EDPMA - January Advocacy Newsletter
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EDPMA January 2015 Advocacy Newsletter

January Articles:
  1. Will Congress Permanently Repeal the SGR? 
  2. Medicaid Expansion Update 
  3. Supreme Court Weighs in Again on the Affordable Care Act
  4. EDPMA and ACEP Lobby CMS on Out-of-Network Payments
  5. MedPAC Considers Changes to Medicare Physician Fee Schedule and Short Stay Policy
  6. 2014 PQRS Data Submission Schedule
  7. 2015 PQRS MAV Document Released 
  8. CMS Sets Lofty Goals for Participation in Alternative Payment Models
  9. New Head of HHS-OCR Talks Tough on HIPAA Audits
  10. The 114th Congress Convenes: Committees Overseeing Healthcare Reorganize with Some New Leaders and Members

   

Will Congress Permanently Repeal the SGR?

 

On April 1, 2015, Medicare physician reimbursement rates will be cut by over 20% unless Congress passes legislation to either permanently or temporarily fix the problem.   This cut is mandated by a law passed in 1997 which ties reimbursement rates to the sustainable growth rate (SGR).  In 2002, this formula began mandating cuts.  Since 2003, Congress has passed 17 temporary "doc fix" patches that have delayed those cuts.  The most recent patch, which was passed last Spring, will expire on March 31st. 

 

In February of last year, the Republican and Democratic leadership in both the House and Senate came to agreement on legislative language that permanently repeals and replaces the SGR formula.  Under this noncontroversial bill, reimbursement, taken as a whole, would increase by 0.5% each year through 2018, would be frozen from 2018 through 2023, and would increase 1% each year after that.  In addition, starting in 2018, reimbursement rates would be adjusted so that physicians getting reimbursed under fee-for-service would be reimbursed at a lower rate and physicians getting reimbursed through approved alternative payment models (APMs) would be paid at higher rates. 

 

EDPMA successfully lobbied for a number of provisions that were included in this bipartisan bicameral bill, including provisions that spur development of alternative payment models for specialties - like emergency medicine - that currently have limited options, address value-based methodology that prejudices emergency physicians, allow hospital-based physicians to elect to use appropriate hospital value scores, provide for reimbursement updates, and permanently repeal the SGR.

 

Unfortunately, despite bipartisan support, the House and Senate were not able to agree on offsets to pay for the SGR repeal bill.  The Congressional Budget Office (CBO) estimates that the bill would cost $ 144 billion over 10 years (by comparison, the cost of freezing current reimbursement rates for 10 years would cost $119 billion over ten years.  So, yearly doc fix patches are also very expensive.). 

 

Last week, the House Energy and Commerce Health Subcommittee held its first hearing in the new Congress.  The good news is that it focused on the Subcommittee's desire to permanently repeal the SGR before the cuts take effect on April 1, 2015.  Unfortunately, the two parties do not seem any closer to identifying a bipartisan offset or agreeing to pass the legislation without offsets.

 

The Republican leadership has typically been characterized as feeling more strongly about requiring offsets.  However, the House recently passed a bill amending the Affordable Care Act (ACA) at a cost of $53 billion without any offsets.  And some members of the Republican Doctors Caucus - many of whom spoke at an EDPMA Solutions Summit - said they would be open to passing a repeal bill without offsets.  However, at the Energy & Commerce Subcommittee hearing last week, Subcommittee Chair Joe Pitts (R-PA) made it clear that he wants the bill offset and it is time to get to work identifying those offsets. 

 

Unfortunately, the hearing did not uncover new ideas for offsetting the repeal bill.  Some of the old ideas that were discussed included using money that was saved by winding down the wars in Iraq and Afghanistan (this offset is typically seen as a Democratic solution and not something Republicans are expected to support), raising the age of Medicare eligibility, and combining Part A and Part B into a single deductible. The Subcommittee also discussed  pushing harder and earlier for providers to take part in APMs.  This last option received a positive reception from both parties; however, it is unclear how much savings it could produce.

 

So, we seem to be in the same place we have been for last year - there is bipartisan agreement on policy, but no movement on finding an offset.  EDPMA will continue to monitor this issue and will continue to work to further improve the permanent repeal bill and urge its passage before April 1st.

   

Medicaid Expansion Update

 

Indiana has agreed to expand Medicaid and will become the 28th State plus DC, to expand Medicaid under the Affordable Care Act (ACA).  An estimated 350,000 low-income people are expected to receive coverage under the Indiana plan. CMS has approved a waiver of some cost-sharing requirements and the state will test the effect of requiring certain Emergency Department (ED) copays.  

 

Individuals under the poverty line will receive basic health care coverage and can elect to pay cost-sharing for vision and/or dental benefits.  However, individuals who earn above the federal poverty line will pay a monthly $25 premium to enroll in a higher level plan and have no other cost sharing, except for certain ED services. Under a pilot program, some of those who seek treatment at the ED will be charged copays ($8 for the first visit, $25 for the second visit) if they could have received care in a doctor's office. Others assigned to a "control" group will not be charged a copay for emergency visits. Indiana hopes to better understand whether cost-sharing has a meaningful effect on ED use.

 

Other states are also developing innovative plans to expand Medicaid.  The Nebraska legislature is considering a bill that would expand Medicaid coverage and possibly establish Medicaid ACOs to control costs and improve quality and coordination of care. Notably, the proposal would institute certain penalty co-pays and costs for over-utilization by individual patients.   Utah, North Carolina, Wyoming, Idaho, Alaska and Virginia governors have all signaled a desire to expand their Medicaid programs, but face strong opposition from primarily Republican-controlled legislatures.  In these states, creative solutions to pay for expanded coverage may be required to muster any significant level of support.

 

Adding fuel to the fire for proponents of expanded Medicaid coverage and benefits, a recent study by the Commonwealth Fund found that citizens in states without Medicaid expansion often faced more burdensome health care bills.  The study is available here.  Specifically, the study found that over a third of adults below the poverty line in non-expansion states continued to lack health insurance, while that number had dropped to just 19% in states that had expanded Medicaid coverage.  Overall, the study noted that the number of adults who could not pay their medical bills declined from about 75 million in 2012 to just 64 million in 2014 - a significant factor when many hospitals' bad debt and charity care ratios are exceedingly high. Notably, this was the first year in which this number declined since the Commonwealth Fund began asking the question in 2005.

 

Supreme Court Weighs in Again on the

 Affordable Care Act

 

As more states agree to expand Medicaid, and in new and different ways, others are challenging portions of the Medicaid programs and the health insurance exchanges. Depending on the actions of the Supreme Court of the United States (SCOTUS), this could mean significant revision of these programs.

 

Specifically, the case of King vs. Burwell has attracted national attention over whether the IRS overstepped its bounds by granting tax subsidies for health insurance exchanges operated by the federal government. Certain states, including Florida, Texas, North Carolina, Georgia, and about 25 others, offer exchanges that are facilitated or supported by the federal government. A strict reading of the ACA implies that subsidies are not available for health insurance purchased on exchanges in these states, while proponents of the subsidies argue that Congress clearly intended to allow subsidies for all state health insurance exchanges. The Congressional Budget Office estimates that residents in these states stand to lose about $65 billion in tax credits if SCOTUS determines that the law does not allow for subsidies on federally-operated exchanges.

 

In a separate case before the SCOTUS, Medicaid providers sued the state of Idaho for low Medicaid rates.  Initially brought in 2009, several providers sued the state's Medicaid director based on an independent review that the state's reimbursement rates were unreasonable as compared to providers' costs. Though the department recommended increased rates, the state legislature declined that recommendation.  The providers won at both the district court and the appeals court levels, setting the stage for a SCOTUS hearing.  The Court plans to decide whether the providers had standing to sue the state over the administration of Medicaid.  At least one Justice has previously noted that he believes they do not.  Nevertheless, should the case come out favorably for providers, many more lawsuits about Medicaid reimbursement rates are likely to follow.

 

EDPMA and ACEP Lobby CMS on 

Out-of-Network Payments

 

On December 22, 2014, EDPMA and ACEP sent a joint letter to the Centers for Medicare & Medicaid Services (CMS) urging them to require qualified health plans under the exchanges to "pay out-of-network emergency services at verifiable market rates that would reduce or mitigate balance billing and reduce enrollee out-of-pocket costs under the 'greatest of three' payment options from the interim final (IF) rule of June 28, 2010."  That rule states that plans should pay a "reasonable amount" for emergency services before a patient becomes responsible for paying the difference.   In that letter, "we ask[ed] CMS once again to structure a requirement whereby insurers/plans reimburse emergency providers via a 'usual and customary charges' (UCR) methodology (adjusted geographically) using a transparent UCR database that cannot be manipulated and is verifiable by providers and outside experts. "  The joint EDPMA-ACEP letter is available here.

   

MedPAC Considers Changes to Medicare 

Physician Fee Schedule and Short Stay Policy

 

The Medicare Payment Advisory Commission (MedPAC) is a nonpartisan agency that provides policy advice to Congress on the Medicare Program.  MedPAC's recommendations are taken very seriously by Congress and are often included in legislation and amendments.  At its recent January 2015 meeting, MedPAC discussed a number of issues including changes to the Physician Fee Schedule (PFS) and hospital short stay policy. 

 

Many of MedPAC's recommendations relating to the PFS are not new, but MedPAC nevertheless plans to "rerun" them in its March report to Congress.  Chief among these recommendations are:

  • repealing the SGR payment system (The SGR mandates over a 20% cut on April 1);
  • rebalancing payments to ensure higher payment for primary care and evaluation and management services (MedPAC did not specify which E&M services it was recommending be "rebalanced"); and
  • encouraging physicians to move away from traditional fee-for-service into "alternative payment models" like ACOs.

MedPAC voiced some frustration that despite bipartisan efforts to replace SGR with a new payment system, Congress has yet to enact a permanent solution.  In addition, MedPAC is also "rerunning" its recommendation of a 3.25% update to hospital inpatient and outpatient services. After conducting an "efficient provider analysis," MedPAC determined that such a bump in payment was needed to allow efficient hospitals to break even on their Medicare business. While many of these important recommendations have been repeatedly made by MedPAC for several years, Congress has not identified offsets to pay for these recommendations. 

 

One new recommendation that MedPAC is considering would remove primary care services from the PFS entirely and thereby develop a separate payment methodology for primary care practice, care coordination, preventive services and related care.  Describing the current arrangement as "imbalanced," MedPAC discussed a number of avenues to ensure that patients continue to have adequate access to primary care services. While no options were affirmatively adopted  (beyond the standard calls for increased reimbursement rates), it is likely that MedPAC will continue to explore this area and may provide additional insight in the near future.

 

In addition to its assessment of PFS issues, MedPAC also considered the current quagmire of hospital short stay policy. Last Fall, in order to ensure that MedPAC was aware of our views on short stay policy, EDPMA sent MedPAC a copy of our comment letter to the Centers for Medicare and Medicaid Services (CMS) on short stays. That EDPMA letter is available here.

 

In mid-2014, CMS tried to address the hospitals' and providers' concerns about the growing number of denials for short stay payment by establishing the 2-Midnight Rule.  However, this rule brought further ambiguity, and the agency has faced increased pressure to develop a more nuanced approach to inpatient admission decisions.

 

Having discussed the issue at its September and November 2014 meetings, MedPAC considered several possibilities that would ease the burden on both CMS and providers in handling short stay cases. Among the possible options discussed by MedPAC were:

  • creating a new site-neutral  1-day stay DRG. MedPAC suggests that this could bridge the cliff between an outpatient observation stay and an inpatient admission;
  • revising Recovery Audit Contractor (RAC) reviews to target hospitals with the highest rate of short inpatient stays; and
  • replacing RAC reviews with a hard-line payment penalty for excessive utilization of short inpatient stays.

The Commission did not affirmatively embrace any of these options as its recommendation to Congress.    Instead, MedPAC plans to continue to consider this issue and coordinate its efforts with CMS.  MedPAC also considered certain hospital-related payment changes to pay for its recommendations above, including a system-wide prospective payment system base rate adjustment.

 

MedPAC's possible recommendations highlight the continued scrutiny that hospitals will face over admissions decisions.   Even if Congress decides to adopt MedPAC's recommendations in legislation, those recommendations will likely not become law before 2016. 

   

2014 PQRS Data Submission Schedule

 

On January 15, 2015, the Centers for Medicare & Medicaid Services (CMS) announced the timeframes it will accept 2014 PQRS data. Note that the submission deadlines vary based on the type of reporting mechanism employed by your group:

  • For EHR and Registry (using QRDA III format) reporting, the deadline is February 28, 2015,
  • For GPRO web interface reporting, the deadline is March 20, 2015, and 
  • For qualified registries, registries only reporting PQRS using XML format, and MOCs, the deadline is March 31, 2015.

 

2015 PQRS MAV Document Released 

 

By Stacie Norris, MBA, CPC, CCS-P, Director of Coding Quality Assurance, Zotec Partners

 

The 2015 MAV ("Measure Applicability Validation") documents have been posted to the CMS website and are available here.  Just scroll down the page to the "2015 PQRS" section and see "2015 PQRS Measure-Applicability Validation (MAV) Process for Claims and Registry-Based Reporting of Individual Measures".  The good news is: 

1) Updated 2015 MAV documents provide more detail and examples than the 2014 documents provided; and 
2) The Emergency Care cluster (Cluster #4) contains only 3 measures.

 

The 3 measures in the Emergency Care Cluster are:

1) Measure #54-12-Lead ECG for Non-Traumatic Chest Pain;
2) Measure #254-Ultrasound Determination of Pregnancy Location for Pregnant Patients with Abdominal Pain; and
3) Measure #255-Rhogam for Rh-Negative Pregnant Women at Risk of Fetal Blood Exposure. 

If groups decide to go into the MAV process, remember there is a new 2015 requirement that Eligible Professionals or group practices that see at least 1 Medicare patient with a face-to-face encounter report at least one "cross-cutting" measure. The Cross Cutting Measure that applies to Emergency Medicine for 2015 is Measure #317-Preventative Care and Screening: Screening for High Blood Pressure and Follow-up Documented.  Physician groups/billing companies should review the CMS PQRS website and decide the best course of action for their physician groups as far as a reporting option.

 

CMS Sets Lofty Goals for Participation in Alternative Payment Models

 

On January 26, 2015, CMS announced that it hopes that 30% of Medicare payments will be tied to innovative payment models such as ACOs by 2016, with this number rising to 50% by 2018.  The announcement is available here.  This is the first time that Medicare has set explicit goals for alternative and value-based payment methodologies.  While no firm requirements have yet sprung from this announcement, it is likely that certain mandates are not far off.  Given the difficulty for emergency medicine providers to actively participate in alternative models, it is unclear what CMS plans to do to enable these providers to assist it in meeting these lofty goals.  EDPMA successfully urged Congress to amend its SGR repeal legislation with language directing CMS to develop APMs for physicians that are not in primary care.  However, this bill has not yet become law because the parties cannot agree on an acceptable offset for the cost of the bill.

 

New Head of HHS-OCR Talks Tough on HIPAA Audits

 

Since her appointment in mid-2014, Jocelyn Samuels, the new Director of the Office for Civil Rights (OCR) at the Department of Health and Human Services, has consistently signaled an increased commitment to HIPAA audits and civil fines.  In recent statements to the press, she stated that OCR is in the last stages of refining its audit protocols and plans to initiate these reviews in 2015.   These audits will be in addition to OCR's regular HIPAA enforcement actions. 

 

Samuels noted that the civil penalties that could result from these audits are designed to "send a strong message to industry about compliance," particularly regarding patient access to their records and privacy and security of electronic protected health information (ePHI).  Indeed, many of OCR's recent civil demands (such as a $1.7 million fine for an unencrypted stolen laptop at a Humana subsidiary or a $150,000 fine when malware compromised the ePHI at an Alaskan mental health clinic) have demonstrated the agency's commitment to heavy-handed enforcement even in cases of unintended HIPAA breaches. 

 

Further daunting is the prospect that breaches of ePHI through hacking, malware, and stolen devices are expected to increase this year due to increased reliance by providers and others on EHR and "bring-your-own-device" policies. These factors can create a perfect storm for an ePHI security breach and, likely, enhanced enforcement for those violations by OCR.  As many physician groups have already begun to do, it is imperative that physicians and staff be trained on securing PHI, particularly ePHI, and that sophisticated control mechanisms be implemented and enforced to ensure your organization is not exposed to these risks.

 

In addition, Ms. Samuels indicated that OCR plans to propose new regulations that allow for individuals affected by a HIPAA breach to share in any civil recoveries by OCR or the Department of Justice. Though this proposal is not new (it was enacted under the Health Information Technology for Economic and Clinical Health (HITECH) Act in 2009), the OCR director's statement suggests that this feature of the HITECH Act will soon have teeth. Should regulations for this law be promulgated, patients will likely be more keen on how their PHI is stored and disclosed.  Physicians and hospitals should consider this reality as they work to lock down their PHI and develop sound policies for ensuring both the physical and electronic security of their data systems.

 

The 114th Congress Convenes: Committees 

Overseeing Healthcare Reorganize with Some New Leaders and Members   

 

On January 6, 2015, the 114th Congress officially convened with Republicans controlling both the House and Senate.  They spent the first few weeks electing party and committee leaders and making Committee assignments. (Note:  the House Democratic Committee membership assignments are still not finalized).  

 

The top leadership of both parties in both the House and Senate largely remained the same with House Speaker Boehner (OH) and new Senate Majority Leader McConnell (KY) having strengthened their hands.  We have included below the leadership positions and the membership of those committees with jurisdiction over the Medicare and Medicaid programs as well as other healthcare programs. If you see a member of your delegation (the delegation representing your place of residence or your place of work), your phone calls and letters to that member on healthcare issues will likely hold more weight. The full list of committee membership for the Senate is available here, while the list for the House is available here

 

House Leadership:

 

Republicans:  Speaker of the House John Boehner (OH); Majority Leader Kevin McCarthy (CA); Majority Whip Steve Scalise (LA); Conference Chair Cathy McMorris-Rodgers (WA).

 

Democrats: Minority Leader Nancy Pelosi (CA); Minority Whip Steny Hoyer (MD); Assistant Leader James Clyburn (SC); Caucus Chairman Xavier Becerra (CA).

 

Senate Leadership:

 

Republicans:  Majority Leader Mitch McConnell (KY); Majority Whip John Cornyn (TN); Conference Chairman John Thune (SD).

 

Democrats:  Minority Leader Harry Reid (NV); Assistant Minority Leader Dick Durbin (IL);Vice Chair/Policy Chair Chuck Schumer (NY); Policy Advisors Elizabeth Warren (MA) and Amy Klobuchar (MN).

 

Senate Finance Committee Members:

 

Hatch, Orrin G. (UT), Chairman

Grassley, Chuck (IA)

Crapo, Mike (ID)

Roberts, Pat (KS)

Enzi, Michael B. (WY)

Cornyn, John (TX)

Thune, John (SD)

Burr, Richard (NC)

Isakson, Johnny (GA)

Portman, Rob (OH)

Toomey, Patrick J. (PA)

Coats, Daniel (IN)

Heller, Dean (NV)

Scott, Tim (SC)          

 

Wyden, Ron (OR), Ranking Member

Schumer, Charles E. (NY)

Stabenow, Debbie (MI)

Cantwell, Maria (WA)

Nelson, Bill (FL)

Menendez, Robert (NJ)

Carper, Thomas R. (DE)

Cardin, Benjamin L. (MD)

Brown, Sherrod (OH)

Bennet, Michael F. (CO)

Casey, Robert P. (PA)

Warner, Mark R. (VA)

 

Senate HELP Committee Members:

 

Alexander, Lamar (TN), Chairman

Enzi, Michael B. (WY)

Burr, Richard (NC)

Isakson, Johnny (GA)

Paul, Rand (KY)

Collins, Susan M. (ME)

Murkowski, Lisa (AK)

Kirk, Mark (IL)

Scott, Tim (SC)

Hatch, Orrin G. (UT)

Roberts, Pat (KS)

Cassidy, Bill (LA)      

 

Murray, Patty (WA), Ranking Member

Mikulski, Barbara A. (MD)

Sanders, Bernard (VT)

Casey, Robert P. (PA)

Franken, Al (MN)

Bennet, Michael F. (CO)

Whitehouse, Sheldon (RI)

Baldwin, Tammy (WI)

Murphy, Christopher (CT)

Warren, Elizabeth (MA)

 

House Energy and Commerce Committee Members:

 

Fred Upton (MI), Chairman

Joe L. Barton (TX)

Edward Whitfield (KY)

John Shimkus (IL)

Joe Pitts (PA)

Greg Walden (OR)

Tim Murphy (PA)

Michael C. Burgess (TX)

Marsha Blackburn (TN)

Steve Scalise (LA)

Bob Latta (OH)

Cathy McMorris Rodgers (WA)

Gregg Harper (MS)

Leonard Lance (NJ)

Brett Guthrie (KY)

Pete Olson (TX)

David B. McKinley (WV)

Mike Pompeo (KS)

Adam Kinzinger (IL)

Morgan Griffith (VA)

Gus Bilirakis (FL)

Bill Johnson (OH)

Billy Long (MO)

Renee Ellmers (NC)

Larry Bucshon (IN)

Bill Flores (TX)

Susan W. Brooks (IN)

Markwayne Mullin (OK)

Richard Hudson (NC)

Chris Collins (NY)

Kevin Cramer (ND)

 

Frank Pallone Jr. (NJ), Ranking Member

Bobby L. Rush (IL).

Anna G. Eshoo (CA)

Eliot L. Engel (NY)

Gene Green (TX)

Diana DeGette (CO)

Lois Capps (CA)

Mike Doyle (PA)

Jan Schakowsky (IL)

G.K. Butterfield (NC)

Doris Matsui (CA)

Kathy Castor (FL)

John Sarbanes (MD)

Jerry McNerney (CA)

Peter Welch (VT)

Ben Ray Luján (NM)

Paul Tonko (NY)

John Yarmuth (KY)

Yvette D. Clarke (NY)

Dave Loebsack (IA)

Joseph P. Kennedy III (MA)

Tony Cárdenas (CA)

 

House Ways and Means Committee Members:

 

Paul D. Ryan (WI), Chairman

Sam Johnson (TX)

Kevin Brady (TX)

Devin Nunes (CA)

Pat Tiberi (OH)

Dave Reichert (WA)

Charles Boustany Jr. (LA)

Peter Roskam (IL)

Tom Price (GA)

Vern Buchanan (FL)

Adrian Smith (NE)

Aaron Schock (IL)

Lynn Jenkins (KS)

Erik Paulsen (MN)

Kenny Marchant (TX)

Diane Black (TN)

Tom Reed (NY)

Todd Young (IN)

Mike Kelly (PA)

James B. Renacci (OH)

Patrick Meehan (PA)

Kristi Noem (SD)

George Holding (NC)

Jason Smith (MO)

 

Sander M. Levin (MI), Ranking Member

Charles B. Rangel (NY)

Jim McDermott (WA)

John Lewis (GA)

Richard E. Neal (MA)

Xavier Becerra (CA)

Lloyd Doggett (TX)

Mike Thompson (CA)

John B. Larson, (CT)

Earl Blumenauer (OR)

Ron Kind (WI)

Bill Pascrell Jr. (NJ)

Joseph Crowley (NY)

Danny K. Davis (IL)

Linda T. Sánchez (CA) 

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