Medical Industry Reimbursement News

According to a report issued by the Congressional Budget Office (CBO), most of the Medicare demonstration projects, which were developed to enhance health care quality and improve efficiency, have not reduced Medicare spending. The report reviews outcomes from six disease management/care coordination demonstrations and four value-based payment demonstrations. The CBO states that the disease management/care coordination demonstrations, comprised of 34 programs operated by disease management companies, have had little or no effect on hospital admissions or regular Medicare spending. Only one value-based payment demonstration that has shown significant savings was is the Medicare Participating Heart Bypass Center.

For further details, go to http://www.cbo.gov/doc.cfm?index=12663

According to a report from the Centers for Medicare & Medicaid Services (CMS), U.S. spending on health care grew 3.9% in 2010 to $2.6 trillion, slightly surpassing the record low of 3.8% growth in 2009.  Spending for hospital care increased 4.9% in 2010, down from 6.4% in 2009, and is the fourth consecutive year of relatively slow growth. Private health insurance spending for hospital services, the largest share of spending for hospital care, grew 2.2% in 2010, down from 4.8% in 2009. This is the smallest increase since 1996. Medicare spending for hospital care grew 4.6% in 2010, down from 5.3% in 2009, while Medicaid spending grew 11.2% in 2010, up from 10.4% in 2009.

The press release can be found by going to this link.

The Medicare Payment Advisory Commission (MedPAC) has recommended that Congress provide a 0.5% update for ambulatory surgical centers (ASCs) in calendar year 2013 and to require them to submit cost data and direct the Health and Human Services secretary to implement a value-based purchasing program for ASCs no later than 2016. MedPAC also recommended long-term care hospitals, skilled nursing facilities (SNF) and inpatient rehabilitation facilities receive a 0% market-basket update for fiscal year 2013. The commission also recommended a 1.0% update for the end-stage renal disease (ESRD) prospective payment system (PPS), and a 0.5% update for hospice providers. The commission further recommended revising and rebasing the SNF PPS, and reducing payments to SNFs with relatively high readmission rates.

For more information, visit http://www.medpac.gov

The Medicare Payment Advisory Commission (MedPAC) has recommended that Congress provide an update of 1.0% for inpatient and outpatient hospital payments for fiscal year 2013. In addition, it recommended equalizing Medicare payment rates for non-emergency evaluation and management (E/M) services between hospital outpatient departments and physician office settings by reducing hospital outpatient department payments for E/M clinic visits by more than 70%. The commission also stated that the E/M payment changes should be phased in over three years, during which reductions for certain hospitals with a disproportionate share percentage of 0.25 or higher would be limited to 2.0% of overall Medicare payments.

For more information, visit http://www.medpac.gov

The Centers for Medicare & Medicaid Services (CMS) published answers to frequently asked questions (FAQ) regarding the Medicaid Recovery Audit Contractor (RAC) program. In its FAQ, CMS discussed operational guidance to states and general information about the Medicaid RAC program. CMS anticipates sharing certain information about each state’s Medicaid RAC through its Medicaid RACs-At-A-Glance website.

The FAQ can be accessed at http://www.cms.gov/MedicaidIntegrityProgram/downloads/Scanned_document_29-12-2011_13-20-42.pdf.

The Department of Health and Human Services (HHS) released an interim final rule with comment period adopting standards for electronic fund transfers (EFTs) and remittance advice (RA) transactions under the Health Insurance Portability and Accountability Act of 1996 (HIPAA). The rule adopts streamlined standards and operating rules called for by the Affordable Care Act (ACA) for the format and data contained in transmissions from health plans to their banks when paying a provider’s claim electronically, and for the notices of payment which are sent to providers. The regulation took effect January 1.

The interim final rule can be accessed at http://www.ofr.gov/OFRUpload/OFRData/2012-00132_PI.pdf.

The Center for Medicare & Medicaid Services (CMS) has announced that it will delay until further notice the Recovery Audit Prepayment Review Demonstration Project. The prepayment review was scheduled to begin on January 1, 2012 in eleven states.

For further details, visit https://www.cms.gov/CERT/02_Demonstrations.asp

The Centers for Medicare & Medicaid Services (CMS) has announced that it selected 73 individuals from 27 States and the District of Columbia for its Innovation Advisors program.

A list of Innovation Advisors can be found at http://www.cms.gov/apps/media/press/factsheet.asp?Counter=4240.

Each Innovation Advisor’s home organization will receive a stipend of up to $20,000 which will be used to support the individual’s activities while serving as an Innovation Advisor.

More information about the Innovation Advisors Program, including a fact sheet and list of participants and their home organization, can be found at: http://innovations.cms.gov/initiatives/innovation-advisors/index.html.

The Centers for Medicare & Medicaid Services (CMS) has announced that Medicare is adding coverage for preventive services to reduce obesity.  This adds to Medicare’s existing portfolio of preventive services that are currently available without cost sharing under the Affordable Care Act (ACA).  It complements the Million Hearts initiative led jointly by CMS and the Centers for Disease Control and Prevention in partnership with other HHS agencies, communities, health systems, nonprofit organizations, and private sector partners across the country to prevent one million heart attacks and strokes over the next 5 years.

To read the final decision on the new national coverage determination, visit this link.

Thirty-two leading health care organizations will participate in a new Pioneer Accountable Care Organization (ACO) initiative made possible by the Affordable Care Act (ACA). The Pioneer ACO initiative will encourage primary care doctors, specialists, hospitals and other caregivers to provide better, more coordinated care for Medicare beneficiaries and could save up to $1.1 billion over five years.

Under this initiative, operated by the Centers for Medicare & Medicaid Services (CMS)InnovationCenter, Medicare will reward groups of health care providers that have formed ACOs based on how well they are able to both improve the health of their Medicare patients and lower their health care costs. The first performance period of the Pioneer ACO Model beganJanuary 1, 2012.

For the final list of participating Pioneer ACOs and more information about the Pioneer ACO Model, a fact sheet is posted at http://www.cms.gov/apps/media/press/factsheet.asp?Counter=4225 or you can visit: http://innovations.cms.gov/initiatives/aco/pioneer

The Pioneer ACO Model is one of several initiatives underway at CMS designed to support the formation of ACOs. For more information, visit www.cms.gov/aco.