Another week, another step towards reformation of the Medicare reimbursement model. Quality, not quantity, of services is to be the basis for hospital payments. Better care - and it should cost less too. Time will tell but none should doubt the determination of HHS to change the way it does business.
On Friday (4/29), CMS announced its final regulation for the Hospital Value-Based Purchasing Program, which will reward hospitals for the quality of care given to Medicare beneficiaries. Under the Hospital Value-Based Purchasing Program, hospitals will receive payments for quality provided in inpatient acute care services, instead of the quantity of services they provide. Quality will be measured based on how closely hospitals adhere to the best-known clinical practices and patients' ratings of experiences of care, with clinical measures making up 70 percent of the evaluation and patient experience 30 percent. Some of the quality indicators that will be tracked include whether: patients who may have had a heart attack receive care within 90 minutes; surgery patients get follow-up care within 24 hours to prevent blood clots; hospitals communicate discharge instructions to heart failure patients; and facilities are clean and well-maintained. The rule will go into effect for hospital discharges beginning in October 2012, at which point hospitals will face an across-the-board 1 percent reduction in Medicare payments under the Inpatient Prospective Payment System. This money will then be used to give bonuses to high-performing hospitals. In 2015, hospitals that are not meeting the quality care and patient satisfaction benchmarks will face a cut in reimbursement.
On Monday (5/2), CMS issued a final regulation, which will relax the process for using certain types of electronic communication. Prior to the new regulation, CMS required hospitals to grant practice privileges to remote-site physicians and other practitioners who were already credentialed in distant-site facilities after they considered qualifications on a practitioner-by-practitioner basis. The American Hospital Association praised the regulation, saying that it will allow physicians to connect with expert specialists even when the patient and specialist are great distances away.
In the states:
1) On Monday (4/25), the Oregon Senate passed Bill 99, which would establish a health insurance exchange in the state.
2) In Oklahoma on Wednesday (4/28), Senate Bill 722, a health care compact measure that first advanced from the Senate on March 15, cleared the state House of Representatives. It will now return to the state Senate for final consideration.
3) In Florida, HB 1193, which would prohibit Floridians from being required to purchase health insurance, passed the state House. The bill will now head to the Senate.
4) CMS informed Florida health officials that it cannot approve its plan to privatize the state's Medicaid program without reviewing the state's specific legislation on it. The legislation, however, is currently stalled in the Senate.
5) In Tennessee on Thursday (4/27), the Health Care Compact bill was shelved for the remainder of the year.
On Friday (4/29), CMS Administrator Dr. Donald Berwick wrote an op-ed in the Wall Street Journal, The Right Way to Reform Medicare. In his piece, Dr. Berwick said that the plan articulated by Republicans in Congress for reforming Medicare would "force the average senior to pay $6,400 more for their insurance, eliminate guaranteed Medicare benefits, and limit choices when it comes to doctors and hospitals." Berwick went on to say, "The right way is to help bring costs down by making care better and improving our health-care system." and that "The Patient Protection and Affordable Care Act laid the groundwork for us to take the right approach." Berwick also touted The Partnership for Patients (a new public-private partnership that will help improve the quality, safety, and affordability of healthcare for all Americans according to HealthCare.gov) in his argument for the Affordable Care Act, stating that the program is "investing up to $1 billion to help health-care professionals learn about and implement proven methods for improving patient safety."
More young adults than expected are taking advantage of the Affordable Care Act provision that allows them to stay on their parents' health plans until they turn 26. According to Kaiser Health News, at least 600,000 young adults have joined their parents' health plans under the new law. HHS had estimated that 1.2 million young adults would sign up for coverage in 2011, but insurers' data show that the number could be much higher.
The results of a new survey from the National Association of Insurance and Financial Advisers, emailed to NAIFA members on April 11th, shows that 75 percent of its members have seen a drop in their commissions since the new law capped the amount of money that insurers can spend on administrative expenses and profits. The survey results can be found here: http://naifa.typepad.com/files/mlr-survey-results_final.pdf.
On Thursday (4/28), House Ways and Means Committee Chairman Dave Camp (R-Mich.) and Oversight Subcommittee Chairman Charles Boustany (R-La.) sent a letter to the IRS Commissioner demanding information about how the IRS is spending $1 billion in funds allocated to the agency by the Affordable Care Act and how much of it the agency has already received. Republicans have targeted the IRS as part of their defunding plan and would like to prevent the agency from penalizing those that do not comply with the law's insurance coverage requirements.
On Thursday (4/28), CMS outlined in the Federal Register two potential ways to update the payment rates for skilled-nursing facilities. The first method would provide an increase of $530 million or 1.5 percentage points. Under the second option, the CMS would adjust for "an unexpected spike in nursing home payments during fiscal year 2011." To achieve the second option, CMS would "restore overall payments to their intended levels on a prospective basis, which would require reducing payments to skilled-nursing facilities in 2012 by $3.94 billion" compared to 2011 payments according to Modern Healthcare.
White House officials have answered requests for documents related to meetings between White House officials and special interest groups in the months leading up to passing the Affordable Care Act. Former MedPAC Commissioner Nancy-Ann DeParle met with groups such as the AARP, the SEIU, the AFL-CIO, the pharmaceutical drug sector, and the insurance industry's trade association. The Daily Caller reports that in one instance, the pharmaceutical drug sector agreed to back the Affordable Care Act if the costs to the sector did not exceed $80 billion.
The American Academy of Family Physicians, the American College of Physicians, the American Medical Association, the Center for Improving Medication Management, the e-Health Initiative and the Medical Group Management Association have joined forces to develop a how-to guide on electronic prescribing. The guide can be found here: http://www.mgma.com/WorkArea/DownloadAsset.aspx?id=1248619.
This week: On Tuesday (5/3), the House is scheduled to vote on a pair of bills. One would repeal PPACA funding for states to establish insurance exchanges, and the other would repeal mandatory funding for school-based health center construction. In reaction, President Obama threatened he would veto such legislation. On Thursday (5/5) at 10:00 a.m. in room 2175 of the Rayburn Office Building, the House Education and Workforce Committee will hold a hearing titled, "Policies and Priorities of the U.S. Department of Health and Human Services." On Thursday (5/5), the CMS Partnership for Patients will host an online conference to provide an overview of the Partnership for Patients and answer questions. On Friday (5/6), a proposed rule that would prevent states from cutting Medicaid payments to providers unless they can show that Medicaid recipients will have "sufficient access" to care after cuts is expected to be published in the Federal Register.
As always, please feel free to contact us with any questions.
To view our compilation of this week's health care reform implementation news, click here.