July 30, 2018

CMS Outpatient Rule Smacks Hospitals: More 340B Cuts and Site Neutral Cuts Included

Hospitals take numerous financial hits in CMS’ proposed hospital outpatient and ASC rule released last week.  Among other changes, the rule would:

  • Make more cuts to the 340B drug discount program, focusing Medicare cuts on non-grandfathered hospital outpatient departments – equal to the 22.5% reductions imposed on all other settings in January 2018;
  • “Control unnecessary increases in the volume of covered HOPD services” by paying the Physician Fee Schedule-equivalent for the clinic visit service when provided at an off-campus provider-based department (PDB) paid under the OPPS leading to lower copayments for patients and reduce Medicare funding by $760 million in 2019.
  • Expand services available at ASCs and improve their payments.  A dozen new cardiac cath procedures are included.

Comments about the rule are due September 25.  Click here for the CMS fact sheet, and here for the proposed rule.  Click here for a summary on the new cardiac cath procedures allowed at ASCs. Strategic Health Care clients received a detailed analysis last week.


House Passes Package of Health Bills; Senate Fate Is Uncertain

In the last week before its summer recess, the House passed a number of health bills including extensions of vital programs. Early last week, Representatives passed, by voice votes, bills reauthorizing nursing workforce development programs (HR 959, click here) and programs for other health professions (HR 3728, click here), renewal of children’s hospital graduate medical education programs (HR 5385, click here), plus grants and expanded research on palliative and hospice care (HR 1676, click here). The House also passed a bill to permanently eliminate a tax on medical devices. The controversial ACA tax was collected from 2013 to 2015 but is currently suspended, through 2019. With of vote  283-132 for the legislation (HR 184, click here) with 226 Republicans and 57 Democrats agreeing to remove the tax permanently. The House also passed two bills that would expand the availability and use of health savings accounts (HR 6199, click here) and further delay a tax on health insurers (HR 6311, click here).


CMS to Resume Risk Adjustment Payments to Insurers

CMS last week released an interim final rule that reinstated the ACA’s risk adjustment program for insurance companies.  Risk Adjustment transfers will begin in September. This comes a few weeks after the agency froze billions of dollars in  payments to insurers citing a court ruling invalidating parts of the program. CMS states that the rule clarifies the program methodology and addresses issues raised earlier this year by the courts, clearing the way for them to begin making the payments again. Click here for the rule and here for the CMS press release.

  • Anew poll finds that 60 percent of Americans think insurance premiums will go up, click here.
  • Attorneys general from 11 states and the District of Columbia filed a lawsuit challenging the Administration’s new rules expanding availability of association health plans without some of the ACA’s protections, click here.

Doctors Tell House Committee to Update and Keep MIPS

In a hearing last week on Medicare Access and CHIP Reauthorization Act (MACRA), physicians told a key health subcommittee that they should keep the Merit-based Incentive Payment System (MIPS) and update the program. They also urged the Committee to encourage CMS to allow for more alternative payment models for physicians, saying that the Physician-Focused Payment Model Technical Advisory Committee, created under MACRA, had accepted 10 payment models they had forwarded from specialty societies and physician groups, but CMS had disregarded them. To read the written testimony and to watch the hearing, click here.


CMS Releases Detailed MA Data

In an announcement on twitter Friday by CMS Administrator Seema Verma, the agency released Medicare Advantage data that could provide insights into whether private insurers are actually providing better and more cost-efficient care to Medicare patients. In the tweet, Verma announced that CMS is releasing the 2015 Medicare Advantage data  to CareSet Systems, a nonprofit that will analyze and aggregate the data and release it for use by journalists and researchers. To read the tweet, click here.


CDC: Opioid Overdoses Seem to be Slowing

According to the CDC’s Provisional Drug Overdose Death Count, there was a leveling-off nationally over the last few months of 2017 of overdose deaths across the country. The data, which is updated monthly for the previous 12 months, shows eight states – Massachusetts, Mississippi, New Mexico, North Dakota, Oklahoma, Utah, Vermont and Wyoming – registered declines. Twelve-month numbers indicate that overdose deaths were up 10.2 percent in the U.S. through December 2017, which is still less than half the rate of increase from 2015 to 2016. Click here for the CDC report.

  • Several advocacy groups organizations sent a letter to Senate leaders last week urging a vote on a bipartisan bill to address the opioid crisis, click here.

Medicare Could Have Saved $3 Billion With Generics

According to new analysis by HHS, Medicare could have saved nearly $3 billion if the Part D program used all the available generic versions of some 600 outpatient drugs. The research shows that Part D plans spent $8.7 billion on brand-name medicines in 2016 when therapeutically equivalent generics were available and could have saved, for example, $577 million alone from full generic substitution of the heartburn drug Nexium. Using 2016 data, the analysis looked at annual beneficiary counts and spending for each brand drug with one or more generic competitor. To read the report, click here.

  • Medicare patients could often spend less on prescriptions filled through Walmart’s generic drug discount program than through their own insurance plan, according to research from Yale School of Medicine. Researchers found Walmart’s generic drug discount program, which charges patients $4 for a 30-day supply of a generic drug, is cheaper than Medicare 21 percent of the time. Click here for the report.
  • Generic medicines for many common health problems may cost Medicare patients less when they pay cash instead of using their health insurance, click here.
  • Senate Committee passes S. 2554 to stop pharmaceutical “gag-rules” that insurance companies use to prohibit pharmacists from telling consumers if they could save money by buying a drug out of pocket instead of with insurance, click here.

Lawmakers Request FTC Review of PBM Mergers

The House Energy and Commerce Committee asked the Federal Trade Commission to conduct a review of past mergers of pharmacy benefit managers, whose role in setting drug prices has come under increasing scrutiny by the Trump administration. The lawmakers cite the 70 percent market revenue share held by the three largest PBMs, CVS Health Corp.’s Caremark, Express Scripts Holding Co. and Optum Rx from UnitedHealthcare Group Inc.  Click here for the story.


GAO: CMS Conducted No Audits of Medicaid MCOs in Two Years

A new report by GAO details how CMS isn’t doing enough to prevent payment risks in Medicaid managed care organizations. GAO found that CMS has not initiated a single audit in the last two years.  MCO officials blamed “a lack of consistent guidance” from states, and one state auditor said sanctions against MCOs were used infrequently. GAO was also critical of  CMS failing to release timely guidance to states and account for improper payments and these gaps are inconsistent with agency’s goals and federal internal control standards. Click here for the report.


CAH Reduced Bullying, Youth Suicides Through Community Health Needs Assessments 
Union General Hospital of Farmerville, Louisiana, sought to address its disproportionately high rates of school bullying and youth suicides in the community following its 2014 CHNA. Union General Hospital began an in-school education program called ‘Together We Can Be Bully Free’ in the local schools. Since implementing the program, youth suicide rates fell to 0 and bullying has significantly decreased in the schools. Click here to read more.

  • The Critical Access Hospital Coalition advocates for the financial viability of rural hospitals in Washington, D.C.. Read more about the CAH Coalition here.

New Alzheimer’s Drug Slows Memory Loss in Early Trial Results

The long, discouraging quest for a medication that works to treat Alzheimer’s reached a potentially promising milestone last week. For the first time in a large clinical trial, a drug was able to both reduce the plaques in the brains of patients and slow the progression of dementia. More extensive trials will be needed to know if the new drug is truly effective, but if the results, presented at the Alzheimer’s Association International Conference in Chicago, are borne out, the drug may be the first to successfully attack both the brain changes and the symptoms of Alzheimer’s. Click here for the NY Times report.

How Hospice Care Givers Deal with Death

As more Americans opt for hospice care, keeping hospice workers dedicated, replenished and content is a growing concern. The number of hospice patients grew 167 percent between 2000 and 2016, to more than 1.4 million, according to a March 2018 report from the Medicare Payment Advisory Commission, which provides Congress with analyses regarding Medicare. Nearly half of Medicare beneficiaries who died in 2015 had received hospice services. Click here for the Pew report.

Seema Verma Rejects Attempts to Create “Single-Payer” System
CMS Administrator Seema Verma last week explained that she would provide no funding to states seeking to implement single-payer systems. In many states, including California, single-payer systems or “Medicare for all” have become popular health care reform policies. However, without the $1 trillion in funding held by CMS, these plans would be extremely difficult to implement. The speech she made in California also focused on the Trump Administration’s plans to combat rising drug prices and remove regulatory burdens on physicians through modernization of laws like the Stark Law and Anti-Kickback statue. Click here for the speech.

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