WEEKLY E-BULLETIN


Nov. 7, 2011


CMS: Payment Increases for Outpatient, Cancer Hospitals, ASCs

CMS issued a final rule last week that will update payment policies and payment rates for services furnished to Medicare beneficiaries in hospital outpatient departments and ambulatory surgical centers beginning Jan. 1. Payment rates under the OPPS will increase by 1.9 percent in CY 2012. This increase is based on the projected hospital inpatient market basket percentage increase of 3.0 percent for inpatient services minus the multifactor productivity adjustment of 1.0 percent and minus a 0.1 percent adjustment, both of which are required by the Affordable Care Act.  Click here for more details.


CMS Pulls Controversial VBP Requirements

In those same rules, CMS acknowledged that data on Healthcare Acquired Conditions (HAC), AHRQ quality composite, and Medicare spending per beneficiary measures were not available on Hospital Compare for a full year prior to the start of the performance period (March 3, 2012), as required by law, so the agency decided to suspend the effective dates of the HAC, AHRQ, and Medicare spending per beneficiary measures. These measures will not be included in the FY 2014 Hospital VBP Program but will be adopted for future years of the VBP Program. The suspension of these measures in this rule will not affect the status of these measures under the Hospital IQR Program.

Cancer Hospital Payments Increased

The final rule provides a payment adjustment for designated cancer hospitals and is expected to increase their payments by 11.3 percent (approximately $71 million) over what they would have otherwise been paid.

ASC Payment Rates Up

The final rule increases payment rates to ASCs by 1.6 percent in CY 2012.  It also establishes a quality reporting program for ASCs and adopts five quality measures, including four outcome measures and one surgical infection control measure beginning in CY 2012 for the CY 2014 payment determination. Click here to review the 1,500-pages of HOPD, ASC and related rules.


Home Health Gets Payment Cut

New CMS rules issued last week say payments to home health agencies are estimated to decrease by approximately 2.31 percent or $430 million in CY 2012, the net effect of a 1.4 percent payment update, the wage index update, and the case-mix coding adjustment. Click here for details.

CMS Rules Make Changes to Dialysis, Ambulance and DME

In a separate set of rules, CMS updated rates for End-Stage Renal Disease (payment rates for dialysis treatments will increase by 2.1 percent in CY 2012)  and other areas – including the extension (through CY 2011) of certain payment increases for ground ambulance services and certain rural area designations for purposes of air ambulance payment, and establishing a 3-year minimum lifetime requirement for equipment to be considered durable for purposes of coverage as durable medical equipment. Click here for more.

Docs Face 27.5% Payment Cut and Other Changes:  CMS

CMS plans to reduce Medicare payments to physicians by 27.5 percent on January 1, 2012, unless Congress acts to stop this cut.  CMS last week issued proposed physician payment rules for next year.  In addition to the payment cut, CMS is expanding its multiple procedure payment reduction policy to the professional interpretation of advance imaging services “to recognize the overlapping activities that go into valuing these services.”  CMS is also expanding the list of services that can be furnished through telehealth to include smoking cessation services. Click here for more info.  Click here to see the 1,200-page rule.

MedPAC Examines Costs Increases Resulting From Physician Practice Acquisition

MedPAC is beginning a serious examination of at least one consequence of physician practices being acquired by hospitals:  costs for same services are going up.  At MedPAC’s meeting last week, staff outlined the issues and recommended the policy option of reducing Medicare payments to “evaluation and management office/outpatient visits provided in hospital outpatient departments”…so total Medicare payments for these visits are the same across settings.  A copy of MedPACs powerpoint presentation can be found here.

CMS to Host Conference Call on ACOs

If you missed our conference call last week on the new ACO regs, you click here to get a copy of the presentation.  You can click here to get a 5-page summary.  To see a recording of the webinar, click here.  CMS is hosting a national conference call on their new rules Tuesday, November 15, 2011 from 1:30-3 pm ET.  A Notice of Intent to Apply memo is available on the Shared Savings Program Application page in the “Downloads” section (click here).  A copy of the Shared Savings Program application will be posted to this same website prior to the National Provider Call.  You must register for the call. Registration will close at 12:00 pm on Tuesday, November 15To register for the call, click here.

Insurers Educate Administration About Hospital Consolidations

The health insurance industry’s association in Washington was reportedly busy educating Obama Administration officials about the consolidation of the hospital industry just days before CMS released the new ACO regulations.  Clickhere to see a detailed summary of hospital consolidation activity.


FDA Approved 35 New Drugs in Last 12 Months:  New Report

This number of FDA approvals is among the highest number in the past decade, surpassed only by 2009 (37), according to the FDA.  Many of the drugs are important advances for patients, including: two new treatments for hepatitis C; a drug for late-stage prostate cancer; the first new drug for Hodgkin’s lymphoma in 30 years; and the first new drug for lupus in 50 years.  Click here to review the FDA’s 29-page report and see a list of the drugs.

White House Issues Executive Order to Address Drug Shortages

The White House last week took steps to deal with persistent and growing shortages of pharmaceuticals.  The President issued an executive order to expedite FDA regulatory reviews, to have the Justice Department investigate certain anti-competitive behaviors and require more timely notifications of disruptions by manufacturers.  Click here to read the executive order.

Health Insurance Industry Details How Tax Will Raise Premiums

A new technical analysis released last week estimates that the new health insurance tax in the Affordable Care Act (ACA) will increase premiums in the insured market on average by 1.9% to 2.3% in 2014, and by 2023 will increase premiums 2.8% to 3.7%.  Click here for details.

AHRQ Awards $34 Million to Fight HAIs

The Agency for Healthcare Research and Quality (AHRQ) announced last week that it has awarded $34 million for grants and contracts to hospitals, academic medical institutions, and health care research organizations to expand the fight against healthcare-associated infections.  Click here to see who got the money and for what projects.

Committee Recommends Changes to HPSA, MUA Criteria

Recommendations changing designations of medically underserved areas and health professional shortage areas were made last week in a report to HHS.  The review was mandated by the Affordable Care Act.  For example, the committee recommended that if a clinician dies, retires or leave a shortage or underserved area not already designated that causes a sudden and dramatic change in primary care services – states should be allowed to submit an urgent request to HHS for immediate evaluation as a shortage area.  Click here to read the committee’s 83-page report.

Deaths Caused by Prescription Painkillers Triple in Past Decade

The death toll from overdoses of prescription painkillers has more than tripled in the past decade, according to an analysis in a CDC report released last week. This new finding shows that more than 40 people die every day from overdoses involving narcotic pain relievers like hydrocodone (Vicodin), methadone, oxycodone (OxyContin), and oxymorphone (Opana). Click here for more.