Healthcare Matters

   A Complimentary Newsletter From:

Barmak and Associates, LLC  

Managing Risk for Long Term Care and Health Care Providers

Volume 15, Issue 10                   ADVERTISEMENT                            October 2014

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In This Issue
Personal Counsel for Professional Matters
Jo Ann Halberstadter, Esq. Joins Firm
Medicare 5-Star Rating and the Impact of IMPACT 2014

David Barmak, Esq.


Matthew Streger

Matthew Streger, Esq.

 Of Counsel

Gerald V. Burke, M.D., Esq. 
Jo Ann Halberstadter, Esq.
Jo Ann Halberstadter, Esq.



Click on Attorney's Picture for More Information 


Personal Counsel for Professional Matters 

By: Gerald Burke, M.D., Esq. 


Physicians, and healthcare professionals in general, are finding themselves in an increasingly complex legal environment due to a myriad of new statutory and administrative guidelines. In addition, they are frequently entangled as unwilling defendants in medical malpractice and other professional litigation. The ever growing specter of audits of their medical and billing practices by both governmental and private organizations with the potential for severe financial consequences to the physician loom ever more prominently. These represent daunting responsibilities that distract and detract the physician from their ability to deliver high quality, cost effective medical care.


In this progressively hostile environment the presence of personal counsel acting as a "shadow attorney" for these health care professionals is quickly moving from being a luxury to a necessity.  When retained, either on an ongoing basis or for specific issues, this counsel can determine the state of the situation upon their entry into the matter, evaluate the potential legal consequences to their client, and then advise and guide the physician client to as quick and painless a resolution of the issue as possible while at the same time implementing procedures to help avoid these issues in the future.


Personal Counsel is uniquely suited to both help a client avoid litigation, or, if litigation begins, work to assure that the client physician's interests are optimally served.  Personal counsel can zealously advocate for the physician when there is third party that may adversely influence the conduct of the litigation.


Other issues particularly suited for Personal Counsel include physician contracting, whether entering into, renewing or exiting from employment contracts.  Compliance issues, including HIPAA, fraud, RAC audits and employment issues are all well served by Personal Counsel.  Hospital and health insurance company credentialing and payment issues as well as State Board of Medical Examiner and hospital peer review issues similarly require legal attention.  Establishing medical practice entities, including mergers of single and multi-specialty groups and establishing solo and small group practices will benefit from the insights into law that Personal Counsel for health care matters engenders.


These and other issues will be explored in future issues of this newsletter.  With the addition of an attorney/physician/surgeon with over 30 years of medical experience in all aspects of medical care to the legal team at Barmak and Associates, LLC we are uniquely positioned to provide legal services in a manner that will provide unprecedented results at affordable prices.


If you have any questions on the services that a Personal Counsel can provide, please contact Dr. Gerald Burke, MD., JD. at or call 609-454-5351.



Jo Ann Halberstadter, Esq. Joins Firm


David S. Barmak, Managing Attorney is pleased to announce that Jo Ann Halberstadter,Esq. has joined Barmak and Associates, LLC as a Senior Associate.


Jo Ann received her J.D. from the University of Pennsylvania Law School and a B.A. in linguistics from Cornell University. She served a judicial clerkship under the Honorable Philip S. Carchman, Superior Court of New Jersey, Mercer County.


Early in her career Jo Ann served as an Assistant City Solicitor, Department of Human Services, Philadelphia City Solicitor's Office and as a Deputy Attorney/Advisor, Civil Rights Litigation Division of the U.S. Department of Housing & Urban Development. Since 2007, she has practiced Elder Law including estate administration, estate planning and real estate transactions.


Jo Ann is a welcomed addition to the staff that is currently serving over 100 long term care facilities in New Jersey, New York, Connecticut, Massachusetts, Maryland & Pennsylvania.


Jo Ann is a resident of Scotch Plains, New Jersey.



Medicare 5-Star Rating System and the Impact of IMPACT 2014

By: Jo Ann Halberstadter, Esq. 


On October 10, 2014, the U.S. Department of Justice announced that Extendicare Health Service, Inc. agreed to pay $38 Million to settle False Claims Act allegations relating to the provision of substandard nursing care and medically unnecessary rehabilitation therapy constituting the largest failure of care settlement  with a chain-wide skilled nursing facility in the department's history. [1]


Extendicare, a Delaware Corporation, that operates 146 skilled nursing facilities in 11 states, is alleged to have billed Medicare and Medicaid for materially substandard skilled nursing services and inadequate care in 33 of its facilities from 2007 through 2013.  Examples of the alleged substandard care included insufficient staffing, failure to provide adequate catheter care to residents, and failure to follow appropriate protocols to prevent pressure ulcers or falls.  Nonetheless,  in a post-settlement press release, Tim Lukenda, President and CEO of Extendicare stated that "the number of EHSI centers with an overall Four or Five-Star quality rating, as measured by the Centers for Medicare and Medicaid Services, has improved by almost 300% since the program's inception in 2008."[2]


On August 24, 2014, the New York Times published an article entitled "Medicare Star Ratings Allow Nursing Homes to Game the System".  The article exposed the flaws of the Medicare Five Star rating system using as an example, Rosewood Post-Acute Rehab ("Rosewood"), a Sacramento, CA nursing home owned by North American Health Care Inc.  The NY Times article examined the discrepancy between actual resident care, safety and satisfaction and Rosewood's public portrayal of itself as a deluxe facility with a Five Star ranking under Medicare's Five-Star rating system.   According to the article, Rosewood had achieved a Medicare five-star rating despite having received a maximum State fine as a result of a resident death and more than twice the average of consumer complaints filed with the State of California. 


The New York Times made public what we in the long term care industry already knew:  the Medicare Five-Star rating system gives the appearance of an independent Medicare evaluation of long term care facilities when in fact, two out of the three criteria used in the evaluation (staff levels and quality statistics) are self-reported by long term care facilities without authentication or audit by Medicare.  Unfortunately, this Five-Star rating system not only affects consumer choices but is relied upon by hospitals for discharge planning and Medicare intends to expand the Five-Star rating system to hospitals and home healthcare centers. [3]


As part of the Five-Star rating system, facilities submit a staff ratio (rating) form once per year at the time of their annual Medicare inspection.  Many facilities often know when this inspection will occur and increase staff hours for that period only.  Similarly, for the Medicare "quality measures" criteria, the score is based on each nursing home's collected data regarding issues such as bedsores and falls. 


President Obama signed into law on October 6, 2014, the Improving Medicare Post-Acute Care Transformation Act ("IMPACT") amending title XVIII of the Social Security Act ("Medicare") to provide for standardized post-acute care assessment data for quality, payment, and discharge planning, and for other purposes.  In conjunction with the signing of the IMPACT Act, the White House announced changes to the Medicare Five Star rating system for nursing homes including nationwide audits to check the quality rating for accuracy. [4]


IMPACT will implement a long-delayed provision of the Affordable Care Act (ACA) requiring nursing homes to more accurately report staffing data.  The bi-partisan Act provides $11 million funding to set up an electronic data collection system.  As a result of the IMPACT Act, nursing homes will have to electronically report staffing data every quarter which will "increase accuracy, improve the timeliness of the data, and allow for the calculation of quality measures for staff turnover, retention, types of staffing, and levels of different types of staffing," according to a White House press release. [5] The Centers for Medicare & Medicaid Services (CMS) will oversee the staffing-data collection and will audit the data using nursing home payrolls.  The data-collection system is scheduled to be in place by the end of fiscal year 2016. 


Using this electronic data, the government plans to expand and strengthen Medicare's five-star Quality Rating System for Nursing Homes, in particular the reliance on self-reported data for staffing levels and quality measures.  Thus, beginning in January 2015, in addition to auditing staff levels against electronically reported payroll information, CMS will implement the following:


a)                          Numerous on-site audits of long term care facilities nationwide or "focused survey inspections" intended to verify the staffing and quality measure information provided by long term care facilities using a sampling method.


b)                          A revised scoring for the Five Star rating system placing more emphasis on verified data;


c)                           An increase in both the number and type of quality measures used in the Nursing Home Compare Five-Star rating system including use of anti-psychotic medication (effective January 2015),  rates of re-hospitalization, discharges to the community and other measures to be introduced in the future.


d)                          Stronger requirements on States to complete timely and accurate on-site inspections and to maintain informational websites for public viewing, assumedly to report the results of the on-site inspections.


It is important to note that in addition to providing the standardized Assessment data and new quality measures used to improve the Five-Star rating system,  the IMPACT Act is also intended to create the necessary assessment instruments to promote Medicare payment reform to Post Acute Care providers  ("PACs") and a more accountable, quality-driven PAC benefit. [6] The IMPACT Act requires the Medicare Payment Advisory Committee, ("MedPAC") and the Department of Health and Human Services to build actual payment prototypes and report them to Congress by 2022.  The IMPACT Act also requires: 1) Post-Acute Care Providers to use quality date to inform discharge planning by 2016; 2) Standardized Quality and Resource Use Measure reporting for PAC providers by 2017; and 3) Standardized Assessment Data required for PAC providers beginning in 2019.




[1] Justice News, Department of Justice, Office of Public Affairs October 10, 2014. 



[2] Extendicare News Release, October 6, 2014,  




[4] The White House, Office of the Press Secretary Statements & Releases at  


[5] See above Footnote 3. 


[6] The United States Committee on Finance at  



If you have any question regarding Medicare 5-Star Rating System and the Impact of IMPACT 2014, please contact Jo Ann Halberstadter, Esq. at or call 609-454-5351. 



Barmak and Associates, LLC      


Our law firm provides integrated regulatory, transactional, employment and litigation/advocacy services to healthcare organizations.


Representative Clients: 

Entities:  Skilled nursing facilities; Home health agencies; Hospice agencies; Hospitals.


Providers: Physicians; Therapists; Orthotists and Prosthetists


Suppliers:  Durable medical equipment; Long-term care pharmacies; Retail pharmacies.


Businesses: Billing; Management service organizations; Independent provider associations


Regulatory Issues: Corporate Compliance Programs (Fraud, waste & abuse; Privacy & Data Security; Employment); Healthcare facility; Licensed Professionals; Medicare & Medicaid (certification, survey and reimbursement); Auditing (legal; clinical; administrative; and reimbursement).


Transaction Issues: General Counsel Services; Contracts.
Employment Issues: Wage and hour; Equal employment opportunity; Discrimination; Whistle-blowing; Employment agreements; Severance packages; Employee release agreements, Non-compete agreements; Non-solicitation agreements; Confidentiality agreements, Employee leave issues, Electronic monitoring and employee privacy, Employee separation (suspensions, terminations and reductions in force); Documentation.


Litigation/Advocacy: Contracts; Employment; Fiduciary issues; Commercial leases; Payment (Managed Care Organizations; Medicare; Medicaid); Guardianship; Professional and facility licensing; Healthcare regulatory; Fraud and privacy issues.
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This newsletter has been prepared by Barmak and Associates, LLC for informational purposes only and is not intended to provide legal advice. You should consult an attorney for advice regarding your individual situation. We invite you to contact us. Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.


For more information, please contact:

David S. Barmak, Esq.

Telephone (609) 454-5351
Fax (609) 454-5361

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