Bundled Payments Initiative Launched

The U.S. Department of Health and Human Services (HHS) announced a new initiative to help improve care for patients while they are in the hospital and after they are discharged. Doctors, hospitals, and other health care providers can now apply to participate in a new program known as the Bundled Payments for Care Improvement initiative (Bundled Payments initiative). Made possible by the Affordable Care Act, it will align payments for services delivered across an episode of care, such as heart bypass or hip replacement, rather than paying for services separately. Bundled payments will give doctors and hospitals new incentives to coordinate care, improve the quality of care and save money for Medicare.

“Patients don’t get care from just one person – it takes a team, and this initiative will help ensure the team is working together,” said HHS Secretary Kathleen Sebelius. “The Bundled Payments initiative will encourage doctors, nurses and specialists to coordinate care. It is a key part of our efforts to give patients better health, better care, and lower costs.”

In Medicare currently, hospitals, physicians and other clinicians who provide care for beneficiaries bill and are paid separately for their services. This Centers for Medicare & Medicaid Services (CMS) initiative will bundle care for a package of services patients receive to treat a specific medical condition during a single hospital stay and/or recovery from that stay – this is known as an episode of care. By bundling payment across providers for multiple services, providers will have a greater incentive to coordinate and ensure continuity of care across settings, resulting in better care for patients. Better coordinated care can reduce unnecessary duplication of services, reduce preventable medical errors, help patients heal without harm, and lower costs.

The Bundled Payments initiative is being launched by the new Center for Medicare and Medicaid Innovation (Innovation Center), which was created by the Affordable Care Act to carry out the critical task of finding new and better ways to provide and pay for health care to a growing population of Medicare and Medicaid beneficiaries.

The Innovation Center’s Request for Applications (RFA) outlines four broad approaches to bundled payments. Providers will have flexibility to determine which episodes of care and which services will be bundled together. By giving providers the flexibility to determine which model of bundled payments works best for them, it will be easier for providers of different sizes and readiness to participate in this initiative.

“This Bundled Payment initiative responds to the overwhelming calls from the hospital and physician communities for a flexible approach to patient care improvement,” said CMS Administrator Donald Berwick, M.D. “All around the country, many of the leading health care institutions have already implemented these kinds of projects and seen positive results.”

The Bundled Payments initiative is based on research and previous demonstration projects that suggest this approach has tremendous potential. For example, a Medicare heart bypass surgery bundled payment demonstration saved the program $42.3 million, or roughly 10 percent of expected costs, and saved patients $7.9 million in coinsurance while improving care and lowering hospital mortality.

“From a patient perspective, bundled payments make sense. You want your doctors to collaborate more closely with your physical therapist, your pharmacist and your family caregivers. But that sort of common sense practice is hard to achieve without a payment system that supports coordination over fragmentation and fosters the kinds of relationships we expect our health care providers to have,” said Dr. Berwick.

Organizations interested in applying to the Bundled Payments for Care Improvement initiative must submit a Letter of Intent (LOI) no later than September 22, 2011 for Model 1 and November 4, 2011 for Models 2, 3, and 4. For more information about the various models and the initiative itself, please see the Bundled Payments for Care Improvement initiative web site at:
http://www.innovations.cms.gov/areas-of-focus/patient-care-models/bundled-payments-for-care-improvement.html.

To view a factsheet on the Bundled Payments for Care Improvement initiative visit http://www.healthcare.gov/news/factsheets/bundling08232011a.html.

Interested parties may obtain answers to specific questions by e-mailing CMS at: BundledPayments@cms.hhs.gov.

This initiative is part of a broader effort by the Obama Administration to improve health, improve care, and lower costs. A brief summary of other efforts, including those authorized by the Affordable Care Act, can be found at: www.HealthCare.gov/news/factsheets/deliverysystem07272011a.html.

For more information about the CMS Innovation Center, please visit: http://www.innovations.cms.gov.

Source: HHS News Release

HHS Awards $137 million to States to Boost Prevention, Public Health

U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius awarded up to $137 million, partly supported by the Affordable Care Act, to states to strengthen the public health infrastructure and provide jobs in core areas of public health. Awarded in nearly every state, the grants enhance state, tribal, local and territorial efforts to provide tobacco cessation services, strengthen public health laboratory and immunization services, prevent healthcare-associated infections, and provide comprehensive substance abuse prevention and treatment.

“More than ever, it is important to help states fight disease and protect public health,” said Secretary Sebelius. “These awards are an important investment and will enable states and communities to help Americans quit smoking, get immunized and prevent disease and illness before they start.”

The grants will fund key state and local public health programs supported through the Centers for Disease Control and Prevention (CDC) and the Substance Abuse and Mental Health Services Administration (SAMHSA). Most of these grant dollars come from the Prevention and Public Health Fund created by the Affordable Care Act. Additional SAMHSA dollars supplement this investment.

“CDC supports state and local public health departments which are key to keeping America safe from threats to health, safety, and security from this country or anywhere in the world,” said Centers for Disease Control and Prevention Director Dr. Thomas Frieden. “With these funds, CDC is strengthening our ability to prevent and combat diseases and keep Americans safe against expensive and dangerous health threats.”

“These funds will allow us to bolster public health services to communities and build on successful programs that have helped people lead healthier lives. Today’s investments will help us prevent future health care costs from problems such as tobacco-related illness and substance abuse,” said Pamela Hyde, administrator of SAMHSA.

The awards include:

- $1 million to further enhance the nations’ public health laboratories by hiring and preparing scientists for careers in public health laboratories, providing training for scientists, and supporting public health initiatives related to infectious disease research.

- Nearly $5 million to help states and territories enhance and expand the national network of tobacco cessation quitlines to increase the number of tobacco users who quit. Quitlines are the toll-free numbers people can call to obtain smoking cessation treatments and services.

- More than $42 million to support: improvements to the Immunization Information Systems (registries) and other immunization information technologies; development of systems to improve billing for immunization services; planning and implementation of adult immunization programs; enhancement of vaccination capacity located in schools; and evaluations of the impact on disease of recent vaccine recommendations for children and adolescents.

- $2.6 million to the Emerging Infections Programs around the country to continue improvement in disease monitoring, professional development and training, information technology development, and laboratory capacity.

- $9.2 million to eight national non-profit professional public health organizations to assist state, tribal, local, and territorial health departments in adopting effective practices that strengthen their core public health systems and service delivery. They will also enhance the workforce by providing jobs in critical disciplines of epidemiology and informatics, thus attracting new talent to public health.

- $1.5 million to evaluate and prevent ventilator-associated pneumonia to reduce cases of Methicillin-resistant Staphylococcus aureus (MRSA) infections and protect Americans from healthcare-associated infectious diseases.

- Up to $75 million to fund nine Screening, Brief Intervention, Referral and Treatment programs over the next five years. These programs will allow communities throughout the nation to provide more comprehensive substance abuse screening, secondary prevention, early intervention and referrals to treatment for people at higher risk for substance abuse. The actual award amounts may vary, depending on the availability of funds and the performance of the grantees.

A full list of grantees is available at: http://www.hhs.gov/news/press/2011pres/08/state_prevention_grants.html.

Source: HHS News Release

HHS Sponsors Contest for Facebook Personal Preparedness Applications

Federal officials are challenging software application developers to design new Facebook applications to help people prepare for emergencies and get support from friends and family after an emergency strikes – from personal medical emergencies to natural or man-made disasters.

The U.S. Department of Health and Human Services’ Office of the Assistant Secretary for Preparedness and Response (ASPR) issued the ASPR Lifeline Facebook Application Developer Challenge in collaboration with the Federal Emergency Management Agency (FEMA), a health-focused online community of developers, designers, patients, providers, health care organizations that promotes health technology innovation.

The online challenge runs throughout National Preparedness Month in September and the remainder of the 2011 hurricane season, closing Nov. 4.

“After disasters, a tremendous number of people use Facebook to post and share information,” said Assistant Secretary Nicole Lurie, M.D., a rear admiral in the U.S. Public Health Service. “We’re challenging our country’s most innovative developers to create apps that help people use Facebook not only to reach out to friends and family for any kind of help they may need after emergency but also to become better prepared in the first place.”

The person or team developing the best application will receive $10,000 from HHS and free admission from Health 2.0 to the 2012 Health 2.0 conference, and will be invited to an HHS event with Dr. Lurie. Second place will be awarded $5,000, and third place will receive $1,000.

While most tools take months or years to roll out, the first place challenge winner will work with the U.S. government and Facebook immediately to get the application into use just weeks after selection.

Submissions will be judged on the application’s ability to enhance community connections and improve individual preparedness. The goal is an app that enables a Facebook user to invite three Facebook friends to become lifelines, points of contact who agree to act as a source of support during disasters such as providing transportation, a place to stay or anything else the Facebook friend may need.

The ideal application includes a way for users to identify lifelines, to create and share a personal preparedness plan including health considerations with these lifelines, and to encourage others to use the application. Additional considerations include being easy to use on basic mobile devices, incorporating Geographic Information System (GIS) locating or tagging, and connecting with other social media and emergency relief technologies.

All submissions will be reviewed by judges from Facebook, ASPR, FEMA, and the New Orleans Health Commissioner.

To register as a participant in the ASPR Lifeline Facebook Application Developer Challenge, visit http://challenge.gov/challenges/220, or http://www.health2challenge.org/2011/07/12/the-aspr-lifeline-facebook-application-challenge/.

Federal employees, federal contractors, and recipients of federal grants may not participate in the challenge using time paid by federal funds. Winners must be U.S. citizens, permanent U.S. residents or businesses incorporated in and maintaining their primary place of business in the United States.

The HHS Office of the Assistant Secretary for Preparedness and Response coordinates the federal public health and medical response to disasters, leading the nation in preventing, preparing for, and responding to the adverse health effects of public health emergencies and disasters. ASPR focuses on preparedness planning as well as response; building federal emergency medical operational capabilities; countermeasures research, advance development, and procurement; and grants to strengthen the capabilities of hospitals and health care systems in public health emergencies and medical disasters.

To learn more about ASPR, visit www.phe.gov.

Source: HHS News Release

NIH Seeks Improvements in Data Gathering for Children's Study

The National Children’s Study is changing its approach to informatics—the science of classifying, cataloging, storing, analyzing, and retrieving information, study officials recently announced.

The new approach, termed facilitated decentralization, seeks to test a variety of different yet compatible information systems to identify those that will best meet the needs of the study. Study officials invite interested researchers in the federal government and in research institutions to collaborate on new informatics components to be integrated into the study’s main informatics system.

The National Children’s Study is a multi-site research study examining the effects of environment and genetics on the growth, development and health of children across the United States, from pre-conception to age 21. Because of its size, length, and complexity, the study will be conducted as two separate but related studies: a vanguard, or pilot study and a main study. The vanguard study seeks to evaluate the ease, acceptability, and costs involved in the methods needed to conduct the main study.

Results from the vanguard study will be used to inform the design of the main study, which is planned to begin in mid-2012. The new components for the National Children’s Study informatics systems will be tested in the vanguard study.

To learn more about opportunities to collaborate on informatics as well as other aspects of the study, researchers are invited to attend National Children’s Study Research Day on Aug. 24, 2011 on the NIH campus in Bethesda, Md. Additional information is available at http://www.nationalchildrensstudy.gov/newsandevents/events/Pages/ncsresearchday.aspx

The National Children’s Study is led by the Eunice Kennedy Shriver National Institute of Child Health and Human Development of the National Institutes of Health, in collaboration with a consortium that includes the NIH’s National Institute of Environmental Health Sciences, the Centers for Disease Control and Prevention, and the Environmental Protection Agency.

“The idea is to identify and develop systems that not only meet the study’s current needs, but can also be adapted and upgraded easily to meet the changing needs of the study as it proceeds through its 21 year span,” said Capt. Steven Hirschfeld, M.D., United States Public Health Service, the acting director of the National Children’s Study and director of clinical research.

Dr. Hirschfeld explained that the facilitated decentralization approach for the study seeks to move away from proprietary informational systems to publicly available, non-proprietary systems. The National Children’s Study will establish uniform standards for the new informational systems components to be studied. In addition to being non proprietary, prospective components must open architecture based—meaning that it can be easily upgraded by researchers wishing to collaborate to expand the system’s capacity.

Dr. Hirschfeld added that the new approach is the first time that different systems can be evaluated concurrently. In addition, the approach is intended to facilitate efforts to classify the concepts and terminology needed to carry out the study. Many conditions and disorders that National Children’s Study scientists will study are unique to childhood and are not uniformly found in the current classification systems that researchers use for their analysis of adult studies. For example, different terminology systems vary on how they have classified a structural birth defect affecting the roof of the mouth. The condition is generally referred to as cleft palate, but different terminologies in use may or may not include a cleft lip within the term or the concept. The NCS is working to coordinate the various terminology systems that apply to early childhood, relate them to terms and concepts across the life course, and ensure that a robust informatics infrastructure supports a uniform terminology.

Information for researchers interested in collaborating in the study’s new facilitated decentralization approach is available at http://www.nationalchildrensstudy.gov/about/overview/Pages/NCS_concept_of_operations_04_28_11.pdf.

Source: NIH Press Release

ONC Issues Metadata Standards Proposal

The Office of the National Coordinator for Health Information Technology (ONC) issued an advance notice of proposed rulemaking, which solicits public comments on the metadata standards recommended to it by the HIT Standards Committee.

The metadata standards under consideration relate to:
• Patient Identity Metadata – These metadata relate to patient identity and include: a patient’s name; date of birth; address; zip code; and relevant patient identifier(s).
• Provenance Metadata – These metadata would be used to provide information on the “who, what, where, and when.” Provenance metadata would include: a tagged data element (TDE) identifier; a time stamp; the actor; and the actor’s affiliation.
• Privacy Metadata – Privacy metadata would include a policy pointer and content elements descriptions such as data type (e.g., consultation note) and sensitivity.

ONC will accept public comments up to September 23, 2011.

For more information, please visit ONC's website at http://healthit.hhs.gov/. The proposed rule may be viewed here: http://www.ofr.gov/OFRUpload/OFRData/2011-20219_PI.pdf.

Source: ONC Release

CMS Launches New Consumer Data Tool

The Centers for Medicare & Medicaid Services (CMS) announced a new tool for patients and caregivers and other enhanced initiatives today to empower consumers to make informed choices about their health care, and to help improve the quality of care in America’s hospitals, nursing homes, physician offices, and other health care settings.

“These tools are new ways CMS is making sure consumers have information about health care quality and important information they need to make the best decisions about where to receive high-quality care,” said Dr. Don Berwick, the CMS Administrator. “These efforts are designed to also encourage providers to deliver safe, patient-centered care that consumers can rely on and will motivate improvement across our health care system.”

The steps include:

• A Quality Care Finder to provide consumers with one online destination to access all of Medicare’s Compare tools -- comparison information on hospitals, nursing homes and plans: www.Medicare.gov/QualityCareFinder.

• An updated Hospital Compare website, which now includes data about how well hospitals protect outpatients from surgical infections and whether hospitals care for outpatients who are treated for suspected heart attacks with proven therapies that reduce death: www.hospitalcompare.hhs.gov

• An enhanced Quality Improvement Organization (QIO) program under which QIOs provide technical assistance and resources to health care providers across the country to assist them in changing how care is delivered in hospitals, nursing homes, physician offices, and across care settings.

CMS has also updated data for outcomes of inpatient hospital care on Hospital Compare. Today’s update includes new 30-day mortality rates and 30-day readmissions rates for inpatients admitted with heart attack, heart failure, and pneumonia. These rates encompass three full years of claims data (from July 1, 2007 to June 30, 2010).

This year, the national 30-day mortality rates for heart attack have continued to decline, falling by 0.3 percent from the 2006 through 2009 rate of 16.2 percent to the more recent 2007 through 2010 rate of 15.9 percent. Mortality rates for heart failure and pneumonia increased slightly over the same period, showing an increase from 11.2 to 11.3 percent for heart failure and 11.6 to 11.9 percent for pneumonia, respectively.

Also this year, national 30-day readmissions rates for heart attack, heart failure, and pneumonia showed small changes in their updated rates. The new 2007 through 2010 rates for these three conditions are 19.8 percent, 24.8 percent, and 18.4 percent, respectively. These rates were slightly higher for heart attack in 2006 through 2009, at 19.9 percent, and slightly lower for pneumonia, at 18.2 percent, and heart failure, at 24.5 percent.

“Both sets of inpatient measures are risk-adjusted, taking health conditions into account to ‘level the playing field’ among hospitals and to help ensure accuracy in performance reporting,” Dr. Berwick said.

Hospital Compare also includes 10 measures that capture patient experience with hospital care. After two years of reporting these patient experience measures, hospitals have shown modest but meaningful improvement on most experience measures. The degree of this improvement has been relatively uniform across most measures and hospitals.

The website also contains 25 process-of-care measures and three children’s asthma care measures. The site also features information about the volume of certain hospital procedures performed and conditions treated for Medicare patients and what Medicare pays for those services.

Consumers have relied on Hospital Compare since 2005 to provide information about the quality of care provided in over 4,700 of America’s acute-care, critical access and children’s hospitals. So far this year, Hospital Compare has received about 1 million page views each month. More information about Hospital Compare is online at www.hospitalcompare.hhs.govse

The QIOs will integrate and coordinate care across settings within communities, improve community health by promoting preventive services, and make health care costs sustainable in the long term by supporting care that keeps patients safe from costly and dangerous complications and harm. The works supports the administration’s National Quality Strategy and its Partnership for Patients, designed to build collaborative models to improve health care quality, reduce hospital-acquired conditions and lower hospital readmissions.

“Patient-centeredness means that every decision that’s made and every program that’s established is focused on patients and their families,” said Patrick Conway, M.D., M.Sc., CMS chief medical officer and director of the agency’s Office of Clinical Standards and Quality. “QIOs will promote this concept by including beneficiaries and front line clinicians in quality improvement initiatives, learning and action networks and communications. Listening to the voices of patients and staying focused on their outcomes and experiences are essential to achieve care centered on the patient.”

More information about the QIO Program is on the CMS website at www.cms.gov/qualityimprovementorgs.

Source: CMS News Release

AHRQ Releases Updated Software for Public Reporting, Research Use

The Agency for Healthcare Research & Quality (AHRQ) has released Version 2.0 of MONAHRQ, its unique, desktop, Windows®-based software application for developing Web sites for hospital quality public reporting or research use. MONAHRQ 2.0 allows users to report Medicare Hospital Compare results along with, or instead of, their own inpatient discharge data. Web sites created with MONAHRQ 2.0 provide information for: quality of care at the hospital level; utilization at the hospital level; potentially avoidable hospitalizations at the area level; and rates of health conditions and procedures at the area level.

Source: AHRQ Release

AHRQ Releases Tool to Help Consumers Reduce Medication Errors

To address the high levels of prescription medicine non-compliance, AHRQ and the National Council on Patient Information and Education have released a newly revised guide to help patients learn more about how to take medicines safely. The booklet, Your Medicine: Be Smart. Be Safe., includes a detachable, wallet-sized card that can help patientskeep track of all medicines they are taking, including vitamins and herbal and other dietary supplements.

Available in English and Spanish, the guide includes questions that patients can ask their doctors about their medications.

Source: AHRQ release

AHRQ Focuses on Patient Safety Organizations

The July issue of the U.S. Department of Health and Human Services (HHS) Agency for Healthcare Research & Quality (AHRQ) Web M&M examines the role of patient safety organizations. The issue on features an interview with William Munier, MD, MBA, who directs AHRQ’s Center for Quality Improvement and Patient Safety and heads the Agency’s oversight of the Patient Safety Organization (PSO) program. The interview describes the support that AHRQ provides to PSOs, the variations in state-level protection, and how the agenda for PSOs has evolved in recent years. The July issue also features a spotlight case on the challenges of managing blood thinner medications. Physicians and nurses can receive free CME, CEU or training certification by taking the Spotlight Quiz.

TJC Posts National Safety Goals Presentation

The Joint Commission has posted a presentation outlining 2011-2012 National Patient Safety Goals. The goals were established in 2002; development and oversight of the safety goals is done by the Patient Safety Advisory Group.

Source: The Joint Commission

ISMP Medication Safety Self-Assessments Due August 31

The Institute for Safe Medicine Practices (ISMP) is requesting data submissions until August 31, 2011 for their self-assessment for hospitals to use to evaluate their medication safety practices.

Additional information about the assessments is here.

Source: The Joint Commission

AHRQ Releases Report on Improving Consumer HIT Application Development

A new report funded by the U.S. Department of Health and Human Services (HHS) Agency for Healthcare Research and Quality (AHRQ) offers a range of design methods that may be applicable for use in developing consumer health information technology (IT) applications. Improving Consumer Health IT Application Development: Lessons from Other Industries: Background Report offers an environmental scan of design practices found in successful consumer products and identifies those that could support improved development of consumer health IT applications. The full report provides recommendations of methods that can be incorporated into consumer health IT application design processes.

Source: AHRQ News Release

CMS Releases IRF Quality Reporting Program Rule

The Centers for Medicare & Medicaid Services (CMS) issued a final rule that updates Medicare payment policies and rates for more than 1,200 freestanding and hospital-based inpatient rehabilitation facilities (IRFs) in Fiscal Year (FY) 2012. The final rule increases IRF payment rates under the IRF Prospective Payment System (PPS) by 2.2 percent and establishes a new quality reporting system authorized by the Affordable Care Act. CMS projects that total payments under the IRF PPS will increase by $150 million in FY 2012.

“The final rule extends to the Inpatient Rehabilitation Facility payment system a quality reporting program designed to encourage these facilities to adopt practices that will better protect patient safety and prevent hospital-acquired conditions, which is an essential part of providing well-coordinated patient-and-family-centered care,” said CMS Administrator Dr. Donald Berwick.”

Initially, IRFs will submit data on two quality measures, a urinary catheter-associated urinary tract infection measure and a measure for new or worsening pressure ulcers, with a third measure—“30-day Comprehensive All Cause Risk Standardized Readmission”--under development. IRFs that do not submit performance data will see their payments reduced by two percentage points beginning in FY 2014. CMS anticipates adding measures for reporting in the future through rulemaking and establishing a process for making the data available to the public. As with other data on the CMS website, the IRFs would have an opportunity to review the data for accuracy before it becomes public.

The final rule will affect payments to more than 200 freestanding rehabilitation hospitals and more than 1,000 IRF units in acute care hospitals and critical access hospitals, beginning with discharges on or after Oct. 1, 2011. Under the IRF PPS, the Medicare payment to an IRF increases after the IRF’s costs for treating a beneficiary exceed an outlier threshold amount. The threshold is set for FY 2012 at an amount that is projected to maintain outlier payments at three percent of total payments under the IRF PPS.

The final rule also:

• Updates the case-mix group (CMG) relative weights using FY 2010 IRF claims and FY 2009 IRF cost report data;

• Uses the final FY 2011 pre-reclassified and pre-floor hospital wage data to determine the FY 2012 rates;

• Freezes the facility-level adjustment factors for FY 2012 at FY 2011 levels for one additional year while the agency explores ways to improve upon the accuracy and consistency of the current methodology used to calculate the facility-level adjustment factors;

• Allows IRFs to receive temporary adjustments to their FTE intern and resident caps if they take on interns and residents who are unable to complete their training because the IRF that had originally been their assigned training site either closed or ended its resident training program; and

• Allows IRF and inpatient psychiatric facility units to expand in the middle of a cost reporting period, rather than restricting such expansions to the start of a cost reporting period.

“The final rule we are announcing today will help ensure that Medicare beneficiaries who require rehabilitation in an inpatient setting, continue to have access to high quality care that will help them meet their rehabilitation goals during the difficult work of recovery,” said Dr. Berwick.

The final rule went on display on July 29, 2011 at the Office of the Federal Register’s Public Inspection Desk and will be available under “Special Filings” at: http://www.ofr.gov/OFRUpload/OFRData/2011-19516_PI.pdf and http://www.ofr.gov/inspection.aspx?AspxAutoDetectCookieSupport=1

It will appear in the Aug. 5, 2011 Federal Register.

For more information, please see: www.cms.hhs.gov/InpatientRehabFacPPS/.

And the CMS Fact Sheet: https://www.cms.gov/apps/media/press/factsheet.asp?Counter=4033.

Source: CMS News Release

CMS Releases Final Wage Index Changes for Medicare Hospices

Hospices serving people with Medicare will see a 2.5 percent increase in their Medicare payments for fiscal year (FY) 2012, according to a final regulation released by the Centers for Medicare & Medicaid Services (CMS). Hospices are also called upon to begin reporting on the quality of care received by Medicare patients, as a result of this final regulation.

The estimated hospice payments are the net result of a 3.0 percent increase in the “hospital market basket,” an indicator of industry-related price increases, offset by an estimated 0.5 percent decrease in payments to hospices due to updated wage index data and the third year of CMS’ seven-year phase-out of a wage index budget neutrality adjustment factor (BNAF).

The final rule also implements Affordable Care Act requirements, including a hospice quality reporting program, and clarifies previously adopted policies on hospice face-to-face certifications, said Jonathan Blum, deputy administrator and director of CMS’ Center for Medicare.“These payment and policy changes and additional attention to quality will work to encourage better coordination of hospice benefits and fair payments to Medicare hospice providers.”

The final rule continues the BNAF phase-out, now in its third year. The BNAF was implemented in 1997, when the former Health Care Financing Administration (HCFA), now CMS, moved from an outdated wage index to a more current and accurate method for determining hospice payments. To minimize disruption to services during the transition, a special budget neutrality adjustment was applied. In FY 2010 rulemaking, CMS adopted a schedule to phase out the BNAF over seven years, reducing it by 10 percent in FY 2010, 15 percent in FY 2011, and successive 15 percent reductions from FY 2012 through FY 2016.

The final rule revises how CMS calculates each hospice’s yearly aggregate cap. Federal law requires that CMS impose a limit on the aggregate Medicare payments a hospice provider receives annually. CMS calculates each hospice’s aggregate cap by multiplying the number of patients served by the hospice in a cap year by a cap amount. Medicare payments made to a hospice during the cap year that exceed the hospice’s aggregate cap must be refunded to Medicare.

In this final rule, CMS will:

- Change the way it counts hospice patients for the 2012 cap accounting year and beyond. The final policy for counting the number of Medicare hospice beneficiaries in care for a given cap year calculates the cap based on the number of days of care the patient received in that cap year for each hospice. This rule also finalized that the new counting method be applied to past cap years in certain instances.

- Allow hospice providers who do not want a change in their patient counting method to elect to continue using the current method.

- Allow any hospice physician to perform the face-to-face encounter regardless of whether that same physician recertifies the patient’s terminal illness and composes the recertification narrative.

- Implement a hospice quality reporting program, which includes a timeframe for reporting, as required by section 3004 of the Affordable Care Act. The measures that are being adopted in this final rule for the FY 2014 program are one measure endorsed by the National Quality Forum related to pain management and one structural measure that assesses whether a hospice administers a Quality Assessment and Performance Improvement (QAPI) program that contains at least three indicators related to patient care.

As finalized, hospices will be required to begin collecting quality data in October 2012, and will submit the data in 2013; hospices may also voluntarily begin collecting data on the QAPI measure in October 2011 for submission in 2012. Hospices failing to report quality data in 2013 will have their market basket update reduced by two (2) percentage points in FY 2014.

Information on the final hospice wage index payment and policy changes and other healthcare news can also be found on a new web portal, www.healthcare.gov, made available by the U.S. Department of Health and Human Services. A link to the final rule, which will be published in the Federal Register on August 4, 2011, along with accompanying documents will be available at: http://www.ofr.gov/OFRUpload/OFRData/2011-19488_PI.pdf or http://www.federalregister.gov/inspection.aspx.


Source: CMS News Release