August 21, 2017

August 21, 2017


IRS Revokes Hospital’s Tax Exempt Status for CHNA Failure

The IRS has revoked the tax-exempt status of a not-for-profit hospital for failure conduct a community health needs assessment, adopt an implementation strategy and make it widely available to the public. In a letter dated Feb. 14, 2017, and just released, the IRS said it revoked the hospital’s tax-exempt status for failure to comply with section 501(r) of the Internal Revenue Code.  Click here to read the letter and detailed related information.  Although the name of the hospital is not included in the letter, previous correspondence from the agency identified the facility as a disproportionate share hospital and a critical care access facility.


CMS’ Mandatory Medicare Bundled Payment Programs Are on the Chopping Block

CMS last week proposed to eliminate two bundled payment programs and scale back a third. The proposed rule would cut the mandatory Episode Payment Models and Cardiac Rehabilitation incentive payment model, and significantly reduce the number of mandatory geographic areas participating in the innovation center’s hip-and-knee replacement demonstration (CJR) by about half, from 67 areas to 34. Providers in the 33 remaining geographic areas would be able to participate on a voluntary basis. (Click here to see the list of mandatory and voluntary CJR areas.) CMS also proposed to make participation in the CJR model voluntary for all low volume and rural hospitals in current CJR geographic areas. Click here for the fact sheet, and here for the proposed rule.


OBSERVATION: It appears that the Trump Administration is moving away from the Obama Administration’s government-initiated volume to value initiatives. HHS Secretary Tom Price had foreshadowed the move when he was nominated for the position, saying that he intended to eliminate or reduce regulatory burdens on physicians and other providers.  The proposal to cut and reduce bundled payment programs, the exemption of more physicians from MACRA (the Quality Payment Program), curtailment of EHR and other requirements under MACRA, inaction over Advanced APM proposals to the technical advisory committee under MACRA have all happened within the past three months and more curtailments are promised.


CMS Releases Updated Hospital Ratings for Patient Satisfaction

CMS updated patient satisfaction survey data on its Hospital Compare website, calculating new HCAHPS summary star ratings for 3,504 hospitals. This update is based on HCAHPS collected between Oct. 1, 2015 and Sept. 30, 2016. Here is the breakdown:  5 stars: 215 hospitals, 4 stars: 1,203 hospitals, 3 stars: 1,468 hospitals, 2 stars: 543 hospitals,1 star: 76 hospitals.  CMS did not assign star ratings to 1,307 hospitals due to insufficient data for these facilities.  Click here to see the update by hospital.

  • NOTE: Patient experience star ratings differ from CMS’ Overall Hospital Quality Star Rating program. CMS last updated these scores December 2016. The agency planned to release updated overall star ratings this July, but pushed back the release date until October after identifying data issues.

Click here to find individual hospitals on the Hospital Compare website.

Click here for the very large list of all hospital HCAHPS scores.


Future of Community Health Systems in Question: Report

Just three years ago, Community Health Systems was the largest for-profit operator of hospitals with more than 200 facilities scattered in rural and suburban areas with growing populations. Now, the company is hemorrhaging money, sitting atop a mountain of debt and teetering on the edge of bankruptcy — all major reasons why CHS has lost almost 90% of its market value. Click here for the story from Axios.


Administration To Make August Insurance Exchange Payments

The Trump Administration last week said it would make cost-sharing reduction payments to insurers in August, but remained silent about future payments.  Click here for the WSJ report.

  • If the Trump Administration decides to eliminate these subsidies, could states to their own?  Click here for a very good analysis.

Eliminating Cost-Sharing Subsidies Will Increase Premiums and Uninsured: CBO 

The Congressional Budget Office reported last week that if cost-sharing reduction payments to insurers were terminated, premiums would rise an average of 20 percent on government-backed exchanges next year and could lead to fewer insurers offering plans. Some states have asked insurers to file two different sets of rate requests. Final rates are due in September. CBO also said an additional 1 million people would be uninsured in 2018 than under current projections. However, the insured rate would eventually stabilize and even increase starting in 2020 but higher premium tax credits required under the law would lead to a $194 billion increase to the federal deficit. Click here for the report. Click herefor the NYTimes report.

  • While the future of exchanges continues to be in question, it seems as though there is a new lease of life for Medicaid. Click here for the story.

Top Democrats Want HHS Briefing on ObamaCare Implementation

Top Democrats from the House and Senate are requesting a briefing on the administration’s plans for ObamaCare’s open enrollment season, which begins Nov. 1, amid uncertainty over how President Trump will administer the law.  In a letter sent to HHS Secretary Tom Price and CMS Administrator Seema Verma, the lawmakers expressed concerns over what they see as the White House’s efforts to undermine the Affordable Care Act’s marketplaces. Click here for the story.


HRSA To Delay 340B Drug Program Ceiling Price and Manufacturer Penalties 

HHS’ Health Resources and Services Administration has proposed to delay implementation of a rule that would set a ceiling price on medicines acquired through the 340B discount drug program. HRSA stated that this proposal is in part “in order to allow a more deliberate process of considering alternative and supplemental regulatory provisions and to allow for sufficient time for additional rule making.”  HRSA would delay the rule on ceiling prices and penalties until July 2018; the rule was originally to go into effect in March of this year. The proposed rule would also give more flexibility to manufacturers who accidentally overcharged, as long as they work to reimburse the hospitals or medical group that overpaid. To read the proposed rule, click here.


AMA Opposes Express Scripts’ Plan for Opioids

The American Medical Association is criticizing pharmacy benefits manager Express Scripts for its plans to limit the number and strength of painkillers that it will allow doctors to prescribe to first-time patients. The move from Express Scripts is part of a larger effort to address the opioid epidemic, which resulted in 33,000 overdose-related deaths in 2015. Most of the patients who become addicted to opioids received a painkiller prescription  from a physician.  Click here for more.


HHS Awards $105 Million to Health Centers

HHS announced that nearly $105 million has been awarded to 1,333 health centers in all U.S. states, territories and the District of Columbia as an investment in quality improvement, building upon their 2016 achievements. Health centers will use these funds to further improve the quality, efficiency, and effectiveness of the health care delivered to the communities they serve. Click here to see the list of awardees.


Hospice Compare Website Launched 

CMS has unveiled its latest “compare” website, this one aimed at hospices. The new Hospice Compare website was created to help patients and families choose facilities in their local areas based on various quality measures. Patients, caregivers, and providers can compare the quality metrics of multiple hospice centers at once, looking at elements such as the percentage of patients screened for pain or uncomfortable breathing, and whether patients’ preferences were being met. The website then compares each hospice’s reported data to the national average. CMS plans to optimize the website for both desktop and mobile use. For the hospice compare website, click here.


Lawmakers Launch Probe into Rising Costs of MS Drugs

Two House members, Elijah Cummings (D-MD) and Peter Welch (D-VT) have opened an investigation into the rising costs of several multiple sclerosis drugs, raising concerns that competing drug companies may be raising their prices in concert with one another. The Representatives sent letters to seven drug companies last week – Bayer, Biogen, Novartis, EMD Serono, Roche, Teva Pharmaceuticals and Sanofi’s Genzyme unit – requesting information about their profits and sales of MS drugs, any discounts provided to payers, their marketing expenses, and spending on patient drug coupons. Concerns stem from the annual sales of MS drugs doubling from $4 billion in 2008, to nearly $9 billion in 2012. Prices for many of the drugs under investigation have been raised by 100 percent to 1,000 percent.  Click here to read the press release from the Congressman and the letters.


CMS To Start National Probe and Educate Audit Program

CMS has announced it would start a new national audit strategy titled Targeted Probe and Educate (TPE) after pilot programs with four Medicare Administrative Contractors (MACs) demonstrated success. CMS described that success as “including an increase in the acceptance of provider education as well as a decrease in appealed claims decisions.”

According to CMS, the nationwide program “will select claims for items/services that pose the greatest financial risk to the Medicare trust fund and/or those that have a high national error rate.” Click here for more from CMS.


Hemophilia Groups File Complaint Against Wellmark BC/BS

Hemophilia advocacy groups have filed a federal civil rights complaint against Wellmark Blue Cross and Blue Shield stating that the insurer discriminated against individuals with the rare bleeding disorder. The groups allege that the insurer pulled out of the Iowa marketplace to avoid providing coverage to a 17-year-old boy with hemophilia and damaged him by publicly speaking about his costly medical condition. The hemophilia advocacy groups point out that just days before that announcement, a Wellmark executive in publicly cited the estimated $1 million in monthly costs of the hemophiliac patient as a factor in the decision. To read the complaint, click here.


Justice Department Settles with Mylan on Epipen Overpayments 

EpiPen maker Mylan has finalized a $465 million government agreement settling allegations it over-billed Medicaid for its emergency allergy injectors for a decade An HHS Office of the Inspector General report had estimated that the misclassification could have cost taxpayers as much as $1.27 billion in over-payments between 2006 and 2016. The agreement settles charges that Mylan violated the False Claims Act by knowingly misclassifying the EpiPen as a generic drug to avoid paying higher rebates to Medicaid. Click here for the settlement agreement.


Medical School Grads Could Practice without Residency Under Missouri Bill

To address the shortage of physicians in Missouri, a recently passed bill would ease the qualifications for medical school graduates who aren’t placed in residency programs to practice in the state. The bill would allow medical school graduates to apply for an assistant physician license. To be eligible for an assistant physician license, applicants would need to be U.S. residents, have graduated from medical school in the last three years, and have completed Step 1 and Step 2 of the United States Medical Licensing Examination (or the equivalent of such steps in any other board-approved medical licensing examination) within the past two years. Click here for more.

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