Congress Passes Bill to Delay Medicare Reimbursement Cuts

On Monday evening the Senate passed and President Obama signed the Protecting Access to Medicare Act of 2014 (H.R. 4302) into law. This marks the 17th time Congress delayed the cuts to physician reimbursements established with the Sustainable Growth Rate under Medicare. The bill delays a 24% cut to the payments.

The Senate passed the bill with a 64-35 vote the evening the cuts were to go into effect at midnight. The Senate vote was preceded by the House passing the bill with a rare voice vote last week.  Both chambers moved quickly to pass this bill after it became obvious no agreement would be reached on how to pay for the permanent 'doc fix' bills.  

The Sustainable Growth Grate (SGR) was created in 1997 by Congress as a mechanism for tracking the payments with economic growth. The SGR became a problem within a few years as increases in healthcare costs substantially outpaced economic growth. This development resulted in the creation of a multi-billion dollar shortfall for the funding of Medicare payments to physicians. 

Members on both sides of the aisle and in both Chambers spoke about the need to permanently fix the SGR. However, they recognized the immediate need to prevent the delay's expiration and prioritized this temporary patch over a lengthy negotiation process to pass a  permanent fix that would result in the expiration of the SGR delay. 

Bill to Delay ICD-10 and Sustainable Growth Rate Patch Passes House

Advocates on behalf of hospitals and practitioners were optimistic about the likelihood of a permanent 'fix' to the Sustainable Growth Rate for Medicare's physician reimbursement system. Members in both the House and the Senate introduced bills this session that would repeal the Sustainable Growth Rate in Medicare's physician payment formula. 

In a surprise development today the House passed the Protecting Access to Medicare Act of 2014, H.R. 4302, by voice vote. This bill does not provide a permanent fix, only a one year patch to the Sustainable Growth Rate. The legislation, sponsored by Rep. Pitts of Pennsylvania, did not extend a fix for the SGR to physician-owned hospitals. Insiders agree that the cost of longer term bipartisan bills with permanent fixes to SGR were tabled because the parties were not able to agree on how to pay for the costs--about $140 billion over a 10 year period.  

Many on the hill expect the Senate to move this bill to a vote tonight. Speaker Harry Reid is said to be working on a deal to bring the bill to the floor. However, Senator Wyden is said to be pushing back on passing a bill with only a short term fix. Stakeholders following SGR legislation believe that if a temporary fix is passed the Congress will feel less pressure, and efforts to pass a permanent fix this year will fade into the background. 

The Protecting Access to Medicare Act of 2014 also contains a provision to delay the ICD-10 meaningful use requirements until October 2015. CMS Administrator Marilyn Tavenner has repeatedly stated that the agency was not going to extend the ICD-10 meaningful use requirements. Many eligible practitioners and hospitals are concerned about being able to meet the deadline and have publicly appealed to the agency and Congress to extend the compliance deadline. 

Congressional Gridlock Stalls Hopes for National Patient Identifier and Meaningful Use Stage 2 Delay

Many in the health IT field believe that implementing a national patient identifier and a deadline extension for stage 2 meaningful use requirements would ensure a more cohesive operation of patient access and identification systems and increase patient safety.  Both of these problems require congressional action to solve, but with a Congress that fails to pass even the most basic pieces of legislation and appropriations it is unlikely there will be any legislation addressing these issues in the year to come.

National Patient Identifier

A national patient identifier would go far to improve patient safety by improving the accuracy with which patients are matched with their medical records.  Ideally, a national patient identifier would be a unique number for each patient with a two-digit checksum at the end of the number. In practice this would allow a patient’s data to move completely through multiple data systems without comingling with other patients’ records that may contain similar names, addresses and other identifying factors.

However, the likelihood of legislation requiring a national patient identifier is very slim after Congress voted to overturn a HIPAA provision that would have required a patient identifier in 1998. Congressional opposition focused on privacy concerns and the capability providers have to identify patients with several different identifying factors. Former national health IT coordinator Farzad Mostashari, M.D., explained that he believed the odds were very low for a national patient identifier and that it would require the industry proving they are unable to keep patients straight by cross-checking a patient’s identity with other identifying factors available to the provider.

Meaningful Use Incentive Program

The electronic health records meaningful use incentive program was created to advance the adoption of health information technology nationwide. Beginning in 2014 eligible hospitals and professionals will have to comply with stage 2 of the regulatory standards in order to receive corresponding incentive payments. 

Senator Alexander and Senator Thune, along with 15 other Senators, wrote a letter to HHS Secretary Kathleen Sebelius requesting more time for implementation of stage 2 standards. Their letter stated, “If the goal is to improve care by achieving broad and meaningful utilization of EHRs, providing sufficient time to ensure a safe, orderly transition through Stage 2 is critical to having stakeholder buy-in, a necessary component of long-term success.

However, former national health IT coordinator Farzad Mostashari, M.D., does not think that this extension will be granted.  Without speaking to the merit of the request, Mostashari recently told a group gathered at the CHIME Fall Forum that the extension would take up to a year to approve, and the extension requested is a year. The overlap would through U.S. health IT into “total chaos” due to the uncertainty during the rulemaking process to amend the schedule.

 Resources

Don Fluckinger’s article, “Shut down thoughts of a national patient identifier,stage 2 extension,” 

A podcast discussing the benefits of a national patient identifier can be found here. 

Alexander-Thune Letter from 17 Senators to Secretary Kathleen Sebelius requesting a meaningful use stage 2 delay can be found here. 

PCPAN Coalition Urges Opposition to Merger of Two Large Pharmacy Benefit Chains

More than 50 consumers, small business owners and community pharmacists with Preserve Community Pharmacy Access NOW! (PCPAN) Coalition gathered in Washington, D.C. on November 4 to urge Congress and the Federal Trade Commission (FTC) to support patient care and oppose the planned merger between Express Scripts Inc. and Medco Health Solutions Inc, two of the nation’s largest pharmacy benefit management (PBM) companies.

Several Members of Congress attended the press conference to express their opposition to the merger.

“If allowed to go forward, this merger would have devastating effects on consumers and small businesses, alike,” said Congressman Joe Courtney (D-CT). “In an industry that already offers few choices, further market concentration would squeeze out the community pharmacies many of us have come to trust the most.”

“Right now, there is not a level playing field which is why I feel we need to act now,” said Congressman Thomas Marino (R-PA). “I supported community pharmacies when I sponsored a bill that sets out to level that playing field – and that would not cost the federal government or anyone else a penny. As a matter of fact, it would actually lower the prices for independent pharmacies and they, in turn, would pass it on to the consumer. I continue to support community pharmacies now.”

Pharmacy benefit managers (PBMs) manage prescription drug benefit programs for employers, unions, health plans and others. PBMs control the drug benefits of more than 200 million patients nationwide. This number includes a diverse group of Americans such as Medicare Part D beneficiaries, servicemen and veterans that are TRICARE beneficiaries, and more.

"[Dr]ugstores are lobbying against the merger, arguing that the deal, in which Express Scripts would acquire Medco for $29 billion, would put drugstores out of business and lead to higher consumer prices," reports Cq.com.

The House Judiciary Subcommittee on Intellectual Property, Competition and the Internet held a hearing on the merger on September 20. The Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights plans to hold a hearing on the merger in December.

Analysts: Debt Reduction Talks Stalling Hospital Expansion

Wall Street panelists at the Center for Studying Health System Change's (HSC) recent "Wall Street Comes to Washington" Conference say that expansions and construction of new hospitals aren't happening because of investor fears and over potential cuts that may be made by Congress to reduce the national debt.

"I think right now the biggest hurdle is planning," said Fitch Ratings analyst Jeff Schaub. "There are so many things that are unknown. And the planning cycle at acute care providers is five years, 10 years they’re looking out and there’s a big black hole starting 2013, 2014 and extending through 2017. So capital decisions that need to be made now, organizational decisions, affiliation decisions that really need to be made now are being made with a certain amount of contingency. Very often when I meet with hospitals they’re talking about...five, six, maybe even 20 different alternative views of the future and trying to quantify and make decisions among that entire array of possible outcomes."

Citigroup analyst Gary Taylor said that facilities that should be being built right now are probably not because investors do not know if how or if Congress will cost shift Medicare and Medicaid cuts to publicly-traded hospitals. “Since this debt ceiling debate took over and we’ve made commitments to reduce entitlement spending etcetera, publicly traded hospital stocks are down probably 40 percent on average, [and] nursing home stocks are down 70 and 80 percent on average,” Taylor said according to a report in CQHealthbeat (subscription required). “The collective wisdom of the market right now is that investing in . . . certain types of health care providers is extraordinarily risky because of the policy changes, primary reimbursement cuts, that are going to potentially come out of Congress.”

Source: CQ Healthbeat (subscription required); HSC Conference Transcript

Children's Hospitals Growing; Raises Questions About Spending

A news report by Kaiser Health News says that children's hospitals are growing and this growth spurt has led to questions about spending. The report says that the hospitals have hired lobbyists to obtain ensure special treatment by Congress and ensure that the highest insurance rates are paid to their facilities.

Source: Kaiser Health News Article

Democrats Signal Discomfort with Obama's Openness to Health Care Cuts

According to a report in the New York Times, Democrats in Washington are concerned about President Obama's willingness to cut up to $300 billion over 10 years from popular programs such as Medicare.

To view the article, please click here.

Source: NYT Article

HHS Submits Report on HITECH Act to Congress

The U.S. Department of Health and Human Services (HHS) Office of Civil Rights (OCR) posted reports to Congress on the Health Information Technology for Economic and Clinical Health (HITECH) Act. The HITECH Act requires the Secretary of the Department of Health and Human Services to prepare and submit annual reports on breach notifications and compliance with the Privacy and Security Rules promulgated under the Health Insurance Portability and Accountability Act of 1996 (HIPAA).

The HITECH Act also requires that each report be made available to the public on the web site of the Department.

The reports may be viewed here.

Source: HHS OCR Posting

HHS OIG: New Technology Helps Cut Waste, Prevent Fraud

Lewis Morris, Chief Counsel to the Inspector General of the U.S. Department of Health & Human Services recently testified before the U.S. Senate Committee on Homeland Security & Governmental Affairs, Subcommittee on Federal Financial Management, Government Information, Federal Services, and International Security about the role new technologies can play in cutting waste and fraud in the Federal health care programs.

"OIG is using information technologies and analytics, including data mining, trend evaluation, and modeling, to better identify fraud vulnerabilities and target our oversight efforts," reported Morris. "OIG is leveraging an analytical foundation that provides an enterprise view of questionable activities, suspected fraud trends, and prevention opportunities. When united with the expertise of our agents, auditors, and program evaluators, OIG brings a formidable combination of cutting edge techniques and traditional investigative skills to the fight against fraud, waste, and abuse."

Source: HHS OIG News Release

Concerns Raised About GOP's Plan to Cut Medicaid

An article in the New York Times discusses how Republican's plans to cut Medicaid could have a heavy impact on the nation's aged population.

Read Critics Fear G.O.P.'s Proposed Medicaid Changes Cut Coverage for the Aged by clicking here: http://www.nytimes.com/2011/05/11/health/policy/11medicaid.html?_r=1&emc=eta1

House Votes to Repeal Health Reform

The House voted to repeal the healthcare reform act by a vote of 245 to 189 on Wednesday. Three Democrats joined all Republican representatives in voting to repeal the act, which was a campaign promise by many Republicans in the past election.

The Senate, which is still controlled by the Democrats, intends to block any attempts to repeal healthcare reform. House Republicans acknowledged that their vote may merely be a symbolic one. However, they intend to "chip away" at healthcare reform by blocking funding and introducing bills to unravel certain provisions.

To read the full article, click here:
http://www.nytimes.com/2011/01/20/health/policy/20cong.html?emc=eta1


Source: The New York Times

Congress Determines Red Flags Rule Does Not Apply to Physicians

Both the House and Senate have passed the Red Flag Program Clarification Act of 2010, which provides additional information on who is determined a "creditor" under the rules.

The rule clarifies the definition to state that a "creditor" does not include an entity that "advances funds on behalf of a person for expenses incidental to a service provided by the creditor to that person." This means that physicians and healthcare institutions are no longer held subject to the red flags rule.

The red flags rule would have required these entities to take precautionary measures to prevent identity theft. Groups such as the American Medical Association fought enforcement of the rule on healthcare providers, stating that the rule would be burdensome and redundant if enforced along with HIPAA protections.

The red flags rule is scheduled to go into effect on December 31, 2010.

To read more, click here:
http://www.outpatientsurgery.net/news/2010/12/14


Source: outpatientsurgery.net