Close this search box.

April 2016

Check your 2015 Open Payments Data The Centers for Medicare

Medicaid Services’ continues to publish data from applicable manufacturers and group purchasing organizations (GPOs) about payments they make to physicians and teaching hospitals on its website, Doctors and teaching hospitals have the chance to review and dispute the information shared about them before we post the new and updated Open Payments data on June 30, 2016. The data posted on June 30th is now available for review through May 15, 2016. Since April 1, this is the only chance for these health care providers to dispute inaccurate or incomplete data before we post it. After that they only have until the end of the year that this financial data is published to review and dispute any payment records and how it was attributed from GPOs, drug and device manufacturers. Any doctor or teaching hospital that wants to look at the financial information reported on them by manufacturers and GPOs can register on the Open Payments website to create an account or log if they already have an account. Visit website for instructions and quick tips.

Medicare Expenses Outpaced Savings in Early Results of Key Test:

Medicare on Wednesday reported disappointing early results from its Comprehensive Primary Care Initiative, which is designed to shape an eventual overhaul of federal payments for basic medical services for the elderly and disabled. The savings in the program’s first two years failed to offset its expenses, while the quality of medical care did not improve as expected, Medicare officials reported. Monthly expenses fell by an average of about $11 per patient in the program, with reductions ranging from $1 to $21, according to a Mathematica Policy Research report for the Centers for Medicare and Medicaid Services. That adds up to about $91.6 million in total savings, possibly because closer contact between doctors and patients reduced the need for hospitalizations and use of skilled nursing centers. The reduced costs, though, were not enough to offset a fee averaging $18 a month per person enrolled in Medicare, the report said. The New England Journal of Medicine published the initial results. The Obama administration is moving away from the traditional fee-for-service program, which some say results in uncoordinated patient care and needless expenses, such as duplicated tests and hospitalizations. The authors of the New England Journal of Medicine paper included Patrick Conway, the chief medical officer for the Centers for Medicare and Medicaid Services. Conway announced plans for another primary-care test program.

Republicans Still Drafting Health Care Law Replacement

Key House Republicans are still having just preliminary conversations as they prepare to draft an alternative to the health care law before the Republican National Convention in July, but they remain optimistic about meeting their informal deadline. House Speaker Paul D. Ryan, R-Wis., tasked three committee chairmen – Kevin Brady, R-Texas, of the Ways and Means Committee; Fred Upton, R-Mich., of the Energy and Commerce Committee; and John Kline, R-Minn., of the Education and the Workforce Committee – with writing a replacement plan to the health law. The goal is to unite the conference behind a blueprint for early action in 2017, should a Republican win the White House. However, lawmakers are far from ready to start deciding exactly what will be in their white paper, following a closed-door meeting of the taskforce set up to draft the replacement. Many of the policies under discussion are familiar. Quite a few have been included in other Republican policy documents. GOP lawmakers and several lobbyists mentioned policies like expanding the use of health care savings accounts or ensuring coverage can be purchased across state lines. Several also mentioned the inclusion of tax credits to help consumers pay for their coverage. One policy under consideration that’s generating attention: a cap on the health care tax exclusion, which would limit the amount an employee could contribute to his or her health care premiums tax-free. Republicans want to continue allowing employers to deduct their health coverage costs from their tax expenditures, several sources off the hill said. Including that policy could raise a great deal of revenue to pay for other changes in the bill. The health care tax exclusion is one of the country’s biggest tax breaks. But the policy would have an effect much like the so-called Cadillac tax, an excise tax on the most expensive health plans. Advocates say both policies would help lower health care costs by reducing plan generosity and giving patients more skin in the game. But the tax is hugely unpopular among both business groups and labor unions, and sizeable bipartisan opposition led to Congress passing a two-year delay of the tax last year. But it’s a favorite policy of Ryan’s, who first included it in a 2010 budget proposal.

Hospitals Eye Unpaid Medical Bills

Medicare is expected to release soon its draft of the fiscal 2017 rule on payment for hospital stays. These payments for so-called inpatient stays are among the federal government’s single biggest expenses of any kind, costing Medicare about $110 billion. The White House’s Office of Management and Budget has been reviewing the hospital pay rule since March 21. OMB checks on major rules before federal agencies release them. OMB also already is reviewing a payment rule for skilled nursing care and a rate update for hospice, services that combined cost Medicare more than $40 billion a year. The Centers for Medicare and Medicaid Services likely will outline steps for a new uncompensated care framework in the fiscal 2017 hospital payment rule, given the agency’s past statements, lobbyists said. Implementing a change may take several years. The Medicare Payment Advisory Commission in March recommended a slow shift to using hospitals’ cost reports for these calculations. CMS now relies on a proxy measure that reflects hospital stays of low-income and disabled people in the Medicaid program. The advisory panel found many flaws in the current CMS approach to uncompensated care payments for hospitals. Medicare’s subsidies of Medicaid costs sends states a signal that they can underpay hospitals through Medicaid, MedPAC said. This work on Medicare’s uncompensated care involves addressing thorny issues that echo from the 2010 health overhaul. The measure changed how the federal government helps hospitals cover the expenses of treating people who can’t afford to buy their services, while also moving to bring millions of Americans into private insurance and Medicaid plans. The pool of money directly designated for uncompensated care dropped to about $6.4 billion for this year from $9.4 billion in 2014, according to MedPAC.

MedPAC Approves Payment Changes

Members of the Medicare Payment Advisory Commission voted unanimously by a show of hands to approve a report on the initial steps needed to move toward creating a unified payment for so-called post-acute care. They discussed the broad themes of this work, but left many of its details to be revealed when the report is published in June. Medicare payments for post-hospital care more than doubled, to $59 billion, between 2001 and 2013 despite concerns about fiscal waste. The absence of clear guidelines on appropriate post-hospital care is seen as one of the reasons for this growth. People can be assigned fairly randomly now to care in one of four tracks: skilled nursing centers, specialty inpatient rehabilitation centers, long-term care hospitals and services provided at home. Medicare often pays more in certain settings for care of similar patients, without establishing if there is an advantage to the more expensive care. Medicare officials and lawmakers may want to use an overhaul of payments to shift the program’s goals, according to MedPAC commissioner William J. Hall, a geriatrician and professor at the University of Rochester. An overhauled approach may need to weigh more carefully how well people maintain the abilities of daily life. The law mandates MedPAC to publish ideas for a payment overhaul– through the report the panel approved Thursday — by June 2016. The Department of Health and Human Services then must issue another report by 2022. MedPAC must respond by around 2023 with a design for a new post-hospital payment. Lawmakers in search of an offset for a future budget deal next year or beyond may be tempted to mandate changes in post-acute care that could save Medicare funding and allow more spending elsewhere in the federal government. Surgeons and hospitals until now have not needed to figure out which forms of post-hospital care work best for elderly people, said Blair Childs, senior vice president at Premier Inc., an alliance of about 3,600 U.S. hospitals and 120,000 other medical providers. The test program provides an incentive for hospital officials to determine which approaches to recovery after orthopedic surgery most benefit their patients, Childs said. It should foster a greater coordination of care.

CMS Shaves Estimated 2017 Medicare Advantage Pay Increase

Medicare officials on Monday shaved their estimate for an expected increase in payments next year for insurer-run Advantage plans, but allowed a longer transition to reimbursement changes in a program in which some retirees benefit from contributions by their former employers. The average base payment increase for each person covered by Advantage plans in 2017 will be little changed from this year at 0.85 percent. That will rise to about 3.05 percent after accounting for additional payments allowed in the system, said Sean Cavanaugh, the director of Medicare, on a conference call with reporters. This is less than an earlier proposed increase of 1.35 percent in base payments and total increase of 3.55 percent that CMS had suggested in February. The change is due largely to new calculations regarding risk adjustment factors, CMS officials said. In the past, unlike this year, CMS officials’ final version had provided more funds for insurers in the final policy than in the proposed version. In the final policy, CMS altered a plan for judging how ill people in Medicare Advantage plans may be. A blended percentage based on actual medical experiences and certain risk scores was intended to constitute 25 percent of certain calculations, instead of 50 percent as earlier proposed. CMS also said that there will be a two-year transition to the new payment approach for what are called employer-group waiver plans. There’s been considerable opposition to proposals to overhaul the employer-group plans, which critics have said could make it more difficult for firms to offer this coverage. Under the new policy, the costs of these plans will be tied more to the cost of other Medicare Advantage plans, which don’t have the retiree subsidies. About 3.2 million people are enrolled in these employer-group waiver plans.