Saturday, September 19, 2026

HCA Healthcare has filed a lawsuit against Independence Blue Cross, alleging the payer systematically denied prior authorizations for medically necessary services by applying out-of-state coverage policies to patients in Virginia and Texas. The suit claims the insurer's practices breached its provider agreements and the terms of patient health plans. This legal action highlights a growing tension over payers using medical policies from one state to adjudicate claims in another, which can lead to unpredictable and unfair denial patterns for practices. Monitor the docket for this case; it could influence how other BCBS plans apply national versus local coverage determinations.

The HHS Office of Inspector General is pressing CMS and Medicare Advantage organizations to intensify efforts to prevent durable medical equipment fraud. The OIG's call follows audit findings of widespread improper payments linked to lax oversight of DME suppliers operating within MA networks. The report signals that CMS may soon require MA plans to implement stricter supplier credentialing and claims validation, which could impact prior authorization timelines and documentation requirements for DME orders placed through MA plans. Practices should prepare for more stringent documentation requests from MA plans for DME referrals, especially for high-cost items.

A client alert from JD Supra warns that CMS's 2027 Physician Fee Schedule proposed rule contains provisions that would significantly restrict common third-party arrangements for remote patient monitoring and remote therapeutic monitoring. The rule targets contractual setups where third-party vendors provide RPM/RTM services and bill under the practice's NPI, raising concerns about compliance with Medicare's reassignment and supervision rules. If finalized, practices that rely on third-party vendors to manage and bill for these services could face operational disruption and potential audit risk for services rendered after January 1, 2027. Review your current RPM/RTM vendor contracts and service models now to assess compliance risk before the final rule is published later this year.

A federal court has ordered CMS to issue clarifying guidance to correct the long-standing but incorrect belief that Medicare only covers skilled therapy services when a patient is improving. This 'improvement standard' myth has led some clinics and therapists to prematurely discharge patients. The order compels CMS to educate providers that coverage is based on the need for skilled care to maintain function or prevent decline, not solely on documented improvement. The corrective guidance, once published, should be reviewed by practices providing physical, occupational, or speech therapy under Medicare Part B. Practices should audit their documentation and clinician training to ensure compliance with the clarified coverage policy.

The Trump administration announced that all 50 states have now signed onto the administration's Medicaid drug pricing model. The model, touted as a way to lower costs, focuses on securing deeper discounts for certain high-cost drugs in state Medicaid programs. This expansion is part of a broader push to address drug spending, though operational details for provider billing remain largely unchanged. The announcement signals sustained political focus on pharmaceutical pricing within public programs, which could influence future coverage decisions for new therapies. The expansion is effective immediately for participating states.