121 New Medicare ACOs Added, At Least 64 Drop Out

CMS announced that 121 new provider groups became Medicare accountable care organizations, 64 ACOs dropped out of the Medicare Shared Savings Program, and some organizations either dropped out of the Pioneer ACO demonstration or moved to other ACO models. Sixty-four of the 477 organizations participating in either the ACO program or three ACO demonstrations are accepting the risk of penalties in return for the prospect of bigger bonuses. Click here for the list of CMS’ 21 Next Generation ACOs and here for the list of the 100 new MSSPs.  There are 41 pre-paid ACOs (called the Investment Model) and 39 of those are new.  Click here for that list and background on that program.

Guidelines Require Medical Record Release without a Stated Reason

In new guidelines issued last week, the Obama administration says doctors and hospitals cannot require patients to state a reason for requesting their records, and cannot deny access out of a general concern that patients might be upset by the information. When patients can see their medical records, the administration said, it is easier for them to participate in their health care. They can, for example, review what they were told by their doctors and, perhaps, consider other options for care.  Click here for the updated HIPAA regs.  Click here for the NY Times story.

MedPAC Votes To Cut 340B; HRSA Updates Some 340B Guidelines

The current 340B drug discount program took another hit last week as MedPAC voted to recommend that Congress cut current program payments and redirect those funds to other providers.  Commissioners voted in favor of lowering Medicare’s payments for Part B drugs furnished through 340B by 10 percent of the average sales price and redistributing those dollars through Medicare’s uncompensated care pool.  Under that formula, MedPAC says most of the redistribution would go to government owned and rural hospitals. Further, the commissioners recommended that the uncompensated care pool distribution should be based on hospitals’ costs for uncompensated care, instead of the current distribution which is based on Medicaid days. Click here for MedPAC’s 340B presentation.

  • HRSA last week updated some of its 340B compliance guidelines.  Click here.
  • MedPAC also made numerous recommendations impacting most other providers:


Congress should update payments for hospital inpatient and outpatient services in 2017 as outlined under current law, which would provide an estimated 1.65% increase.  Click here for the MedPAC slide presentation on inpatient and outpatient hospital services.

  • Physician fee schedule: Congress should increase payment rates for physicians and other health professionals by the amount specified in current law for calendar 2017. Medicare paid about $69.2 billion in 2014 for services covered by the physician fee schedule, paying about 576,00 doctors, 165,000 advance-practice nurses and physician assistants and 150,00 therapists and other providers.
  • Skilled nursing facilities: Congress should eliminate the market basket update for 2017 and 2018 and direct the Department of Health and Human Services to revise the prospective payment system.
  • Hospice: Congress should eliminate the update to payment rates for fiscal 2017. Medicare paid $15.1 billion for hospice care in 2014, with about 1.3 million people using this services.
  • Dialysis: Congress should increase the outpatient dialysis base payment rate by the update specified in current law for calendar 2017. Medicare spent about $11.2 billion on outpatient dialysis service in 2014, with about 383,000 people served.
  • Inpatient Rehab: Congress should eliminate the payment update for fiscal 2017. HHS should conduct a review of medical records for IRFs that have unusual patterns of case mix and coding, and expand the outlier pool to redistribute payments more equitably across cases and providers. Medicare spends about $7 billion a year on these services.
  • Ambulatory Surgery Centers: Congress should eliminate the update to the payment rate for calendar 2017. It also should require ambulatory surgical centers to submit cost data. Medicare payments to these centers have topped $3.8 billion a year, with 3.4 million people served.

Click here for the MedPAC slide presentation covering these services. It contains very good updated data.

200,000+ Physicians, Clinician, Hospitals Hit with Meaningful Use Penalties

More than 200,000 physicians and healthcare professionals will face penalties in 2016 for failing to demonstrate meaningful use of electronic health records in previous years, according to documentation released last week by CMS. Professional organizations representing physicians decried the penalties, which affect about 30 percent of eligible physicians and clinicians. About 5 percent of the nation’s hospitals also will see downward adjustments in reimbursement.  Click here for details.

  • CMS says EHR MU will end in 2016, but that doesn’t mean reporting quality data will end with it.  Click here.

Largest Nurses Union Challenges Catholic Systems’ Merger

The nation’s largest nurses union has asked two state attorneys general to take a closer look at a merger that would create one of the biggest Catholic health systems in the country, according to reports last week. The merger between Orange County, California’s St. Joseph Health System and Washington’s Providence Health & Services would affect providers in seven states, including California and Oregon. The union cites concerns about the proposed system’s size and worries that the merger could lead to service reductions at the eight affected Oregon providers. It also points out that St. Joseph’s provides the least charity care of any California Catholic health system. Click here for the news report.  Click here for the union’s statement.

Antitrust Institute Urges DOJ To Reject Mergers of Major Health Insurers

The American Antitrust Institute last week advised the U.S. Department of Justice to reject proposed mergers of leading health insurers. The letter lays out detailed arguments and economic evidence as to why the proposed mergers would likely harm competition and consumers. These include why the DOJ should pay attention to consolidation in the healthcare supply chain designed (as are the insurance mergers) to leverage up bargaining power; the effects of the mergers on increasing market concentration to presumptively illegal levels in numerous markets, and evidence of higher premium and lower quality and innovation from past insurance mergers. Click here for the letter.

Health System Leaders Identify Major Trends

While usually focused on the for-profit health care sector, this year’s JP Morgan Healthcare Conference in San Francisco last week featured  presentations from CEOs and CFOs from over 20 major healthcare delivery systems.  Organizations include Advocate Health Care, Aurora Health Care, Baylor Scott & White Health, Cleveland Clinic, Geisinger Health System, Intermountain Healthcare, Northwestern Medicine, Partners HealthCare, Vanderbilt University Medical Center and University of Wisconsin Health.  Click here for a good summary of the trends identified in the presentations.

White House Unveils a New Medicaid Expansion Plan

White House announced a new proposal that will give States that have not yet expanded their Medicaid programs an extra incentive to states to take advantage of three years of full federal funding whenever they join. It’s an incentive that would be worth billions in additional federal dollars and require Congressional approval. Specifically, the President’s Fiscal Year 2017 Budget will include a legislative proposal to provide any state that takes up the Medicaid option the same three years of full Federal support and gradual phase down that those states that expanded in 2014 received, no matter when the state takes up the option. To read the proposal, click here.

Medicaid Expansion Enrollees Cost Less than Previous Enrollees

Spending on care for Medicaid expansion enrollees is significantly lower than populations who were previously eligible for coverage according to a recent report by the Kaiser Family Foundation. Each expansion enrollee in 2014 cost roughly $4,500, compared to more than $7,500 for traditional enrollees. Spending on Medicaid expansion enrollees totaled $47.2 billion in 2014, or 16 percent of total Medicaid expenditures in those states. To read the report, click here.

GAO Will Investigate CMS Aid to States with Closing Exchanges

Republican lawmakers have asked the U.S. Government Accountability Office to investigate the management of state-based exchanges by CMS and whether the agency is providing adequate assistance to states shifting to the federally run HealthCare.gov. Leadership of the House Energy and Commerce Committee wants GAO to investigate how CMS helps states transition to the federal marketplace and investigate what CMS is doing to ensure the success of the state-based insurance exchanges now that federal funding for the marketplaces has dried up. Click here for the letter.

Fewer Docs Can Prescribe Drug That Helps Those Addicted to Opioids

As the country’s opioid epidemic kills more and more Americans, some of the hardest-hit communities across the country don’t have enough doctors who are able — or willing — to supply those medications to the growing number of addicts who need them. More than 900,000 U.S. physicians can write prescriptions for painkillers such as OxyContin, Percocet and Vicodin. But because of a federal law, fewer than 32,000 doctors are authorized to prescribe buprenorphine to people who become addicted to those and other opioids. Most doctors with a license to prescribe buprenorphine seldom — if ever — use it.  Click here for the story.

Final Breast Cancer Screening Recommendations Unchanged from Draft – But Congress Weighs In

The U.S. Preventive Services Task Force published its final breast cancer screening recommendations much in line with its earlier draft recommendations saying women should start routine mammograms later and have them less frequently. The task force advises that women between the ages of 50 to 75 get biannual mammogram screenings, while women ages 40 to 49 should weigh the benefits and harms of screening every two years. However, the Omnibus Appropriations Bill passed before the holidays mandates that any law that references the USPSTF breast cancer and mammography screening guidelines refer to the version issued before 2009 – essentially rejecting more recent recommendations that call for less frequent screenings. To read the recommendations from USPSTF, click here.

FDA Nominee Approved by Committee; Senator Could Block Full Senate Vote Over Salmon

The Senate Health Committee last week approved Robert Califf’s nomination to head FDA by a voice vote, sending the nomination to the full Senate for approval. While no Committee Members voted no during the hearing, Califf could still face opposition. Sen. Bernie Sanders (I-VT) has consistently said he would not support confirming Califf as FDA commissioner, was absent from the hearing and Sen. Lisa Murkowski who voted to move Califf to the floor for full Senate confirmation, said she still has concerns about the agency’s approval last November of genetically engineered Atlantic Salmon and could block the nomination until the issue is addressed. Click here for details.

VA Backlog Reduction in Question at House Hearing

The a Deputy Assistant Inspector General to the VA told the House Veterans Affairs Committee during a hearing that he doesn’t fully trust the agency’s recent assertion that it has substantially reduced the backlog of benefit claims. He stated that there may be a systemic problem of data integrity at VA field offices across the country. The VA said at the end of 2015 that it had a backlog of about 75,000 cases, which is nearly a 90% reduction from a high of about 612,000 cases in 2013. The VA’s Office of Inspector General has uncovered several instances of data manipulation meaning that claims about reducing the backlog cannot be substantiated. Click here to view the hearing and read the testimony.

Hospitals, Regulators Faulted for Scope Infections

An outbreak of bacterial infections, triggered by tainted medical devices known as duodenoscopes, spread nationwide longer than it should have because hospitals and federal regulators failed to take timely action, according to an investigation. “Preventable Tragedies: Superbugs and How Ineffective Monitoring of Medical Device Safety Fails Patients” is the result of a year-long investigation by Sen. Patty Murray, D-WA. The infected duodenoscopes, used to identify and treat conditions of the pancreas and bile duct were found to spread bacteria even after being cleaned to the manufacturers’ specifications. At least 250 people in 10 states and four countries faced life-threatening illnesses because of the risk posed by certain duodenoscopes. Click here for the report.

Primary Care Physician Comp Grows Faster than Specialists

A new survey is out with findings showing that primary care physicians are experiencing bigger increases in total cash compensation than their specialist peers. Family practice ($225,546) and internal medicine ($230,000) total pay was up more than 7% in a year and about 3.5% annually over the past 5 years. Psychiatry ($223,380 up 9% last year) and hospitalists ($249,458, up 6% in 2015) also did well.  Click here for more information on the survey.

New Nutrition Therapy Guidelines Recommended for Critical Care

American Society for Parenteral and Enteral Nutrition and the Society of Critical Care Medicine have published new guidelines providing updated recommendations on nutrition therapy methods, procedures, and tools for healthcare providers involved in nutrition therapy of the critically ill. The guidelines provide healthcare providers with the most up-to-date recommendations on providing the nutrition therapy for critically ill adult patients (those 18 years or older). Click here for the report.

Americans Moving South and West Again

As the economy improves, more Americans are moving south and west (read: warmer states with more sun) again.  Click here for a good summary and interactive map showing migration in your state.