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Medical Industry Reimbursement News

FY 2016 Proposed Inpatient and LTCH Rule Released

April 17th, 2015

On April 17, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule to update fiscal year (FY) 2016 Medicare payment policies and rates under the Inpatient Prospective Payment System (IPPS) and the Long-term Care Hospital (LTCH) Prospective Payment System (PPS).  The rule would increase rates by 1.1% in FY 2016.  This reflects the projected hospital market-basket update of 2.7%, adjusted by -0.6 % for multi-factor productivity and -0.2 % in accordance with the Affordable Care Act. In addition, the rate is further decreased by a proposed 0.8 % for a documentation and coding recoupment required by the American Taxpayer Relief Act of 2012.

The proposed rule also includes ACA-mandated Medicare Disproportionate Share Hospital (DSH) reductions. The reduction would reduce overall Medicare DSH payments by $1.3 billion in FY 2016 compared to FY 2015. The rule also proposes that a number of clinical quality measures be submitted electronically for the FY 2018 Inpatient Quality Reporting Program. CMS is also proposing changes to the Hospital-Acquired Conditions Program, the Hospital Readmissions Reduction Program, and the Value-Based Purchasing Program. The proposed rule will be published in the April 30 Federal Register and comments will be accepted through June 16.

The proposed rule can be found at https://s3.amazonaws.com/public-inspection.federalregister.gov/2015-09245.pdf

MACRA Legislation Signed into Law

April 16th, 2015

On April 16, 2015, President Obama signed the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) into law. Under MACRA, the sustainable growth rate (SGR) physician payment methodology is replaced with 0.5% annual payment increases for doctors for the next five years while Medicare transitions to a physician payment system focused on quality, value, and accountability. Under the new physician payment methodology, Medicare payments will rise by 0.5% each year between 2015 and 2019. Base payments will then be held steady from 2020 to 2025, but doctors will become eligible for additional payments under the Merit-based Incentive Payment System (MIPS). The MIPS intention is to reward physicians and certain other medical professionals based on a number of factors related to quality of care. These factors include implementation of care models that emphasize quality over volume and meaningful use of electronic health records. Under MIPS, doctors, physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists will receive annual payment increases or decreases based on their performance. Beginning in 2026, physicians will receive a 0.75% annual increase if they participate in an alternative payment model or a 0.25% annual increase if they do not.

In addition, MACRA will extend the Children’s Health Insurance Program (CHIP) for two more years, as well as extending funding for community health centers, ambulance add-on payments, home health rural add-on payments, and the therapy cap exceptions process

MACRA also contains the following of measures:

  • Limiting base payment increases for post-acute providers, such as long-term care and inpatient rehabilitation hospitals, skilled nursing facilities, and home health and hospice organizations, to 1% in 2018.
  • Delaying by one year scheduled reductions in Medicaid “disproportionate share hospital” payments to hospitals that care for large numbers of people who are uninsured or covered by Medicaid. These reductions will occur between 2018 and 2025, instead of between 2017 and 2024.
  • Strengthening certain aspects of anti-fraud oversight under Medicare
  • Prohibiting the Secretary of HHS from implementing the final rule requiring the transition of all 10-day and 90-day global surgical packages to 0-day global periods.
  • Amending the Protecting Access to Medicare Act of 2014 to extend the moratorium on the two midnight rule through September 2015.

The legislation can be found at https://www.congress.gov/bill/114th-congress/house-bill/2

Strategy to Address Blocking of Electronic Health Information Released

April 13th, 2015

According to a report released by the Office of the National Coordinator (ONC) for Health Information Technology, there is information blocking occurring which is interfering with the exchange of electronic health information. The report states that most of the complaints are directed at health IT developers; however, health care providers have also been accused. The report details steps the agency is taking to address information blocking, including efforts to strengthen in-the-field surveillance of health IT certified by ONC, constrain standards and implementation specifications, and promote greater transparency in certified health IT products and services, among other actions.

The report can be found at http://www.healthit.gov/sites/default/files/reports/info_blocking_040915.pdf

Proposed Rule Modifying EHR Reporting Period Released

April 8th, 2015

The Centers for Medicare & Medicaid Services (CMS) has released a proposed rule that would modify the reporting period for the Medicare and Medicaid Electronic Health Records (EHR) Incentive Program in 2015 to a 90-day period aligned with the calendar year and provide additional flexibilities, including reducing the share of patients that must use the patient portal. In addition, the rule would remove some measures that have reached widespread adoption. The shortened reporting period that is proposed would provide hospitals additional time to transition to Stage 2 and would increase the likelihood they will meet CMS’s timetable.

The proposed rule can be found at https://s3.amazonaws.com/public-inspection.federalregister.gov/2015-08514.pdf

Reports Issued on Hospital Uncompensated Care Costs and Medicaid Expansion

March 23rd, 2015

According to a report issued by the Department of Health and Human Services (HHS), hospital uncompensated care costs in 2014 were $7.4 billion lower because of gains in health insurance coverage under the Affordable Care Act (ACA).  More than $5 billion of the estimated reduction was in states opting to expand Medicaid to uninsured low-income adults. A second HHS report looks at the economic impact of Medicaid expansion, including jobs and federal funding. The report includes a summary of state-specific impacts for 26 states that commissioned independent studies.

The reports can be found by going to http://aspe.hhs.gov/health/reports/2015/MedicaidExpansion/ib_UncompensatedCare.pdf and


Sequestration to Continue Through March 31, 2016

March 17th, 2015

For the Medicare Fee-For-Service (FFS) program, claims with dates-of-service or dates-of-discharge on or after April 1, 2013, will continue to incur a two percent reduction in Medicare payment through March 31, 2016. Claims for Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS), including claims under the DMEPOS Competitive Bidding Program, will continue to be reduced by two percent based upon whether the date-of-service, or the start date for rental equipment or multi-day supplies, is on or after April 1, 2013. The claims payment adjustment will continue to be applied to all claims after determining coinsurance, any applicable deductible, and any applicable Medicare Secondary Payment adjustments.

Although beneficiary payments for deductibles and coinsurance are not subject to the two percent payment reduction, Medicare’s payment to beneficiaries for unassigned claims is subject to the two percent reduction. The Centers for Medicare & Medicaid Services (CMS) is encouraging Medicare physicians, practitioners, and suppliers who bill claims on an unassigned basis to continue discussions with beneficiaries on the impact of sequestration on Medicare’s reimbursement.

More information can be found at http://www.palmettogba.com/palmetto/providers.nsf/ls/Jurisdiction%2011%20Part%20B~95XLW67354?opendocument&utm_source=J11BL&utm_campaign=J11BLs&utm_medium=email

Next Generation ACO Model Announced by CMS

March 10th, 2015

On March 10, the Centers for Medicare & Medicaid Services (CMS) announced its Next Generation Accountable Care Organization (ACO) Model. According to CMS, the Next Generation ACO Model will be added to its existing portfolio of ACO models, which are the Medicare Shared Savings Program, the Pioneer ACO Model, the Advance Payment ACO Model, the ACO Investment Model, and the Comprehensive End Stage Renal Disease (ESRD) Care Initiative. The new model is intended for ACOs that are experienced in coordinating care for populations of patients, and will allow them to assume higher levels of financial risk and reward than under the Pioneer Model and Shared Savings Program. The agency expects from 15 to 20 ACOs to participate in the new model.

The fact sheet is available at http://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-03-10.html

CMS Launches the Health Care Payment Learning and Action Network

February 27th, 2015

The Centers for Medicare & Medicaid Services (CMS) has launched the Health Care Payment Learning and Action Network to provide a forum for public-private partnerships. The network was created to help the U.S. health care payment system meet or exceed recently established Medicare goals for value-based payments and alternative payment models. Health care payers, providers, employers, purchasers, state partners, consumer groups, and others are invited to join the network. The network will be supported by an independent contractor that will act as a convener and facilitator, and will synthesize and document best practices across a variety of topic areas. A Guiding Committee will be created to prioritize discussion topics and make recommendations to the contractor.

For more information, go to http://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-02-27.html

End-to-end Testing of ICD-10 Successful Overall

February 26th, 2015

According to recent results from end-to-end testing, the health care community will be ready for ICD-10 on October 1. About 660 health care providers and billing companies submitted nearly 15,000 test claims, and according to the Centers for Medicare & Medicaid Services (CMS), participants in the January 26 to February 3 testing were able to successfully submit ICD-10 claims and have them processed.  The testing was the first of three end-to-end testing weeks scheduled before October 1, when health care providers and others must begin using ICD-10 diagnosis and procedure codes.

For more on details, go to http://www.cms.gov/Medicare/Coding/ICD10/Downloads/2015-Jan-End-to-End-Testing.pdf

PCORI Awards $64.1 Million to Support Five Pragmatic Clinical Studies

February 24th, 2015

On February 24th, the Patient-Centered Outcomes Research Institute (PCORI) Board of Governors approved awards totaling more than $64 million to fund five large patient-centered comparative effectiveness research (CER) studies that will answer critical clinical questions about care for cancer, back pain, and stroke.

The awards are the first to be made through PCORI’s Pragmatic Clinical Studies Initiative, an effort to produce results that are broadly applicable to a greater variety of patients and care situations and can be more quickly taken up in routine clinical practice.

For further details, visit http://www.pcori.org/content/pcori-awards-641-million-support-five-pragmatic-clinical-studies