A big clue for 2021 Medicare Advantage plans

https://www.axios.com/newsletters/axios-vitals-3635dfb2-f6b2-4986-b8f0-15acd9436ea4.html?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiosvitals&stream=top

Image result for A big clue for 2021 Medicare Advantage plans

Spending levels for people in the traditional Medicare program are expected to rise by 4.5% in 2021, the Centers for Medicare & Medicaid Services said in a memo sent this week.

Why it matters: This growth rate is the key number government actuaries use when figuring out how much to pay Medicare Advantage plans, Bob writes.

  • A 4.5% rate “is a very strong starting point for reimbursement and a continued reflection of a MA-friendly Republican administration,” health care analysts at Barclays wrote to Wall Street investors.
  • The early estimate also is almost always revised higher once final rates are released in April, meaning another large pay raise is in store for insurance companies that sell MA plans.

Go deeper: The war over Medicare Advantage audits heats up

 

 

Critics say ‘junk plans’ are being pushed on ACA exchanges

https://www.washingtonpost.com/health/2019/11/20/critics-say-junk-plans-are-being-pushed-aca-exchanges/

Image result for junk health plans

The Trump administration has encouraged consumers to use private brokers, who often make more money if they sell the less robust plans.

The Trump administration is encouraging consumers on the Obamacare individual market to seek help from private brokers, who are permitted to sell short-term health plans that critics deride as “junk” because they don’t protect people with preexisting conditions, or cover costly services such as hospital care, in many cases.

Consumers looking at their health insurance options on the website for the federal marketplace, called healthcare.gov, may be redirected to other enrollment sites, some of which allow consumers to click a tab entitled “short-term plans” and see a list of those plans, often with significantly cheaper premiums. Short-term plans were once barred from the exchanges because they were considered inadequate coverage and do not meet the insurance requirements laid out under the Affordable Care Act. If consumers select a short-term plan, they are directed to call a phone number to finish signing up, according to screenshots provided to The Post.

Critics say that both the sale of short-term plans through private brokers and consumers’ ability to select such plans are the latest examples of Trump administration efforts to weaken the ACA after failing to repeal and replace the law in Congress. The president has repeatedly contended that short-term plans provide “relief” from expensive individual market insurance plans that are unaffordable to many consumers. The rule allowing the sale of such plans was finalized late last year, just weeks before open enrollment, so this is the first year they are widely available.

In addition to these efforts, the administration is also seeking to void the law in court, siding with a group of Republican state attorneys general who argue it is unconstitutional since Congress zeroed out the penalty for not having insurance in its 2017 tax overhaul legislationA trial court in Texas ruled the entire law invalid late last year, and an opinion is expected at any time from the U.S. Court of Appeals for the 5th Circuit. The law is likely to end up in front of the Supreme Court for a third time, possibly amid the 2020 presidential election.

Under the ACA, all health insurance plans have to cover 10 essential health benefits, including maternity and newborn care, prescription drugs, emergency room services and mental health. Short-term health plans do not have to cover those services, can discriminate against those with preexisting conditions and set caps on how much they are willing to pay, which is prohibited for Obamacare plans.

Brokers often make higher commissions on short-term plans, health policy experts said, which gives them an incentive to sell them. They are supposed to present ACA-compliant plans to consumers, but are allowed to provide other options, including short-term plans. Some brokers make clear that such plans are not as comprehensive as ACA plans, but experiences differ.

“The whole business model is signing people up for coverage and getting a cut of what they sell, and the place they’re going to make their money is selling these short-term plans,” said Nicholas Bagley, a professor of law at the University of Michigan and proponent of the ACA. Consumers “don’t fully understand the lack of protections if they go over some annual or lifetime [insurance] limit. These plans don’t cover preexisting conditions.”

The administration’s use of outside brokers has prompted nearly two dozen Senate Democrats, including Democratic presidential candidates Elizabeth Warren, Kamala D. Harris and Amy Klobuchar, to send a letter to CMS on Wednesday expressing their concern over the promotion of short-term health plans.

“We are concerned that [CMS] is not only failing to conduct sufficient oversight to protect customers, but is actively emailing consumers to encourage them to obtain coverage through third-party agents and brokers instead of the HealthCare.gov website,” the senators wrote in a letter. Democratic New Hampshire Senator Jeanne Shaheen orchestrated the effort.

Such plans were previously available for periods of three months or less and could not be renewed, but the administration late last year finalized a rule that allowed for the plans’ availability for up to 12 months, with the option to renew them for up to three years. A federal judge sided with the administration in a court challenge to their expanded availability and upheld the rule in July. Consumers still cannot use government subsidies to purchase short-term plans, however.

“For most of the people buying on the exchanges, this would be worse than what they’ve been buying, especially because the majority of people who buy on exchanges get help with their premiums,” said Allison Hoffman, a law professor at the University of Pennsylvania Law School.

The Centers for Medicare and Medicaid Services has sent at least five emails so far to individual market consumers encouraging them to use outside brokers, including through a service called Help on Demand, to sign up for health insurance, according to emails obtained by The Post from a recipient of ACA market emails. The agents and brokers must be registered with the federal exchanges, CMS said in a statement, and they help consumers sign up for individual market plans.

“While agents and brokers are required to provide assistance with Exchange, Medicaid and CHIP coverage and are directed to enroll consumers in such coverage options whenever possible, they are not prohibited from sharing information on other coverage options, such as those offered off-Exchange,” a CMS spokeswoman said.

Some critics of the policy say the expanded sale of short-term plans may be one of the factors depressing enrollment in Obamacare plans, which dropped 13 percent in the first three weeks of the sign-up period, compared to the same period last year, according to federal data released Wednesday. During the 2019 open enrollment, 1,924,476 people signed up for individual market plans in the first two weeks of enrollment, compared to 1,669,401 for 2020. Open enrollment ends on Dec. 15.

CMS said it has used Help on Demand for three years, but the agency has increasingly encouraged consumers to seek their advice through emails directing them to the service’s website.

The Trump administration has drastically cut federal funding for “navigators” — grass roots organizations that help people sign up for ACA plans, including those who may not otherwise know they are eligible for coverage. .

Premiums for the most common type of Obamacare plan dropped by 4 percent for 2020, CMS said last month, and the vast majority of consumers on the individual market qualify for government tax subsidies that help cover the cost of their insurance. However, consumers complain about high deductibles and premiums in individual market plans.

 

CMS pitches ramped up oversight of Medicaid payments, promises block grant guidance

https://www.healthcaredive.com/news/cms-pitches-ramped-up-oversight-of-medicaid-payments-promises-block-grant/567135/

Image result for medicaid block grants

UPDATE: Nov. 13, 2019: This brief has been updated to include comments from provider groups.

Dive Brief:

  • CMS proposed a new rule Tuesday that would establish stricter requirements for states to report information on supplemental Medicaid payments to providers in a bid to clamp down on spending and promote transparency.
  • The agency will also soon release guidance on how states can test alternative financing approaches in the safety net program like block grant and per-capita cap proposals for “certain optional adult populations,” CMS Administrator Seema Verma said Tuesday at the National Association of Medicaid Director’s annual conference in Washington, D.C.
  • Later this year, CMS will also issue guidance on how states can promote value-based payments and social determinants of health factors in Medicaid, Verma said. The Center for Medicare and Medicaid Innovation is currently developing several new payment models to push providers to take on more risk for their patient populations in those programs.

Dive Insight:

The moves are in line with sweeping changes from the Trump administration moving more power to the states and asking more from recipients. The CMS administrator teased late last month the agency would soon release new guidance for states to inject flexibility into their Medicaid programs.

“We shouldn’t ration care but instead make how we pay for care more rational,” Verma said Tuesday. “Medicaid must move toward value-based care.”

Speaking to the Medicaid directors Tuesday, Verma said the changes are aimed preserving Medicaid for future generations.

“Going forward there will be no new [State Innovation Model] grants, no more open-ended one-off district waivers,” she said. “We must move forward with a more unified, cohesive approach across payers, across CMS, across states.”

The proposed rule, called Medicaid Fiscal Accountability (MFAR), will add more scrutiny to supplemental payments, which are Medicaid payments to providers in addition to medical services rendered to Medicaid beneficiaries, such as payments supporting quality initiatives or bolstering rural or safety net providers.

Some states rely heavily on these additional payments to offset low Medicaid reimbursement or support struggling hospitals. Provider lobbies did not take kindly to the new rule.

“We share the government’s desire to protect patients and taxpayers with transparency in federal programs, but today’s proposal oversteps this goal with deeply damaging policies that would harm the healthcare safety net and erode state flexibility,” Beth Fledpush, SVP of policy and advocacy for America’s Essential Hospitals, said in a statement.

AEH, which includes more than 300 member hospital and health systems, many of which are safety net providers, asked CMS to withdraw the proposal. The American Hospital Association told Healthcare Dive it was still reviewing the rule and declined comment.

However, government oversight agencies like the Government Accountability Office and the Office of Inspector General have recommended changes to these payments, which have increased from 9.4% of Medicaid payments in 2010 to 17.5% in 2017, according to CMS.

MFAR would also propose new definitions for “base” and “supplemental” payments in order to better enforce statutory requirements around and eliminate vulnerabilities in program spending.

Verma has long teased CMS support of block grants, an idea popular with conservatives, but Tuesday’s speech solidifies the agency’s support of such proposals. A handful of red states have been mulling over capped spending to gain more clarity around budgets.

In September, Tennessee unveiled its plan to move to a block grant system that would set a floor for federal contributions adjusted on a per capita basis if enrollment grows. Any savings would be shared between the state and the government.

Tennessee must submit a formal application to CMS to later than Nov. 20. If approved, it would become the first state to use a block grant funding mechanism in Medicaid. Additionally, Utah submitted a waiver application seeking per-capita Medicaid caps in June; Oklahoma Gov. Kevin Stitt, a Republican, is reportedly considering such a program; and Alaska and Texas have both commissioned block grant studies.

 

 

 

CMS retains 340B, site-neutral payment cuts in final hospital payment rule

https://www.fiercehealthcare.com/hospitals-health-systems/cms-retains-340b-site-neutral-payment-cuts-final-hospital-payment-rule?utm_medium=nl&utm_source=internal&mrkid=959610&mkt_tok=eyJpIjoiWTJZd1pqWXpZbVUwWTJKbSIsInQiOiJLV2JJQWM1clQ3OVBiaURjdFVUUUg2K093U21XZm0zVHNPa1hTUjdTWEdxSWZpYklsako0TVMrZFYxazVGZHFkOHJ3M1pWNlwvYW5pVWpPcjM1TEtVRnErOWgxU3NKc1dcLzk3TnZTc1pLZVI0Ymcrb0V1ZEZ2eDh1djFwa1FlaW50In0%3D

billing statement from a doctor's office

The Trump administration finalized a hospital payment rule Friday that retains proposed cuts to off-campus clinics and the 340B drug discount program. 

The changes outlined in the hospital Outpatient Prospective Payment System (OPPS) rule come despite both cuts being struck down in legal challenges and amid major pushback from providers.

Site-neutral payments

The agency decided to move ahead with the two-year phase-in of the cuts to outpatient services for clinic visits furnished in an off-campus hospital outpatient setting. The goal is to bring payments to off-campus clinics in line with standalone physicians’ offices.

“With the completion of the two-year phase-in, the cost sharing will be reduced to $9, saving beneficiaries an average of $14 each time they visit an off-campus department for a clinic visit in [calendar year] 2020,” the Centers for Medicare & Medicaid Services (CMS) said in a fact sheet.

However, the two-year project that was supposed to start in 2019 has been halted because of a federal court ruling.

CMS decided to move forward with the cuts for off-campus clinics.

“The government has appeal rights, and is still evaluating the rulings and considering, at the time of this writing, whether to appeal the final judgment,” the agency said.

The American Hospital Association (AHA) said that the site-neutral payment rule was misguided and that CMS ignored the recent court ruling. 

“There are many real and crucial differences between hospital outpatient departments and the patient populations they serve and other sites of care,” said Tom Nickels, executive vice president of the AHA, in a statement.

CMS also finalized a proposed cut for the 340B program that cuts payments by 22.5% in 2020.

CMS has installed prior cuts in 2018 and 2019 to the program that requires drug companies to provide discounts to safety-net hospitals in exchange for getting their products covered on Medicaid.

However, a court ruling has struck down the cuts, and CMS is currently appealing the decision.

CMS said that it hopes to conduct a 340B hospital survey to collect drug acquisition cost data for 2018 and 2019, and the survey will craft a remedy if the appeal doesn’t go their way.

“In the event the 340B hospital survey data are not used to devise a remedy, we intend to consider the public input to inform the steps we would take to propose a remedy for CYs 2018 and 2019 in the CY 2021 rulemaking,” the agency said.

Hospital groups commented that CMS should drop both the 340B and site-neutral cuts because of the legal challenges.

Several groups weren’t happy that the cuts were still there.

“The agency also prolongs confusion and uncertainty for hospitals by maintaining unlawful policies it has been told to abandon in clear judicial directives,” said Beth Feldpush, senior vice president of policy and advocacy for America’s Essential Hospitals, in a statement Friday.

The hospital-backed group 340B Health added that CMS needs to stop this “unfunny version of ‘Groundhog Day’ and restore Medicare payments for 340B hospitals to their legal, statutory level.”

 

 

 

Trump’s Plan To Privatize Medicare

Trump’s Plan To Privatize Medicare

Image result for medicare privatizing

Last week, President Donald Trump signed an executive order titled “Protecting and Improving Medicare for Our Nation’s Seniors.” The order is the latest example of how Trump says one thing while doing another. Rather than strengthening Medicare, Trump envisions turning large swaths of the 54-year-old program for the elderly over to the private sector while directing the federal government to dismantle safeguards on seniors’ health care access, shift costs onto beneficiaries, and limit seniors’ choice of providers.

Among other things, the executive order lays out a path to:

  • Shift the Medicare program toward private plans
  • Expand private contracting between beneficiaries and providers, putting seniors at risk for higher costs and surprise medical bills
  • Further restrict seniors’ choice of providers in Medicare Advantage
  • Expand Medicare Medical Savings Accounts as a tax shelter for the wealthy

President Trump rolled out the executive order in a speech at a retirement community in Florida, during which he echoed his administration’s previous attacks on progressive health reform proposals by referring to them as “Medicare for None.” In fact, several recent congressional proposals would offer new choices for coverage, expand the benefits of insurance, and strengthen Medicare benefits for the elderly. Unlike these Medicare for All-type proposals, Trump’s plan fails to address some more common problems in Medicare, such as high out-of-pocket costs or difficulties navigating Medicare Advantage networks.

A shift toward Medicare privatization

Today, about one-third of seniors are enrolled in private plans through Medicare Advantage; the other two-thirds are in traditional, fee-for-service Medicare. The share of beneficiaries enrolled in Medicare Advantage has grown over the past two decades. Medicare Advantage attracts a relatively healthier, less expensive pool of enrollees than that of traditional Medicare, and its per-beneficiary spending is lower. Some of that difference is attributable to lower health care utilization, although local market conditions and beneficiary health status also contribute. A number of studies have shown how Medicare Advantage plans profit from selection by attracting relatively healthier enrollees while also gaming the Centers for Medicare and Medicaid Services’ (CMS) risk adjustment program to make their enrollees appear sicker. Medicare Advantage plans also enjoy distinct advantages over the traditional Medicare program, including integrated plan designs and the ability to avoid providers involved in graduate medical education.

Last week’s executive order emphasizes so-called market-based approaches, signaling that President Trump envisions an even bigger role for the private sector in Medicare. In fact, Trump has already taken steps to accelerate enrollment in private plans. Last year, the administration bombarded beneficiaries with email messages promoting Medicare Advantage to such an extent that one former CMS official described the effort as “more like Medicare Advantage plan advertising than objective information from a public agency.”

The executive order directs the secretary of the U.S. Department of Health and Human Services (HHS) to ensure that traditional Medicare “is not advantaged or promoted over [Medicare Advantage] with respect to its administration.” For example, one way the administration could nudge more enrollees into Medicare Advantage would be to further relax CMS guidelines governing how plans market to beneficiaries. A more aggressive tactic to shift enrollees into private plans would be to make Medicare Advantage, rather than the traditional Medicare program, the default for more seniors. While auto-enrollment could result in lower costs for some beneficiaries, others could find themselves stuck in plans with limited networks or insufficient coverage for services they need. In addition, studies of the private drug plans offered through Medicare Part D have shown that seniors find it cumbersome to switch plans, even when the one they have is not the best value.

CMS’ existing Medicare Advantage auto-enrollment mechanism, though limited to a small subset of beneficiaries, caused enough problems that the agency suspended expansion of the process in 2016. In some instances, beneficiaries subject to “seamless conversion,” which allows insurance companies to auto-enroll their marketplace or Medicaid customers into Medicare Advantage, were unaware what type of Medicare coverage they had until they were assigned a new primary care doctor or they already had received out-of-network care. Even if a future Trump administration plan allowed people automatically enrolled in Medicare Advantage to opt back into traditional Medicare, the switch could cause seniors to miss enrollment deadlines for private Medigap plans. Unable to obtain supplemental benefits for traditional Medicare coverage, those people would effectively be stuck in Medicare Advantage.

Another part of the order asks the HHS secretary to align Medicare’s reimbursement rates with the prices paid by Medicare Advantage plans and commercial insurers. Broad application of market-based pricing in Medicare could raise expenses for beneficiaries and taxpayers and drain the Medicare trust fund: Bloated provider rates for commercial insurance show that the market does not work in patients’ interests and cannot be trusted to ensure fair prices. Dominant provider systems leverage their market power to demand prices well above the cost of care. A recent RAND Corporation study found that private insurance typically pays hospitals about 241 percent of Medicare rates, with wide variation across geographic regions. While Medicare Advantage plans’ negotiated rates for individual items or services can be lower or greater than those in the traditional Medicare fee schedule, reimbursement rates in the two programs are generally close, on average. The administratively set rates in Medicare keep the prices for hospital and physician services reasonable not only for traditional Medicare beneficiaries but also for those in Medicare Advantage plans. Allowing traditional Medicare prices to float up toward commercial rates while also delinking Medicare Advantage rates from Medicare rates could cause traditional Medicare premiums and the overall cost of the program to skyrocket and deplete the Medicare trust fund.

The executive order could also give new life to a deeply unpopular, longstanding conservative scheme to privatize Medicare. Under so-called premium support plans, seniors would receive vouchers that they would use to purchase either a private Medicare plan or traditional Medicare. Past premium support proposals differ in how they set the amount of the voucher: Some plans set the voucher amount arbitrarily, while others put a thumb on the scale to encourage beneficiaries to choose a private plan.

The executive order calls for using Medicare Advantage negotiated rates to set traditional Medicare rates and instructs the HHS secretary to develop a transition plan to adopting “true market-based pricing” for the traditional Medicare program, including through competitive bidding, which in the past has been a method for setting the voucher amount. Traditional Medicare—saddled with now-higher costs—would have to bid against private Medicare plans in order to compete for beneficiaries. Past premium support plans would then cap the yearly growth of the voucher, and as costs exceeded those caps, Medicare beneficiaries would pay a greater share of the costs of the program over time.

Expansion of private contracting would weaken Medicare’s financial safeguards

The executive order also directs the HHS secretary to “identify and remove unnecessary barriers to private contracts.” Today, Medicare protects beneficiaries from surprise medical bills by limiting the amount that doctors who see Medicare beneficiaries can charge these patients. Physicians may opt out of the Medicare program and enter into private contracts that set higher prices than Medicare will pay; in these cases, the patient is responsible for the entire billed amount. However, less than 1 percent of doctors have chosen to opt out of the program, in large part because Medicare’s rules protect consumers from these arrangements.

For example, doctors must give Medicare beneficiaries written notice that they have opted out of Medicare, and the patient must sign the document acknowledging that they understand they are responsible for paying the entire charge. Doctors may not enter into private contracts with patients who qualify for both Medicare and Medicaid or with patients experiencing a medical emergency. In addition, if a physician opts out of the Medicare program, they must do so entirely instead of cherry-picking beneficiaries or services. The opt-out period is a minimum of two years. Together, these limits protect beneficiaries by providing greater certainty about their doctors’ status and avoiding confusion about which visits and services Medicare will reimburse.

Loosening these rules could allow doctors to more easily circumvent Medicare consumer protections; opt out of Medicare; and charge higher prices to Medicare patients, who have lower incomes and greater health needs than privately insured individuals, on average. While wealthy beneficiaries might benefit from expanded access to nonparticipating providers, higher private prices could make it difficult for most Medicare patients to keep their doctors or afford to see other providers. Nevertheless, Trump’s first HHS secretary, Tom Price, sponsored legislation to permit private contracting and supported allowing doctors to balance bill Medicare beneficiaries.

Restriction of seniors’ choice of doctors in Medicare Advantage

During his Florida speech, Trump asked the crowd, “You want to keep your doctors, right?” Yet his order calls for changes that could restrict Medicare beneficiaries’ choice of doctors by favoring Medicare Advantage plans and by tinkering with the CMS network adequacy standards for those plans.

From a beneficiary perspective, a distinguishing feature of Medicare Advantage is that plans typically have restrictive provider networks. Under the Trump proposal, the network adequacy standards would take into account state laws affecting provider competition and the availability of telehealth services. If these changes lower the bar for Medicare Advantage plans and allow plans to include even fewer doctors in a particular area, a position the Trump administration has previously supported, they could make it harder for seniors to schedule in-person visits or see the provider of their choice. They could also increase costs for beneficiaries who need to see out-of-network specialists.

Lower-cost, narrower network plans could profit by cream-skimming healthier seniors because healthy individuals benefit most from the trade-off between lower premiums and fewer providers. Enrollees in traditional Medicare, including seniors who need the broad provider access that only traditional Medicare offers, could see their premiums rise as a result of a sicker risk pool and imperfect risk adjustment.

If networks become narrower, it may be increasingly hard for Medicare Advantage beneficiaries to identify and schedule visits with providers included in their plans. Moreover, online provider directories for Medicare Advantage are already filled with inaccuracies. A 2018 CMS report found that 45 percent of directories had inaccurate location information for providers. The CMS audit also found that 221 providers who were listed as in-network were not accepting new Medicare Advantage patients. This lack of accurate information, combined with Medicare Advantage’s relatively weak network adequacy standards, means that the Trump plan’s changes to the program could decrease, rather than increase, choice for seniors.

Savings accounts to benefit the wealthy and healthy

The executive order proposes wider access to Medicare Medical Savings Accounts (MSAs), which are available to those enrolled in high-deductible Medicare Advantage plans. Like health savings accounts (HSAs), the money in MSAs is tax-free and can be used toward health care costs, including dental, hearing, and vision. While high-deductible health plans and MSAs can be a good value for relatively healthy seniors who have high enough incomes to afford to fund these accounts, they may not provide adequate financial protection for those who need first-dollar coverage or have greater health needs.

President Trump has previously proposed turning MSAs into a tax shelter, which would chiefly benefit the wealthy. Trump’s FY 2020 budget proposed allowing seniors to deposit additional funds into MSAs beyond the plan’s contribution, as they can with HSAs. Data on HSA contributions show that higher-income individuals are more likely to contribute toward accounts and to benefit more from the tax exemption.

Trump sidesteps seniors’ most pressing concerns

A glaring omission in the president’s plan is any provision to directly take on one of seniors’ widespread concerns: the high cost of health care. Although Americans have overwhelmingly favorable experiences with the existing Medicare program, it is far from perfect. According to a report from the Commonwealth Fund, about 1 in 4 Medicare beneficiaries is underinsured, meaning their out-of-pocket health care costs are 10 percent or more of their income. A 2011 analysis by the Medicare Payment Advisory Commission (MedPAC) found that Medicare beneficiaries without supplemental plans, also known as “medigap” coverage, paid 12 percent of their medical costs out of pocket, on average.

For example, traditional Medicare has no limit on out-of-pocket costs. By contrast, the CMS limits out-of-pocket costs in Medicare Advantage to $6,700 for in-network services, and many individual plans offer lower out-of-pocket limits. In 2012, the MedPAC commissioners voted unanimously to recommend that Congress rework Medicare’s benefit design to include an out-of-pocket maximum. Doing so would give Medicare beneficiaries better financial protection against high health care costs.

President Trump claims that his executive order protects Medicare from “destruction.” In fact, not only would recent prominent Medicare for All and public option reforms proposed in Congress maintain the benefits of the existing Medicare program for seniors, but many also lay out improvements to the program in recognition of its shortcomings. For example, Sen. Bernie Sanders’ (D-VT) Medicare for All bill would almost immediately add an out-of-pocket limit for seniors in Medicare parts A and B. The Medicare for America Act, sponsored by Reps. Rosa DeLauro (D-CT) and Jan Schakowsky (D-IL), would also add out-of-pocket limits and strengthen Medicare Advantage network adequacy standards. And multiple proposals have provisions to lower beneficiaries’ prescription drug costs; eliminate the two-year waiting period for nonelderly disabled people; and add hearing, dental, and vision coverage to standard Medicare benefits.

Conclusion

President Trump has laid out a plan to privatize Medicare and undermine the program, breaking his promise that “no one will lay a hand on your Medicare benefits.” Furthermore, he is trying to scare seniors away from supporting congressional proposals that would genuinely improve Medicare beneficiaries’ access to health care and financial security. Although seniors need better protection against out-of-pocket medical costs and better access to care providers, the changes Trump has proposed will only make things worse.

 

 

DOJ breaks up alleged genetic testing fraud scheme estimated at $2.1 billion

https://www.healthcarefinancenews.com/news/doj-breaks-alleged-genetic-testing-fraud-scheme-estimated-21-billion?mkt_tok=eyJpIjoiWkdNMU56WmxabVl3TWpRMSIsInQiOiI0dlhaYUJpT2xBU0FqeDNmWkRlZHVZYnRsZ2xBK3pxMmN6RG5kS3Q1UWgrWFYyNllIK2lLZEYzclRDWUYyTFwvOGdhUzRVSnlscG5MQjBtY0NwT2d1TjZHdXJYRUlYRGszVEhrQmY5b0xhRDlFTWNTNUEwWnVvWGUwZXE3ME9kdGgifQ%3D%3D

The defendants ordered unnecessary tests that were reimbursed by Medicare, with laboratories sharing the profit, DOJ says.

The U.S. Department of Justice has charged 35 people with unlawfully charging Medicare $2.1 billion in what it said is one of the largest healthcare fraud schemes in history.

The 35 alleged offenders were charged in five separate federal districts, and were linked to dozens of telemedicine firms and laboratories focused on genetic testing for cancer. The people charged, including nine doctors and one other medical professional, cumulatively billed Medicare billions for cancer genetic tests, the DOJ said in a press release.

The charges were a culmination of coordinated law enforcement activities over the past month that were led by the Criminal Division’s Health Care Fraud Unit, resulting in charges against more than 380 individuals who allegedly billed federal healthcare programs for more than $3 billion, and allegedly prescribed and dispensed approximately 50 million controlled substance pills in Houston, across Texas, the West Coast, the Gulf Coast, the Northeast, Florida and Georgia, and the Midwest.

These include charges against 105 defendants for opioid-related offenses, and charges against 178 medical professionals.

The investigation targeted an alleged scheme involving the payment of illegal kickbacks and bribes by CGx laboratories in exchange for the referral of Medicare beneficiaries by medical professionals working with fraudulent telemedicine companies for expensive, and medically unnecessary, cancer genetic tests.

According to the DOJ, the targets of the scheme were primarily seniors, who were approached at health fairs, at their homes during door-to-door visits, or through telemarketing calls. The “recruiters,” as they were called, would approach seniors about supposedly free cancer screenings or generic cheek swab tests, and the recruiters would then obtain the seniors’ Medicare information for the purposes of fraudulent billing or identify theft.

The recruiter would then get a doctor to sign off on a genetic so a lab would process it, and then pay a kickback in exchange for ordering the test. The lab would process the test and bill Medicare, and once it was reimbursed, would share the proceeds with the recruiter, according to the charges.

Often, the test results were not provided to the beneficiaries, or were worthless to their actual doctors. Some of the defendants allegedly controlled a telemarketing network that lured hundreds of thousands of elderly and/or disabled patients into a criminal scheme that affected victims across the U.S.

The defendants allegedly paid doctors to prescribe CGx testing, either without any patient interaction or with only a brief phone conversation with patients they had never met or seen.

WHAT’S THE IMPACT

In addition to the DOJ charges, the Centers for Medicare and Medicaid Services, Center for Program Integrity said it took adverse administrative action against cancer genetic testing companies and medical professionals who submitted more than $1.7 billion in claims to the Medicare program.

The DOJ Criminal Division, along with the U.S. Department of Health and Human Services Office of Inspector General and the FBI, spearheaded the investigation.

The DOJ calls the scheme one of the largest it has ever handled.

THE LARGER TREND

Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $16 billion.

In addition, CMS, working in conjunction with the Health and Human Services Office of the Inspector General, are taking steps to increase accountability and decrease the presence of fraudulent providers.

The newest Medicare fraud scheme is the second to be uncovered in the last month. Earlier in September, a telemedicine CEO pleaded guilty to one count of conspiracy to defraud the United States and pay and receive healthcare kickbacks and one count of conspiracy to commit money laundering in a scheme estimated at $424 million.

ON THE RECORD

“Unfortunately, audacious schemes such as those alleged in the indictments are pervasive and exploit the promise of new medical technologies such as genetic testing and telemedicine for financial gain, not patient care,” said Deputy Inspector General for Investigations Gary L. Cantrell of HHS-OIG. “Instead of receiving quality care, Medicare beneficiaries may be victimized in the form of scare tactics, identity theft, and in some cases, left to pay out of pocket.  We will continue working with our law enforcement partners to investigate those who steal from federal healthcare programs and protect the millions of Americans who rely on them.”

“Healthcare fraud and related illegal kickbacks and bribes impact the entire nation,” said Assistant Director Terry Wade of the FBI’s Criminal Investigative Division. “Fraudulently using genetic testing laboratories for unnecessary tests erodes the confidence of patients and costs taxpayers millions of dollars. These investigations revealed some medical professionals placing their greed before the needs of the patients and communities they serve. Today’s law enforcement actions reinforce that the FBI, along with its partners, will continue to pursue and stop this type of illegal activity.”

 

Hospitals, insurers object to rule posting their negotiated rates

https://www.healthcarefinancenews.com/news/hospitals-object-posting-negotiated-rates-and-other-payment-rules?mkt_tok=eyJpIjoiWkdNMU56WmxabVl3TWpRMSIsInQiOiI0dlhaYUJpT2xBU0FqeDNmWkRlZHVZYnRsZ2xBK3pxMmN6RG5kS3Q1UWgrWFYyNllIK2lLZEYzclRDWUYyTFwvOGdhUzRVSnlscG5MQjBtY0NwT2d1TjZHdXJYRUlYRGszVEhrQmY5b0xhRDlFTWNTNUEwWnVvWGUwZXE3ME9kdGgifQ%3D%3D

CMS is proposing that hospitals make public their payer-specific negotiated charges for a limited set of “shoppable” services.

Hospitals and insurers have made clear their opposition to the Centers for Medicare and Medicaid Services proposed rule requiring the disclosure of their privately negotiated contract rates.

CMS is proposing that hospitals make public their payer-specific negotiated charges for a limited set of “shoppable” services or face civil monetary penalties, in a rule to go into effect on January 1, 2020. Comments were due by September 27.

Under the rule, hospitals would display payer-specific negotiated charges for at least 300 shoppable services, including 70 selected by CMS and 230 by the provider.

The American Hospital Association called it the wrong approach, even though it said it supported ensuring patients have the information they need, including knowing what their expected out-of-pocket costs would be. However, the AHA said, “Instead of helping patients estimate their out-of-pocket obligations, it would introduce confusion and fuel anticompetitive behavior among commercial health insurers in an already highly-concentrated insurance industry, seriously limiting the choices available to patients.”

America’s Essential Hospitals said, “We are particularly concerned that the agency’s proposals regarding the public posting of charges, in particular the posting of negotiated rates, offer little benefit to the consumer, add substantial burden to hospitals, and pose harm to competition, potentially driving up prices.”

America’s Health Insurance plans said that forcing disclosure of privately and competitively negotiated rates will not provide consumers with information that is actionable or helpful. I

“Instead,”AHIP said, “it will hamper competitive negotiations and push healthcare prices and premiums higher for patients, consumers, businesses and taxpayers. This proposed rule also has significant implications for, and is interconnected with, other proposed rules regarding interoperability of health care data. We are concerned that unknown entities will have open access to the data, with few restrictions on how they may use it.”

WHY THIS MATTERS

CMS released the proposals on July 29 in the 2020 hospital outpatient prospective payment and ambulatory surgical center payment rule.

The rule also has three additional proposed policies that run afoul of the law, the AHA said.

Specifically, the AHA opposes completion of the phase-in of payment reductions for the hospital outpatient clinic visit in excepted off-campus provider-based departments to the “physician fee schedule equivalent” rate of 40% of the outpatient prospective payment system rate.

The AHA said the proposal “exceeds the Administration’s legal authority and should be abandoned.”

The AHA has already won a case in court on the government’s site neutral payment policy.

“On the clinic visit policy, we remind CMS that the agency was recently found by the courts to have exceeded its statutory authority when it cut the payment rate for clinic services at excepted off-campus provider-based departments,” the AHA said.

Hospitals also object to continuing the current policy that pays for separately payable drugs acquired through the 340B drug savings program at the rate of average sales price minus 22.5%.

And the AHA objects to the implementation of a prior authorization process for five categories of outpatient department services.

THE LARGER TREND

On September 17, a federal judge ruled in favor of the AHA and hospital organizations, saying CMS exceeded its statutory authority when it reduced payments for hospital outpatient services provided in off-campus provider-based departments that were grandfathered under the Bipartisan Budget Act of 2015.

The AHA, joined by the Association of American Medical Colleges and several member hospitals, had filed the lawsuit in December.

ON THE RECORD

America’s Essential Hospitals said, “These cuts deter hospitals from expanding access in communities with the most need for healthcare services and run counter to CMS’ goal of integrated, coordinated healthcare.

“Taken together, these proposals would have a chilling effect on beneficiary access to care while also increasing regulatory burden,” the AHA said.