WEEKLY E-BULLETIN


Bipartisan House Letter Supports CAHs, Necessary Provider Status

44 House members have signed on to a letter supporting Critical Access Hospitals and their Necessary Provider status. This is in response to an HHS OIG report recommending that most CAHs be eliminated. Click here for the letter.  Because of the significance of the letter, sponsors are allowing House members to sign on through Thursday. Click here for the list of current signers. If you don’t see your House member’s name, call today.

Hospital Groups Push for 2-Midnight Observation Status Rule Delay

CMS’ “2-midnight” observation status regulation takes effect next week, but an increasing number of hospital interests are pushing for a delay or phase-in. The American Hospital Association, the public hospital association, the medical colleges association and premier are all seeking a delay.  Click here for the AHA letter. Several of them will be pushing a congressional sign-on letter this week – a letter from Congress to CMS requesting a delay. If you’re concerned, call your congressional offices. A recent JAMA analysis (click here) shows the rule’s negative financial impact on hospitals. 

Accreditation Changes Threaten Federal Funding for Hospital-Based Nursing Colleges

About 70 hospital-based nursing colleges in 17 states are facing the loss of their Medicare support funding because of a change in the by-laws of their accrediting body, the Higher Learning Commission. In a bi-partisan letter sent to the Commission by nine U.S. Senators, the Commission was urged to change its regulations so that federal funding to the colleges would not be jeopardized. Click here for the letter.

Most Physicians Still Self-Employed: AMA Survey

A 2012 survey of physicians released last week by the American Medical Association shows that while there has been a shift toward hospital employment, 53.2 percent of physicians were self-employed and a full 60 percent of physicians worked in practices that were wholly owned by physicians. Only 23 percent of physicians worked in practices that were at least partly owned by a hospital and another 5.6 percent were directly employed by a hospital. Click here for the 16-page report.

New Rules Will Increase Pay for Home Care Workers

The U.S. Department of Labor announced a final rule last week extending the minimum wage and overtime protections to most of those who provide home care assistance to elderly people and people with illnesses, injuries or disabilities. This change will result in nearly two million direct care workers — such as home health aides, personal care aides and certified nursing assistants — receiving minimum wage and overtime pay effective January 1, 2015. Click here for the regs. Click here for DOL announcement. Click here for the report on business backlash.

CMS Issues Glowing Report on Medicare Advantage Plans

Seniors with Medicare Advantage plans will pay an average monthly premium of 32.60 next year, just $1.64 more than last year, and CMS says premiums are down 9.8 percent since the health reform law passed, that enrollment is growing and that the quality the managed care plans is improving. Click here for the CMS report. However, health insurers say payment reductions of $200 billion to health plans have yet to kick in, and when they do premiums will likely increase, insurers say. Only 20 percent of pay cuts will have taken effect by the end of next year, the insurance association says in a release – click here. A new, broad coalition of business and insurance interests have come together to fight the tax. Click here for their new website.

Federal Government Shutdown Possible; Impact Detailed

It seems increasingly likely the federal government will shut down in a week as Democrats and Republicans fight over ObamaCare funding. For those of you wondering what impact a shutdown will have, click here for a good summary from the Washington Post.

HHS Awards Grants to Hospitals, Others for Enrolling Uninsured in Rural Areas

HHS on Friday announced it is giving more than $2.5 million to educate and enroll uninsured people in rural parts of the country. Rural health supporters, such as universities and hospitals, will receive $25,000 each to fund the outreach efforts. Click here for the list of awardees.

FQHCs Get New Prospective Payment System

CMS last week issued a proposed rule to establish a Medicare prospective payment system for Federally Qualified Health Centers, as required in the Affordable Care Act. The proposed, updated payment system, which is scheduled to begin October 1, 2014, would increase Medicare payments to these health centers by approximately 30 percent for services furnished to Medicare beneficiaries in medically underserved areas. Click here for a summary and the rule.

State Exchange Update

Still more trouble with state exchanges – less than two weeks before the launch of insurance marketplaces the government’s software can’t reliably determine how much people need to pay for coverage, according to insurance executives and people familiar with the program. This is according to a report Friday in the Wall Street Journal (click here - subscription required). More than half of uninsured Americans will have health care options under Obamacare that cost less than $100 a month, according to an analysis released last week by HHS (click here).

Young Invincibles May Sign Up for Insurance Coverage

Uninsured 18-to-29-year-olds – young invincibles – are more likely to buy insurance, if the price is right, than most people have believed, according to a study released last week.  A key issue for the new insurance exchanges is whether enough younger and healthier people will take advantage of new subsidized coverage. Without enough good risks to offset older and sicker people who are likely to jump at the opportunity to gain more-affordable coverage, the exchanges risk significant adverse selection that will drive up premiums. Click here for the informative 9-page study.

Two Ads Aimed At Keeping Young from Signing Up

Two kind of creepy ads out last week were designed to keep young people from signing up for health insurance: one featuring a young man and another a woman left alone in exam rooms by their doctors, lying in vulnerable positions and waiting for medical tests. As their doctors exit, an Uncle Sam character emerges to administer the exams. Click here and here.

House Committee Focuses on Hospital Mergers

Hospital mergers and acquisitions were the topic at a congressional hearing last week before the Judiciary Committee. Hospitals said consolidation is necessary to lower costs and improve quality, click here for their testimony. Insurers made the case that hospital consolidation is not so good. click here for their testimony. The leading witness said ACOs are contributing to increasing the market power of providers and was particularly critical of all aspects of today’s health systems’ business plans, click here for that testimony.

New Study Predicts Likelihood of Hospital Readmissions

Nearly one in seven patients hospitalized for a major surgical procedure is readmitted to the hospital within 30 days after discharge, according to a study out last week in the New England Journal of Medicine. Hospitals with high surgical volume and low surgical mortality have lower rates of surgical readmission than other hospitals (click here).

Leapfrog Group to Allow Hospitals to Review Data

About 2,500 general acute-care hospitals that will receive safety scores from the Leapfrog Group can confidentially preview their scores and underlying data online, and should report any errors in the data to Leapfrog by October 7. CEOs at affected hospitals should receive a letter from Leapfrog with log-in information. The Leapfrog data site is here.

Medicare Premium Support Plans Modeled by Government Agency

The CBO modeled two premium support Medicare options in a report it released last week. Both would reduce the program’s spending, lower premiums for seniors and could also reduce out-of-pocket costs, the agency found. One of the options is similar to Rep. Paul Ryan’s Medicare plan; the other uses a method similar to the Federal Employees Health Benefits Program. Click here for the 55-page CBO report.

Hospital Wage Index Data Available for Review

CMS last week released hospitals’ wage and occupational mix data and now have until Nov. 21 to review and request revisions before it’s used to develop the fiscal year 2015 hospital wage index. Certain subsequent dates in the wage index development process also will be earlier than in previous years as a result of the advanced timeline. For more information, click here see the CMS notice. Click here for the CMS data.

Basic Health Plan Rules Released

CMS on Friday released an Affordable Care Act rule to guide the introduction of Basic Health Plans, optional programs states may implement to help prevent churn among residents whose incomes fluctuate below and above Medicaid eligibility. The 119-page proposed rule will enable states to pursue BHPs beginning in 2015. It “sets forth a framework for Basic Health Program eligibility and enrollment, benefits, delivery of health care services, transfer of funds to participating states, and federal oversight.” Click here for the rule.

House GOP Releases ObamaCare Replacement Plan

House Republicans issued their repeal and replace plan for ObamaCare last week and it relies fairly heavily on repeal. The GOP proposal: allows the purchasing of health insurance across state lines; enables small businesses to pool together to buy insurance; reforms medical malpractice laws; allows families and individuals to deduct health care costs like companies do; expands HSAs; bolsters state-based risk pools and extends HIPPA protections; and prohibits federal funding of abortions. Click here for their complete proposal.

FDA Rule Establishes Unique Device Indentifier

The FDA last week issued a final rule requiring most medical devices distributed in the U.S. to carry a unique device identifier within seven years. Class III (or high-risk) devices must comply by Sept. 24, 2014 and Class I devices by Sept. 24, 2020. Devices intended for reuse must eventually bear a permanent UDI marking on the device, beginning with Class III devices in 2016. Click here for the rule. Click here for the FDA’s draft guidance document.

Medicare Beneficiaries Get Much More Than They Pay

It’s not a surprise that Medicare beneficiaries receive far more assistance from the program than they pay into it, and that gap will only widen in coming years.  A CBO report last week gives specifics. Those born in the 1940s will receive an average $160,000 in benefits over their lifetimes, while paying a total of $45,000 in Medicare payroll taxes. That gap will expand as benefit costs — driven upwards by rising health care costs and longer life expectancies — increasingly outstrip revenues. Those born in the 60s will receive $270,000 in benefits, four times as much as the $65,000 they’re projected to pay into the program. Click here for the easy-to-read CBO report.

Florida, Texas, California Have Most Uninsured Kids

Four million kids, a third of whom live in Florida, Texas and California, were eligible for Medicaid and the Children’s Health Insurance Program in 2011 but remained uninsured, according to a report out last week. That’s down from the 4.9 million children in 2008, but it points to a persistent challenge for public health advocates, especially in key geographic areas. Click here for the 4-page analysis.

CMS Actuary Says Slower Health Spending May Be the New Norm

The CMS actuary was out with a report last week projecting a continuation of slower than normal growth in health care spending. Spending increases on hospital services are projected to be below five percent. For 2015 to 2022, growth in total hospital spending is projected to average 6.3 percent per year. Over this period, hospital spending is impacted by a number of factors, including increases in spending among the newly covered, improvements in the economy that are expected to lead to more use of services, aging of the US population, and Medicare hospital payment update reductions that have been cumulatively impacting spending since 2012, click here for more.