – To plan and develop a governance model and legal and policy framework for statewide HIE activity conducted through publicly-funded or -supported programs.

Many people put in many hours in September 2011 to engage stakeholders, create a unified statewide HIE plan, suggest a funding model, define requirements, and broadly communicate the strategy.

In October of 2011, three of us that had worked with these early efforts – Manu Tandon (the CIO of the Executive Office of Health and Human Services), Micky Tripathi (the CEO of the Massachusetts eHeath Collaborative), and John Halamka (CIO of Beth Israel Deaconess Medical Center) visited CMS to discuss a powerful idea.   We proposed a single state operated infrastructure connecting all payers, providers, and patients using national standards at low cost.    In Massachusetts, where 100% of the hospitals serve Medicaid patients and   80% of the ambulatory providers serve Medicaid patients, development of this infrastructure could be a game-changer.   Medicaid 90/10 matching funds could be applied for the first time to the construction of a statewide health information exchange.   The state would contribute $5 million and Medicaid would match it with $45 million to create an infrastructure that all stakeholders could use.  The private sector would pay its fair share and every stakeholder would pay a subscription fee that related to the value they derived from healthcare information exchange and their ability to pay.

CMS was impressed by the core elements of the proposed strategy that included:

•     Three-phase HIE plan beginning with creating the statewide Information Highway as a foundation for richer applications and services from 2012-2014.

•     Alignment with national interoperability standards and emerging Meaningful Use (MU) stage 2 requirements[1]

•     Maximization of Medicaid SMHP/Medicaid Management Information System (MMIS) 90/10 Federal Finance Participation (FFP) funding

In January of 2012, CMS approved the funding and work began on the Requests for Proposal to support an open, transparent, competitive bidding process for vendors to provide the products and services needed by the HIE.

The Plan:

The three phase plan was based on stakeholder requirements, the maturity of available technology, and the likelihood that the needed policies would be supported by payers and providers.

The first phase leverages existing workflow and processes used to release medical records today.  In a paper-based healthcare world, patients request/consent that their information be disclosed to another party and then the information is sent (we use the term “pushed” to another organization).   Information would continue to be “pushed” from one organization to another, but we would replace all these paper flows with secure, fully electronic ones. Such a workflow supports coordination of care between primary care givers and specialists; hospitals and primary givers; providers and payers.

The second phase uses this new “push” technology to send data from provider offices and hospitals to registries and data warehouses for quality measurement and population health analytics.

The third phase envisions a solution for the “unconscious in the Emergency Department” problem.  You arrive in the Emergency Department with only a wallet and no ability to communicate.  Using only your name, gender, and date of birth, information from clinician offices and hospitals where you have previously consented to disclose your data make that information available to the emergency physician.

The Technology:

These three phases require an array of technology components and policies.   For the first phase, we implemented 5 components.

  1. A transmission gateway – just like email, a server is needed to send and receive pushed data between organizations.  As part of the Federal stimulus program for electronic health records, a set of standards for exchange of data, called Direct, is required.   We needed to create appropriate hardware and software to support the state’s efforts to enable secure transmission between EHRs.
  2. A provider directory – just as email has an address book, we needed an address book of every provider organization in the Commonwealth and its members.
  3. Certificate management – to send data securely between organizations, there needs to be appropriate encryption over the wire.   Digital certificates enable us to prove the provenance of the sender and ensure only the rightful recipient organization can unencrypt the message.
  4. Skilled nursing facility/long term care interfaces – we received a grant to accelerate adoption of data sharing in post-acute facilities that often do not have an EHR.
  5. Webmail – for those organizations without EHRs, we needed a method of sending and receiving secure messages.  A secure webmail portal meets those requirements.

All of these were competitively bid and procured from a single vendor (Orion) and then, implemented over the Summer of 2012.

In 2014, we will complete a statewide consent repository.  Each institution will record opt-in consent for disclosure of that institution’s data and that consent will be forwarded to a statewide registry, which will store patients’ consent preferences.  At any time a patient may opt-out of disclosing data from an institution.  To support stored consent function, we will need a secure, statewide citizen index.  We will also need this index to support patient-matching of medical records across organizations.  For other phases in the future, we will need other additional components.

The Policies:

Before we could send patient identified data between organizations over this infrastructure, we needed policies to delineate roles/responsibilities, support business associate agreements, and ensure patient consent is obtained and patient privacy preferences are respected.

We assigned roles and responsibilities as follows:

  • Executive Office of Health and Human Services (EOHHS) – provides the infrastructure, the overall project governance, and manages the participation agreements/business associate agreements.   A new HIT Council, as enumerated in the Healthcare Cost Containment Bill (Chapter 224 of the Acts of 2012), will serve as the ongoing governance body.   Advisory workgroups will continue to engage community and other stakeholders to provide input to the HIT Council.
  • Massachusetts eHealth Institute (MeHI) provides the connections from EHRs to the state HIE via its “last mile” program, which offers grants to vendors to develop interfaces, incentives to providers to implement connectivity to the HIE, and community-based collaborative working groups to encourage adoption that fits the needs of the local healthcare community..
  • Massachusetts eHealth Collaborative – provide Last Mile Management Office support to MeHI and facilitation support to other stakeholders and agencies.  Part of that facilitation included running the 5 HIT Council Work Groups that suggested initial policies and procedures.

EOHHS created a single participation agreement that included business associate language.   Each stakeholder that wants to use the state HIE must first sign this common participation agreement.   The Participation Agreement defines key aspects of roles and responsibilities of EOHHS and participants, especially those relating to maintaining patient privacy and technical data security, including audits and investigations of suspected incidents or breaches.

Highlights of this Phase 1 (pushing of information only) Participation Agreement include:

  • Permitted Users and Uses:  Initial participation is open to Massachusetts-licensed providers and entities, Massachusetts-licensed health plans, Commonwealth agencies, and certain employees and agents of the foregoing who are authorized as users. Use of the Massachusetts HIWay is limited to exchanges of information that are allowed by law and that are related to treatment, payment, or healthcare operations as defined by HIPAA. EOHHS may, if it determines, in its sole discretion that such actions are in the public interest:
    • allow additional participants and/or authorized users;
    • allow additional uses;
    • deny or suspend participation, or use, for any organization or individual
  • Delegated Authority:  Each Participant must execute a Delegated Administration Agreement before being granted access to the Massachusetts HIWay.  Each Participant must identify at least one individual to serve as an Access Administrator, as provided in the Delegated Administration Agreement.  Each Participant’s Access Administrator is responsible for administration of the Participant’s Authorized Users and must sign the Access Administrator Agreement.
  • Patient Privacy and Consent:  Each Participant is responsible for obtaining any and all necessary patient consents and authorizations relating to the use and exchange of patient information, including without limitation consent to release HIV test results, genetic test information, substance abuse information, and as otherwise required by law.  In addition, the Participant and/or the Authorized User is responsible for obtaining patient permission to share patient information over the Massachusetts HIWay.  It is the responsibility of the Participant to maintain these consents and permissions as required by law and their policies. The method by which the Participant maintains the consents will be determined by the Participant but proof of consent may be subject to audit by EOHHS.

As noted above, standard practice is that health records are only disclosed from one organization to another when the patient has signed his or her written consent to such a release.  We adopted the same approval to disclose (oral, written) that is in place in healthcare workflows today.   All that changes is that phone, fax, email, and paper is replaced by secure electronic transmission.

The end result of obtaining common participation agreements among all the providers in the Commonwealth over a single secure infrastructure governed by the underlying principle of achieving patient consent to disclose before transmission creates a fabric of trust that protects patient privacy.

Acquiring Customers:

With policies in place and technologies under construction, we could begin acquiring customers.  In the Summer of 2012 the Advisory Committee supported efforts to recruit and prepare early adopters to go live with the statewide HIE on its launch date or “Golden Spike” event. A large number of early adopter organizations have come forward to participate including Atrius Healthcare, Baystate Healthcare, Beth Israel Deaconess Medical Center, Boston Children’s Hospital, Greg Harris MD, Holyoke Medical Center, Network Health Plan, Partners, Tufts Medical Center, and Vanguard Health Systems representing a significant portion the Commonwealth’s active providers.

The “Golden Spike Group” began meeting in August to review, react to, and help refine the statewide HIE participation agreements, pricing, and technical interfacing requirements.

The Go Live:

In front of the press and leaders of Massachusetts, I accessed my wife’s actual hospital records, with her consent, and sent them electronically to her actual doctor’s office, a payer, a private primary care provider affiliated with another hospital, and the Massachusetts eHealth Collaborative (a quality measurement and analytics service provider).  We broke down silos, demonstrating that care coordination, population health, and quality analytics based on healthcare information exchange is now possible in Massachusetts.  The electronic records involved included an institution’s home-grown electronic medical record, eClincialWorks, a custom payer system, and self built analytic applications.

Other transactions followed.

With patient consent, Tufts New England Medical Center sent patient-identified summaries to and received summaries from Vanguard Health Systems New England illustrating a primary care physician-to-specialist closed loop workflow.  EHRs included Siemens Soarian and Meditech.

Also with patient consent, Boston Children’s sent pediatric patient-identified summaries to Atrius Healthcare, a multi-specialty group, illustrating tertiary hospital-to-primary care giver coordination.

All were successful and were documented in real time on the Twitter stream.

The Governor distributed golden spikes made from actual railroad spikes salvaged from rail near Promontory Point, Utah, the site of the original transcontinental railroad connection.

Conclusion:

Just as the original Golden Spike in 1869 issued in a new era of connectedness, so does the Massachusetts healthcare information exchange change business as usual in Massachusetts. Over the next year, we will be building new “bridges,” ensuring that every payer, provider, and payer can send transition of care summaries with patient consent.

This achievement, although conceived in Fall of 2011 and completed in the Fall of 2012, builds upon over 15 years of trust building, early experiences with healthcare information exchange, and an array of public/private investments along the way.

Simple policies – a common participation agreement and consent to disclose complemented by simple technologies – gateways that support secure transmission, a provider directory, and a digital certificate infrastructure, funded by both Medicaid funds and private sector contributions, make the Massachusetts a first-in- the-country model for the rest of the U.S.   We look forward to breaking down healthcare information silos over the coming months.  Never again will issues such as those which affected John’s wife and mother be caused by the lack of healthcare information superhighway in Massachusetts.

AUTHORS:

John D. Halamka MD, CIO Beth Israel Deaconess Medical Center

Manu Tandon, CIO EOHHS

Micky Tripathi, CEO, Massachusetts eHealth Collaborative

Laurance Stuntz, Director, Massachusetts eHealth Institute


[1] Medicare and Medicaid Programs; Electronic Health Record Incentive Program—Stage 2, 77 Fed. Reg. 53,968 (September 4, 2012).

HIPAA Enforcement Trends: Growing Civil Enforcement

By Cassandra H. Arriaza and Sarah W. Walsh

The stakes are higher than ever before for HIPAA compliance.  Enforcement of the Health Insurance Portability and Accountability Act (“HIPAA”) is spread throughout numerous government bodies at the state and federal levels, leaving covered entities vulnerable to a wide scope of investigatory and enforcement actions.  Each of these enforcement authorities brings a different approach and different focus to their HIPAA efforts:

  • The Office for Civil Rights in the Department of Health and Human Services (“OCR”) can impose civil monetary penalties for HIPAA violations;
  • State attorneys general can initiate civil proceedings for injunctive relief on behalf of a state’s citizens; and
  • The Department of Justice (“DOJ”) can investigate and treat certain HIPAA violations as criminal offenses.

The differing remedies and corresponding approaches taken by these government bodies complicate the enforcement landscape, particularly with the recent addition of state enforcement.  With increasing enforcement by state attorneys general and increasing penalties levied by OCR, HIPAA compliance has become the focus of investigations – no longer merely a backdrop to enforcement investigations.

State Attorneys General Join HIPAA Enforcement Landscape Through Civil Enforcement

State attorneys general have most recently entered the enforcement landscape, having only been given authority to pursue civil actions starting in 2009.  Although it is still early to determine how state attorneys general will pursue enforcement, training on HIPAA enforcement offered by OCR for state attorneys general offers some insight.  This training program, which was held in four different locations in 2011, was attended by representatives from 45 States and territories and the District of Columbia.  Many of the modules focused on background information about HIPAA and the relationship between OCR and state attorneys general.  For example, the training explained that pending federal actions take priority over state actions and OCR has a right to be heard in all matters that a state may file regarding HIPAA enforcement.[1]

Most interesting was OCR’s suggestions to state attorneys general about how they may uncover potential HIPAA violations.  Some of these methods are similar to those approaches that OCR itself takes—monitoring news outlets, breach reports filed by covered entities, receiving direct complaints, referrals from other agencies.[2]  However, OCR also suggested that states may learn of potential violations from whistleblowers or as a part of—or by revisiting—other types of investigations, such as health care fraud, labor and employment cases, or any case that involves health care access and licensure.[3]  Thus, in addition to investigating HIPAA problems that are likely already known to the covered entity—perhaps through breach reports or a patient complaint—state attorneys general may also use the threat of HIPAA civil penalties as additional leverage in broader—or even ongoing but unrelated—investigations of covered entities.

New England Takes the Lead in HIPAA Civil Enforcement Actions

Massachusetts followed Connecticut and Vermont as the third state to pursue HIPAA enforcement actions.[4]   The Massachusetts investigation followed a data breach that was reported to the Massachusetts Attorney General in July 2010.  After receiving a breach report from South Shore Hospital, the Massachusetts Attorney General’s office launched an investigation into the hospital’s practices in handling protected health information.  It was determined that the hospital had shipped three boxes containing 473 unencrypted back-up computer tapes to a third-party to be erased and resold, never having informed the third-party that Protected Health Information (“PHI”) was on the disks.  Only one of the three boxes arrived at its destination.  In May 2012, South Shore Hospital ultimately agreed to pay $750,000 to settle the data breach allegations.  In addition, the hospital agreed to take a variety of steps to ensure compliance with HIPAA and agreed to undergo a review and audit of certain security measures.[5]

More recently, on January 7, 2013, the Massachusetts Attorney General reached a settlement with Goldthwait Associates and four pathology groups.  Goldthwait Associates, a medical billing practice, improperly disposed of PHI from those four pathology groups, affecting more than 67,000 residents.  This first came to the public’s attention in July 2010 when a Boston Globe photographer, who was disposing of his own trash at the Georgetown Transfer Station, observed a large pile of papers, which he determined were medical records.  The Massachusetts Attorney General alleged that the four pathology groups violated HIPAA by failing to have appropriate safeguards in place to protect the PHI and by failing to take reasonable steps to select and retain a service provider that would maintain appropriate security measures to protect PHI.  As part of the settlement, all five entities collectively agreed to pay $140,000 in civil penalties, attorney fees, and “a data protection fund to support efforts to improve the security and privacy of sensitive health and financial information in Massachusetts.”[6]

With Massachusetts at the forefront of state-based HIPAA enforcement, covered entities can expect that Massachusetts will continue to look for and bring additional HIPAA  enforcement actions.  Indeed, recent activity from the Massachusetts Attorney General underscores the intent to continue to pursue HIPAA violations.  The Massachusetts Attorney General’s Office and the Massachusetts Medical Society held a “first-of-its-kind data privacy training” in October 2012 and January 2013.  Additionally, the most recent HIPAA settlement from the Massachusetts Attorney General’s Office also include a contribution to a data protection fund.[7]  All of this points to increased HIPAA enforcement on the horizon in Massachusetts.

Monetary Fines Serve As New Enforcement Tool but Improved Compliance Remains the Focus for OCR

OCR also has been stepping up enforcement after it obtained authority to impose civil monetary penalties (“CMPs”) in 2009, but OCR’s focus remains largely on educating covered entities in proper procedures to prevent HIPAA violations, reserving monetary fines for the most serious of violations.  Indeed, in 2011, OCR implemented a new audit system that ran through December 2012 to proactively review compliance with HIPAA.[8]  Although OCR describes these audits as a “compliance improvement tool” that will be used to determine what types of assistance OCR should develop, OCR has noted that in certain cases, it may elect to open a compliance review as a result of an audit.[9]  The future of the audit program will be shaped by evaluation and reports from the first year of audits.

The new audit process is just one of the ways in which OCR obtains information that can lead to an investigation.  Other, more typical, sources of information that could result in the start of an OCR investigation include complaints from the public, breach reports filed by covered entities, and privacy and security incidents reported by the media or government agencies.[10]

Two out of three cases investigated by OCR since 2003 have identified a violation and required the covered entity to make changes in privacy and security policies and practices.[11]  A majority of those cases have been resolved without CMPs, relying instead on voluntary agreements by the covered entity to take steps required by OCR, which might include revising or developing policies and procedures, training or retraining staff, or sanctioning members of the entity’s workforce.[12]  If needed, OCR may even provide “technical assistance” to help the covered entity make the required changes.  For example, OCR resolved a complaint of a physician not providing a patient with a medical record by explaining to the physician that nonpayment for services does not permit a covered entity to withhold access to medical records.  After OCR gave that explanation—its “technical assistance”—the physician provided the patient with a copy of the medical record, and this voluntary compliance resolved OCR’s investigation.[13]

Increasingly, OCR does not resolve the violation through education and voluntary compliance alone but instead obtains a resolution agreement.  Under a resolution agreement, a covered entity enters into a contract with OCR to settle potential violations and implement a corrective action plan.  These agreements often include a monetary settlement as well as a period of monitoring or reporting to OCR.[14]  From 2008 through mid-January 2013, OCR has entered into eleven resolution agreements, with five of those occurring in 2012 alone.[15]

These increasingly frequent resolution agreements can involve significant monetary settlements.  In September 2012, Massachusetts Eye and Ear Infirmary and Massachusetts Eye and Ear Associates (collectively, “MEEI”) paid $1.5 million as part of a resolution agreement.  Following a breach report filed by MEEI in 2010 related to the theft of an unencrypted laptop containing PHI, OCR conducted an investigation and concluded that MEEI failed to take certain security steps, particularly relating to the use of portable devices to store confidential protected health information.  In addition to paying $1.5 million, MEEI also agreed to a corrective action plan that includes reviewing, revising, and maintaining policies related to the HIPAA Security Rule.  MEEI also agreed to have an independent monitor conduct assessments of its compliance with the corrective action plan; the monitor will issue semi-annual reports to OCR for three years.[16]  As can be seen with MEEI’s resolution agreement, these agreements not only can be costly but also can have long-term consequences as entities take on additional reporting requirements for a period of time after entering into the resolution agreement.

MEEI’s case follows the February 2011 resolution agreement OCR entered into with Massachusetts General Hospital (“MGH”).  The resolution agreement come about as a result of a March 2009 incident where an MGH employee inadvertently left documents containing the PHI of 192 patients on the subway while commuting to work.  OCR learned of the breach when an affected patient reported it.  OCR’s investigation concluded that MGH failed to take reasonable and appropriate safeguards to protect PHI taken from MGH’s premises.  In addition to paying one million dollars as part of the resolution agreement, MGH also agreed to a corrective action plan that required, among other things, the Director of Internal Audit Services of Partners HealthCare Systems to serve as an internal monitor to conduct assessments of MGH’s compliance with the corrective action plan and send semi-annual reports to OCR.[17]

Although Massachusetts-based companies so far have been able to resolve violations through resolution agreements, OCR does have another tool available to address HIPAA violations.  When a covered entity refuses to take action to resolve the matter in a manner satisfactory to OCR, OCR will seek CMPs but must first obtain authorization from the U.S. Attorney General.[18]  OCR’s first and only CMP to date issued to Cignet Health of Prince George’s County, Maryland (“Cignet”) in 2011.  OCR’s investigation into Cignet began when Cignet denied 41 patients access to their requested medical records over a one-year period and each of those patients filed a complaint with OCR.  Cignet refused to cooperate with OCR’s investigation, requiring OCR to obtain a subpoena to acquire the medical records.  Remarkably, Cignet failed to respond to the subpoena, and OCR obtained a default judgment against Cignet to enforce that subpoena.  OCR determined that Cignet’s failure to cooperate with the investigation was due to Cignet’s willful neglect to comply with HIPAA.  As a result, OCR imposed a $4.3 million CMP for Cignet’s violations.[19]  Because CMP penalties increase with the knowledge of the entity—with the lowest penalties for violations where the entity lacked knowledge and the highest penalties for violations caused by willful neglect that were not corrected[20]—CMP penalties can be expected to continue to be quite high.  Not surprisingly, OCR has found that the specter of these CMP fines “have reinvigorated covered entities’ attention to compliance.”[21]

DOJ’s HIPAA Investigations Tend to Be a Smaller Piece of a Larger Investigation

Another road for enforcement is through DOJ prosecution for criminal violations.  Although OCR forwards to the FBI all HIPAA complaints or disclosures that involve potential criminal violations, the number of cases OCR refers to DOJ for possible criminal prosecution has been steadily declining since OCR’s enforcement tools were enhanced in 2009.  Although over 500 cases have been referred to DOJ since 2003, the number of cases referred has declined in recent years with fewer than 20 referrals a year in 2010 and 2011.  It is difficult to say with certainty how many cases related to HIPAA violations are prosecuted by DOJ.  This is because the criminal statutes that can be used to prosecute medical privacy cases are varied and cases charging only a violation of HIPAA constitute only a small portion of DOJ’s cases.  Although DOJ may not decide to prosecute all cases related to medical privacy, DOJ has noted that it tends to prosecute cases that fall under any one of three fact patterns: records stolen to commit massive fraud, records stolen for purpose of embarrassment, and records stolen for financial fraud.[22]  However, these cases are more likely to be brought under different statutes—such as unlawful computer access, conspiracy, or anti-kickback—rather than HIPAA, underscoring the difficulty of identifying the extent to which HIPAA plays into DOJ prosecutions.

Increased Civil Enforcement Calls for Heightened Attention to HIPAA Compliance

There is a continued pattern of DOJ focusing on cases that involve fraud or improper use of protected health information while OCR targets the prevention of disclosure of protected health information by seeking voluntary compliance and improved procedures.

It is less clear where state attorneys general will fit into this framework, but it seems likely that they will develop into significant players in this enforcement field.  With increasing interest and activity on the part of state attorneys general and OCR, the potential for HIPAA violations to have costly and long-lasting consequences is increasing.  Covered entities must be prepared to not only ensure full compliance with HIPAA through well-crafted and comprehensive written policies but also to vigilantly implement those policies, provide employees with robust training, and prepare an action plan to respond to any policy violations.

Cassandra H. Arriaza and Sarah W. Walsh are associates at LibbyHoopes, P.C. Their clients include organizations and private individuals in many fields, including health care, and their practices focus on white collar criminal defense, internal corporate investigations, and complex civil and administrative litigation.


[1] United States Department of Health & Human Services, HIPAA Enforcement Training for State Attorneys General, Module 6: Investigating and Prosecuting Potential HIPAA Violations, available at http://www.hhshipaasagtraining.com/module6.php.

[2] Compare Testimony of Leon Rodriguez, Direct of OCR, before the Senate Committee on the Judiciary, Subcommittee on Privacy, Technology and the Law, Nov. 9, 2011, available at http://www.judiciary.senate.gov/pdf/11-11-9RodriguezTestimony.pdf with United States Department of Health & Human Services, HIPAA Enforcement Training for State Attorneys General, Module 1: State Attorneys General Enforcement of Federal Health Privacy Law, available at http://www.hhshipaasagtraining.com/module1.php.

[3] Module 1, supra note 2.

[4] Lisa Pierce Reisz, “State Attorneys General Wade Further Into HIPAA Pool,” HealtHITech Law, Aug. 7, 2012, available at http://www.healthitechlaw.com/2012/08/07/state-attorneys-general-wade-further-into-hipaa-pool/.

[5] Press Release, Massachusetts Office of the Attorney General, “South Shore Hospital to Pay $750,000 to Settle Data Breach Allegations,” May 24, 2012, available at http://www.mass.gov/ago/news-and-updates/press-releases/2012/2012-05-24-south-shore-hospital-data-breach-settlement.html.

[6] Press Release, Massachusetts Office of the Attorney General, “Former Owners of Medical Billing Practice, Pathology Groups Agree to Pay $140,000 to Settle Claims that Patients’ Health Information was Disposed of at Georgetown Dump,” January 7, 2013, available at http://www.mass.gov/ago/news-and-updates/press-releases/2013/140k-settlement-over-medical-info-disposed-of-at-dump.html.

[7] Id.

[8] OCR, “HIPAA Privacy & Security Audit Program,” available at http://www.hhs.gov/ocr/privacy/hipaa/enforcement/audit/index.html (last visited Jan. 10, 2013).

[9] Kurt T. Temple, Esq., Deputy Regional Manager Region V, OCR, “An Update from OCR on HIPAA Enforcement,” HIPAA COW 2012 Spring Conference, Apr. 20, 2012, available at http://www.hipaacow.org/Events/Spring%202012/Temple%20Handout.pdf.

[10] Testimony of Leon Rodriguez, supra note 2.

[11] Temple, supra note 9.

[12] Id.

[13] U.S. Department of Health and Human Services Office of Civil Rights, Annual Report to Congress on HIPAA Privacy Rule and Security Rule Compliance for Calendar Years 2009 and 2010, at 14, available at http://www.hhs.gov/ocr/privacy/hipaa/enforcement/compliancerept.pdf.

[14] Testimony of Leon Rodriguez, supra note 2.

[15] The last resolution agreement of 2012 was completed on December 31 but not widely publicized until January 2, 2013.  See Case Examples and Resolution Agreements, OCR, available at http://www.hhs.gov/ocr/privacy/hipaa/enforcement/examples/index.html (last visited Jan. 15, 2013).

[16] Press Release, Department of Health and Human Services, “Massachusetts provider settles HIPAA case for $1.5 million,” Sept. 17, 2012, available at http://www.hhs.gov/news/press/2012pres/09/20120917a.html.

[17] Press Release, Department of Health and Human Services, “Massachusetts General Hospital settles potential HIPAA violations,” Feb. 24, 2011, available at http://www.hhs.gov/news/press/2011pres/02/20110224b.html.

[18] Annual Report to Congress, supra note 13; Testimony of Leon Rodriguez, supra note 2.

[19] Press Release, Department of Health and Human Services, “HHS imposes a $4.3 million civil penalty for violations of the HIPAA Privacy Rule,” Feb. 22, 2011, available at http://www.hhs.gov/news/press/2011pres/02/20110222a.html. See also Case Examples and Resolution Agreements, supra note 15 (listing all CMPs and resolution agreements).

[20] Temple, supra note 9.

[21] Testimony of Leon Rodriguez, supra note 2.

[22] Testimony of Loretta E. Lynch, U.S. Attorney, E.D.N.Y., before the Senate Committee on the Judiciary, Subcommittee on Privacy, Technology, and the Law, Nov. 9, 2011, available at http://www.justice.gov/ola/testimony/112-1/11-09-11-usa-lynch-testimony-re-examination-of-the-enforcement-of-federal-health-information-privacy-laws.pdf.

From Practice to Theory: Medical-Legal Partnership Enters its Third Decade

From Practice to Theory:
Medical-Legal Partnership Enters its Third Decade[i]

By Samantha Morton

Over the last two decades, there has been an increasing recognition that the healthcare system and the legal community share a large swath of low-income, medically vulnerable clients (patients), and that the two professions can better serve those constituents if they collaborate with more intention and structure.[ii]

The medical-legal partnership (MLP) model was founded in 1993 at Boston Medical Center,[iii] and the depth and breadth of MLP integration into healthcare delivery and related medical education and training systems has accelerated rapidly over the last 20 years. Today, the model has taken root in over 250 health care sites across the United States; indeed, 38 medical schools[iv] and 46 residency programs[v] participate in these programs. A first-ever MLP textbook was published in August 2011.[vi] MLP programs have expanded internationally as well: in November 2012, an Inaugural Symposium on Advocacy-Health Alliances was hosted in Melbourne, Australia.[vii]
MLP had important origins in earlier innovations in legal services delivery to vulnerable, low-income people, particularly in the domains of advocacy for (a) persons with disabilities[viii] and (b) domestic violence survivors. These service delivery paradigms were consonant with evolving theories of ethical and optimal allocation of scarce legal services resources for the poor, particularly theories and models cultivated at Harvard Law School as early as the 1970s.[ix]

The MLP model was “born” at a hospital, and founded at a time when the healthcare system was growing – by necessity if not inclination – more attune to patients’ non-biological determinants of health. However, as the model has matured, it increasingly harmonizes with a range of important legal frameworks. These frameworks connect to a diversity of theoretical underpinnings, many of which are relevant to health law practice, especially where that practice involves the interests of low-income, medically vulnerable patients and the providers, staff, and institutions that serve them. Against the backdrop of the monumental 2012 milestones in federal and Massachusetts health reform, and at a time of profound reflection within the access to justice community regarding prioritization of even scarcer resources, this article seeks to update MLP’s theoretical landscape, and to identify specific paradigms through which MLP (and similar) interventions can be understood, leveraged, and critiqued.

The Original Framework: Advancing an Individual Patient’s Health and Well-Being Through Referrals to Legal Adjuncts

Simply put, some social determinants of health have legal solutions. The originating MLP model focuses on integrating legal advocates into healthcare teams so that those teams can leverage their legal colleagues’ advocacy skills and expertise on behalf of patients with health-harming legal needs.[x] These needs range from those with obvious connections to health and healthcare access (correction of housing conditions that exacerbate asthma, legal advocacy for domestic violence survivors needing protection from their abusers, appeals of unlawful health insurance denials on behalf of persons in need of treatment, and so forth) to those with more attenuated but no less important connections to health and well-being (special education advocacy, disability benefits access, estate planning and guardianship preparations for persons with terminal illness and their families, vindicating non-discrimination rights, and many more). The MLP legal partners often have been characterized as an adjunct to social work infrastructure (itself, of course, historically considered an adjunct to the clinical team) in helping patient-families to meet their basic needs.

Historically, the professional adjunct framework has positioned MLP projects primarily to “catch” individual patients’ emergency legal needs that are filtered through existing healthcare “triage” systems – which tend to focus on acute needs. This default MLP operating model aligned with the long-standing orientation of legal services agencies to allocate the majority of their scarce resources to those people at the greatest legal (and immediate human) risk.[xi]

This professional adjunct MLP framework may be revised in the coming years, substantially, by the Patient-Centered Medical Home (PCMH) model, which embodies five key attributes and functions: (1) comprehensive care; (2) patient-centered care; (3) coordinated care; (4) accessible services; and (5) quality and safety.[xii] At least in theory, this model urges healthcare delivery systems (and the teams that comprise them) to be built around the patient’s reality, whatever that may be, and to that extent the model may productively disrupt long-standing organizational charts and service flow models. If fully realized, a patient treated in a PCMH will benefit from a “hub” (such as a primary care physician) with many integrated, coordinated “spokes” (a nurse; and, as needed, a mental health provider, a social worker, a substance use counselor, a housing advocate, and so forth).

As described below, sharing a “room” in the patient-centered medical home with legal advocates – a level of systematic integration thus far without precedent – might also allow for more proactive, population-level benefits for vulnerable patients and the healthcare teams that treat them. Massachusetts already has been a leader in this regard. The Massachusetts payment reform legislation signed in August 2012 invites the State’s Office of Medicaid, when developing new cost containment methodologies that will impact healthcare delivery to a range of patient populations in the Commonwealth, to account for the costs of

care coordination and community based services provided by allied health professionals, including but not limited to community health workers, legal advocates, medical interpreters, clinical prevention specialists, human services workers, social workers, and licensed alcohol and drug counselors (emphasis added).[xiii]

This provision –- developed and advanced by the Disparities Action Network (http://cchers.org/health-disparities-and-health-equity/disparities-action-network/) –

is a milestone acknowledgment of the broad diversity of professionals required to keep people healthy.

A Corollary Framework: Advancing Population Health and Well-Being Through Structured Integration of Legal Advocates

In medicine, prevention is the province of public health[xiv] and, to some degree, primary care. Primary care is understood generally to be comprehensive first contact and continuing care for patients, with a focus on primary prevention but also diagnosis, referral, and occasional management of conditions. Public health systems are charged with preventing disease and promoting good health within groups of people, and those systems deploy unique strategies (such as policy development, research, door-to-door outreach campaigns, and population health surveillance) to achieve these goals.

In the last five years, MLP services increasingly have been described as a new kind of public health tool,[xv] with accompanying integration into a range of public health systems. In September 2011, the New York State Legislature amended its public health law to define and endorse “Health-Related Legal Services Programs.”[xvi] The U.S. Health Resources and Services Administration (HRSA, part of Health and Human Services) is supporting the model in a variety of ways, including hosting a current MLP demonstration project involving Healthy Start programs in three communities.[xvii] Healthy Start programs are committed to reducing infant mortality and other health disparities affecting communities of color.

When thinking about the role of legal collaborations in the context of combating health disparities, it is necessary to parse the concept of health equity, which often is imprecisely conflated with the phrase “health disparities.” This Boston Public Health Commission Center for Health Equity and Social Justice explanation is useful:

Health disparities, or health inequalities, are differences in the presence of disease, health outcomes, or access to health care between population groups. Health inequities, on the other hand, are differences in health that are not only unnecessary and avoidable, but, in addition, are considered unfair and unjust. Health inequities are rooted in social injustices that make some population groups more vulnerable to poor health than other groups.

Consider the following example. Male babies are generally born at a heavier birth weight than female babies. This is a health disparity. While there may be a difference in the birth weight between male babies and female babies, the difference is unavoidable and rooted in genetics. On the other hand, babies born to Black women are more likely to die in their first year of life than babies born to White women. Some of this difference is due to poverty – a higher percentage of Black mothers are poor and face hardships associated with poverty that can affect their health. But we find differences in the health and Black and White mothers and babies even if we compare Blacks and White[s] with the same income. Many scientists believe that it is racism experienced by Black women that explains this extra difference. Racism creates stress, and too much stress creates a risk for mothers and babies. This is a health inequity because the difference between the groups is unfair, avoidable and rooted in social injustice.[xviii]

This definition of health inequity – emphasizing “unnecessary,” “avoidable”, “unfair,” and “unjust” conditions – reveals that in many respects (and as further discussed below), health equity work is the public health iteration of the civil rights work historically led by, and almost exclusively associated with, the legal community.

MLP as a Civil Rights Strategy

In many respects, health equity work is civil rights work. Its focus on changing conditions (such as structural racism) that have the effect of harming large groups of people – regardless of whether responsible decision-makers intended these harms – is fundamentally analogous to disparate impact theory, a legal concept that has driven decades of important national civil rights litigation on behalf of a range of populations. The work of public health departments in both (a) educating people about health risks and (b) monitoring the prevalence of health problems is directly analogous to the civil rights outreach and enforcement efforts of bodies like the Fair Housing Center of Greater Boston and the Massachusetts Attorney General’s office.

To the extent that MLP projects serve to identify patterns and practices that put vulnerable patient populations at health risk (or greater health risk), they can play an important role in supplying both (a) documentation of the harms to a group of patients’ health and well-being, and (b) linkages to medical experts who can attest to the current and potential future health risks to that population.[xix]

This has important implications for a range of civil rights-informed legal strategies that are gaining more currency nationally, and increasing relevance and impact regionally. Spearheaded by the Kirwan Institute for the Study of Race and Ethnicity at The Ohio State University, opportunity mapping is deployed to “illustrate where opportunity rich communities exist (and assess who has access to those communities) and to understand what needs to be remedied in opportunity poor communities” based on systematic analysis of key metrics across zip codes and neighborhoods.[xx] With funding from the Massachusetts Legal Assistance Corporation, in 2009, the Massachusetts Law Reform Institute’s Race Equity Unit supported publication of a groundbreaking report on opportunity disparities in Massachusetts.[xxi]

MLP as a Community Lawyering Strategy

The community lawyering model, with deep roots in criminal justice[xxii] and environmental justice practice, has evolved significantly over the last two decades. Key elements of this model include: (1) structured collaboration with community members (around priority-setting and strategy, etc.), (2) a focus on “empowering communities, promoting economic and social justice, and fostering systemic change,” and (3) interdisciplinary thinking and collaboration.[xxiii] One example of a thoughtful community lawyering practice in Massachusetts is the Environmental Justice Legal Services project at Alternatives for Community & Environment.[xxiv]

Increasingly, MLP projects are understood to be effective mechanisms for meaningfully infusing legal advocacy work with community perspectives and client priorities.[xxv] A range of MLP sites are integrated into formal community lawyering practices, including but not limited to the Community Lawyering Project of the Volunteer Legal Services Program of the Bar Association of San Francisco, and the Community Lawyering Clinic at the University of New Mexico School of Law.

MLP as Preventive Law

Notions of preventive law are embedded in a familiar paradigm: the customary practice of corporations and organizations to engage legal counsel on how to both conduct business successfully and, simultaneously, avoid legal problems. Typically this is accomplished through integration of in-house general counsels, or external lawyer advisors on a range of subject matters. However, a deeper theoretical basis for preventive law is developing, with significant support over the last two decades from the National Center for Preventive Law at California Western School of Law.

Preventive law theory underscores law as, fundamentally, a problem-solving tool.[xxvi] It also argues that legal problem-solving is most effective when approached as problem prevention.[xxvii] Honoring the early theoretical contributions of Louis M. Brown, preventive law theory advocates, among other things, that clients’ engage in periodic legal check-ups.[xxviii] This concept historically has been viewed as a luxury in the access to justice domain, primarily because of perpetual and deepening resource constraints that necessarily drive a more reactive referral and assistance paradigm. Preventive law theory invites consideration of whether MLP presents an opportunity for patients to have access to a “primary care legal advocate” dedicated to primary prevention of health-harming legal problems.[xxix]

Challenges to Fully Realized MLP Integration in the Next Decade

Not all interests align.

Historically, the MLP model has leveraged the substantial intersection of institutional interests and individual client (patient) interests. This predictably has eased joint, interdisciplinary priority-setting processes for MLP projects. After all, eliminating an asthmatic patient’s housing conditions problem through legal strategies dovetails with a healthcare team’s interest in reducing preventable emergency department or inpatient readmissions for that patient. This concrete alignment also has meant that MLP projects do not tackle legal issues on behalf of patients that might be adverse to the interests of their partner institutions (classic medical debt advocacy, medical malpractice, and so forth).

It remains to be seen whether MLP projects focused on health-harming legal issues that do not hew closely to the incentives embedded in healthcare finance systems will flourish, at least in the short- and mid-term.

Interdisciplinary, public health-informed work challenges deeply-held professional culture and identity attributes.

Particularly in the legal services domain, engaging in interdisciplinary work focused on prevention demands a substantial reorientation, implicating both expansion of professional values and priorities and adaption of front-line resource allocation/workloads.

First, effective partnering between the healthcare sector and the access to justice community requires that the access to justice community in particular (1) understand its (healthcare) allies and the systems that drive them, and (2) embrace its professional responsibility to conduct zealous advocacy for clients as well as develop strong professional cultural competence when communicating with allies from other professions – professions that increasingly are inviting, and funding, legal services agencies.

Second, public health and healthcare ventures are extraordinarily and data-driven, and the access to justice community must accelerate its current efforts to support data collection, aggregation, and analysis relating to the varied impacts of its work on patients and on society. Many such efforts are underway nationally, regionally, and locally.

Third, the access to justice community and the healthcare community share a common history of seeking to divide team-based labor through reliance on the notion of “practicing to the top of one’s license.” In the access to justice domain, this has reinforced a culture of lawyer as litigator and combatant (perhaps analogous to a “legal surgeon”), and a corresponding de-valuing of legal screening, referral, and delivery of legal information and advice short of full litigation (typically performed by legal hotline and related infrastructures, perhaps analogous to “legal primary care”). It bears noting that social work has experienced similar dynamics in the healthcare environment, e.g. those engaging in clinical therapy are positioned differently than those focused on addressing patients’ material hardships and other basic needs barriers to health and well-being.

While there may be reasonable differences of opinion regarding the efficacy of various strategies in a significantly resource-constrained environment, there is no doubt that a true public health-infused model of legal services delivery would allocate more resources upstream than downstream. Perhaps the common ground within the access to justice community will be found in upstream systemic, policy, or impact, work. Achieving this kind of common ground certainly would require funders of legal services delivery for low-income people to adapt their priorities accordingly, and to substantially move away from the case-counting model.

There are other sectors, aside from healthcare, with which the legal community could systematically partner in ways that could be productive for vulnerable members of society.

The “footprint” of healthcare in American society is so expansive, and the intersection of that sector with low-income, medically vulnerable consumers so deep, that medical-legal partnership was a natural nexus for a sustained experiment in interdisciplinary access to justice. But healthcare certainly is one among several, if not many, sectors that present such opportunities, albeit if at a smaller scale.

Will the MLP movement lead new experiments in these other domains, such as education-legal partnerships? Or will the next decade be focused on replication and deepening of MLP infrastructures in many more communities and healthcare delivery systems across the country? Or are these false distinctions, since all roads (schools, prisons, etc.) lead back to the bedrock concept of social determinants of health and well-being?

It would appear that given the expanding theoretical landscape on top of which the MLP model “sits,” there is ample opportunity for these and many other consequential questions to be answered thoughtfully in the next decade.

 

Samantha J. Morton is Executive Director of Medical-Legal Partnership | Boston. She is co-chair of the Boston Bar Association Delivery of Legal Services Section, and also serves on the Health Law Section’s Steering Committee. Ms. Morton is a graduate of the BBA’s Public Interest Leadership Program, and has taught Health Law at New England Law | Boston. Further biographical details can be found at: http://www.mlpboston.org/about-us/staff#Legal Staff & Consultants.


[i] The author thanks JoHanna Flacks, Medical-Legal Partnership | Boston’s Legal Director, for her critical conceptual input on this article.

[ii] Setting the Stage: Need for MLP, Nat’l Center for Med. Legal Partnership, http://www.medical-legalpartnership.org/model/need (last visited Jan. 16, 2013); Transforming Delivery Models for Healthcare and Law, Nat’l Center for Med. Legal Partnership http://www.medical-legalpartnership.org/model/transforming (last visited Jan. 16, 2013); The Movement, Nat’l Center for Med. Legal Partnership, http://www.medical-legalpartnership.org/movement (last visited Jan. 16, 2013); Awards and Recognition, Nat’l Center for Med. Legal Partnership, http://www.medical-legalpartnership.org/network/awards (last visited Jan. 16, 2013); Academic Articles, Nat’l Center for Med. Legal Partnership, http://www.medical-legalpartnership.org/resources/additional-resources/academic-articles (last visited Jan. 16, 2013).

[iii] History: One Doctor’s Vision, Nat’l Center for Med. Legal Partnership, http://www.medical-legalpartnership.org/movement/history (last visited Jan. 15, 2013).

[iv] Medical Schools, Nat’l Center for Med. Legal Partnership, http://www.medical-legalpartnership.org/movement/healthcare-partners/medical-schools (last visited Jan. 15, 2013). See generally Amy T. Campbell, Teaching Law in Medical Schools: First, Reflect, 40 J.L. Med. & Ethics 301 (2012); Jeremy Long et al., Developing Leadership and Advocacy Skills in Medicine Through Service Learning, 17 J. Pub. Health Mgmt. and Prac. 369 (2011).

[v] Residency Programs, Nat’l Center for Med. Legal Partnership, http://www.medical-legalpartnership.org/movement/healthcare-partners/residency-programs (last visited Jan. 15, 2013).

[vi] See generally Poverty, Health and Law: Readings and Cases for Medical-Legal Partnership (Elizabeth Tobin Tyler et al. eds., 2011) (positioning health in the broader social context of people’s lives and advancing legal advocacy and related interdisciplinary strategies as key responses to complex social problems).

[vii] Advocacy Health Alliances: 2012 Advocacy Health Alliance Symposium, Pub. Interest L. Clearinghouse, http://www.pilch.org.au/ (last visited Jan. 15, 2013).

[viii] See Jeanette Zelhof & Sarah Fulton, MFY Legal Services’ Mental Health-Legal Partnership, 44 Clearinghouse Rev. 535, 535 (2011). Of course, the Americans with Disabilities Act was passed by Congress in 1990, and this informed legal services priority-setting greatly.

[ix] See generally Biographies, Bellow-Sacks Access to Civ. Legal Services Project, http://www.law.harvard.edu/academics/clinical/bellow-sacks/Templates/biographies.htm; Gary Bellow’s Papers, Bellow-Sacks Access to Civ. Legal Services Project, http://www.law.harvard.edu/academics/clinical/bellow-sacks/Templates/bellowpapers.htm; http://www.garybellow.org/people/gsingsen.htm.

[x] Stewart B. Fleishman et al., The Attorney As the Newest Member of the Cancer Treatment Team, 24 J. Clinical Oncology 2123, 2123–26 (2006); Barry Zuckerman et al., Why Pediatricians Need Lawyers to Keep Children Healthy, 114 Pediatrics 224, 224–28 (2004); Paul R. Tremblay et al., Commentary: The Lawyer is In: Why Some Doctors are Prescribing Legal Remedies for Their Patients, and How the Legal Profession Can Support this Effort, 12.2-3 B.U. Pub. Int. L.J. 505-527 (2003).

[xi] The access to justice infrastructure has been compelled to ration its services since its inception, due to profound (and often politicized) resource constraints. This challenge has only deepened over the last few years. See I. Glenn Cohen, Rationing Legal Services, J. Legal Analysis (November 25, 2012) (forthcoming; available at SSRN: http://ssrn.com/abstract=2180453).

[xii] Patient Centered Medical Home Resource Center: Quality and Safety, U.S. Dep’t of Health and Hum. Servs. http://pcmh.ahrq.gov/portal/server.pt/community/pcmh_home/1483/PCMH_Defining%20the%20PCMH_v2 (last visited Jan. 15, 2013).

[xiii] Chapter 224 of the Acts of 2012.

[xiv] Public health has critical corollaries in social medicine, population medicine, and preventive medicine. References to public health herein incorporate those practices.

[xvii] Hearing on Numerous Public Health Bills Before Comm. on Energy and Commerce, Subcomm. on Health, U.S.H.R., 111th Congress (2010) (statement of Marcia K. Brand, Ph.D., Deputy Administrator, Health Resources and Services Administration, U.S. Department of Health and Human Services), available at http://www.hhs.gov/asl/testify/2010/09/t20100914d.html (last visited Jan. 16, 2013).

[xviii] What is Health Equity?, Boston Pub. Health Comm’n., http://www.bphc.org/chesj/about/Pages/WhatisHealthEquityDisparities.aspx (last visited Jan.15, 2013).

[xix] One can predict that a human rights-based theoretical basis for MLP interventions is close at hand. In November 2012, the Program on Human Rights and the Global Economy and the Program on Health Policy and Law at Northeastern University School of Law hosted an institute on Human Rights and the Social Determinants of Health, at which an MLP scholar presented. 

[xx] GIS Mapping, Kirwan Inst., http://kirwaninstitute.osu.edu/research/opportunity-communities/mapping (last visited Jan. 15, 2013).

[xxi] Report Finds That 90% of African-Americans and Latinos are in the Lowest “Opportunity” Neighborhoods in Massachusetts, Mass. L. Ref. Inst., http://www.mlri.org/mlri-announcements/report-finds-that-90-of-african-americans-and-latinos-are-in-the-lowest-opportunity-neighborhoods-in-massachusetts (last visited Jan. 15, 2013).

[xxii] Roger L. Conner, Community Oriented Lawyering: An Emerging Approach to Legal Practice, 242 Nat’l Inst. Justice J. 27, 27-33 (2000). 

[xxiii] Karen Tozark et al., Conversations on Community Lawyering: The Newest (Oldest) Wave in Clinical Legal Education, 28 J. L. & Pol. 359, 364 (2008).

[xxiv] See generally EJLS: Environmental Justice Legal Services, Alternatives for Community and Env., http://www.ace-ej.org/services (last visited Jan. 15, 2013).

[xxv] See Liz Tobin Tyler, Aligning Public Health, Health Care, Law and Policy: Medical-Legal Partnership as a Multilevel Response to the Social Determinants of Health, 8 J. Health & Biomed. L. 211 (2012).

[xxvi] See Thomas D. Barton, Preventive Law for Three-Dimensional Lawyers, 19 Preventive L. Rptr. 29 (2001).

[xxvii] See id.

[xxviii] David B. Wexler, Beyond Analogy: Preventive Law as Preventive Medicine, National Center for Preventive Law Symposium (2000), available at http://www.preventivelawyer.org/main/default.asp?pid=essays/wexler.htm (last visited Jan. 16, 2013).

[xxix] See Samantha Morton et al. (2009). Advancing the Integrated Practice of Preventive Law and Preventive Medicine. In Thomas D. Barton, Ed., Preventive Law and Problem Solving: Lawyering for the Future. Lake Mary, Florida: Vandeplas Publishing.

The “Dual Eligibles” Demonstration: Massachusetts Becomes First in the Nation to Implement a New Health Care Model for Medicare-Medicaid Beneficiaries

By: Margaretta Homsey Kroeger, Esq.

Introduction 

In August 2012, Massachusetts became the first state to gain federal approval to test a new model for providing integrated health care to individuals who are eligible for both Medicare and Medicaid, known as “dual eligibles.”[i]  The dual eligibles demonstration, detailed in a Memorandum of Understanding reached with the federal Centers for Medicare and Medicaid Services (“CMS”), will significantly alter the way health care is coordinated and funded for up to 115,000 individuals statewide and, if successful, could be replicated nationally.[ii]

Prompted by the passage of the Affordable Care Act, CMS has invited states to develop new service delivery and payment models in order to improve the quality of care for dual eligibles, while also reducing the high cost of care for this population.[iii]  Dual eligibles account for a disproportionately large share of both Medicare and Medicaid spending because of their complex health needs and low incomes, a situation that has been exacerbated by cost-shifting and a lack of coordination between the two programs.[iv]  As a result, CMS has made it a priority to “significantly increase” the number of dual eligibles enrolled in systems that can integrate their care and align the financial incentives of the Medicare and Medicaid programs.[v]

Massachusetts’ new demonstration applies to dual eligibles ages 21 to 64, who receive Medicare because they have a chronic illness or disability and who are also financially eligible for Medicaid assistance.[vi]  The demonstration is intended to reduce the cost of care for these individuals over time by enrolling them in new managed care organizations that will receive prospective blended capitated payments to provide coordinated care.  These organizations will integrate the provision of Medicare and Medicaid services for dual eligibles, including primary, acute, and behavioral health care, along with long-term services and supports.[vii]

Many details still need to be finalized before enrollment begins in July 2013, and questions remain about whether the demonstration will in fact be able to reduce costs without sacrificing the quality of care for this particularly vulnerable population.  In the coming months, policymakers, providers, health plans, and advocates on the state and national level will be monitoring the implementation of the Massachusetts plan closely and evaluating whether it could become a national model.

This article provides a broad overview of the development of the state’s new dual eligibles demonstration.  First, it discusses the national profile of the dual eligible population and the current model for providing health care to dual eligibles.  It then details the provisions of the Affordable Care Act targeted at improving care for dual eligibles and efforts by CMS to promote integrated care demonstration projects.  Third, it describes the dual eligible population in Massachusetts and summarizes the contents of the state’s demonstration plan.  Finally, it discusses various stakeholders’ concerns about the plan and the potential challenges and possible impact that the plan may have.

Background

The Dual Eligible Population: A National Profile

Nationwide, there are approximately nine million people who are dually eligible for both the Medicare and Medicaid programs.[viii]  These individuals are eligible for Medicare either because they are age 65 or older, or, if they are under 65, because they have a permanent disability that qualifies them to receive federal Social Security Disability Insurance benefits or because they have end-stage renal disease.[ix]  Medicare beneficiaries may also qualify for Medicaid assistance if they are low-income or meet certain other requirements.  On average, dual eligibles are much poorer than other Medicare beneficiaries—86 percent of dual eligibles had incomes below 150 percent of the federal poverty level in 2008, compared to 22 percent of other beneficiaries.[x]

Dual eligibles receive primary health insurance coverage through Medicare, which covers inpatient and outpatient care, diagnostic and preventive services, prescription drugs, short-term rehabilitative and skilled nursing care, and some home health services.[xi]  Medicaid supplements this coverage by helping to pay for Medicare premiums and copayments, and may also provide other benefits that are not covered by Medicare, including long-term services such as nursing and home health care and personal care attendant services.[xii]  About 77 percent of beneficiaries, known as “full” dual eligibles, receive complete Medicaid benefits in addition to their Medicare coverage.[xiii]  The remainder receives limited Medicaid assistance that helps to cover Medicare premiums and cost-sharing expenses.[xiv]

The cost of care for dual eligibles is disproportionately expensive because they have more complex medical needs than the general Medicaid and Medicare populations.  Dual eligibles are much more likely to suffer from multiple chronic health conditions, to have cognitive and mental impairments, and to require home and personal care services or nursing home care.[xv]  Additionally, dual eligibles are more likely to utilize expensive services, such as emergency room visits, hospitalizations, post-acute care, and long-term care, than other beneficiaries.[xvi]  As a result, while dual eligibles made up 15 percent of Medicaid and 20 percent of Medicare enrollees, they accounted for 39 percent of Medicaid and 31 percent of Medicare expenditures in 2008.[xvii]

Room for Reform: The Affordable Care Act and Dual Eligibles

As national health care reform gained momentum, policymakers recognized opportunities to control costs and improve the delivery of care for the dual eligible population.  It was clear that the current structure can be inefficient and unnecessarily expensive.  The provision of services to dual eligibles is often not coordinated between the Medicare and Medicaid programs.  Differences in coverage rules, provider networks and plans, and other program regulations have led to problems in navigating the bifurcated system and to inadequate or duplicative care.[xviii]

Further, the financial incentives of the Medicare and Medicaid programs are not aligned, which encourages cost-shifting between the programs.[xix]  In a 2010 report to Congress, the independent Medicare Payment Advisory Commission (“MedPAC”) found that the programs “often work at cross-purposes,” noting that conflicting incentives “encourage providers to avoid costs rather than coordinate care, and poor coordination can raise spending and lower quality.”[xx]  For example, a nursing home receiving Medicaid payments might be incentivized to transfer a dual eligible resident to a hospital, where Medicare would cover costly services, rather than provide the services itself.[xxi]  Similarly, a hospital might be financially incentivized to transfer a patient to a nursing home, without considering the long-term implications for cost containment and quality of care.[xxii]  The Commission also pointed out that under the current system states are “more inclined to invest in programs to lower their long-term care spending,” which comes out of state Medicaid funds, than to create programs that would avoid unnecessary hospitalizations for dual eligibles, because doing so would benefit the Medicare program rather than the state.[xxiii]

In order to address these issues, the 2010 federal Affordable Care Act health reform legislation[xxiv] contains provisions intended to increase coordination and remove the programs’ conflicting financial incentives.  First, § 2602 of the Act created a new Federal Coordinated Health Care Office within CMS, also known as the Medicare-Medicaid Coordination Office.[xxv]  The stated purpose of the office is to “bring together” the officers and employees of both programs to: (1) “more effectively integrate benefits” under the Medicare and Medicaid programs, and (2) “improve coordination” between the federal government and the states concerning dual eligibles.[xxvi]  Specifically, the goals of the office are set out as follows:

“(1) Providing dual eligible individuals full access to the benefits to which such     individuals are entitled under the Medicare and Medicaid programs.

“(2) Simplifying the processes for dual eligible individuals to access the items and             services they are entitled to under the Medicare and Medicaid programs.

“(3) Improving the quality of health care and long-term services for dual eligible    individuals.

“(4) Increasing dual eligible individuals’ understanding of and satisfaction with     coverage under the Medicare and Medicaid programs.

“(5) Eliminating regulatory conflicts between rules under the Medicare and            Medicaid programs.

“(6) Improving care continuity and ensuring safe and effective care transitions for             dual eligible individuals.

“(7) Eliminating cost-shifting between the Medicare and Medicaid program and    among             related health care providers.

“(8) Improving the quality of performance of providers of services and suppliers    under the Medicare and Medicaid programs.”[xxvii]

Further, § 3021 of the Affordable Care Act established the Center for Medicare and Medicaid Innovation (“CMMI”) within CMS, which is intended “to test innovative payment and service delivery models to reduce program expenditures…while preserving or enhancing the quality of care” for Medicare and Medicaid beneficiaries.[xxviii]  The CMMI was granted authority under §1115A of Title XI of the Social Security Act to waive certain requirements of the Medicare and Medicaid programs in order to test 20 possible models set out in the Act.[xxix]  Two of the models specifically reference dual eligibles: (1) “[a]llowing States to test and evaluate fully integrating care for dual eligible individuals in the State, including the management and oversight of all funds under the applicable titles with respect to such individuals;” and (2) “[a]llowing States to test and evaluate systems of all-payer payment reform for the medical care of residents of the State, including dual eligible individuals.”[xxx]

The Act provides for phased testing of these payment and service delivery models through the CMMI.  In the first phase, models will be tested to determine their effect on program expenditures and the quality of care.[xxxi]  In the second phase, the Secretary of Health and Human Services may expand the duration and scope of a model through rulemaking, “including implementation on a nationwide basis.”[xxxii]  In order to expand a particular model, the Secretary must determine that the model is expected either to reduce spending without reducing the quality of care, or to improve the quality of care without increasing spending.[xxxiii]  Further, the Secretary must determine that the expansion “would not deny or limit the coverage or provision of benefits” for the applicable individuals, and the CMS chief actuary must certify that the expansion would reduce, or at least not increase, net program spending.[xxxiv]

The Call for Integrated Care and Financial Alignment Demonstration Proposals

In April 2011, the Federal Coordinated Health Care Office and the CMMI announced that CMS had awarded contracts to 15 states under a new “State Demonstrations to Integrate Care for Dual Eligible Individuals” initiative.[xxxv]  These states, including Massachusetts, were each awarded up to $1 million “to design strategies for implementing person-centered models that fully coordinate” care for dual eligibles, and CMS indicated that it would be working with these states “to implement the plans that hold the most promise.”[xxxvi]

In July 2011, CMS sent a letter to all state Medicaid directors detailing two new “financial alignment models” that it was seeking to test to improve quality and reduce the cost of care for dual eligibles, and inviting all interested states to submit letters of intent to participate.[xxxvii]  CMS observed that a “longstanding barrier” to integrating care for dual eligibles “has been the financial misalignment between Medicare and Medicaid,” noting that because duals receive services from both programs, the states do not have an incentive to invest in initiatives to better coordinate their care.[xxxviii]  To address this structural problem, CMS proposed two options for realigning the programs’ financial incentives, which it believes will lower costs for both the states and the federal government: a capitated model and a managed fee-for-service model.[xxxix]

Under the first option, a proposed “capitated model” would integrate care for dual eligibles by creating three-way contracts between CMS, the state, and health plans that would be selected through a competitive joint procurement process.[xl]  The plans would receive a blended capitated rate for “the full continuum of benefits” provided to dual eligibles by both Medicare and Medicaid, and the rate would be actuarially developed to provide savings to both the state and federal government.[xli]

Under the second option, a “managed fee-for-service model” or “FFS model,” the state would provide coordinated care for dual eligibles.[xlii]  The state would then be eligible for a retrospective performance payment if it achieved a certain level of savings for the Medicare program (after controlling for any increase in federal Medicaid costs) and if it met quality thresholds.  CMS noted that this model could be attractive to states that had already invested in a coordinated FFS model for Medicaid beneficiaries, and to states that wanted to take advantage of new opportunities through the Affordable Care Act to establish Accountable Care Organizations (ACOs) or Medicaid health homes.[xliii]

By the spring of 2012, 26 states had submitted proposals for the financial alignment demonstration to CMS, including Massachusetts and the 14 other states that had been awarded contracts in the initial 2011 integrated care initiative.[xliv]  CMS has been working with state officials to meet demonstration requirements with the eventual goal of entering into a formal Memorandum of Understanding with each state.

The Massachusetts Dual Eligibles Demonstration Plan

Profile of Dual Eligibles in Massachusetts

There are approximately 242,000 dual eligibles in Massachusetts.[xlv]  In 2009, they accounted for 43 percent of the state’s Medicaid spending, compared with a national average of 38 percent.[xlvi]  Within the Massachusetts dual eligible population, approximately 115,000 are between the ages of 21 and 64, and qualify for Medicare due to chronic illness or disability rather than age.[xlvii]

The Massachusetts Medicaid Policy Institute (“MMPI”) in collaboration with the Massachusetts Medicaid Program (MassHealth) found that combined Medicare and Medicaid spending for the 21 to 64 age group was $2.5 billion in 2008, accounting for 16 percent of all Medicare spending and 20 percent of all Medicaid spending in the state.[xlviii]  On average, combined annual spending was $23,700 per capita for this group.[xlix]

The MMPI further found that 60 percent of Massachusetts dual eligibles in the 21 to 64 age group had diagnoses in at least two of three major categories: physical illness or disability, behavioral diagnosis, or developmental disability.[l]  This subset represented more than 80 percent of total spending.[li]  Spending levels were particularly high for dual eligibles in this age group with developmental disabilities, especially when combined with other diagnoses.  For example, annual per capita spending for dual eligibles diagnosed with a developmental disability was $31,800 on average, rising to $71,300 for dual eligibles who also had a behavioral and physical diagnosis in addition to their developmental disability.[lii]

The Massachusetts Demonstration and Memorandum of Understanding

On August 23, 2012, Governor Patrick’s administration announced that Massachusetts had become the first state to sign a Memorandum of Understanding (“MOU”) with CMS to begin implementation of an integrated care and financial alignment demonstration for dual eligibles.[liii]  The Massachusetts plan focuses on the 115,000 “full” dual eligibles in the state between the ages of 21 and 64 and will last for three years.[liv]  The state has decided to test the capitated model proposed by CMS via three-way contracts between the state, CMS, and new managed care entities called Integrated Care Organizations (“ICOs”) that will receive a blended payment to cover all Medicare and Medicaid services.[lv]

The MOU between Massachusetts and CMS describes the demonstration’s key objectives as follows: “[T]o improve the beneficiary experience in accessing care, deliver person-centered care, promote independence in the community, improve quality, eliminate cost shifting between Medicare and Medicaid and achieve cost savings for the Commonwealth and Federal government through improvements in care and coordination.”[lvi]  The MOU also emphasizes the importance of dual eligible beneficiaries’ involvement and ability to self-direct their care under the new demonstration, and it states that the parties expect improvements in the quality of care and in transitions among care settings for dual eligibles.[lvii]

The stated purpose of the MOU is to lay out the “principles under which the initiative will be implemented and operated” and to outline the preparations that will be necessary for the plan’s implementation.  The MOU notes that additional details, including specifics about the responsibilities of the managed care plans, will be contained in the final contracts between the state, CMS, and the ICOs, which at that time were still being selected through the joint procurement process.[lviii]

Benefits and Service Delivery

Generally, ICOs must provide integrated primary care and behavioral health services to each enrollee, coordinated by a designated Care Coordinator or Clinical Care Manager in conjunction with an Independent Living and Long Term Services and Supports (“IL-LTSS”) Coordinator, who will be an independent contractor from a community-based organization.[lix]  Notably, the requirement for the IL-LTSS Coordinator was added to the proposal based on stakeholder comments received by the state as it was developing the demonstration.[lx]  The IL-LTSS Coordinator will be available to act as an independent facilitator between the enrollee, the ICO, and service providers, as well as to provide expertise about community supports and to ensure that the enrollee receives “person-centered” care.[lxi]

The primary care provider, Care Coordinator, IL-LTSS Coordinator, and other providers will together form an Interdisciplinary Care Team that will work with enrollees to develop and implement an Individualized Care Plan.[lxii]  At the outset, the plan will be based on an initial assessment of the enrollee’s medical, behavioral health, and LTSS needs performed by a registered nurse within 90 days of enrollment.  It will also be based on an in-person comprehensive assessment that evaluates the enrollee’s needs in social, functional, medical, behavioral, wellness, and prevention domains.[lxiii]  The comprehensive assessment must describe the enrollee’s strengths and goals, need for specialists, as well as the care management and coordination plans.[lxiv]

The ICOs are required to provide the full continuum of services covered by Medicare and Medicaid to their enrollees as well as a range of supplemental benefits listed in the MOU, including diversionary behavioral health services, community support services, and expanded oral health, personal care attendant, and durable medical equipment services.[lxv]  The MOU explains that medical necessity determinations for services will be based on existing Medicare and MassHealth definitions, except where there is an overlap between the programs; in that situation, the three-way contracts will set out the coverage and rules for particular services.[lxvi]

Enrollment

Under the MOU, Massachusetts will be using a passive enrollment process that will enroll dual eligibles in an ICO managed care plan unless they affirmatively request to opt out of the demonstration.[lxvii]  The state will conduct two passive enrollment periods,[lxviii] prior to which the ICOs will have an opportunity to market their plans and enroll beneficiaries who would like to self-select a plan.[lxix]

For those beneficiaries who do not voluntarily choose a plan, the state hopes to develop an “intelligent assignment” algorithm that will automatically enroll people in particular plans based on factors such as continuing relationships with existing providers and services.[lxx]  These beneficiaries will receive notice at least 60 days prior to being passively enrolled in a plan and will have the opportunity to opt out of enrollment.[lxxi]  Further, once enrolled, dual eligibles may choose to disenroll from their managed care plan on a month-to-month basis.[lxxii]

In order to promote continuity of care, the ICOs must allow enrollees to maintain their current providers and services for up to 90 days after enrollment or until the ICO completes the initial assessment of the enrollee’s needs, whichever comes later.[lxxiii]  Further, under certain circumstances the ICOs will be required to offer single-case, out-of-network agreements to an enrollee’s service providers after the 90-day period if the providers will accept the in-network payment rate.[lxxiv]

Financing, Risk Mitigation, and Program Savings

With respect to financing, the state and CMS will enter into a joint rate-setting process to determine the blended capitated payment rates and contributions will be risk-adjusted.[lxxv]  The MOU provides that the state will arrive at a baseline spending and payment rate for Medicaid based on its historic cost data, and CMS will determine a baseline spending and payment rate for Medicare Parts A and B based on a blend of Medicare Advantage projected payment rates and Medicare fee-for-service standardized county rates, which will be weighted by the proportion of dual eligibles that will be moving from each program to the ICOs.[lxxvi]  The baseline rate for Medicare Part D will be based on the national average monthly bid amount for the calendar year.[lxxvii]

The blended payments to the ICOs will be risk-adjusted.  In addition, the state will be creating “high cost risk pools” to help cover the expense of certain long-term supports and services for high-cost enrollees.[lxxviii]  It will withhold a portion of the ICO Medicaid payments in separate risk pools covering enrollees in different rating categories (those likely to need facility-based care or who have “high” community needs).  Risk pool funds will then be divided and distributed among the ICOs based on their share of total costs for these enrollees above a specified threshold amount, to be determined in the three-way contracts.[lxxix]  Finally, the demonstration will include risk corridors during the first year to prevent overpayment or underpayment to particular ICOs.[lxxx]

The MOU states that the demonstration is expected to generate savings for both programs by applying designated savings percentages to the baseline Medicaid and Medicare Part A and B rates in determining the capitated payment rates.[lxxxi]  In the first year of the demonstration, the savings percentage will be one percent, in the second year, two percent, and in the third year it will increase to four percent.[lxxxii]  The savings percentages will not be applied to the Medicare Part D rate.[lxxxiii]  The MOU notes that the state and CMS “agree that there is reasonable expectation” that savings can be achieved while paying the ICOs “capitated rates that are adequate to support access to and utilization of medical and non-medical benefits according to beneficiary needs.”[lxxxiv]

The MOU also establishes a “quality withhold” policy whereby Medicare and Medicaid will withhold a designated percentage of the capitated rate which it will only pay out to the ICOs if they show that they have met certain quality thresholds.[lxxxv]  The quality withhold will be one percent in the first year of the demonstration, two percent in the second year, and three percent in the third.[lxxxvi]

     Appeals, ADA Compliance, Monitoring, and Evaluation

The MOU provides for a unified grievance and appeals process,[lxxxvii] and for the establishment of at least one consumer advisory committee that will give input to the ICO governing boards.[lxxxviii]  The ICOs must also include consumers with disabilities within their governing structure.  In addition, the state and CMS will be developing both monitoring and quality measures to ensure that ICOs and providers comply with the Americans with Disabilities Act, including providing physical access and flexible scheduling, as well as accommodating enrollees who have hearing or cognitive impairments, or who do not speak English.[lxxxix]

Under the MOU, CMS will pay for an independent evaluator to monitor and evaluate the Massachusetts demonstration.  The evaluator will look at enrollee health outcomes, the quality and utilization of care across settings, enrollees’ satisfaction and experience, administrative and system changes and efficiencies, and overall costs or savings for the Medicare and Medicaid programs.[xc]

Implementation: Future Challenges and Opportunities

As the MOU makes clear, many details of the demonstration project still have to be hammered out in the contracts between the state, CMS, and the new ICOs.  Stakeholders and policymakers nationwide will be watching to see how issues are resolved in the contracts and how implementation progresses, as the Massachusetts model may have a significant impact on the demonstrations being developed in other states.

The state Executive Office of Health and Human Services (“EOHHS”) announced in November 2012 that it had selected six organizations to serve as ICOs for the demonstration: Blue Cross and Blue Shield of Massachusetts HMO Blue Inc.; Boston Medical Center HealthNet Plan; Commonwealth Care Alliance; Fallon Total Care, LLC; Neighborhood Health Plan; and Network Health, LLC.[xci]  These organizations are currently engaged in a joint federal and state readiness review process.  The ICOs will then negotiate the contracts with the state and CMS, which are expected to be finalized in March or April 2013.[xcii]

Dual eligibles and disability and consumer advocates in Massachusetts and across the country have said that they see great promise in the demonstration.  Many view it as a critical opportunity to improve the quality of care for dual eligibles and to increase the level of control that they have over the decisions being made about their care and the long-term services and supports they receive.[xciii]  However, these groups and other organizations have also raised concerns about the overall approach that CMS is taking with the demonstration projects and about the contents of the Massachusetts MOU.

Most broadly, state and national groups have expressed unease about the wide scope and short implementation timeline of the proposed dual eligible demonstrations, the use of passive enrollment, and whether capitated rates will be sufficient for plans to provide adequate care to such medically complex individuals.  For example, in comments submitted to CMS, the Medicare Payment Advisory Commission (“MedPAC”) stated that it believed the scope of the demonstrations was too broad, should be limited to only a few states, and should not apply to all or even to a majority of full dual eligibles in a given state.[xciv]  It noted that given the current size of the proposed demonstrations, plans initially might not have the capacity to care for such large numbers of dual eligibles.  Further, MedPAC pointed out that if demonstrations were not successful it could be very challenging to transition so many people out of the plans.  It also suggested that CMS consider not applying savings reductions to capitated payment rates in the first year of the demonstrations, given how much uncertainty there is about what actual program costs will be and the ability of plans to provide care under reduced rates.[xcv]

The American Medical Association (“AMA”) has suggested that CMS delay the implementation of the dual eligible demonstrations for at least a year to provide more time for stakeholders to review and comment on state proposals and to work with CMS, the states, and health plans to address areas of concern.[xcvi]  The AMA, the Federation of American Hospitals, and other provider associations have also voiced concern about whether providers will continue to be reimbursed at Medicare rates under the new demonstrations, or if plans will try to achieve savings by reducing rates rather than by improving coordination of care.[xcvii]

With respect to Massachusetts in particular, there is concern about the MOU’s lack of specificity and the number of issues that still need to be resolved in the three-way contracts, as well as whether the implementation process will be sufficiently transparent.  Various groups have raised questions about whether the ICOs will have enough time to build the necessary competence and capacity to adequately serve such a high-need population before enrollment begins.[xcviii]  Further, many are worried about the passive enrollment process, specifically that duals may not fully understand the program—especially those with intellectual and developmental disabilities—and that once enrolled they could lose access to providers with whom they have built vital long-standing relationships.[xcix]  There is also unease about the method that the state will be using to assign dual eligibles to particular plans and whether the disability community will be consulted about its design.[c]

To address these and other concerns, the state has announced the creation of an “Implementation Council” that it says will promote transparency and actively monitor implementation of the duals demonstration.[ci]  The Council will include dual eligibles as well as representatives from medical, behavioral health and long-term services and supports providers and from community-based organizations.[cii]  The state has indicated that it also plans to establish an ombudsperson role for the demonstration.[ciii]

Finally, EOHHS recently announced that the state and CMS have decided to delay demonstration enrollment by several months in order to “ensure that there is sufficient time for all critical implementation milestones to be achieved…including robust public awareness and targeted outreach efforts so that individuals have a meaningful opportunity to learn about the Demonstration and select an ICO prior to the auto-assignment process.”[civ]  The MOU originally provided for ICO plan marketing to begin in January 2013, with voluntary self-selected enrollment beginning in April 2013 and passive enrollment periods slated for July and October 2013.  Under the revised implementation timeline, ICOs will now begin outreach to dual eligibles in May 2013 for voluntary enrollment beginning July 1, 2013, followed by the two passive enrollment periods beginning October 1, 2013 and January 1, 2014.[cv]

Conclusion

As the dual eligibles demonstration is implemented in the coming months and years, it remains to be seen whether the state will be able to lower costs by more effectively and efficiently providing care for dual eligible beneficiaries, and how the state’s experience with using a capitated financial model will compare with that of states choosing to implement a managed fee-for-service plan.  What is certain is that the rest of the country will be watching with interest to see whether Massachusetts is successful in its latest attempt to lead the nation in improving the quality of health care while containing its cost.

Margaretta Homsey Kroeger is a Skadden Fellow at Greater Boston Legal Services in the Elder, Health and Disability Unit, where she focuses on advocating for youth with disabilities who are aging out of the foster care system. She provides outreach and direct legal representation to youth who need assistance accessing disability benefits, health care, and related services. Prior to her fellowship, Ms. Kroeger clerked for Justice William P. Robinson III of the Rhode Island Supreme Court. She received her law degree from Boston College Law School, where she was a Public Service Scholar and served as an articles editor of the Boston College Law Review and as vice president of the Public Interest Law Foundation. She received her undergraduate degree from Harvard University with a con


[i] Massachusetts Executive Office of Health and Human Services, Patrick-Murray Administration Announces First in the Nation Comprehensive Health Care Option for Dual Eligible Individuals Approved by Obama Administration (Aug. 23, 2012), available at http://www.mass.gov/eohhs/gov/newsroom/press-releases/eohhs/first-in-the-nation-comprehensive-health-care-option.html.

[ii] The Kaiser Commission on Medicaid and the Uninsured, Massachusetts’ Demonstration to Integrate Care and Align Financing for Dual Eligible Beneficiaries 3 (Oct. 2012), http://www.kff.org/medicaid/upload/8291-02.pdf [hereinafter “Massachusetts’ Demonstration to Integrate Care”].

[iii] Letter from CMS Center for Medicaid, CHIP and Survey & Certification and Medicare-Medicaid Coordination Office to State Medicaid Directors (Jul. 8, 2011), available at http://downloads.cms.gov/cmsgov/archived-downloads/SMDL/downloads/Financial_Models_Supporting_Integrated_Care_SMD.pdf [hereinafter “Letter from CMS to State Medicaid Directors”].

[iv] The Kaiser Commission on Medicaid and the Uninsured, Medicaid’s Role for Dual Eligible Beneficiaries 7 (April 2012), http://www.kff.org/medicaid/upload/7846-03.pdf [hereinafter “Medicaid’s Role for Dual Eligible Beneficiaries”].

[v] Letter from CMS to State Medicaid Directors, supra n.3.

[vi] Massachusetts’ Demonstration to Integrate Care, supra n.2, at 1-3.

[vii] Id.

[viii] The Kaiser Family Foundation, Medicare’s Role for Dual Eligible Beneficiaries 1 (April 2012), http://www.kff.org/medicare/upload/8138-02.pdf [hereinafter “Medicare’s Role for Dual Eligible Beneficiaries”].

[ix] Id. at 2.

[x] See Medicaid’s Role for Dual Eligible Beneficiaries, supra n.4, at 2.

[xi] See Medicare’s Role for Dual Eligible Beneficiaries, supra n.8, at 2.

[xii] See Medicaid’s Role for Dual Eligible Beneficiaries, supra n.4, at 2.

[xiii] Id. at 4.

[xiv] Id.

[xv] Medicare’s Role for Dual Eligible Beneficiaries, supra n.8, at 3.  For example, in 2008, 55 percent of dual eligibles had three or more chronic conditions, as compared with 44 percent of other Medicare beneficiaries, and 58 percent had a cognitive or mental impairment, as compared with 25 percent of other beneficiaries.  Id.  In addition, 44 percent of dual eligibles required assistance with activities of daily living versus 26 percent of other Medicare recipients, and 13 percent lived in nursing homes or mental health facilities, compared with one percent of non-dual eligibles. Id.

[xvi] Id. at 4.  Among dual eligibles nationwide, 26 percent had at least one hospitalization per year, compared with 18 percent of other Medicare beneficiaries, 17 percent had an emergency room visit compared with 12 percent of other beneficiaries, and nine percent had stayed in a skilled nursing facility versus four percent of other beneficiaries.  Id.  Under the Medicaid program, 69.1 percent of dual eligibles spending was for long-term care services, while 15.8 percent was for Medicare acute care cost-sharing, and  9.2 percent went toward Medicare premiums.  Medicaid’s Role for Dual Eligible Beneficiaries, supra n.4, at 7.

[xvii] Medicaid’s Role for Dual Eligible Beneficiaries, supra n.4, at 7; Medicare’s Role for Dual Eligible Beneficiaries, supra n.8, at 2.  Within the Medicare program, average annual spending on each dual eligible beneficiary was $14,169 in 2008, compared with $7,933 for other Medicare beneficiaries.  Medicare’s Role for Dual Eligible Beneficiaries, supra n.8, at 4.

[xviii] See Community Catalyst, Dual Eligible Demonstration Projects: Top Ten Priorities for Consumer Advocates 1 (March 2012), http://www.communitycatalyst.org/doc_store/publications/Top_Ten_Duals_Projects_Guide_Advocates.pdf.

[xix] See Letter from CMS to State Medicaid Directors, supra n.3; The Kaiser Family Foundation, Health Reform Opportunities: Improving Policy for Dual Eligibles 4 (Aug. 2009), http://www.kff.org/medicaid/upload/7957.pdf.

[xx] The Medicare Payment Advisory Commission (MedPAC), Report to the Congress: Aligning Incentives in Medicare 129 (June 2010), http://www.medpac.gov/documents/jun10_entirereport.pdf.

[xxi] Id. at 141.

[xxii] Id. at 140-41.

[xxiii] Id. at 141.

[xxiv] The “Affordable Care Act” refers to the Patient Protection and Affordable Care Act (Pub. L. 111-148) enacted on March 23, 2010, as revised by the Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152).

[xxv] Affordable Care Act § 2602(a).

[xxvi] Id. § 2602(b).

[xxvii] Id. § 2602(c).

[xxviii] Affordable Care Act §3021(a), adding § 1115A to Title XI of the Social Security Act, codified at 42 U.S.C. 1315a(a)(1).

[xxix] 42 U.S.C. 1315a(b).

[xxx] 42 U.S.C. 1315a(b)(2)(B)(x)-(xi).

[xxxi] 42 U.S.C. 1315a(b)(1).

[xxxii] 42 U.S.C. 1315a(c).

[xxxiii] 42 U.S.C. 1315a(c)(1)(A)-(B).

[xxxiv] 42 U.S.C. 1315a(c)(2)-(3).

[xxxv] CMS Office of Public Affairs, 15 States Win Contracts to Develop New Ways to Coordinate Care for People with Medicare and Medicaid (April 14, 2011), available at http://www.cms.gov/apps/media/press/factsheet.asp?Counter=3929&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numdays=3500&sr.  The 15 states selected were California, Colorado, Connecticut, Massachusetts, Michigan, Minnesota, New York, North Carolina, Oklahoma, Oregon, South Carolina, Tennessee, Vermont, Washington and Wisconsin.  Id.

[xxxvii] Letter from CMS to State Medicaid Directors, supra n.3.

[xl] Id.

[xli] Id.

[xlii] Id.

[xliv] The Kaiser Commission on Medicaid and the Uninsured, Explaining the State Integrated Care and Financial Alignment Demonstrations for Dual Eligible Beneficiaries 2 (Oct. 2012), http://www.kff.org/medicaid/upload/8368.pdf.  The 26 states that submitted proposals were Arizona, California, Colorado, Connecticut, Hawaii, Idaho, Illinois, Iowa, Massachusetts, Michigan, Minnesota, Missouri, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, Tennessee, Texas, Vermont, Virginia, Washington, and Wisconsin.  Id. at 1-2.  For a current list of states with active financial alignment demonstration proposals, visit https://www.cms.gov/Medicare-Medicaid-Coordination/Medicare-and-Medicaid-Coordination/Medicare-Medicaid-Coordination-Office/FinancialModelstoSupportStatesEffortsinCareCoordination.html.

[xlv] Massachusetts’ Demonstration to Integrate Care, supra n.2, at 3.

[xlvi] The Kaiser Family Foundation, Individual State Profiles, Massachusetts: Dual Eligibles, available at http://www.statehealthfacts.org/profileind.jsp?cat=6&rgn=23&sub=76.  That year, Massachusetts averaged $23,790 in annual Medicaid spending per dual eligible versus the national average of $16,325.  Id.

[xlvii] Massachusetts Medicaid Policy Institute, Dual Eligibles in Massachusetts: A Profile of Health Care Services and Spending for Non-Elderly Adults Enrolled in Both Medicare and Medicaid 4 (Sept. 2011), http://bluecrossmafoundation.org/sites/default/files/MMPI%20Duals%20Chart%20Pack_0.pdf.

[xlviii] Id.  The statistics in the report are based on a data set comprised of 105,000 duals between the ages of 21 and 64 who received fee-for-service coverage, and excludes the approximately 10,000 additional duals in this group who were enrolled in managed care.  Id.

[xlix] Id.  When broken down by type of service, 35 percent of spending went toward long-term support services for these dual eligibles, 22 percent went toward inpatient care, and 13 percent went toward pharmacy costs.  Id. at 21.

[l] Id. at 15.

[li] Id.

[lii] Id. at 19.

[liii] Massachusetts Executive Office of Health and Human Services, Patrick-Murray Administration Announces First in the Nation Comprehensive Health Care Option for Dual Eligible Individuals Approved by Obama Administration (Aug. 23, 2012), available at http://www.mass.gov/eohhs/gov/newsroom/press-releases/eohhs/first-in-the-nation-comprehensive-health-care-option.html.

[liv] Massachusetts’ Demonstration to Integrate Care, supra n.2, at 3.

[lv] Id. at 1.

[lvi] Memorandum of Understanding (MOU) Between The Centers for Medicare & Medicaid Services (CMS) and the Commonwealth of Massachusetts Regarding a Federal-State Partnership to Test a Capitated Financial Alignment Model for Medicare-Medicaid Enrollees, Demonstration to Integrate Care for Dual Eligible Beneficiaries 3 (Aug. 22, 2012), available at https://www.cms.gov/Medicare-Medicaid-Coordination/Medicare-and-Medicaid-Coordination/Medicare-Medicaid-Coordination-Office/Downloads/MassMOU.pdf [hereinafter “MOU”].

[lvii] Id.

[lviii] Id. at 2-4.

[lix] Id. at 26, 58.

[lx] See Massachusetts’ Demonstration to Integrate Care, supra n.2, at 5.

[lxi] MOU, supra n.56, at 26, 58.

[lxii] Id. at 26-27, 58-59.

[lxiii] Id. at 59, 82.

[lxiv] Id. at 59.

[lxv] Id. at 10, 68-81.

[lxvi] Id. at 68.

[lxvii] Id. at 9, 56.

[lxviii] Id. at 56.

[lxix] Id. at 56, 87.

[lxx] Id. at 57.

[lxxi] Id. at 56.

[lxxii] Id. at 9.

[lxxiii] Id. at 82.

[lxxiv] Id. at 83.

[lxxv] Id. at 39.

[lxxvi] Id. at 43-44.

[lxxvii] Id. at 45.

[lxxviii] Id. at 52.

[lxxx] Id. at 52-53.

[lxxxi] Id. at 46.

[lxxxv] Id. at 47.  The MOU contains charts that lay out the specific quality withhold measures to be considered, broken down by demonstration year.  Id. at 47-50.

[lxxxvi] Id. at 48-49.

[lxxxvii] Id. at 15.

[lxxxviii] Id. at 13-14.

[lxxxix] Id. at 12-13.

[xc] Id. at 20, 106.

[xciii] Massachusetts Executive Office of Health and Human Services, Patrick-Murray Administration Announces Health Care Cost Containment Measure to Serve 111,000 Dually Eligible Individuals (June 19, 2012), available at http://www.mass.gov/eohhs/gov/newsroom/press-releases/eohhs/health-care-cost-containment-measure-to-serve-111000.html.

[xciv] See Letter from Medicare Payment Advisory Commission (MedPAC) to Marilyn Tavenner, CMS Acting Administrator (Jul. 11, 2012), available at http://www.medpac.gov/documents/07112012_MedPAC_Comment_CMS_demos_states_integratedcare_dualeligibles.pdf.

[xcv] See id.

[xcvi] See Letter from American Medical Association to Marilyn Tavenner, CMS Acting Administrator (Jul. 19, 2012), available at http://www.ama-assn.org/resources/doc/omss/temp/i-12/1-2.pdf.

[xcvii] See id.; see also The Advisory Board Company, In 26-State Dual-Eligible Demo, Hospitals Push Insurers to Pay Medicare Rates (Sept. 20, 2012), http://www.advisory.com/Daily-Briefing/2012/09/20/In-26-state-dual-eligible-demo-hospitals-push-insurers-to-pay-Medicare-rates; Letter from Federation of American Hospitals to Marilyn Tavenner, CMS Acting Administrator (April 19, 2012), available at http://www.fah.org/fahCMS/Documents/On%20The%20Record/Public%20Comments/2012/FAH_Comments_Capitated_Finan_Align_Demo_Guid.pdf.

[xcviii] See, e.g., Letter from Dennis Heaphy and Bill Henning, Co-Chairs of Disability Advocates Advancing our Healthcare Rights (DAAHR), to Massachusetts EOHHS Secretary JudyAnn Bigby, MD, and CMS Medicare-Medicaid Coordination Office Director Melanie Bella (Sept. 18. 2012), available at

http://www.masslegalservices.org/content/letter-disability-rights-coalition-sec-bigby-duals-memo-understanding; Memorandum from DAAHR and the ARC of Massachusetts to the Massachusetts Congressional Delegation, Memorandum on Needed Changes or Clarifications in Massachusetts Medicare/Medicaid Integration Demonstration Project (Oct. 1, 2012), available at

https://www.arcmass.org/LinkClick.aspx?fileticket=PspW5h00DeE%3D&tabid=114.

[xcix] See id.

[c] Id.; see also National Committee to Preserve Social Security and Medicare and the National Senior Citizens Law Center, Comments on the Massachusetts Memorandum of Understanding, available at  http://www.ncpssm.org/Portals/0/pdf/comments-dual-eligible-demonstrations.pdf.

[ci] See Massachusetts Executive Office of Health and Human Services, MassHealth Demonstration
to Integrate Care for Dual Eligibles, Materials from Nov. 2, 2012 Open Meeting, available at http://www.mass.gov/eohhs/provider/guidelines-resources/services-planning/national-health-care-reform-plan/federal-health-care-reform-initiatives/integrating-medicare-and-medicaid/materials-from-previous-meetings.html.

[cii] Id.

[ciii] Id.

[cv] Id.

Policymaker Profile: Laurance Stuntz

By David Sontag

When Jerry Tichner and I (co-editors of the Health Law Reporter) received the good word that John Halamka would be writing an article for this issue about the Massachusetts Health Information Exchange (“Mass HIway”), we thought readers would be interested in learning more about the person selected to serve as Director of the Massachusetts eHealth Institute (“MeHI”), the state entity responsible for helping providers and payers in the state connect to the Mass HIway.  Luckily for us, Laurance Stuntz was gracious enough to grant us an interview, the results of which are reproduced below.  But first, here is some background information about MeHI.

The Massachusetts eHealth Institute is a division of the Massachusetts Technology Collaborative and was established in Section 4D of Chapter 305 of the Acts of 2008, which is codified at M.G.L. ch. 40J, §§ 6D-6G.  The Legislature tasked MeHI with generally “advanc[ing] the dissemination of health information technology across the commonwealth, including the deployment of electronic health records systems in all health care provider settings that are networked through a statewide health information exchange.”[1]  More specifically, the Legislature provided that MeHI:

shall advance the dissemination of health information technology by: (i) facilitating the implementation and use of electronic health records systems by health care providers in order to improve health care delivery and coordination, reduce unwarranted treatment variation, eliminate wasteful paper-based processes, help facilitate chronic disease management initiatives and establish transparency; (ii) facilitating the creation and maintenance of a statewide interoperable electronic health records network that allows individual health care providers in all health care settings to exchange patient health information with other providers; and (iii) identifying and promoting an accelerated dissemination in the commonwealth of emerging health care technologies that have been developed and employed and that are expected to improve health care quality and lower health care costs, but that have not been widely implemented in the commonwealth.[2]

To accomplish this lofty goal, the Legislature directed the director of the Massachusetts Technology Collaborative to “appoint a qualified individual to serve as the director of the institute, who shall be an employee of the corporation, report to the executive director and manage the affairs of the institute.”[3]   Laurance Stuntz is that “qualified individual.”

Laurance is a graduate of Dartmouth College with a degree in history.  Surprisingly, he didn’t take a single computer class, although he has done a lot of programming over the years (the “real coders” do not let him code anymore).  His Dartmouth education taught him how to speak and write eloquently, which he has to do everyday in his new position.  Prior to taking the reins at MeHI in May of 2012, Laurance worked at NaviNet for a year as the Senior Vice President, Product Development.  Before NaviNet, Laurance worked at Computer Sciences Corporation (“CSC”) for almost 20 years.  CSC is a very large, multi-national system integrator. Laurance was a partner in the commercial healthcare division.  For the last 12 years he was there, he concentrated exclusively on healthcare information technology (“IT”) consulting.  By the time he left CSC, Laurance was in charge of the national collaborative communities effort, which was the CSC practice that concentrated on the exchange of health information and helping organizations (e.g., payors and providers) talk to each other. Also at CSC, Laurance was the technical architect for the New England Health Exchange Network (“NEHEN”) in Massachusetts from 2000 until 2011, when he left CSC.

Soon after Pamela Goldberg became the CEO for the Massachusetts Technology Collaborative (“Collaborative”) in June of 2011, she began a search for a new Director of MeHI.  Based on all his work with CSC and NEHEN, Laurance was highly recommended to become the Director at MeHI.  And the rest, so they say, is history.  But there is so much more to know about Laurance – why he is so interested in health information exchanges, why does he think healthcare IT is so important, and how he is working through (with his colleagues and advisors) some of the tricky issues posed by health information exchange, to name a few.  Reading Laurance’s own explanations on these issues provides so much more depth than I could provide when interpreting.

What made you interested in Health Exchange or did you fall into it?

Originally at CSC I did a lot of work for retail and financial services clients. I was at a point in my career where I was wondering whether I should leave CSC because those industries didn’t particularly interest me. We had this new project at NEHEN, one of the early health information exchanges and it seemed very interesting. It was an industry that I found interesting from a career perspective, as well as from a socially good perspective. I’m not a doctor so I’m not going to deliver medical care directly, but the work we do in healthcare IT has a real effect on the way all of us experience the health care system. I purposely moved within CSC to the NEHEN project and over the 11 years I worked on that project I helped grow that organization from its original five founding members to about forty members when I left, as well over one hundred and fifty small practices using the portal application. I intentionally got into health IT and CSC allowed us, though the NEHEN project, to create something brand new. It was a totally unique project because we effectively had the Massachusetts health care system as a client.

Can you explain a little more your concept of healthcare IT as a “social benefit”?

From my perspective, in healthcare right now, there is a tremendous opportunity to improve efficiency in the way all of us experience health care.  I really think that IT is one of the key ways we are going to get that. For instance, the Health Information Exchange that we just launched on October 16 (2012), is going to transform the way all of us interact with a system when we move care from one provider to another. In the past year, two of my children had injuries.  One had to go from the ER to his PCP and the other went from his PCP to a specialist.  All of these providers were in different networks.  We had to carry records with us from one system to another.  The health IT work that we are doing affects all of us.  On NEHEN, when we were working on eligibility verifications, claims status inquiry and claims submission, all that work made it easier and less of a pain-in-the-neck for patients and providers to deal with the administration in the health care system. Another example that I’ve heard a lot about recently is that systems are emerging that provide a good, convenient way to schedule an appointment online.

I wanted to work in an area where I felt like we could affect the lives of lots of people, even if I wasn’t delivering medical care. There is so much opportunity within healthcare to improve the customer service and over time, to improve the quality of care. I did a lot of projects at CSC around e-prescribing and there are significant safety benefits to getting prescription history; making sure there are no interactions between current medications and what the doctor is going to prescribe. IT, in those cases, really has the potential to save lives.

Can you tell our readers what a health information exchange is and does, and what the Mass HIway is aimed at doing and how it is improving health care?

We launched Mass HIway on October 16, 2012.  We demonstrated from Massachusetts General Hospital, Governor Patrick clicking the button that sent his medical records to BayState Medical Center in Springfield. We demonstrated, in an initial, high level way, the fact that over the next few years we are going to connect every provider in the state so they can communicate electronically from within their electronic health records (“EHRs”). We will make it easy to send records to the next setting of care. For instance, when your kid goes into the ER for a broken arm and the doctor sets it and sends info about that to the PCP for a follow-up visit or to the orthopedic surgeon for a follow-up visit, the record of that visit can be sent electronically, and seamlessly, and securely from one provider to another. Our goal over the next 2 years is to connect the majority of providers in the state all together over this one single statewide health information exchange.

I think of this as laying the gravel under the interstate highway system – we are really creating the foundation for lots of really interesting work that really will totally transform healthcare. For instance, one of the things that we have planned for Phase 2 of the health information exchange, which we are planning for now and will be implementing in 2013 and 2014, is patient access to their own data. So we will be developing the policies and procedures that are necessary to allow a physician to send patient data to them or to their app of choice. For instance, a patient could sign up with Microsoft Health Vault as a personal health record and the statewide health info exchange will allow a provider to send that patient’s data to their personal health record account. We are also going to be working on ways that patients can designate that their data goes to other tools, like a wellness app.  There are all sorts of tracking applications that are out there on people’s phones. If we could include real clinical data with the user input data in these applications, I think there is really powerful potential for helping patients to manage their own health data. On the whole patient engagement front, the health information exchange is a big piece of that.

The other thing the health information exchange is going to give us is the opportunity to have a lot better understanding of population health as a whole. We are doing some demonstration projects now that allow us to distribute population health queries to participants on the network and allow those individual participants, maybe large EHRs like Beth Israel Deaconess Medical Center or Atrius or the Mass League of Community Health Centers, to receive the query, run the query against their own datasets, and send back a de-identified dataset to an organization like the Department of Public Health so they can understand in real time what is going on with the health of our community, which we’ve never been able to do before. So, initially we are going to connect everybody with the health information exchange, but then there is a whole layer of public health and personal health on top of that – that is how the health information exchange is going to transform how we all get care.

One word stuck out to me in your last response – de-identified. As a health lawyer, I recognize obvious issues around privacy with relation to the health information exchange and the accessibility to data by large numbers of people.  Some of it will be identifiable data and some will be de-identified data or non-identifiable data. On behalf of the Health Law Section of the Boston Bar Association, do you call lawyers to help you with those issues?

There is a whole legal and policy workgroup of the health information exchange that has been helping to guide the policy. So there are a couple of things that are built into the legislation that governs the health information exchange, as well as the policies and procedures, which largely stem from the state legislation as well as the federal HIPAA legislation. One of the key features of the Mass HIway is that we have a strict opt-in policy to the health information exchange. In order to share a patient’s information over the health information exchange, each patient must explicitly give consent for their provider to share the patient’s health information. So in Phase 1 of the Mass HIway (the  statewide health information exchange), we are starting with pushing out data. We are replacing all the faxes and paper that move around today with electronic transmission and there is a whole bunch of benefits we see to that: a) it’s more efficient; b) it’s auditable. A patient can now go to a provider and inquire, “Who have you disclosed my data to?”

Our experience is that the vast majority of patients will opt in to use of the health information exchange under these conditions because they understand they will get better care, because the provider they are going to will have a better picture of their health. The HIE is more secure than using a fax.  Although a user of the HIE can select the wrong recipient of that HIE transmission, human error, every participant of the exchange is going to be an authorized user. So, there is no chance of sending a record to Joe’s Pizza Shop or a newspaper because non-participants in health care would never have an account at the HIE. Phase 1, with the strict opt-in policy and just pushing out data, is a giant leap forward. And the next phase, a lot of work on which will be in 2013, is working on the policies and the infrastructure we need to have a centralized and robust consent management process for patients to be able to register how they want their health information to be used and available for query. For instance, if a patient at BIDMC wants authorized providers to have access to any of his/her information, that patient can sign a consent that would be registered with the statewide exchange that says “any of my data that came from my visit at BI or my PCP, I am fine with sharing.” However, if you happen to be admitted to McLean Hospital, a psychiatric hospital, you may not want to share any of that data with other providers unless you explicitly allow it, so you might have a default opt-out of sharing that data and a specific opt-in for your behavioral health specialist. All of that consent management will be registered at the core health information exchange. There is going to be a lot of work from a policy perspective to understand whether this is sufficient. To the Health Law Section at the BBA, we are trying to reach out as much as possible to the community to understand where everybody’s concerns are. The health information exchange has a legal policy workgroup and folks should absolutely volunteer to participate in that. We need all the volunteers we can get.

How do people volunteer to get involved?

The Health Information Technology Council creates these work groups as needed. People interested in learning more about getting involved should contact Mark Belanger at [email protected]

So you are actively engaging lawyers in conversations about health IT?

They are invited to the work groups, in general. We have a few lawyers represented, particularly on the legal and policy work group.

Is your position now focused more on how the HIE works or do you also effect some of the policies the HIE will create?

It’s a combination. MeHI is not just the HIE. MeHI has a whole set of increasing responsibilities under Chapter 224. So we have three current programmatic responsibilities: (1) Connect every provider in the state to the health info exchange; (2) Run the regional extension center, which is helping abut 2,500 primary care providers install and use electronic health records meaningfully; and (3) We administer the Medicaid Meaningful Use incentive payment program. Under the Federal Meaningful Use Program, they delegate to the states the responsibilities to run payment administration for the program. We have supported more than 3,000 Medicaid providers getting paid for Meaningful Use incentives and  more than fifty hospitals. Overall, we have helped pay out more than $120 million in Meaningful Use incentives to Massachusetts providers as part of that program.

Those are the three current programmatic areas, and in addition, over the next four years we’ve been asked by the legislature as part of Chapter 224, to help every other provider in the state get and use electronic health records and connect them to the HIE, with a specific focus on the underserved communities who didn’t qualify for the Federal Meaningful Use – communities like long-term care, home health and behavioral health. Our group will be helping all those organizations start to use EHRs and at the same time helping to connect each of them to the HIE, so they can exchange data electronically. In that role, there is policymaking we need to do. For example, there is an annual report to the legislature about the state of health IT adoption, key areas of need that the legislature might help us address, the accomplishments – all of that – sort of an annual report that feeds statewide policymaking regarding health IT adoption. So there is a combination of programmatic, as well as policymaking jobs within MeHI that I am responsible for. The third area of key responsibility comes out of our legacy with the Mass Tech Collaborative.  Mass Tech is an economic development agency for the state, a quasi-agency. In health IT, we have a similar role that comes from our heritage at Mass Tech to help encourage and develop the health IT community in Massachusetts. So, we have programs around internships and workforce development that are designed to help grow the health IT industry in Massachusetts, create jobs and bring them here.

What has the reception been from providers – both physicians and hospitals – to the policies and outreach to try to get people involved?

It has been very positive. On the HIE, we have had very rapid interest. On our programs around helping to get EHRs up and running, what we find is that providers generally (but not universally) feel this wave of EHRs is coming and it’s something they are going to need to figure out how to adopt, so they welcome the support we are able to give to help ease their transition to EHR. So what we find is that providers are very welcoming of our role and they find the education and the infrastructure-development things that we do as a quasi-agency to be very helpful. Frankly, it’s why I was interested in taking this job; you rarely get a chance to help change the way 6 ½ million people experience the healthcare system. We have the opportunity to help every provider connect and make their lives more efficient. We got enough capital support from the federal and state government to make it relatively – not relatively – quite inexpensive for the providers to connect and support the operations of the exchange. I really think it’s a perfect storm of opportunity here to – going back to what we first started talking about – use health IT to really change the way that care is delivered.

Any advice to providers or counsel to providers who are behind the curve about what they should start doing (other than dedicating more money to EHRs) or thinking about, so they can get up to speed and get to where other people already are?

Education and training.  I have to research and see whether we are doing a particularly effective job at providing those resources.  One of the things that we expect to help provide is a series of training materials and educational materials for providers to help them understand what it is really going to take to start to adopt EHRs and what they can start doing now is just educating themselves on ways that other providers have effectively adopted technology. Because it doesn’t have to be a big bang, all-at-one proposition; it could be a gradual sort of thing. Providers have been very successful at this over the years, so they can educate themselves on what has worked well for other providers. Go to http://mehi.masstech.org/useful-resources for more information.

Anything that has surprised you since coming into your new position?

I had no public service background; I didn’t work for the government or anything like that before coming to this.  Frankly, I have been very pleasantly surprised by how dedicated the folks in government are to helping, to furthering the public good, making sure the system works better. Sometimes sitting on the outside you can feel like there is bureaucracy or there is unnecessary sort of slowness in government and that has not been my experience. I have been very encouraged by how committed folks in public service, in general, are towards the public good.

In light of the timing of this conversation and the events of November 6th, do you see health IT as a political issue or do you see it as something people have adopted and understand, obviously funding aside?

I think it’s a non-political issue. The federal Office of the National Coordinator was started under President Bush, then it was continued under President Obama. My expectation is that it will continue on under President Obama. On the Massachusetts side, I’ve found that in my conversations with different legislators is that health IT is broadly supported on both sides. So, I don’t think it’s political. There may be methodology differences and potential funding differences, but I think that it is generally a both sides of the aisle thing. One of the more vocal promoters of health IT over the past 10 years was Newt Gingrich, who did a lot of work with Hilary Clinton on this before she took the Secretary of State job. I think that’s just symptomatic of how broad-based the recognition is that this is a good thing and is not a politicized thing.

Any parting thoughts in terms of any issues you think people should be aware of – specifically, the health lawyers out there – anything they should be focusing on or thinking about or legislating about?

I think the big question for us over the next year is how to effectively manage and implement the consent process so we protect patients’ privacy, but we don’t create a system that is so onerous that providers can’t get the data they need to treat patients with the full picture of the patient’s health. I think from a health law perspective, what I would ask the lawyers out there to think about is how do we make this an efficient, fair and open process so we can properly and fully inform the public, so that they can make an informed decision how to/what consent to give, but that we do that in as efficient a way as possible so health care can be delivered very cleanly and with all the information a provider needs to deliver safe care. That is a broad charge, but I think there will be a lot of conversation about this consent question over the next year and I think particularly the legal profession can help a lot in making sure it’s done efficiently and it doesn’t create a barrier to care.

David Sontag is Associate General Counsel at Beth Israel Deaconess Medical Center, and formerly practiced as an associate at Choate, Hall & Stewart LLP. His current practice focuses on negotiating and drafting contracts, and advising and resolving legal and compliance issues related to mergers and acquisitions and other business relationships with the medical center. David also advises medical center clinicians regarding guardianships, health care proxies and related informed consent issues, and oversees the process for obtaining guardianships for medical center patients. He is a graduate of Washington University and the University of Pennsylvania, where he received degrees in both law and bioethics.


[1] M.G.L. ch. 40J, § 6D(a).

[2] Id. at § 6D(c).

[3] Id. at § 6D(a)

Health Law Case Brief: Boston Medical Center Corporation v. Secretary of EOHHS

By Andrew P. Rusczek

On September 14, 2012,[1] the Supreme Judicial Court of Massachusetts (the “Court”) denied an appeal brought by Boston Medical Center Corporation (“BMC”), Boston Medical Center Health Plan, Inc. (“Health Plan”), Holyoke Medical Center, Inc. (“Holyoke”), Quincy Medical Center, Inc. (“Quincy”), and Brockton Hospital, Inc. (“Brockton” and collectively, “Plaintiffs”) of decisions by the Superior Court to deny the Plaintiffs’ claims against the Secretary of the Executive Office of Health and Human Services (“EOHHS”) regarding MassHealth payment rates.[2]  After denying each of the Plaintiffs’ claims, the Court advised the Plaintiffs that the proper forum for seeking redress with respect to MassHealth payment rates is the political arena, not the courts.

This brief first discusses the hospitals’ claims, then discusses Health Plan’s claim, and finally discusses the claims common to all Plaintiffs.

Claims Asserted by Plaintiff Hospitals

As explained further below, the Plaintiff hospitals claimed that by setting unreasonably low MassHealth payment rates, EOHHS had violated state law, violated the contract that it had entered into with each hospital, violated federal Medicaid regulations, and unlawfully taken the hospitals’ property.

The hospitals asserted that MassHealth payment rates set by EOHHS violated Massachusetts law because the payment rates did not compensate the hospitals for the reasonable costs of providing medical care to MassHealth enrollees.  The hospitals are all disproportionate share hospitals.  Under M.G.L. ch. 118E, § 13F (the “Statute”),[3] MassHealth payment rates for a disproportionate share hospital must equal the hospital’s revenue requirements for providing care to MassHealth enrollees.  These payment rates must take into account costs such as the hospital’s reasonable operating, capital, and working capital costs, reasonable costs of depreciation of plant and equipment, and reasonable costs related to medical practice and technology changes.[4]

The Court held that the doctrine of sovereign immunity barred the hospitals’ claims that the MassHealth payment rates did not equal the hospitals’ reasonable costs as required by Massachusetts law.  The Statute neither waives the doctrine of sovereign immunity nor provides the hospitals a private right of action.  In support of this finding, the Court noted that it would be “complex and difficult” for the Court to review a hospital’s payment rates set by EOHHS and to determine whether the hospital’s costs are “reasonable” in accordance with the Statute.

The hospitals also argued that EOHHS had violated its contract with each of the hospitals when it set payment rates that did not comply with the Statute.  The payment rates that a hospital receives from MassHealth are set forth in that hospital’s contract with EOHHS.  EOHHS generally has the authority to revise payment rates or other terms set forth in a MassHealth hospital contract as it determines necessary upon thirty days’ notice to the hospital.[5]  The rates at issue in this case were set by EOHHS in December 2008 in a Request for Applications for payment year 2009.[6]  The Plaintiff hospitals argued that although EOHHS was authorized to set and even to revise each hospital’s payment rates under the contract, EOHHS could not choose payment rates that did not comply with the Statute.  The Plaintiffs argued further that by choosing payment rates that did not comply with the Statute, EOHHS had violated the contract.  The Court, however, held that the doctrine of sovereign immunity bars this contract claim just as it bars the hospitals’ claim that EOHHS directly violated the Statute.

Holyoke, Quincy, and Brockton additionally asserted that EOHHS had violated the implied covenant of good faith and fair dealing by imposing unreasonably low payment rates in violation of the Statute.  The Court did not agree with this position and instead found that EOHHS could not have acted in bad faith or engaged in unfair dealing simply by not proposing higher payment rates as the hospitals had agreed to accept the payment rates set forth in their MassHealth contracts.

The Court also rejected the hospitals’ claims that the payment rates violated federal Medicaid regulations and that the hospitals had a private right of action to challenge the rates under the supremacy clause.  Under federal Medicaid laws, a state Medicaid plan (such as MassHealth) must “assure that [Medicaid] payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area.”[7]  The Plaintiff hospitals argued that by imposing unreasonably low payment rates, EOHHS had failed to ensure that the rates were consistent with efficiency, economy, and quality of care and that the rates were sufficient to ensure adequate access to care.  Because these federal Medicaid laws do not provide a private right of action, the hospitals argued that EOHHS’s rate setting process and payment rates were preempted by the supremacy clause of the United States Constitution.  The Court, however, held that the hospitals could not “sidestep” the lack of a private right of action by claiming a violation of the supremacy clause.  Further, even if the hospitals could bring a claim under the supremacy clause, the claim would be invalid due to the Commonwealth’s sovereign immunity.

Finally, the hospitals claimed that the unreasonably low payment rates represented a taking without lawful compensation.  Article X of the Massachusetts Constitution’s Declaration of Rights[8] and the Fifth and Fourteenth Amendments to the United States Constitution[9] prohibit the unlawful taking of private property.  While the Court agreed that the inadequacy of a regulated price can give rise to an unlawful taking when a property owner is legally required to engage in a price-regulated activity, the Court also noted there can be no unlawful taking when the property owner is not legally required to engage in the price-regulated activity.  The Court recognized that “it would be difficult, perhaps impossible,” for the hospitals to survive financially if they refused to participate in MassHealth.  But the Court nonetheless found that the hospitals did have a choice to participate in MassHealth and their participation was ultimately voluntary.  As a result, the hospitals’ claim that the low payment rates constituted an unlawful taking was unsuccessful.

Claim Asserted by Plaintiff Health Plan

Health Plan’s principal claim was that EOHHS had failed to increase its capitation rates for fiscal year 2009 by $84.6 million as was required by the 2006 Massachusetts health reform legislation (the “Act”).[10]  The Act required EOHHS for fiscal years 2007, 2008, and 2009 to reimburse certain hospitals operated by BMC and the Cambridge public health commission “at levels consistent with their net supplemental payments of $287,000,000 in fiscal year 2006.”[11]  In fiscal year 2009, EOHHS was required to meet this requirement by “allocating $160,000,000 in net supplemental payments from the Commonwealth Care Trust Fund and by increasing actuarially sound rates to the maximum extent allowable and eligible for financial participation, including the balance from other financing mechanisms.”[12]  Of the $287 million, BMC and Health Plan were to receive two-thirds, or $191.3 million.  EOHHS did make a lump-sum payment of $106.7 million to BMC in fiscal year 2009.[13]  Health Plan argued that EOHHS was obligated to pay the remaining $84.6 million to BMC and Health Plan “by increasing . . . to the maximum extent allowable” the capitation rates that Health Plan received for MassHealth enrollees.  EOHHS, however, had not raised Health Plan’s capitated rates for 2009 as Health Plan claimed the Act required.

EOHHS refuted Health Plan’s interpretation of the Act.  Under EOHHS’s interpretation, EOHHS was not required to make $287 million in supplemental payments in fiscal year 2009, but rather was only required to ensure that the total payments that Health Plan received from EOHHS from all funding sources (including capitation payments, the lump-sum payment of $106.7 million, and “other financing mechanisms”) was “consistent with” the 2006 supplemental payments.

Without resolving the parties’ dispute regarding the proper interpretation of the Act, the Court held that Health Plan’s claims were barred by the doctrine of sovereign immunity as the legislature did not provide a private right of action with respect to these provisions of the Act.

Claims Asserted by All Plaintiffs

The Court found against the Plaintiffs with respect to all of their common claims.  The Court held that the Plaintiffs were not eligible to recover costs of services provided to MassHealth enrollees under a theory of quantum meruit because a party cannot recover under a theory of quantum meruit when a valid contract sets forth the obligations of the parties.[14]  The Court also found the Plaintiffs’ claims with respect to certiorari, mandamus, and declaratory judgment to be invalid.

Andrew P. Rusczek  is Counsel in the Boston office of Verrill Dana LLP. Andrew provides regulatory, transactional and compliance advice to a broad range of health care clients, including hospitals, health systems, academic medical centers, physician practice groups, and pharmaceutical and medical device manufacturers.  Andrew has particular experience with respect to hospital mergers and affiliations, federal and state health care reform and accountable care organizations, HIPAA and HITECH, fraud and abuse laws, medical staff matters, and human subjects research compliance.  Andrew earned his J.D. and Master of Bioethics from the University of Pennsylvania and his B.A. from Bowdoin College. 


[1] See Boston Med. Ctr. v. Sec’y of EOHHS, 463 Mass. 447 (2012).

[2] The Superior Court cases were brought as separate actions, the first by BMC and Health Plan and the second by Holyoke, Quincy and Brockton.

[3] At the time of the Court’s decision, the applicable requirements were found in M.G.L. ch. 118G, § 11(a).  These requirements were relocated to M.G.L. ch. 118E, § 13F by the Massachusetts health care cost containment law approved in August (2012 Mass. Acts ch. 224).

[4] M.G.L. ch. 118E, § 8A.  Each hospital’s payment rates are unique to that hospital and are calculated based in part on that hospital’s “casemix index.”  The hospital’s casemix index represents the relative cost of providing care to the hospital’s patients and takes into account factors such as patients’ diagnoses, procedures, illness severity, age, and payment source.  By using a hospital’s casemix index to calculate the hospital’s payment rates, EOHHS is able to ensure that hospitals with patients in especially poor health or with more complex medical needs receive higher relative rates of payment.  See Boston Med. Ctr., 463 Mass. at 451–52.

[5] See Boston Med. Ctr., 463 Mass. at 451–53.

[6] A hospital must agree to accept the payment rates under the Request for Applications when it enters into a MassHealth contract with EOHHS.  See id. at 451.

[7] 42 U.S.C. § 1396a(a)(30)(A).

[8] Mass. Const. pt. 1, art. X.

[9] U.S. Const. amend. V, amend. XIV, § 1.

[10] 2006 Mass. Acts ch. 58.

[11] Id. § 122.

[12] Id.

[13] See Boston Med. Ctr., 463 Mass. at 466.

[14] The Court dismissed each Plaintiff’s argument that it had no valid contract with EOHHS for rate year 2009.

Health Law Case Brief: Commonwealth v. Dung Van Tran

By Margaret Schmid, Esq. 

Massachusetts General Laws Annotated chapter 233, section 20B establishes a privilege for communications between a patient and a psychotherapist “relative to the diagnosis or treatment of the patient’s mental or emotional condition.” The purpose of the privilege is to “protect justifiable expectations of confidentiality that people who seek psychotherapeutic help have a right to expect.”[1] In Commonwealth v. Dung Van Tran, the Supreme Judicial Court of Massachusetts (“SJC”) further clarified its interpretation of the psychotherapist-patient privilege.

In Commonwealth v. Dung Van Tran, the defendant entered the apartment inhabited by his estranged wife and children, poured gasoline in such a manner that it landed on himself, one of his children, and the children’s caretaker, and set the gasoline on fire.[2]  The defendant was indicted and convicted by a Massachusetts Superior Court jury on charges of armed assault with intent to murder, aggravated assault and battery by means of a dangerous weapon, assault and battery by means of a dangerous weapon, arson of a dwelling, and armed home invasion.[3]

On appeal, the defendant argued that the trial court judge erred by admitting evidence of prior bad acts and by admitting privileged statements made by the defendant to a psychiatrist.[4]  The defendant also argued that the evidence at trial was insufficient to support his convictions for armed assault with intent to murder, aggravated assault and battery by means of a dangerous weapon, assault and battery by means of a dangerous weapon, arson of a dwelling, and armed home invasion.[5]

Following a transfer of the case on its own motion, the SJCconcluded that the trial court judge did not err in admitting evidence concerning the defendant’s prior bad acts arising out of the defendant’s hostile relationship with his estranged wife.[6]  The SJC held that it was within the trial court judge’s discretion to decide that the challenged evidence was relevant to establish the defendant’s motive and intent.[7]

The SJC did, however, find that the trial court erred in admitting statements made by the defendant to his psychiatrist.[8]  At trial, the defense theory was one of excuse; the defendant testified that while he intended to commit suicide in his estranged wife’s apartment by self-immolation, injury to anyone other than himself was purely accidental.[9] To cast doubt upon the defendant’s stated intent and to call into question the defendant’s frame of mind, the Commonwealth argued that Tran had “essentially testified that he was ‘not thinking rationally at the time’ due to a ‘suicidal ideation,’” and thus, the psychotherapist-patient privilege should yield in the interest of justice.[10]  The trial court judge found the Commonwealth’s argument to be persuasive and permitted the defendant’s psychiatrist to testify as a rebuttal witness regarding the defendant’s actual, specific intent.[11]

On appeal, the SJC disagreed and ruled that the “Commonwealth may not introduce against a defendant statements protected by the psychotherapist-patient privilege, on grounds that the defendant himself placed his mental or emotional condition in issue, unless the defendant has at some point in the proceedings asserted a defense based on his mental or emotional condition, defect, or impairment.”[12]  The SJC concluded that, “lack of intent does not, without more, suffice to put in issue a defendant’s mental or emotional condition.”[13]

Finally, the SJC considered the defendant’s argument that the evidence presented at trial was insufficient to support his convictions for the charged crimes.[14]  Without taking into consideration the psychiatrist’s improperly admitted testimony, the court concluded that the evidence was sufficient to support each of the convictions.[15]  However, since the convictions of armed assault with intent to murder rested directly upon the psychiatrist’s improperly admitted testimony concerning the defendant’s intent, the case was remanded for a new trial on those indictments.[16]  The SJC affirmed the remaining convictions.[17]

Margaret Schmid is an attorney working for Donoghue, Barrett, & Singal, P.C.  Prior to working for Donoghue, Barrett, & Singal, Ms. Schmid interned at Massachusetts Executive Office of Health and Human Services.  She also worked for the U.S. Department of Health and Human Services, Office of the General Counsel, Public Health Division during her third year of law school.  Ms. Schmid received her law degree from The Catholic University, Columbus School of Law in Washington, D.C., where she was a Note and Comment Editor on the Journal of Contemporary Health Law and Policy.  She received her undergraduate degree from Kenyon College. 


[1]   Commonwealth v. Clancy, 524 N.E.2d 395, 397 (Mass. 1988).

[2]  972 N.E.2d 1, 4 (Mass. 2012).

[3]  Id. at 5.

[4]  Id.

[5]  Id.

[6]  Id. at 8; The defendant’s estranged wife testified to the defendant’s abusive behavior toward her and defendant’s threats to kill her and their children within weeks of the fire.  Id. at 5.

[7]  972 N.E.2d at 13.

[8]  Id. at 12.

[9]  Id. at 11.

[10]  Id. at 10.

[11]  Id at 12.; The psychiatrist testified that the defendant stated that he intended “to take [his daughter] with him.”  Id. at 10.

[12]  972 N.E.2d at 12; essentially, the mere desire to commit suicide is not enough to place one’s mental or emotional condition in issue.

[13] Id. at 11 (citing Commonwealth v. McLaughlin, 729 N.E.2d 252 (2000)).

[14] Id. at 13-14.

[15]  Id.

[16]  Id. at 17.

[17]  Id.

Health Law Case Brief: Tartarini v. Dep’t. Mental Retardation

By Devin Cohen

In Tartarini v. Dep’t. Mental Retardation, 972 N.E.2d 33 (2012), the Massachusetts Appeals Court invalidated the Department of Developmental Services’ (the “Department”) definition of “mental retardation,” as used for public benefit determinations.  The Court held that the Department’s regulatory definition was inconsistent with the statutory requirements of Massachusetts law.

Mass. Gen. Laws ch. 123B, §1 defines “mentally retarded person” as a “person who, as a result of inadequately developed or impaired intelligence, as determined by clinical authorities as described in the regulations of the department is substantially limited in his ability to learn or adapt, as judged by established standards available for the evaluation of a person’s ability to function in the community” (emphasis supplied).  The Department’s regulations defined “mental retardation” as “significantly sub-average intellectual functioning existing concurrently and related to significant limitations in adaptive functioning,” and noted that “mental retardation manifests itself before age 18” (emphasis supplied).[1]  The regulations then defined “significantly sub-average intellectual functioning” to mean “an intelligence test score that is indicated by a score of 70 or below as determined from the findings of assessment using valid and comprehensive, individual measures of intelligence that are administered in standardized formats and interpreted by qualified practitioners.”[2]

Paula Tartarini, the plaintiff in this case, applied for benefits with IQ test scores of 71 at age 18, 69 at age 40, and 71 at age 42.  The Department employed its definitions of “mental retardation” and “significantly sub-average intellectual functioning,” and determined that Tartarini’s IQ score of 71 at age 18 was higher than the regulatory threshold of 70 and that her adaptive functioning did not meet the eligibility requirements of the rule.[3]  Therefore, she was denied benefits.  The Superior Court judge, applying a deferential standard of review, affirmed the Department’s decision.  Tartarini brought suit against the Department alleging that it over-reached its legislative mandate by setting the definition of “significantly sub-average intellectual functioning” at an IQ of 70 or below and failing to mention any clinical authorities or established standards upon which its determination rested.

The Massachusetts Appeals Court, in an opinion authored by Judge Sullivan, reversed and remanded the Superior Court’s decision, finding that the Department’s regulations could not “by any reasonable construction be interpreted in harmony with the legislative mandate.”[4]  The court held the regulations invalid on the grounds that they failed to “describe the clinical authorities upon which the clinical judgments regarding intelligence are made [for mental retardation determinations],” contrary to the statutory requirements of Mass. Gen. Laws ch. 123B, §1.[5]

The Department argued that it should be given the discretion to choose which clinical authorities to rely upon, and that the term “clinical authority” can have a dual meaning, referencing professionals either outside of the Department or inside the Department itself.  The Department claimed that it had identified relevant clinical authorities, as required by statute, by requiring internal professional experts to review benefits determinations.  Judge Sullivan responded by noting that first, the Department itself had acknowledged in regulations and memorandums to the Superior Court that “clinical authority” refers to external professionals, and second, that the Department’s wavering position on whether an IQ score of 70 was an absolute ceiling to determining eligibility in all cases undercut its reliability, and consequently, its justification for deference.[6]  Judge Sullivan then concluded that regardless of whether the Department was entitled to use internal professionals as clinical authorities, the “standardized tests described in the regulations are measurements of intelligence or adaptive abilities; they are not clinical authorities.”[7]

Devin Cohen is an associate in the law firm of McDermott, Will, & Emery and focuses his practice on general health law.  Devin has been a member of the BBA since he was admitted to the Massachusetts bar in 2012.  More information about Devin’s practice and interests is available at: http://www.mwe.com/Devin-Cohen/.  


[1] 115 Mass. Code Regs 2.01 (2006).  The statute additionally defined “adaptive functioning” to include “independent living/practical skills, cognitive, communication/conceptual skills, and social competence/social skills.” Tartarini, 972 N.E.2d at 35.

[2] Tartarini, 972 N.E.2d at 34.

[3] The regulations required that mental retardation manifest before age 18.  As a result, the hearing officer largely ignored Tartarini’s IQ score at the age of 40 and 42.  Id. at 35.

[4] Tartarini, 972 N.E.2d at 36 (quoting Dowell v. Comm’r. of Transitional Assistance, 677 N.E.2d 213 (1997) (quoting from Berrios v. Dep’t of Pub. Welfare, 583 N.E.2d 856 (1992))).

[5] Tartarini, 972 N.E.2d at 37, fn 5.

[6] Id. at 38; The Department initially argued that an IQ of 70 did not establish a ceiling for benefits eligibility.  However, once Department experts and hearing officers applied an IQ of 70 as a ceiling for benefits eligibility, the department changed it’s contention to conform with such application.

[7] Id.

Health Law Case Brief: Grocela v. General Hospital Corporation

By Sophie F. Wang 

In July 2012 the Superior Court of Massachusetts at Suffolk dismissed a doctor’s action against a hospital at which he had privileges over ownership of inventions in Grocela v. General Hospital Corporation, No. SUCV2011-00991-BLS1, 2012 Mass. Super. LEXIS 206 (Mass. Super. Ct. July 18, 2012).  The plaintiff, Dr. Grocela, sued the Massachusetts General Hospital (“MGH”), claiming (1) that the hospital’s IP Policy, as applied to him, was an unenforceable restrictive business covenant on ordinary competition; (2) that MGH had breached his right to privacy under Mass. Gen. Lass c. 214, §1B; and (3) that because the IP Policy was unenforceable, he was owed restitution for MGH’s retention of royalty rights for three inventions that he had previously disclosed to MGH.

Background:

Dr. Grocela was a physician with staff privileges at MGH with a surgical specialty in urology.  As a condition of his application for reappointment to the MGH staff, he was required to certify his understanding that the ownership of all inventions was to be decided in accordance with MGH’s IP Policy (the “IP Policy”).  The IP Policy states that (1) MGH shall own all staff inventions “that arise out of or relate to the clinical, research, educational or other activities of the Inventor at [MGH],” (2) MGH’s Research Ventures & Licensing Department (the “RVL Department”) administers the IP Policy and is responsible for determining whether MGH owns the disclosed invention, and (3) all invention disclosures submitted to the RVL Department are considered confidential.

Dr. Grocela had disclosed over his tenure at MGH many inventions, two which were based upon his personal experiences.  One invention (the “2004 Invention”) was influenced by Dr. Grocela’s childhood experience, while another (the “2005 Invention”) had been tested on himself in treating a medical condition with which he was afflicted.  Dr. Grocela had included this information in the invention disclosures he gave to MGH, and had also disclosed his medical condition in a letter to the president of MGH and a mutual friend.  To attract business partners, the RVL Department had publicized the 2005 Invention, naming Dr. Grocela as the inventor and advertising that it had been “tested on a single patient with promising results.” Id. at *14.  It also applied for a patent on the 2005 Invention.

In 2010, Dr. Grocela conceived of a “voice box invention,” a device for voice training that could, among other things, be used to enable mute patients to phonate.  While this invention did not expressly relate to his practice of urology, Dr. Grocela admitted that the invention utilized or incorporated knowledge that he acquired in the course of his engagement at MGH.

IP Policy:

In dismissing Counts I and III relating to the enforceability of MGH’s IP Policy, the Superior Court upheld the well-established principle than an employee inventor may properly contract away his ownership of an invention to his employer. See id. at *10 n3 (though Dr. Grocela was technically not an employee of MGH, “a formal notice of appointment is the equivalent of an employment contract”) (internal citation omitted).  Dr. Grocela argued that the IP Policy improperly covered inventions that were created outside the hospital and “on his own time,” and that such coverage was an unreasonable restriction on competition.  The court first found that the plain language of the IP Policy required Dr. Grocela to assign his rights to an invention to MGH if the invention “arises out of or relates to Dr. Grocela’s clinical, research, education or other activities at the hospital.”  Id. at *10.  The court paid little attention here to Dr. Grocela’s focus on inventions made “on his own time” that did not relate directly to his urology practice.  Instead, the court noted that with respect to the voice box invention, “Dr. Grocela himself does not dispute that it arose out of his activities at MGH.”  Id. at *10.  As such, he was bound by the terms of the agreement because he had willingly signed it.

The court next held that the IP Policy did not restrict competition.  Citing to the Supreme Judicial Court’s decision in National Dev. Co. v. Gray, 55 N.E.2d 783 (Mass. 1944), the court concluded that even absent an express contract, an invention that was prepared in the employee’s home and on his own time nonetheless came within the scope of his employment if (1) the employer contemplates the discovery of an invention, and (2) the employee reasonably understood that such inventions  resulting from his employment would belong to his employer.  Again, the court emphasized the plain language of the IP Policy, which established both that MGH contemplated the discovery of inventions by its employees related to their activities at MGH, and that Dr. Grocela understood that ownership of his inventions would be subject to MGH’s decisions under the IP Policy.

Finally, the court found that the IP Policy was not unreasonable.  The policy merely established a common quid pro quo whereby an employee agrees to contract away certain rights in exchange for the benefits of the clinical resources, office space, access to doctor-patient relationships and professional prestige offered by the hospital.  Furthermore, nothing in the IP policy prevented Dr. Grocela from practicing medicine at a place other than MGH, had he chosen not to sign the agreement.  Finally, the court found that any speculative restraint on competition was outweighed by MGH’s legitimate public interest in freely sharing staff inventions to further research and benefit patients.

The court also determined that MGH did not owe any payments to Dr. Grocela based on its retention of royalty rights for the 2004, 2005 and 2008 Inventions.  Even though MGH had relinquished the rights to those inventions back to Dr. Grocela in 2010, the IP Policy nonetheless allows MGH to require the inventor to pay royalties “on sales of products or services covered by the relinquished Invention.”  Id. at *14.  Because Dr. Grocela, a sophisticated professional, had agreed to be bound by the IP Policy, and the Policy was found enforceable, the court dismissed the royalty rights count of his complaint.

Invasion of Privacy

In Count II of his complaint for invasion of privacy, Dr. Grocela asserted that MGH violated his privacy by (1) retaining information regarding his medical condition in its records in violation of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) and (2) advertising that he was the inventor of the 2005 Invention and that “the device has been tested on a single patient with promising results.”  Id. at *14.  Such advertising, he argued, made it possible for others to infer that he was the single patient afflicted with the medical condition at issue.

The court first found that HIPAA was designed to protect the privacy interests of patients receiving treatment, not the privacy interests of employees of the hospital.  The court disagreed with Dr. Grocela’s claim that HIPAA creates an affirmative duty not to disclose his personal health information without advance notice to him.  Rather, HIPAA expressly excluded from the definition of protected health information “employment records held by a covered entity in its role as employer.”  Id. at *15-16.  Furthermore, the court reiterated that HIPAA does not create a private right of action.

Second, the court found that Dr. Grocela did not meet the elements of an invasion of privacy claim under Mass. Gen. Laws ch. 214, §1B.  To prevail under §1B, a plaintiff must prove that a defendant “unreasonably, substantially and seriously interfered with his right to privacy by disclosing facts of highly personal or intimate nature” and that the defendant “had no legitimate reason for doing so.”  Id. at *16.  While the court must balance interests of the employer in disclosing the information against the substantiality of the intrusion on the employee’s privacy, where there is evidence to support only a de minimis intrusion of privacy, dismissal is appropriate.

Even assuming that the medical information about Dr. Grocela was highly personal or intimate, the court found that Dr. Grocela had disclosed his medical condition on the invention disclosure forms even though MGH had not required such information.  In fact, he had also disclosed his condition in a letter he sent to the president of MGH and a mutual friend.  There was nothing in the record to indicate that MGH had disseminated his information to the public, and the advertisement stating that the 2005 invention had been tested on “a single patient” did not mean that MGH had named him as the patient.

Finally, the court reiterated its previous belief that MGH had a legitimate interest in maintaining and sharing information regarding staff inventions with a limited group of persons, especially in the pursuit of patents.  And, MGH’s substantial interest in furthering research and supporting inventions to benefit its patients outweighed any possible intrusion into Dr. Grocela’s privacy.  As such, the court dismissed the claim.

Grocela marks a continuation in the line of Massachusetts cases where an employee’s inventions made on his own time and at his own expense could nonetheless be owned by his employer, so long as the employer contemplated the discovery and the employee “reasonably understood” that his inventions would belong to his employer.  In particular, Grocela emphasizes that an employer’s IP policy, voluntarily agreed to as a condition of employment, may be sufficiently broad as to encompass all inventions that “arise out of or relate to” the clinical, research, educational or other activities of the employee, including inventions resulting from knowledge gained through the course of employment.

Wang_Sophie_Headshot

Sophie F. Wang is an associate at Choate Hall & Stewart LLP, where she assists in representing leading life sciences and technology corporations and institutions in complex patent infringement, trade secret litigation and commercial litigation.

Ms. Wang received her JD, cum laude, from Washington University School of Law and her BA from Wellesley College.  While in law school, she was awarded the Dean’s Book Award for outstanding leadership and service, the Judge Amandus Brackman Moot Court Award, and was Primary Editor of the Washington University Journal of Law & Policy.

Ms. Wang is a member of the Boston Bar Association and the American Bar Association.