Medical Industry Reimbursement News

The Centers for Medicare & Medicaid Services (CMS) has announced that it will award up to $1 billion in funding in round two of the Health Care Innovation Awards which is an Affordable Care Act (ACA) initiative to test new payment and service delivery models. The second round of awards will focus on models to rapidly reduce Medicare, Medicaid and Children’s Health Insurance Program (CHIP) costs in the outpatient and post-acute settings; improve care for populations with specialized needs; test approaches for specific types of providers to transform financial and clinical models; and improve the health of populations.

For more information, go to this link.

On May 8, Health and Human Services (HHS) Secretary Kathleen Sebelius announced a three-part initiative that gives consumers information on what hospitals charge. The newly released data shows significant variation across the country and within communities in what hospitals charge for common inpatient services.  In addition, HHS made approximately $87 million available to states to enhance their rate review programs and further health care pricing transparency.

The data posted on CMS’s website include information comparing the charges for services that may be provided during the 100 most common Medicare inpatient stays.  Hospitals determine what they will charge for items and services provided to patients and these charges are the amount the hospital generally bills for an item or service.

To make these data useful to consumers, HHS is also providing funding to data centers to collect, analyze, and publish health pricing and medical claims reimbursement data.  The data centers’ work helps consumers better understand the comparative price of procedures in a given region or for a specific health insurer or service setting. Businesses and consumers alike can use these data to drive decision-making and reward cost-effective provision of care.

The data can be viewed at http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/Medicare-Provider-Charge-Data/index.html.

The Centers for Medicare & Medicaid Services (CMS) has released a proposed rule increasing Medicare fiscal year (FY) 2014 payment rates for skilled nursing facilities (SNF) by 1.4%. The proposed increase is based on a 2.3% market basket increase, minus a 0.4 percentage point productivity adjustment required by law and a 0.5 percentage point adjustment to account for the difference between the actual and projected market basket for FY 2012. The rule also would revise and rebase the market basket beginning in FY 2014 to reflect FY 2010 cost data, add five cost categories and revise several price proxies. CMS also proposes a more specific Minimum Data Set (MDS) reporting process to capture distinct calendar days of therapy.

The proposed rule is available at https://www.federalregister.gov/articles/2013/05/06/2013-10558/medicare-program-prospective-payment-system-and-consolidated-billing-for-skilled-nursing-facilities

The Centers for Medicare & Medicaid Services (CMS) issued a proposed rule increasing fiscal year 2014 Medicare payments for inpatient rehabilitation facilities (IRF) by 2%. The net increase includes a market basket update of 2.5%, minus a 0.4% productivity adjustment and 0.3 percentage point reduction mandated by the Affordable Care Act (ACA), plus a 0.2% increase due to proposed outlier payment changes.  The rule would also modify the process used to assess IRF compliance with the 60% Rule which requires 60% of an IRF’s cases for the prior 12-month compliance period to fall within 13 qualifying conditions. The proposed rule would require new, more specific codes for the patient’s condition, severity of illness, and anatomical location of illness.

The rule will can be accessed at https://www.federalregister.gov/articles/2013/05/08 with comments accepted through July 1.

The Patient-Centered Outcomes Research Institute (PCORI) has approved 51 new awards, totaling $88.6 million over three years, to fund patient-centered comparative clinical effectiveness research (CER) projects under the first four areas of its National Priorities for Research and Research Agenda. This brings the total that PCORI has awarded for projects addressing these priorities to $129.3 million. PCORI also has committed another $30 million in funding for a series of pilot projects.

The projects include studies of how to best care for people with kidney disease, certain cancers, obesity, asthma, diabetes, and various mental health conditions. Other projects will explore ways to support patient decision-making, reduce specific health disparities, and improve health care delivery systems. The awards are part of PCORI’s second cycle of primary research funding, and were selected from among more than 400 completed applications.

Details on the approved awards, including the project name, primary investigator, research institution, and associated PCORI priority area, are provided on the PCORI website, www.pcori.org.

The Centers for Medicare & Medicaid Services (CMS) has simplified and shortened the applications for individuals and families who apply for health coverage through the Health Insurance Marketplace beginning in October 2013. Consumers will have the option of applying online, by phone or by paper. Paper applications for those individuals without health insurance have been reduced to three pages from 21, and applications for families have been reduced by two-thirds.

More information is available at http://www.healthcare.gov/marketplace/index.html.

On April 26, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule that would update fiscal year (FY) 2014 Medicare payment policies and rates for the hospital inpatient prospective payment system (IPPS) and long-term care hospitals (LTCHs) prospective payment system (PPS).  Overall, CMS estimates total Medicare spending on inpatient hospital services will increase by about $27 million in FY 2014.

The proposed rule would increase IPPS operating rates by 0.8 percent, after accounting for inflation and other adjustments for those acute care hospitals that report quality data. Hospitals that do not report quality data would receive a 2 percent reduction in Medicare payments. The proposed rate is comprised of the following updates: an estimated + 2.5% market basket update, a – 0.4% update for a productivity adjustment, a – 0.3% update for cuts under the Affordable Care Act, (ACA), a – 0.8% documentation and coding adjustment, and a – 0.2% adjustment for other policy proposals.

The rule also proposed a reduction in disproportionate share hospital (DSH) payments to 25 percent of the amount Medicare would pay under the current policy.  The remaining 75 percent will be adjusted for decreases in the rate of uninsured individuals nationally and distributed to hospitals that receive DSH payments based on each hospital’s share of uncompensated care relative to all Medicare DSH hospitals.

In addition, based on provisions in the ACA, CMS proposed to implement a program aimed at improving patient safety in hospitals.  Beginning in FY 2015, hospitals that rank among the lowest performing 25 percent with regard to hospital acquired conditions will be paid 99 percent of what they would otherwise be paid under the IPPS.   The rule proposes also the criteria and methodology CMS would use to rank hospitals with a high rate of hospital acquired conditions.

For FY 2014, CMS is increasing the applicable percent reduction, the portion of Medicare payments available to fund the Value-Based Purchasing Program’s incentive payments, to 1.25 percent.  CMS estimates that the total amount available for performance-based incentive payments for FY 2014 would be approximately $1.1 billion, and will update this estimate for the final rule.

CMS will accept comments on the proposed rule until June 25, and will respond to comments in a final rule to be issued by August 1.   The proposed rule can be accessed at https://www.federalregister.gov/articles/2013/05/10.

On April 22, the American College of Cardiology (ACC) Board of Trustees announced that Shalom “Shal” Jacobovitz has been selected as the College’s chief executive officer (CEO). Jacobovitz comes to the ACC from Actelion Pharmaceuticals U.S., a biopharmaceutical company specializing in cardio-pulmonary therapies, where he has served as president since 2004. Prior to Actelion, Jacobovitz held positions at F. Hoffmann La Roche, where he served as general manager for Central America and the Caribbean, led the Pharmaceutical, OTC and Diagnostic divisions, and served as the global lifecycle leader for cardiovascular products in Basel, Switzerland. He also held positions with Abbott Canada, Nordic Labs and Marion Merrill Dow (now known as Aventis) in Canada. Jacobovitz earned his Bachelor of Science degree in biology at the University of Western Ontario in Canada.

The press release can be found by going to http://www.cardiosource.org/News-Media/Publications/Cardiology-Magazine/2013/04/CEO-Announcement.aspx

The Centers for Medicare & Medicaid Services (CMS) has published a proposed rule that would allow additional Part B payment when a Medicare Part A claim is denied because the beneficiary should have been treated as an outpatient, rather than being admitted to the hospital as an inpatient.  The rule proposes that if the beneficiary is enrolled in Part B, Medicare would pay for all reasonable and necessary Part B hospital inpatient services when a Part A inpatient admission is denied as not reasonable and necessary. Currently, payment is only for a limited list of Part B inpatient services currently allowed in these circumstances.

The proposed rule can be viewed at https://www.federalregister.gov/articles/2013/03/18/2013-06163/medicare-program-part-b-inpatient-billing-in-hospitals

The Medicare Payment Advisory Commission (MedPAC) has published its March report to Congress. Their recommendations are a 1% increase in hospital inpatient and outpatient prospective payment system payments.  For inpatient services, MedPAC recommended the difference between the 2014 statutory update and a 1% increase to offset the costs of changes in hospitals’ documentation and coding. The commission also recommended no marketbasket update for inpatient rehabilitation facilities, long-term care hospitals, skilled nursing facilities or home health providers in 2014. The report also recommends the elimination of the update to ambulatory surgical center payment in 2014 and requiring them to submit cost data.

The report can be viewed at http://www.medpac.gov/documents/Mar13_EntireReport.pdf.