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July 2016

CMS Doctor Pay Rule Timeline May Allow for Few Major Changes

A November deadline for creating a new Medicare payment system for doctors may leave federal officials little time to significantly change a draft proposal. The agency is required by law to finalize the rules by November if officials intend to implement them when the new payment year begins in January. CMS unveiled the proposed rules in April. Andy Slavitt, the acting administrator for CMS, on Monday tweeted that more than 3,100 responses had been submitted before a Monday deadline. Many physicians appealed to the agency to shorten the reporting period for doctors who will be covered by the most common reimbursement approach, the new merit-based incentive payment system. Instead of looking at a full year of data from doctors, a six-month period could be used, she said. The rule will carry out the mandate set in last year’s overhaul of physician pay (PL 114-10), known as the Medicare Access and CHIP Reauthorization Act. A key concern with MACRA has been helping doctors in small practices adapt to the new reporting requirements. Groups representing doctors have sought to persuade CMS to reconsider the standards for qualifying for alternative payment models, which may prove more profitable in the long term for doctors.

CMS Releases Proposed CY 2017 Medicare Physician Fee Schedule

The Centers for Medicare & Medicaid Services (CMS) released the proposed 2017 Medicare Physician Fee Schedule (MPFS) July 7. The rule includes essentially no change to the total payment for general surgery services next year and proposes a significant data-collection effort related to global codes. Two years ago, CMS finalized a policy that would have transitioned all 10- and 90-day global codes to 0-day codes. However, Congress intervened and prohibited the agency from implementing that policy but required CMS to collect data on global codes starting in 2017 and to use those data to revalue these codes starting in 2019. In this proposed rule, CMS sets forth a plan for data collection that would require all practitioners who provide 10- and 90-day global services to report data on these services to the agency CMS also proposes values for new moderate sedation codes. The agency said it appeared that practice patterns for certain endoscopic procedures were changing and that anesthesia was increasingly being reported for these procedures even though payment for these services was automatically included in payment to the physician furnishing the primary services. As a result, the agency proposes separate codes for moderate sedation. In addition, the rule includes quality-related proposals, such as updates to the Medicare Shared Savings Program, which facilitates coordination and cooperation among providers. Providers and hospitals may participate in the Shared Savings Program by creating or participating in an Accountable Care Organization (ACO). CMS proposes updates to ACO quality reporting measures that support alignment with the Quality Payment Program.

Medicare’s Hospital Fund Dire Report

Medicare’s hospital insurance trust fund will draw in enough revenue to cover its expenses only through 2028, the trustees said in their annual report released Wednesday. Last year, trustees projected that these hospital expenses could be covered through 2030. The trustees urged Congress to address the looming shortfall, noting that new legislation would be needed to allow transfers from the Treasury’s general fund to address the shrinking hospital fund. The hospital trust fund is considered a bellwether for the challenges facing the United States as baby boomers age into their retirement years. The trustees on Wednesday also reported that Social Security’s retirement and disability trust fund reserves are projected to be exhausted in 2034, the same year projected in last year’s report. Congress has not taken many actions in recent years to address the programs’ long-term funding. Medicare’s total expenses might reach $1.29 trillion in 2026, up from $ 683.2 billion this year, according to what the trustees term intermediate estimates. The mandatory spending involved in caring for senior citizens and the disabled are expected to crowd out other national priorities in future budget battles. The report could signal another congressional battle over raising the premiums that some people pay for Medicare Part B services, such as routine visits to doctors. The standard monthly premium may rise from $121.80 this year to $149.00 next year. The trustees in their 2015 report had predicted the Part B premium would rise to $159.30 for 2016, but Congress acted through last year’s budget deal to lower it. The projected 2017 hike would apply for only about 30 percent of people on Medicare, because the majority of beneficiaries would be protected by a “hold harmless” provision that keeps their premium increases in check. Under the provision, increases in Medicare Part B premiums can’t exceed the dollar increase in Social Security benefits. The cost-of-living adjustment for Social Security next year could be 0.2 percent, meaning about 70 percent of people would see only small increases in their Medicare payment, the trustees said. Among those potentially in line for a higher 2017 Medicare premiums are people enrolling in Part B for the first time, those that do not receive a Social Security benefit and people who qualify for both Medicare and the Medicaid program due their low incomes.

CMS Releases 2017 OPPS/ASC Proposed Rule

The Centers for Medicare & Medicaid Services (CMS) on July 6 released the proposed 2017 Outpatient Prospective Payment System (OPPS)/Ambulatory Surgical Center (ASC) payment rule. CMS projects that the OPPS proposals will lead to a reimbursement increase of 1.55 percent for 2017 for services provided in most hospital outpatient departments. CMS proposes that certain items and services furnished by off-campus provider-based departments would not be covered for OPPS payment. CMS also proposes new measures for the ASC Quality Reporting Program and Outpatient Quality Reporting Program, including five measures that are collected using the Outpatient and Ambulatory Surgical Center Consumer Assessment of Healthcare Providers and Systems survey. The patient experience-of-care survey assesses patients’ access to care, interactions with facility staff, and overall experience at the facility. Under the ASC payment system, CMS is projecting an increase of 1.2 percent in 2017 for services provided under the ASC payment system. CMS also calls for adding eight procedures to the ASC list of covered surgical procedures. In addition, CMS proposes to reduce the reporting period for demonstrating meaningful use (MU) of an electronic health record system in 2016 for previous participants in the MU program from a full year of reporting to any continuous 90-day period.

House Republicans Offer Details on Obamacare Replacement

House Republican leadership released a sweeping manifesto for overhauling the health care system, one that focuses on repealing the 2010 health care law but also hints at GOP priorities should Democrats win the election. The 37-page document contains a variety of proposals that have been floated before. Many, such as a tax credit for people purchasing health insurance in the individual market, aim to replace the features of the 2010 health care law designed to reduce the uninsured rate and improve access to coverage. But the document also includes proposed changes to Medicare, Medicaid, malpractice law and even medical research funding. The plan would fully repeal the health care law’s individual and employer coverage mandates and their associated penalties. It would keep popular provisions, such as its requirement that health plans keep young people on their parents’ plans until the age of 26 and the ban on insurers kicking sick consumers off their plans. Unlike the tax credits offered under the health law, these would be a flat, monthly credit available regardless of income. Older Americans, whose health costs are usually higher, would get larger credits. The proposal would forbid insurers from discriminating on the basis of pre-existing conditions, highlighting a requirement that insurers not increase costs for anyone who maintains continuous coverage under a health plan. They also propose $25 billion in funding to strengthen state-based high-risk pools for consumers otherwise priced out of the individual market, in which premiums would be capped. Under the new Republican plan, insurers would get regulatory relief from many of the law’s requirements related to essential health benefits, and they’d also get to charge older Americans up to five times more than younger Americans for their insurance. The health law sets that ratio at three. The proposal relies on the expansion of tax-preferred Health Savings Accounts, which are usually coupled with high- deductible health plans. It would expand regulations that let insurers sell products across state lines, and it would also allow small businesses to band together to offer association health plans. The proposal also takes aim at employer-sponsored health insurance by capping the health insurance tax exclusion for employers for the most generous health care plans. The move would rein in what some Republicans view as a problematic tax break for employers while discouraging high-end coverage. The blueprint also outlines $25 billion in funding for states looking at innovative ways to reduce insurance premiums. And it includes several restrictions on using taxpayer funding for abortions that go beyond those in the 2010 law. The outline would overhaul the Medicare program for the elderly and disabled by setting up a voucher program under which the federal government would pay a portion of the health insurance premium as a defined contribution. Beneficiaries would be liable for the remainder of the cost. Republican budgets and other proposals in recent years have described similar ideas. Other provisions take aim at uncompensated care and look to achieve performance parity between private Medicare Advantage plans and traditional fee-for-service Medicare. It would also give insurers more flexibility in benefit design under Medicare Advantage.

IPAB Lives on in Annual Medicare Report

Medicare trustees on Wednesday again gave prominence to the Independent Payment Advisory Board, a panel created under the 2010 health care law that’s never had members appointed and that’s been repeatedly targeted for termination by congressional Republicans, with the backing of some Democrats. The law mandates that IPAB or the Department of Health and Human Services put forward a package of spending cuts if growth in Medicare spending reaches a trigger point. The trustees on Wednesday reiterated an estimate that the IPAB trigger on spending would be reached for the first time in 2017, which would require that a package of cost-cutting proposals move forward in 2018. Lawmakers have a history of easing the terms of cost controls such as the IPAB. It did this with the so-called sustainable growth rate, created by a 1997 budget law. Moving to repeal the IPAB provision could trigger a debate about finding alternative savings in the budget to offset the loss of those estimated to result from the trigger provision. The 2010 law calls for making IPAB’s proposals take effect automatically unless Congress acts to stop them. Paying the cost for medical care for the aging baby boomers is seen as one of the largest challenges to the federal budget. Medicare’s annual outlays may jump to $1.29 trillion in fiscal 2026 from $695 billion in fiscal 2016, according to the Congressional Budget Office.