E&C SGR Reform Draft and Hearing
House Energy & Commerce Committee staff unveiled a draft legislative framework for repeal of the Sustainable Growth Rate (SGR) formula. The proposed framework would repeal and replace the SGR and provide an undefined period of stable payments. It would also include the development of quality measures for competency assessments – the Secretary would develop cohorts of providers and develop sets of measures or “competencies” within each cohort. The measures would be published before being proposed in notice and comment rulemaking. The framework also includes an opt-out option for providers to be paid under alternative payment models. Under this option, the Secretary would publish a list of approved models in which providers could participate and would develop a process by which stakeholders could propose new payment models for consideration. The framework leaves blank any discussion of funding specifics.
The proposal leaves open many issues; interested parties may submit feedback on the proposed framework by June 10 to SGRComments@mail.house.gov. The committee will hold a hearing on the proposal on Wednesday, June 5 (see This Week’s Hearings below). Chairman Upton intends to pass a bill out of Committee, and possibly through the full House, by the end of the summer.
This Week’s Hearings:
- Tuesday, June 4: The House Committee on Education and the Workforce will hold a hearing titled “Reviewing the President’s FY 2014 Budget Proposal for the U.S. Department of Health and Human Services.” The Honorable Kathleen Sebelius, Secretary of HHS, will testify.
- Wednesday, June 5: The House Energy & Commerce Committee will hold a hearing on Medicare physician payment overhaul legislation.
Wellness Programs Final Rule
The Internal Revenue Service (IRS), U.S. Department of Labor (DOL), and U.S. Department of Health and Human Services (HHS) released the Incentives for Nondiscriminatory Wellness Programs in Group Health Plans Final Rule. This document contains final regulations, consistent with the Affordable Care Act (ACA), regarding nondiscriminatory wellness programs in group health coverage. Specifically, these final regulations increase the maximum permissible reward under a health-contingent wellness program offered in connection with a group health plan (and any related health insurance coverage) from 20 percent to 30 percent of the cost of coverage. The final regulations further increase the maximum permissible reward to 50 percent for wellness programs designed to prevent or reduce tobacco use. These regulations also include other clarifications regarding the reasonable design of health-contingent wellness programs and the reasonable alternatives they must offer in order to avoid prohibited discrimination.
Other Health News
Medicare Trustees Report
The Medicare Trustees released a report on Friday, May 31 that predicted that the Medicare trust fund will be solvent until 2026, which is two years beyond what the trustees projected last year. The report found lower-than-expected growth of Medicare spending in 2012, lower projected spending in many categories, and reflected an expectation that the federal health care law will reduce growth in Medicare Advantage spending more than previously anticipated.
The Government Accountability Office (GAO) made its appointments to the Medicare Payment Advisory Commission (MedPAC). Jon Christianson, PhD, was appointed as a new member, along with reappointments of Scott Armstrong, Katherine Baicker, PhD, Herb Kuhn, Mary Naylor, PhD, RN, and Cori Uccello, FSA.
Medicaid State Readiness Report
The Urban Institute and Robert Wood Johnson Foundation released a report on state readiness for Medicaid expansion. The brief examines how eight states are altering their Medicaid managed care programs as they move into the home stretch of implementing the ACA. In particular, the report draws on the experiences of eight states (Maryland, Michigan, Minnesota, New Mexico, New York, Oregon, Rhode Island, and Virginia) participating in the Robert Wood Johnson Foundation’s State Health Reform Assistance Network and the related health reform implementation monitoring and tracking project.
The report describes how these states are revamping their Medicaid managed care programs and how they are preparing the programs to provide coverage to new enrollees under health reform, and look into health plan and health care stakeholders’ perceptions of the changes and preparations. The report concludes that states with Medicaid managed care programs seem well-positioned to handle the ACA Medicaid expansion.
OIG Health Reports
The Office of Inspector General (OIG) released two reports last Tuesday, May 28. In the first report, “Improvements are Needed To Ensure Provider Enumeration and Medicare Enrollment Data Are Accurate, Complete, and Consistent,” OIG states that inaccurate, incomplete, and inconsistent provider data coupled with insufficient oversight place the integrity of the Medicare program at risk and present vulnerabilities in all health care programs. OIG recommends that the Centers for Medicare & Medicaid Services (CMS) should require Medicare Administrative Contractors to implement program integrity safeguards for Medicare provider enrollment as established in the Program Integrity Manual. Additionally, CMS should require more verification of National Plan & Provider Enumeration System (NPPES) enumeration and Provider Enrollment, Chain, and Ownership System (PECOS) enrollment data. Finally, CMS should detect and correct inaccurate and incomplete provider enumeration and enrollment data for new and established records.
In the second report, “Medicare Could Save Millions by Implementing a Hospital Transfer Payment Policy for Early Discharges to Hospice Care,” OIG estimated that Medicare could have saved $602.5 million for calendar years 2009 and 2010 by applying a hospital transfer payment policy for early discharges to hospice care.
CSHSC Report on Geographic Variations in Medical Spending
The Center for Studying Health System Change released a report on geographic variations in medical spending. The report suggests that at least 75 to 85 percent of the difference between high-cost and low-cost areas can be explained by taking patient health into consideration.