Budget, SGR Deals Could Bring More Health Care Cuts

Hospitals and other providers are increasingly concerned that their Medicare payments could be the targets of more cuts as Congress and the President negotiate a deal on the federal budget and the debt limit. Additionally, lawmakers are expected to find funding for a physician Medicare payment fix by the end of the year. A one year fix, depending on how it is structured, costs $15 billion to $18 billion. Where could the money come from? Our team put together a 6-page summary of most of the health care spending cuts that have been seriously discussed over the past 8 months. There is every reason to believe that if there are cuts, this is where they will come from. Click here to see the report.

Federal Shutdown Has Big Impact on CDC and Hospital, Nursing Home Inspections

Because of the shutdown of the federal government, about 9,000 of the CDC’s 15,000 workers have been furloughed. James Blumenstock, chief of public health practice for the Association of State and Territorial Health Officials, said states are concerned that the absence of those workers might slow down identification and response to MERS cases if the virus spreads to the U.S. Click here for more. Another health care casualty of the government shutdown: states are under a directive from CMS to limit their inspections of hospitals and nursing homes largely to cases posing “immediate jeopardy” to patients, and those where a hospital’s funding is at risk. Click here for the story.

CMS Finalizes Medicaid DSH Payment Reductions Rule

CMS has released a final rule on Medicaid disproportionate share hospital (DSH) payments for FY14 and FY15. The rule finalizes CMS’s methodology for reducing federal payments to states. The annual aggregate reductions in federal DSH funding are $500 million for FY 2014 and $600 million for FY 2015. CMS is reducing the federal DSH allotments as a result of the Medicaid expansion and the expectation that the expansion will reduce levels of uncompensated care. Click here for an excellent one-page summary.

CMS Revises Timeline for Medicare DSH Payments

On September 30, CMS released an interim final rule to adjust methodology established in the agency’s final inpatient payment rule and to prevent recoupment of uncompensated care payments. This modification effectively changes when uncompensated care payments are made to hospitals whose cost reporting periods do not span October 1 to September 30. CMS made this change to ensure that hospitals with cost reporting periods spanning more than one Federal fiscal year will not encounter delays or administrative challenges in receiving DSH payments. Click here for the one-page summary.

Septicemia, Osteoarthritis, Device Complication, Birth, AMI are Most Expensive: Report

Septicemia tops the list of most expensive inpatient conditions to treat, costing $20.3 billion in 2011, according to the latest statistical brief from AHRQ. Care and treatment for septicemia represented 5.2 percent of total inpatient hospital costs, which reached $387 billion in 2011. Medicare and Medicaid took care of most (63 percent) inpatient hospital costs, incurring $182 billion in costs. Private insurers covered $112.5 billion in hospital costs (29 percent) and uninsured hospitalizations totaled $17 billion. Click here to see the government’s list.

Grassley Hits Drug Makers for NOT Giving 340B Discounts to Hospital

US Senator Chuck Grassley has written two drugmakers and demanded they explain why they refused to provide required discounts to an Iowa hospital. The Iowa Republican took this move after confirming with the Health Resources Services Administration that the drugmakers should have offered lower prices. Click here for the report and his letters to the drug companies.

State Exchange Updates

  • The consumer experience at state run health exchanges appear to be much better than those at exchanges run by the federal government, according to a New York Times report last week. Click here.
  • Experts agree that the success of the health exchanges depends, in part, on younger, less sick (lower cost) consumers signing up. According to an initial analysis of the sign up, that seems to be happening. Click here for the report.
  • The federal government will spend about $10,000 subsidizing health insurance costs for a poor, middle-aged man who lives in Georgia – and just $3,000 buying the same guy in nearby Tennessee a near-identical plan. The cost variation in the federal exchanges is wide. Click here to see how your area compares.
  • For the past 12 days, a federal health exchange system costing more than $400 million and billed as a one-stop click-and-go hub for citizens seeking health insurance has thwarted the efforts of millions to simply log in. The growing national outcry has deeply embarrassed the White House, which has refused to say how many people have enrolled through the federal exchange. Click here to see why this has happened.
  • House Republicans last week called on the Obama Administration to suspend penalties for consumers because of all the trouble they continue to have signing up. Click here.
  • If you want to put it all in perspective, the last time there was a huge rollout of a new Medicare benefit – the Part D drug program – there were huge glitches. Click here for this very interesting story.

Ohio Governor to Bypass Legislature and Expand Medicaid

After failing to gain enough support from Republican legislators, Ohio Governor John Kasich will ask a spending oversight panel to expand the state’s Medicaid program, according to reports last week. The Republican governor is expected to make the request to the Controlling Board on Oct. 21. Kasich will ask the seven-member board, made up of lawmakers, for permission to spend about $2.5 billion in federal funds to cover about 275,000 residents under Medicaid. If the Controlling Board approves the request, expanded coverage can start January 1. Click here for more.

Daily Show’s Jon Stewart Takes On “Medican’t” States

The Daily Show’s Jon Stewart had harsh words this week for states that have not expanded their Medicaid programs under the Affordable Care Act. His 3-and-a-half minutes on this topic last week are very funny – regardless of your political persuasion. Click here.

House Chairman Wants Info On Inmates Getting New Medicaid Coverage

A Center for Health Care Strategies presentation showing that jail inmates could represent 30 percent of new Medicaid enrollees under the health care law has prompted congressional action. Energy and Commerce Committee Chairman Fred Upton (R-MI) has asked the Comptroller General to analyze Medicaid enrollment among inmates, saying he’s concerned the program is straying from its primary purpose of providing care for the most vulnerable. Click here for the letter.

New Home Health Fraud Bill Attacked by Medicare Rights Group

New legislation designed to curb home health fraud in Medicare has been introduced by Representatives Jim Matheson (D-UT) and Brett Guthrie (R-KY). The bill would establish a maximum threshold for episode reimbursement to skilled home health agencies under Medicare. Last week it came under fire from a Medicare rights group. Click here for their analysis.

113 House Members Urge CMS Not to Cut Lab Payments

A bipartisan group of 113 lawmakers in the House of Representatives last week urged CMS to drop its proposed pay cut for laboratory tests, which industry estimates could reduce pay by 75 percent for some of the most common anatomic pathology services that diagnose cancer. A group of senators sent a similar letter two weeks ago. Click here for a copy of the signed House letter.

Docs Not Too Happy with EHR Requirements: Study

While physicians note some advantages of electronic health records, they complain that the systems in use today are cumbersome to operate and a key contributor to job dissatisfaction, according to a RAND Corp. study sponsored by the AMA released last week. Contributors to dissatisfaction included excessive productivity quotas and burdensome rules and regulations. Researchers based their findings on information gathered from 30 physician practices in six states — Colorado, Massachusetts, North Carolina, Texas, Washington and Wisconsin. Click here to read the study.

Study: Higher Nurse Staffing Equals Lower Readmissions

Hospitals with higher nurse staffing had a 25% lower odds of being penalized for readmissions compared to hospitals with lower staffing, a study in Health Affairs last week finds. Policy makers and hospital administrators should consider investing in nursing as a way to reduce readmissions, the authors say. Click here for the abstract, or complete report if you have a subscription.

Health Care Price Increases Hit New Historic Low

National health care prices in August were 1 percent higher than a year ago, down 0.1 percentage point from July and equal to the historically low growth recorded in May, according to the latest economic indicators from Altarum Institute’s Center for Sustainable Health Spending. Year-over-year hospital prices fell to 1.5 percent growth in August, the lowest rate since December 1998. National health expenditures were 3.8 percent higher than a year ago, equal to CMS’ recent forecast for 2013. Click here for details.

More Part D Choices for Seniors

Seniors will have a choice of four more Medicare Part D prescription drug plans next year than they have now, according to an analysis by the Kaiser Family Foundation. 36 million people are now enrolled and the average premium is expected to increase by 5 percent. Most plans won’t offer any gap coverage beyond what’s required by the Affordable Care Act. Click here for more.

House Budget Committee Makes Case to Restructure Medicare, Medicaid and Social Security

The Republicans on the House Budget Committee last week made another case for restructuring Medicare, Medicaid, and Social Security. The Committee said these programs are growing rapidly because the population is getting older and health-care costs continue to rise. About 10,000 baby boomers are retiring every day. And in recent years, health-care costs have grown 50 percent faster than inflation. Click here to read the Committee’s brief report.

High Cost of Asthma Drugs in US Detailed

The CDC puts the annual cost of asthma in the United States at more than $56 billion, including millions of potentially avoidable hospital visits and more than 3,300 deaths, many involving patients who skimped on medicines or did without. NY Times article last week detailed the high cost of asthma related medication in the United States, particularly as compared with the prices in other nations. Click here.

Pee in a Cup, The Musical” Ads Seek Physician Drug Screening in California

Consumer Watchdog is pushing an effort in California to require drug testing of physicians – and their using a short comedy ad: “Pee in a Cup, The Musical.” The 33-second clip uses song and dance to portray the idea that California doctors should submit to drug testing, just like police, firefighters, bus drivers and Disney workers. As many as 18 percent of doctors in the state are involved in substance abuse, the group says. Click here for the clips.