WEEKLY E-BULLETIN


Hospitals Face New, Increased Performance Penalties

Hospitals are facing an increase in performance penalties and new quality requirements beginning in FY15 as part of CMS’ proposed changes to rules governing the Inpatient Prospective Payment System that were released last week. The unplanned readmission penalty increases from 2% to 3%; the Value Based Purchasing penalty increases from 1.25% to 1.5%; and the new Hospital Acquired Condition penalty starts at 1%. Hospitals would receive a 1.3% update under the proposal. There are about 1,800 pages in the CMS document. Click here for our health policy team’s excellent 5-page executive summary. Click here for the CMS summary. Unfortunately, there were no changes to the 2-midnight rule – as had been expected.

LeapFrog Group Releases New Hospital Safety Scores

New research reveals that 1 in 25 patients acquire an infection in the hospital – it’s one reason more than 1,000 people die each day from preventable medical errors, according to a release last week from the Leapfrog Group. The group says medical errors remain the third leading cause of death in the United States. Leapfrog released its update hospital safety scores last week. Click here to check on your hospital’s score and your competitor’s.

CBS News: Spinal Fusion Surgeries Increasing Dramatically, Perhaps Unnecessarily

From 2001 to 2011, the number of spinal fusions in U.S. hospitals increased 70 percent, making them more frequently performed than even hip replacements, according to new investigative report from CBS News. The growth has been attributed in part to improved technology, an aging population, and a greater demand among older people for mobility. But it has also sparked a debate over whether some surgeons are performing spinal fusions that are unnecessary and potentially dangerous. Click here for the report and the video.

ICD-10 Implementation Date Set

CMS last week said providers and insurers will have to put in place the ICD-10 coding system for billing by October 1, 2015. CMS said that HHS expects to release an interim final rule in the near future that will include a new compliance date that would require the use of ICD-10 beginning October 1, 2015. The rule will also require HIPAA covered entities to continue to use ICD-9-CM through September 30, 2015. Click here for more.

8 Million Sign Up for Obamacare; State-by-State Enrollment Numbers Released

A last-minute deluge of health insurance sign-ups came from states where political leaders have opposed the Obama administration’s health-care law, according to federal figures released last week. In March and April, the number of people enrolling in plans more than doubled in the 36 states that chose not to set up their own marketplaces, the figures show. Click here for ACA enrollment numbers by state. Click here for the news report.

National Medical Board Telemedicine Guidelines Attacked

New guidelines issued by the Federation of State Medical Boards could have a chilling effect on the growth of telemedicine – especially in rural areas and among low-income patients, say some patient advocates, health care providers and health care companies. But the federation says the updated guidance will safeguard patients’ privacy and ensure high-quality care in the current fast-changing health care delivery environment. Click here for the guidelines. Click here for the press report.

LTCH Medicare Payments Would Slightly Increase in FY15

CMS says that Long-Term Acute Care Hospital PPS payments to about 435 hospitals would increase by 0.8 percent, or approximately $44 million, based on the proposed payment rates for FY15. Click here for a one-page LTCH summary from our policy team.

Administration Targets Cuts to Post-Acute Care Costs

The Obama administration will intensify its focus on cutting healthcare costs related to care after hospital discharge, according to media reports last week. Medicare spending per capita on post-acute care services grew about 5 percent or more annually in 34 of the 50 largest hospital markets in the United States, according to an economic analysis by Kaiser Health News. Some states, such as Louisiana, spend more than 30 percent of all their Medicare dollars on such services. Altogether, the program spent about $62 billion on such services in 2012. Click here for details.

FQHCs Could See 32% Payment Increase

CMS issued a final rule last week that could increase Medicare payments to Federally Qualified Health Centers by as much as 32 percent. The new payment system establishes a Medicare prospective payment system for FQHCs, which provide access to medical services to patients in or from medically under-served areas. Click here for a detailed fact sheet from CMS.

New Hospice Rules Designed to Stop Duplicative Rx Payments

New Medicare guidance that took effect May 1 aims to stop the federal government from paying millions of dollars to hospice organizations and drug insurance plans for the same prescriptions for seniors. But the changes may make it more difficult for dying patients to get some medications, senior advocates and hospice providers say. The new measures direct insurers not to pay for any prescriptions for hospice patients until they receive confirmation that the drugs are not covered instead by the hospice provider. Click here for the CMS guidance document.

Hospice Medicare Payments Would Increase 1.3%

CMS released new payment rules for Hospice that would see a 1.3% increase in payments in FY15. Click here for the CMS summary. Click here for the proposed rules.

IRFs Would Get 2.2% Increase

Inpatient rehabilitation facilities (IRFs) would see their FY15 Medicare payments rise by 2.2 percent according to the proposed rule released last week by CMS. The agency projects that a market basket measure of the costs of delivering such services will rise by 2.7 percent, but other adjustments, including cuts under the health law make the increase 2.2 percent, which translates to additional payments totaling $160 million for the facilities. Click here for a summary.

SNFs Would Get 2% Increase

CMS projects that aggregate FY15 payments to SNFs will increase by $750 million, or 2.0 percent, from payments in FY14, which represents a higher update factor than the 1.3 percent update finalized for SNFs last year. This estimated increase is attributable to 2.4 percent market basket increase, reduced by the 0.4 percentage point multifactor productivity adjustment required by law. Click here for a detailed summary.

Inpatient Psych Would Get 2% Increase

The total Medicare payment rate update for inpatient psych facilities is 2 percent. This is comprised of a rehabilitation, psychiatric, and long-term care market basket increase of 2.7 percent, an ACA required reduction of 0.3 percentage point, and an ACA required productivity adjustment reduction of 0.4 percentage point. Click here for details from CMS, which include many new policy changes.

122,000+ Awaiting Organ Transplants; 17 Die Waiting Every Day

There are more than 122,000 people on the organ transplant waiting list in the United States, according to a briefing last week on Capitol Hill presented by the Association of Organ Procurement Organizations. More than 6,000 people died last year waiting for a transplant – 17 every day. Click here to see their excellent slide presentation.

Improper Medicare Payments Totaled $50 Billion Last Year

Improper payments cost taxpayers and Medicare beneficiaries about $50 billion in 2013, according to HHS last week. Gloria Jarmon, HHS deputy inspector general for audit services, testified at a House Ways and Means health subcommittee hearing on Medicare oversight. The Medicare fee-for-service program lost $36 billion, Medicare Advantage $11.8 billion and Medicare Part D $2.1 billion. Click here for her testimony. Click here for a related GAO report.

Survey: Most Docs Say Other Docs Make Unnecessary Prescriptions Weekly

Three out of four physicians believe that fellow doctors prescribe an unnecessary test or procedure at least once a week, a survey released last week finds. The most frequent reasons that physicians order extraneous—and costly—medical care are fears of being sued, impulses to be extra careful and desires to reassure their own assessments of the patient, the survey said. Click here for the complete survey.

CMS Releases Updated Medicaid, CHIP Enrollment Numbers

More than 4.8 million additional individuals enrolled in Medicaid or CHIP from October 1, 2013 through the end of March 2014 compared to enrollment before the exchanges opened. Another approximately 1 million individuals gained coverage through an early expansion of Medicaid to low-income adults in seven states before January 1, 2014. Click here for further details from CMS.

Health Care Spending Spiked in First Quarter

Total spending on medical care spiked in the first quarter of 2014 as people gained health insurance under ObamaCare, according to government data released last week. The dramatic 9.9 percent growth in healthcare spending helped to boost the economy overall amid slow growth in other sectors. Click here for the report.

COBRA Changes Announced

The Obama administration last week announced updates to model notices informing workers of their eligibility to continue health-care coverage through the Consolidated Omnibus Budget Reconciliation Act. The updates make it clear to workers that if they are eligible for COBRA continuation coverage when leaving a job, they may choose to instead purchase coverage through the state exchanges. Click here for details.

House Leaders Issue White Paper on Medical Innovations

House Energy and Commerce leaders will host NIH Director Francis Collins and top FDA officials for a roundtable on Wednesday on how to encourage and accelerate medical innovation around the country, as part of their new, bipartisan effort to bring attention to the topic. The committee released a white paper asking for feedback on how to improve the process of discovering, developing, and delivering such innovations. Click here for the white paper.

CMS Panel: Low-Dose CT Scans Not Likely for High-Risk Patients

CMS is expected to follow the advice of its national coverage determination panel that ruled last week that annual screening for lung cancer by low-dose CT scan for high-risk individuals would not be covered. Why? Annual low-dose CT lung cancer screening for high-risk individuals doesn’t have enough evidence for benefit over harms to be covered by Medicare, the advisory panel concluded. Click here for more.

CDC: 39% of Premature Deaths Preventable

Up to 39% of premature deaths each year from heart disease, cancer, chronic lower respiratory disease, stroke and unintentional injury could be averted, the CDC said last week. Southeastern states had the highest number of potentially preventable deaths from all of the five leading causes. Click here for more from the CDC.

First US MERS Patient Treated

The CDC last week announced the first confirmed case of the Middle East Respiratory Syndrome Coronavirus (MERS-CoV) in a traveler to the U.S. The patient is currently isolated and in stable condition at an Indiana hospital, where the patient was admitted on April 28 after visiting the emergency department. Click here for more from the CDC.

Study: Diabetes in Children Increases Dramatically

Diabetes in children and teens jumped significantly between 2001 and 2009 in the United States with minority youth increasingly being affected, according to a new study. The findings show a more than 30 percent rise in type 2 diabetes during that period. The spike reflects the nation’s sharply higher rates of childhood obesity, which is a major risk factor for the disease. The study also found that type 1 diabetes, also known as juvenile-onset diabetes, is becoming more common among minorities. Click here for the study results.