WEEKLY E-BULLETIN


Oct. 10, 2011


IOM Issues Long Awaited Essential Benefits Report

The Institute of Medicine is out with its long-anticipated report on what constitute essential benefits.  Actually, the 297-page report doesn’t define essential health benefits, it just recommends the methodology HHS should use to determine the package. IOM said the benefits should be pegged to the “typical” small employer plan and states should have flexibility to determine what’s essential.  HHS should come up with benefits that are medically necessary, and it should first set a cost target before filling in the benefits to meet that goal.  HHS should have the initial benefit package in by May 1, 2012, and it should be as specific as possible, the report says.  Click here to see the report.

CAHs In The Cross-Hairs?

A couple of important federal agencies last week fired warning shots a critical access hospitals.  The Office of the Inspector General announced its work plan for the coming year and among its targets CAHs.   Inspectors will examine how many and what kind of patients CAHs treat to determine the appropriateness of a CAH designation. Click here to see the entire 165-page OIG report (PDF).  Also, the Medicare Payment Advisory Committee last week was openly discussing the variable levels of quality provided by CAHs and whether a change in payment policies could improve the quality of care.  MedPAC made no formal recommendations. Click here to review the MedPAC powerpoint on the differences between urban and rural care.

MedPAC Hits Specialist With Medicare Payment Fix

MedPAC did vote last week to recommend a dramatic and controversial fix to the Medicare physician payment formula.  Unless Congress acts by year’s end, physicians will see an average 30 percent payment reduction in Medicare.  Physician and hospital groups actively opposed the proposal, which would hold primary care docs harmless and cuts payments to specialists by about 17 percent over three years.  It would also make additional cuts to other providers, as we reported last week.  It is unlikely Congress will approve the recommendations this year.  Click here for proposal details.  U.S. Rep. Allyson Schwartz (D-PA) sent a letter – signed by 113 Democrats and Republicans to the congressional deficit reduction supercommittee urging them to repeal the physician payment formula.  Click here to see if your member of Congress signed on.

Scathing Senate Report Released on Home Health Companies

Senate Finance Committee chairman Max Baucus and Republican committee member Chuck Grassley last week released a report about the tactics home health companies have used to get maximum payments out of Medicare. One tactic identified: encouraging therapists to aim for the most profitable number of therapy visits, whether the patients needed them or not.  Click here to review the 670-page PDF report.

HHS Identifies Insurance Rate Requests On Line

HHS is now publishing a comprehensive list of insurance companies across the United States that are requesting rate increases of at least 10 percent and their explanations.  Click here to see the new tool.  Consumer Reports is out with its ranking of Medicaid plans across the country.  Click here to see their PDF report.

Studies:  High Cost Factors Identified

A new study out last week finds that almost one-third of Medicare beneficiaries have surgery in the last year of their lives, leading to questions of whether they contribute to a bloated health care system.  Click here to see the report in The Lancet.  Click here to see the NY Times story.  Another report identified the top 5 most unnecessary health care costs - number one is not using a generic drug first when treating high cholesterol.  Click here to see the summary.

CMS Touts Affordable Care Act Gains

CMS said last week that nearly 20.5 million people with Medicare reviewed their health status at a free Annual Wellness Visit or received other preventive services with no deductible or cost sharing this year. In addition, nearly 1.8 million people with Medicare have received discounts on brand-name drugs in the Medicare Part D coverage gap, also known as the “donut hole,” between January and August of this year. The total value of discounts to people with Medicare in the donut hole is nearly $1 billion through August of this year, with an average savings of $530 per beneficiary.  Click here for more.

BCBS Makes Major Reform Recommendations

The Blue Cross BlueShield Association was out with a 52-page report last week identifying ways the government could reduce health care costs.  More generic drugs, less advanced imaging use, more primary care incentives, etc…clickhere to see the PDF report.

ACO Update

CMS will likely be announcing soon which programs it has selected as Pioneer ACOs.  It has already started informing programs whether they have been selected.   In a related development, OMB has received the final rule for the accountable care organization initiative formally known as the Medicare Shared Savings Program, which means its public release could come soon.

House GOP Continue CLASS Attack

Congressional Republicans continue their attack on the CLASS Act.  Three top Republicans on the Energy and Commerce Committee sent a letter to HHS Secretary Sebelius demanding the release of new HHS information that may call into question the viability of CLASS.  Click here for a copy of the letter.

FBI Investigates Behavioral Health Lobbying in Washington

The FBI is investigating what appears to be a major health care fraud initiative that may have been hiding behind the National Association of Behavioral Health.  It involves lobbyists, big money and a Miami businessman who has already plead guilty to 38 counts.  Click here for the story.

House Rep Investigates Gray Market Drug Companies on Shortages

Rep. Elijah Cummings (D-MD) released five letters he sent last week to “gray market” pharmaceutical vendors, asking for documentation of their business and drug-safety practices.  Cummings is the ranking member of the House Committee on Oversight and Government Reform, and is investigating recent accusations of price gouging amid record-breaking drug shortages in generic cancer and anesthesia medicines.  Click here to see the targeted companies and read the letters.

Local Health Departments Eliminating Programs Across US

More than half of all local health departments eliminated or reduced at least one program between July 2010 and June 2011, according to a new survey released last week from the National Association of County & City Health Officials.  Maternal and child health services were cut most often.  Click here for a summary.

CDC Says 300,000 Drink and Drive Every Day

Adults drank too much and got behind the wheel about 112 million times in 2010—that is almost 300,000 incidents of drinking and driving each day—according to a CDC report released last week.  Click here.

New Federal Program Summaries Prepared by Our Health Policy Team

Medicare Bundled Payments:  Click here.
Community Based Care Transitions Program:  Click here.
Medicaid Eligibility Changes – State Exchanges:  Click here.
Health Insurance Premium Tax Credit – State Exchanges:  Click here.