WEEKLY E-BULLETIN


Observation Status, 2-Midnight, 96-Hour, 2-Year Hearing Suspension, RACs – All Working Against Providers

Is CMS picking a fight with providers? Particularly hospitals? You could come to that conclusion by the way the Medicare agency is ratcheting up the pressure through regulatory actions.

  • Observation status. Fox News picked up the issue last week with a report on how this issue puts seniors at risk financially. Click here for the report. Legislation to repeal the 3-day inpatient requirement to qualify for some post acute care services from Medicare was introduced about a year ago. There are now 133 cosponsors in the House (click here to see the list) and 25 in the Senate (click here.) Here’s more advice from a physician on how to manage the issue.
  • 2-Midnight Rule. CMS is just not backing down from this rule, despite the fact that is appears to be having the opposite impact from what CMS expected – creating more, not fewer, observation patients and less, not more, inpatients. CMS held another national conference call to clarify, but again raised as many questions as it answered. Click here for our 2-page summary of that call held last week. The House bill to repeal the rule now has 91 cosponsors – click here to see the list.
  • 96-Hour Rule for CAHs. In its 2-Midnight guidance, CMS has indicated it will now start enforcing a Critical Access Hospital rule that requires physicians to certify that patients admitted to a CAH will be discharged or transferred to another hospital within 96 hours for the CAH to receive payment - a situation that would threaten patients’ access to longer care when needed. Legislation was introduced in the House last week to repeal this mandate. Click here to see the 8 House members who are on bill today.
  • 2-Year RAC Hearing Suspension. The HHS office that conducts RAC hearings and reviews appeals says it will suspend any new hearings for 2 years because of its tremendous backlog of cases. The Office of Medicare Hearings and Appeals will host a forum this Wednesday – but because of heavy demand no one else can attend either in person or online. Click here to see the announcement.
  • RACs lobbying the Hill. Recovery audit contractors have formed their own association and are actively lobbying lawmakers against providers and changes to regulations that relax enforcement. The American Coalition for Healthcare Claims Integrity sent a letter to members of Congress on Jan. 21, saying the suspension of appeals is undermining the audit process and subverting established Medicare policy. Click here for more.

Inspector General Taking Aim at Hospitals’ 340B Contract Pharmacy Arrangements

A new HHS OIG report out last week said many poor patients are not benefiting from 340B discounts. In OIG’s sample, two-thirds of the hospitals do not offer the 340B price to uninsured patients. OIG studied 30 covered entities—15 community health centers and 15 Disproportionate Share Hospitals and their contract pharmacy arrangements. Click here for the 18-page OIG report. Click here for the drug industry’s take on the issue.

Report: Insurers Dropping Specialty, Community Hospitals

Insurers are dropping specialty and community hospitals from provider networks and driving customers to providers that accept lower rates in exchange for higher patient volumes, according to report last week. The move is an unexpected consequence of reform, the article noted, which has payers scrambling to keep a lid on premiums while faced with new taxes, added benefits and restrictions on age-based premium variation ushered in by the Affordable Care Act. Click here for the report. Click here for a related report from the Wall Street Journal.

CMS Regs May Force Insurers to Broaden Provider Networks

Insurers selling plans on health insurance exchanges may soon have to broaden their provider networks to include 30 percent of essential community providers in their area–or risk being dropped from the online marketplaces. Under a new policy proposed last week, CMS would require insurers to include more federally-funded health clinics, safety-net hospitals and other providers that low-income consumers typically use. They’re currently required to include 20 percent of these providers in exchange plans. That percentage could increase to 30. Click here to read the CMS letter to insurers.

Doc Payment Fix Deal Reached – Except For A Way to Pay For It

The battle continues this week over the future of the doc payment fix (SGR – Sustainable Growth Rate) as House Republicans reportedly are considering another temporary fix. Discussions appear to be centering around a 9-month extension of the current formula and a more permanent fix happening during a Lame Duck session of Congress later this year. Press reports say the AMA is adamantly opposed to another short term fix, pushing instead for the 5-year-plus deal reached between the key House and Senate committees last week. Click here for the 10-page summary of the new deal. Here’s the 1-page summary. Here’s the story in the Washington Post. A copy of the bill, H.R. 4015, should be available later today by click here. The problem continues to be the lack of agreement over how to pay for the long-term fix, which is said to be about $150 billion. Click here for the Finance Committee list of potential cuts floated two weeks ago.

PCORI Announces $206 Million in New Funding

The Patient Centered Outcomes Research Institute (PCORI) last week announced a first round of $206 million in funding, and it’s looking for — among other things — the kind of studies that are comparisons of two or more interventions to determine which works best. Click here for the announcement.

Webinar Set For Learning How Best To Pursue PCORI Grant Funding

Interested in pursuing PCORI funds, but not quite sure if it’s worth your effort? We are hosting a webinar with our colleagues at Innovative Funding Partners to review what it takes to submit a winning PCORI grant. The webinar is Tuesday, February 18 at 2 p.m. EST. Click here to sign up for the 30 minute program – at no cost to you.

New Rules Allows Patients Direct Access to Their Lab Results

HHS last week released a final rule allowing laboratories to give a patient or a person designated by the patient access to completed lab results at their request. The action means that patients can now get their lab results from a physician or directly from the lab. The rule amends the Clinical Laboratory Improvement Amendments of 1988 and HIPAA. Click here for a copy of the rule.

U.S. Senator Asks All California Hospitals For An Update on Medical Error Prevention

U.S. Senator Barbara Boxer (D-CA) wrote to the heads of all 283 hospitals in California last week to ask what steps they have taken to successfully prevent medical errors and reduce the transmission of infection within their facilities. Click here to read her letter.

Many Insurers Turning to Supplemental Health Policies

To expand their business, many insurers now are selling supplemental health policies that fill gaps for consumers with employer-based coverage. Supplemental coverage is needed, insurers say, because employers are increasingly trying to lower their health-related costs by switching to high-deductible plans that often trim typical coverage. Click here for the story.

Report: State-by-State Analysis of Health Insurance Rates

A year before most of the reform law provisions were implemented, insurers were charging individual consumers a wide range of prices for premiums, deductibles and co-insurance, according to a new GAO report. Senators wanted benchmark pricing data to analyze whether the reform law has succeeded in impacting costs. Analysts found, for example, that yearly base rates for a single, 19-year old male nonsmoker in California were between $672 and $11,664. A single, nonsmoking, 64-year old male in California had base rates ranging from $3,096 to $26,928. The highest costing policy for both consumers included a $2,000 deductible and $3,000 out-of-pocket maximum. Click here for the GAO report that provides detailed data from every state. Click here for a new report on the 10 most expensive health insurance areas in the country today.

State, Local Government Health Spending Soaring

Growth in healthcare spending by state and local governments doubled the overall growth of healthcare spending nationwide in 2012, according to a report out last week. Altogether, healthcare spending nationwide increased about 4 percent in 2012, but rose 8 percent among state and local governments. The data concluded that state and local governments were forced to spend more after a temporary jump in Medicaid funds tied to the 2009 federal stimulus package began tapering down in 2010 and 2011. Click here for the report.

New Guidelines on Stroke Risks Target Women

Women of all ages should pay more attention to the risk of stroke than the average man, watching their blood pressure carefully before they think about taking birth-control pills or getting pregnant, according to a new set of prevention guidelines released last week. Women are also more likely to have risk factors associated with stroke, such as migraines, depression, diabetes and the abnormal heart rhythm known as atrial fibrillation. Click here for the new guidelines.

CBO: Health Law Will Reduce U.S. Workforce

A February 4 CBO report predicts the Affordable Care Act will reduce the U.S. workforce by more than 2 million full-time positions through 2021. Republicans used the report to assert their position that the healthcare law is a job killer. The White House and other Democrats shot back. You can draw your own conclusions by reviewing the report here.

CRS Issues Affordable Care Act Score Card

So, how many times have House Republicans tried to repeal, defund, delay or otherwise amend the Affordable Care Act? How many times has the Obama administration delayed parts of the health care law? The Congressional Research Service released a report last week with all that info. It lists House-passed bills amending the ACA — both the ones that have become law and those that haven’t — ACA-related provisions added to appropriations bills and actions by HHS and Treasury to delay implementation. Click here for a copy.

Small Ideas That Could Save Billions of Dollars: RAND

A focused review of recent RAND Health research identified small ideas that could save the U.S. health care system $13 to $22 billion per year, in the aggregate, if successfully implemented. For example, reduce use of anesthesia providers in routine gastroenterology procedures for low-risk patients, change payment policy for emergency transport, increase use of lower-cost antibiotics for treatment of acute otitis media, shift care from emergency departments to retail clinics when appropriate, eliminate co-payments for higher-risk patients taking cholesterol-lowering drugs, increase use of $4 generic drugs, and reduce Medicare Part D use of brand-name prescription drugs by patients with diabetes. Click here for the complete report.

Report: CO-OPs May Be Shaking Up Insurance Marketplaces

A study of available premium rates found that states with a CO-OP had premium rates that were, on average, about 9% lower than states without a CO-OP, according to congressional testimony last week. A McKinsey report determined that CO-OPs are offering the most products among all new insurance companies in state health exchanges. The same report found that CO-OPs are offering 37% of the lowest priced-plans in the states in which they operate, and are the most likely of all insurers to have plans within 10% of the lowest-priced option. Click here for more.

Committee Passes Bill to Exempt Volunteer Responders from “Full-Time” ACA Requirements

The House Ways and Means Committee last week unanimously passed a bill exempting volunteer emergency responders from being counted as full-time-equivalent employees under the Affordable Care Act. The legislation would mean that emergency response organizations wouldn’t be required to provide volunteers with health coverage under the law’s employer mandate next year. The policy has already been adopted by the Treasury Department and the IRS. Click here for the bill.

CBO Chief Discusses His Views on Health Policy

The CBO has a tremendous impact on how Congress maneuvers around health care issues. Last week, the person who heads the agency shared a slide presentation on how CBO views the health care world and where it is focusing some of its research. Click here for the presentation.