June 18, 2018

Hospital Readmission Penalties Save $2 Billion,  MedPAC Suggests Expansion To All Conditions

The Medicare Payment Advisory Commission released its annual June Report to Congress late last week and says the hospital readmission penalties program should be dramatically expanded.  The overall report examines a variety of Medicare payment system issues. Within the report, MedPAC states that Medicare readmission penalties on hospitals saved Medicare $2 billion per year without shifting patients to other services or increasing mortality rates. The Commissioners suggest that the penalties could be expanded to cover all conditions while reducing the size of penalty. Currently, as required by the ACA, hospitals are penalized for readmissions from heart attack, heart failure and pneumonia within 30 days of discharge. Additionally, as expected, MedPAC also recommended reducing payment for urban, off-campus emergency departments, while increasing payments for stand alone, rural EDs. Click here for the report, and here for the fact sheet.

Study: Federal Hospital Payment Reductions Will Be $218.2 Billion by 2028

A new study commissioned by the nation’s largest hospital associations estimates that the cumulative federal payment reductions to hospitals from 2010 through 2028 are beyond those enacted under the Affordable Care Act. The report identified eleven legislative Acts  as well as regulatory changes by CMS that are estimated to reduce federal payments to hospitals by $218.2 billion over this 18 year period. The bulk of the payments come from sequestration, MS-DRG Documentation & Coding, and Medicaid DSH reductions. To read the study, click here.


Opioid Legislation: House and Senate Are Moving Dozens of Bills

The House passed 30+ pieces of legislation last week but they are not finished.  There will be more bills on the chamber floor this week. Bills that were passed impact clinical practice, authorize new grants, boost prevention efforts, and increase law enforcement . In the Senate, the Finance Committee unanimously approved a package of opioid bills entitled HEAL, Helping to End Addiction and Lessen Substance Use Disorders Act. For the Strategic Health Care memo with a full list of bills voted on, click here.

  • Last week, CMS released guidance that urges states to use electronic health records, prescription drug monitoring programs and telemedicine to combat the opioid crisis, click here.
  • In an article in the Journal of American Medical Association, NIH details its strategy for dealing with the crisis, click here.

New, Pro-Provider 340B Legislation Introduced; Senate Hearing This Week

340B entities are lining up to support a bill introduced last week by California Congresswoman Doris Matsui (D-HI) that would provide support for the drug discount program. The bill would codify a patient definition, expand the program to include Substance Abuse and Mental Health Services Administration grantees as covered entities, halt the CMS regulation cutting payments, and add more audits for manufacturers. Hospital groups were very quick to endorse the legislation.  The SERV Communities Act (H.R. 6071) was introduced without co-sponsors. Click here for the bill and here for the section-by-section review.

  • The Senate HELP Committee will hold its third 340B hearing on the program this week with one witness – HRSA’s Director of Pharmacy Affairs, click here.

HHS Secretary Defends Administration Drug Policies Before Senate Committee

HHS Secretary Alex Azar testified last week before the Senate Health Committee on the President’s plan to bring down drug prices. During the hearing, Azar said that “several drug companies are looking at a substantial material decrease in drug prices,” but it will take time. He also stated that HHS is planning a demonstration project to figure out new ways to pay for Medicare Part B drug including possibly moving physician-administered drugs over to Part D and negotiating prices in Part B like they do in Part D. Click here to read the Secretary’s written testimony and view the hearing.

  • FDA released two documents to encourage value-based drug buying, the first outlines how manufacturers can communicate off-label information to purchasers (click here), the second describes when companies can share information absent from a product’s label without violating rules against off-label promotion (click here).

Health Care Cost Expected to Go Up 6% Next Year; Cost Increases Are Government’s Focus

According to a new PwC Health Research Institute analysis, employer medical costs will go up 6 percent in 2019, the same as 2018 and twice the rate of overall inflation. The authors state that the push to lower utilization rates “have run their course” and that health care prices have continued to grow. PwC suggests that in order “to drive medical cost trend down, employers should tackle prices and these efforts should address more than just drug prices, which have been the focus of attention in the last several years.” Click here for the report.

  • CMS data released last week shows that more than 60 percent of American children were enrolled in CHIP or Medicaid in 2017, click here.
  • According to the American Academy of Actuaries, non-ACA compliant plans and the repeal of the insurance mandate penalty will drive up premiums in 2019, click here.
  • According to analysis by Altarum Institute, health care spending has grown 31 percent since the recession began in December 2007, click here.

States Requiring Mental Health Ed

Amid sharply rising rates of teen suicide and adolescent mental illness, two states have enacted laws that for the first time require public schools to include mental health education in their basic curriculum. Most states require health education in all public schools, and state laws have been enacted in many states to require health teachers to include lessons on tobacco, drugs and alcohol, cancer detection and safe sex. Two states are going further: New York’s new law adds mental health instruction to the list in kindergarten through 12th grade; Virginia requires it in ninth and 10th grades. Click here for the report.


Biden Cancer Initiative Announces FIERCE Awards, Seeks Nominees

The Biden Cancer Initiative is gathering nominations for the first round of “FIERCE” Awards, given to people and organizations who impact the lives of cancer patients. Nominations will be accepted for individuals or organizations for one of five categories:

  • Prevention and early detection
  • Reducing cancer disparities
  • Patient navigation
  • Survivorship
  • LEAP (Leadership through Exemplary and Awesome Purpose)

Nominations open through July 31, 2018. Click here for more.


CMS’ Hospital Star Rating Program Put on Ice, for Now.

After an outcry from hospitals across the country, CMS will not update the Hospital Compare website with new overall hospital quality star ratings data as planned in July because of the concern that the performance ratings are unreliable. As hospitals received the previews of their ratings, they saw large shifts in their scores, in some cases dropping by as much as 3 stars in some cases with little explanation as to why. CMS states on Qualitynet, a CMS website for healthcare quality data communications, that “CMS has decided to postpone the July star ratings update to give time for additional analysis of the impact of changes to some of the measures on the star ratings and to address stakeholder concerns.” The agency says that as part of that process, it will ask for feedback from a multi-disciplinary technical expert panel, a provider leadership group and a public comment period. View the announcement here.


Court Says Insurers Don’t Get Risk Corridor Payments

A three-judge panel of the Court of Appeals for the Federal Circuit issued an opinion last week in Moda Health Plan v. United States. By a 2-1 majority, the appellate panel concluded that the government does not have to pay health insurers that offered qualified health plans (QHPs) the full amount owed to them in risk corridors payments. The panel’s decision overturned a decision in the Court of Federal Claims in favor of the insurer. The legal question at issue was whether the government, by not making full payment, violated Section 1342 of the Affordable Care Act (ACA) and its implementing regulations, as well as an implied-in-fact contract with the Department of Health and Human Services (HHS) over risk corridors payments. Click here for an excellent review of the issue.


CMS to Allow Use of Smartphone Apps with Glucose Monitors; HHS OKs Telehealth Change

CMS announced last week that Medicare will now support the simultaneous use of smartphone applications with continuous glucose monitors. The new policy will allow beneficiaries to link CGM devices with their smartphones to better manage their diabetes as well as the share data with family members, physicians, and caregivers. People with diabetes use CGMs to provide them with real-time measurements of their glucose levels, which can prevent deadly complications from the disease. The goal of this program is to make CGMs more accessible for those who are blind or have low-vision. According to CMS, one out of every three Medicare dollars is spent on patients with diabetes and this move could lower costs. To read the announcement, click here.

  • The HHS Inspector General issued an advisory opinion approving an arrangement involving the provision of free telemedicine equipment and services by a provider to a potential referral source, click here.

1 in 5 SNF Patients Will Be Readmitted to the Hospital Within 30 Days: Study

In a new report published by Kaiser Health, one in five Medicare patients will return from the nursing home to the hospital within 30 days of discharge often due to preventable complications. In 2013, Medicare began penalizing hospitals for high readmission rates as a way to encourage the hospital to provide efficient and effective care. Starting in October, Medicare will begin providing bonuses or penalties to nursing homes based on their readmission rates. Click here for more.


Rates of Vaccine Exemptions Rise, Create “Hot Spots” for Disease
A rise in families choosing not to vaccinate their children for philosophical or religious reasons has left a number of American states and metropolitan areas more vulnerable to outbreaks of vaccine-preventable disease. Since 2009, there has been an increase in non-medical vaccine exemptions in 12 of the 18 states that currently allow this policy.  PLOS Medicine recently published a study identifying these states, and specifically their “highly-mobile” metropolitan regions, as being especially susceptible to disease outbreaks. Some examples of these regions include: Phoenix, AZ, Salt Lake City, UT, and Pittsburgh, PA. Multiple outbreaks of measles have already been connected to communities with high rates of non-medical vaccine exemptions. Click here for the study.

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