WEEKLY E-BULLETIN


MedPAC Reviews Potential Changes to Hospital Readmmission Reduction Program

The Medicare Payment Advisory Commission last week reviewed potential future refinements to the hospital readmissions reduction program, which starts October 1. Commissioners said they support the program but that several refinements could be made, such as controlling for the socioeconomic status of the patients a hospital treats and more adequately excluding unrelated and planned readmissions. The initial average magnitude of the penalty is 0.3% of operating payments. Each hospital’s risk is limited in fiscal year 2013 because its total penalty is capped at 1% of inpatient base operating payments. MedPAC said over the longer term, some aspects of the policy may need to be revised. “Doing so could require revising the measure of readmissions, the method for determining excess readmissions, and the formula for computing penalties for hospitals with excess readmissions.” Click here for the 19-slide MedPAC presentation.

IOM Recommends 10 Fixes for Health Care System

America spent $2.6 trillion on health care last year; that’s about 17% of the U.S. economy. A third of that spending — a full $750 billion — did nothing to make anyone healthier. That’s one of the conclusions of an Institute of Medicine report out last week, which looks at the health care spending problem. The IOM recommended 10 different fixes for the American health care system. The report is 381 pages, but you can read a brief by clicking here. An excellent Washington Post summary is available here with two summary graphs that outline the problems.

MedPAC Reviews Therapy Payment Changes; Caps Expire at Year’s End

MedPAC also looked at options for updating payment policies for outpatient therapy. Payments for outpatient physical, occupational and speech/language therapy are currently subject to a yearly cap, but those caps can be circumvented. CMS’ authority over the therapy caps periodically expires and Congress must update it by the end of this year. The commissioner’s discussion focused on the need to balance a more orderly payment policy with a desire to make sure that patients who really need therapy can get it. Click here to review MedPAC’s 25-slide presentation.

“Premium Support” Issues Reviewed

MedPAC is gently weighing into the Medicare “premium support” issue that is occupying a lot of time in the presidential campaign. However, the commission isn’t using the term “premium support.” Instead, it’s referring to “competitively determined plan contributions.” Commission Chairman Glenn Hackbarth observed that MedPAC has long endorsed the idea of giving seniors a private plan alternative to the traditional fee-for-service Medicare program. The private plan alternatives that exist now in Medicare, called Medicare Advantage plans, are paid based on “administered pricing,” he noted. MedPAC’s 15-slide presentation (here) reviews a number of the issues that will need to be considered.

Fee-For-Service Payment Systems Need Reform: New Report

Despite growing interest in replacing fee-for-service payments to health care providers, fee for service is likely to remain the core way of paying physicians, according to a report out last week. So, ensuring the accuracy of these payments will be important to the success of broader payment reforms. Click here for the Health Affairs article by Paul B. Ginsburg, Ph.D.

Study: Wide Variation in Costs for Commercial Patients

A study released last week on non-elderly commercial patients showed a wide variation in costs for treating similar cases. The study was based on UnitedHealthCare patients. For example, treating a basic asthma episode, cases in the 10th percentile of distribution cost $98 each while in the 90th percentile the cost was $1,535 per case. Migraine sufferers in the 10th percentile got treated for $94 while those in the 90th percentile cost the system $2,006. Expense for treating high blood pressure ran from $149 to $1,469 per episode. Click here for the Kaiser Health News report. The full study was published in Health Affairs (here), which requires a subscription for this report.

Imaging Payments Decline: Study

After years of rapid growth in Medicare non-invasive diagnostic imaging (NDI) payments, an abrupt reversal occurred starting in 2007, according to a new analysis released last week. By 2010, overall NDI costs to Medicare Part B were down 21% compared with their 2006 peak. It is unclear whether this large payment reduction will satisfy federal policymakers, according to the study in this month’s Journal of the American College of Radiology. Click here.

$30 Million Radiology Fraud Scheme Revealed

The owner of a radiology practice in New York City has been charged by the U.S. Department of Justice with fraudulent billing of more than $30 million in radiology services provided to Medicare and Medicaid patients that allegedly were never performed. Click here for the report from the U.S. Attorney’s office.

RAC Audit Process Questioned by Congressman

Saying that there are some “unintended consequences” of how the Recovery Audit Contractor program came to be, U.S. Rep. Dan Boren (D-Okla.) said last week that the program needs to be looked at more closely –- adding that in small-town America, if there isn’t a nearby hospital, it could be a life-and-death situation. Boren has called for an investigation into the RAC process and its impact on hospitals, particularly those in rural areas. Click here for more.

MGMA Wants CMS to Stop Penalties on Docs for EHR Shortfalls

The Medical Group Management Association has called on CMS to allow doctors who attest to meaningful use to automatically be given Physician Quality Reporting System e-prescribing credit, and to abolish penalties for doctors who fail to meet incentive criteria. The group also expressed its disapproval of a proposal to cut payments for specialists who treat patients with multiple procedures on the same day. Click here for a copy of the MGMA’s letter to CMS commenting on the 2013 proposed physician payment rules.

New Community Benefit Innovation Program Announced

The need to transform your hospital’s community benefit program into an evidence-based, outcomes-focused system for serving your community has never been greater. Click here to learn more. Strategic Health Care is offering a new, comprehensive service – backed by years of proven experience - to align ongoing strategic initiatives, clinician champions, and patient needs with your new community benefits program. Our program increases your capacity and community engagement, while exceeding best practices to meet patient needs and IRS compliance. Our service also creates a community benefits program to give your hospital a strong foundation to increase grant funding opportunities.

CDC Issues Health Advisory on Yosemite Park Infections

The CDC has issued a health advisory last week concerning six confirmed cases of hantavirus pulmonary syndrome associated with staying at Yosemite National Park in California. Two of the affected people died and additional suspected cases are being investigated. Click here for the advisory.

New Salmonella Outbreak Linked to Turtles

CDC is collaborating with public health officials in multiple states and the FDA to investigate six overlapping, multistate outbreaks of human Salmonella infections linked to exposure to turtles or their environments (e.g., water from a turtle habitat). More than 160 illnesses have been reported from 30 states; 64% of ill persons are children age 10 or younger, and 27% of ill persons are children age  one year or younger. Fifty-six% of ill persons are Hispanic. Click here for more information.

Vaccinations in Children Lowers Incidence of Many Diseases to Historic Levels

High vaccination coverage in children by age two years has resulted in historically low levels of most vaccine-preventable diseases in the United States, according to a report last week from the CDC. Vaccination coverage remained above the national Healthy People 2020 target of 90% for measles, mumps, rubella vaccine (MMR), hepatitis B vaccine, poliovirus vaccine and varicella vaccine. The percentage of children who had not received any vaccinations remained at <1%. Click here for additional details.

EHR Incentive Payments Nearing $7 Billion

CMS said last week that as of July; 271,105 Medicare and Medicaid physicians and hospitals have registered to participate in the EHR payment incentive program, tracking at about 10,300 monthly. Breaking down the total, that’s 180,513 Medicare physicians, 86,708 Medicaid clinicians and 3,884 hospitals. Click here for the story.

October 3 is Eligible Professional EHR Deadline

Wednesday, October 3rd, is the last day for eligible professionals (EPs) to begin their 90-day reporting period for calendar year 2012 for the Medicare EHR Incentive Program, according to a reminder issued by CMS last week. For EPs, this means that they must begin their consecutive 90-day reporting period by October 3rd in order to attest to meeting meaningful use and be eligible to receive an incentive payment for CY 2012. Click here for details.

Advisory Panel Urges Reducing Supervision Level for 28 Outpatient Services

CMS’ Advisory Panel on Hospital Outpatient Payment has recommended reducing the supervision level for 28 outpatient services from direct to general supervision. The proposed services include selected vaccine immunizations; IV infusion hydration, therapeutic infusions and push injections; various urological services; vascular access services; skin or wound care services; and direct admission to observation services. Three rural hospitals and health systems – Avera Health, Carrington Health Center and Mission Health System – testified in support of the changes. CMS’ final decision will be posted here soon.

Public Can Now Vote for Favorite HHS Innovation

For the first time, according to an HHS announcement last week, the public can vote to choose their favorite innovation from among the finalists of the HHSinnovates Program. Launched in the spring of 2010 as part of HHS’s Open Government efforts, HHSinnovates recognizes innovative projects led by HHS employees designed to help solve our country’s toughest health care challenges. Now, in the program’s fifth round, the public is invited to choose from among six finalists. The winners will be announced on September 24. Click here to review the projects and to learn how to vote.