Tag Archives: CMS

Budget, White Paper Provide Insight Into Trump Administration’s Strategy On Drug Pricing

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https://www.healthaffairs.org/do/10.1377/hblog20180212.852840/full/

During his first year in office, President Donald Trump spoke often about the problem of high drug prices but took no action on the subject. President Trump’s new budget proposal and a newly released white paper from the White House Council of Economic Advisors (CEA) aim to change that by laying out a strategy for action moving forward. These documents are, of course, aspirational, but they do provide a window into the administration’s priorities, and they should be evaluated to consider whether the administration has a possibility of achieving its stated goals.

In this post, I review several of the key elements of those proposals, considering their impact on a range of relevant dimensions. I discuss what’s included in the proposals, and, as importantly, what’s left out.

Medicare Reforms

The bulk of the proposed reforms would act on the Medicare and Medicaid programs. For Medicare, the Trump administration’s proposals are largely targeted at 1) assisting beneficiaries with high out-of-pocket costs and 2) realigning incentives to alter prescribing and reimbursement practices.

First, the administration is advancing a set of proposals to assist Medicare Part D beneficiaries with high out-of-pocket costs. Both the white paper and budget proposal argue that plans should be required to share with beneficiaries at the point-of-sale some amount of the rebates the plan negotiates with drug manufacturers. In November, the Centers for Medicare and Medicaid Services (CMS) already requested public comments on the implementation of this proposal, and it seems as if the budget document’s inclusion of the proposal is evidence that the administration is hoping to move it forward.

However, like many of the other reforms in the budget proposal and white paper, there are few details proposed. In CMS’s November proposal, the agency modeled a set of scenarios in which insurers pass through 33 percent, 66 percent, 90 percent, or 100 percent of their negotiated rebates. Each scenario comes with a set of advantages for beneficiaries, but also costs for the federal government. That is, CMS anticipated that reducing cost-sharing for particular high-cost beneficiaries would increase premiums for all beneficiaries, and therefore increase CMS’ overall spending through premium subsidies. How much the proposal would increase overall spending depends on the amount of rebates being passed through.

The budget proposal simply says that sponsors must pass through “at least one-third” of total rebates, so it does not provide further clarity on this proposal. However, it states that this proposal will cost the government $42.2 billion over 10 years. That estimate lies between CMS’s November estimates for 33 percent ($27.3 billion in spending) and 66 percent ($55.1 billion in spending), so it is possible that the administration has in mind a pass-through provision at 50 percent or so.

Another proposal aimed at out-of-pocket costs would establish an out-of-pocket maximum for patients who enter the Medicare Part D catastrophic phase. Currently, patients who reach the catastrophic phase of the Part D benefit are responsible for 5 percent of the costs of their prescription drugs, with no upper limit. The budget proposal would reduce their payments to 0 percent, although it is light on the details as to how this would be accomplished. The Henry J. Kaiser Family Foundation estimated that just over one million Part D enrollees have out-of-pocket costs above this threshold, and those patients would likely be the primary beneficiaries of this proposal. At the same time, however, the budget proposes to exclude manufacturer discounts from patient out-of-pocket cost calculations, which would likely slow the rate at which patients move into the catastrophic phase.

Second, the Trump administration proposes a number of changes to drug classification and reimbursement that would both enable plan sponsors to negotiate more effectively and alter prescribing behavior. The budget proposal would change current Part D plan formulary rules, requiring sponsors to cover just one drug per class, rather than two. The proposal also mentions increased use of utilization management tools for the six protected classes of drugs, suggesting that the general coverage requirement for those classes would remain as-is. This proposal is projected to save $5.5 billion over ten years.

More interestingly, both the budget proposal and CEA white paper suggest the possibility of moving a set of Part B drugs (those administered in an outpatient setting) into Part D coverage. Medicare Part B does not presently have a number of the tools that enable Part D plan sponsors to negotiate discounts with drug manufacturers, and Secretary Alex Azar spoke during his confirmation hearing about the need to “take the learnings from Part D and apply them to Part B.” This proposal would accomplish that goal, just through the reverse mechanism: by shifting drugs from Part B into Part D. The budget proposal envisions giving the authority to do this to the Secretary, noting that “[t]he Secretary will exercise this authority when there are savings to be gained from price competition.” As such, it does not provide any particular budgetary impact.

The budget proposes two other changes to Part B reimbursement. At present, when a physician is reimbursed for providing a drug under Part B, she is reimbursed based on the Average Sales Price (ASP) of the drug plus 6 percent. There is widespread concern that this reimbursement system encourages physicians to prescribe and administer more expensive drugs than may be medically necessary. The Obama administration proposed a demonstration project that would have moved from the current ASP+6 percent system to a system of ASP+2.5 percent+a flat fee for prescribing the product. After extensive criticism from a range of stakeholders, the administration shelved the initiative. Now, the administration is proposing to reduce payment rates for new drugs (for which the ASP information is not yet available, and so for which the only price available is the Wholesale Acquisition Cost (WAC)). Instead of paying 106 percent for these new products, the administration would pay 103 percent of the WAC during the period before ASP information has yet to be provided. This proposal is quite narrow in its scope, applying only to new drugs and only during the brief period before ASP information is available; it is therefore unlikely to save much money.

The Trump administration is also proposing to establish an inflation limit for the reimbursement of Part B drugs more generally. Instead of continually updating the ASP+6 percent figure if the ASP increases, this proposal would limit the growth of the reimbursement to the Consumer Price Index for all Urban Consumers. CMS would therefore pay “pay the lesser of (1) the actual ASP +6 percent or (2) the inflation-adjusted ASP +6 percent.” At present, Medicaid is protected from price increases when the Average Manufacturer Price (AMP) for a drug increases faster than inflation. The Department of Health and Human Services Office of Inspector General has proposed that CMS and Congress consider extending this provision to Medicare Part D, but as yet Congress has not moved to do so. This budget proposal can be thought of as proposing a similar constraint on Part B pricing.

Medicaid Reforms

The Medicaid portion of the budget proposal puts forth an idea which is potentially ground-breaking, but which is also potentially a sign of the administration’s recalcitrance to move on drug pricing (depending on the details). Specifically, the administration is proposing “new statutory demonstration authority to allow up to five states more flexibility in negotiating prices with manufacturers, rather than participate in the Medicaid Drug Rebate Program, and to make drug coverage decisions that meet state needs.” The idea is something like this: at present, state Medicaid programs must cover essentially all drugs approved by the U.S. Food and Drug Administration (FDA), which limits their ability to extract discounts. To be sure, Medicaid programs are already entitled by statute to large discounts off of the AMP, and to the inflation clawback as noted above. But many state Medicaid programs are worried that pharmaceutical spending has become an unsustainable part of their budget and are seeking ways to control their costs in this area. This proposal might empower them to do so.

Here’s the thing: Massachusetts has already submitted an 1115 waiver to CMS along these lines. Massachusetts is seeking 1) to pay for a single drug in each therapeutic class (as noted above, this is a reform the administration is proposing to make to Medicare Part D), and 2) to exclude entirely from coverage drugs “with limited or inadequate evidence of clinical efficacy,” likely to be those approved through the FDA’s accelerated approval process. This budget proposal may be a sign that the administration is interested in approving Massachusetts’ waiver. However, the fact that the budget explicitly calls for new statutory authority to do so suggests that the administration may not think it has the legal authority to approve Massachusetts’ waiver, as is. And given Congress’ inability to act thus far on drug pricing, the administration may be seeking to hide behind Congress’ inaction here.

Yet the call for new statutory authority is puzzling. At present, pharmaceutical coverage is an optional benefit under the Medicaid program. States do not have to cover drugs and therefore are not required to participate in the Medicaid Drug Rebate Program, although all have chosen to do so, and choosing to do so comes with a set of requirements. But it is not clear to me why CMS could not conduct this demonstration at present, under the Center for Medicare and Medicaid Innovation’s (CMMI) existing authority.

A potential clue may lie in the administration’s statement that the demonstration would “exempt prices negotiated under the demonstration from best price reporting.” Having written recently on the topic of the Medicaid best-price rule and innovative contracting for pharmaceuticals, it is not clear to me exactly why this is a sticking point. The Medicaid best price rule entitles Medicaid to the “best price” available for a particular drug for a particular set of providers. The statute contains large carve-outs—for instance, discounts provided to the Department of Veterans Affairs or to Medicare Part D are exempt from the best-price calculation. But it is strange to talk about needing to exempt Medicaid programs from the best-price rule when the best-price rule was intended to benefit Medicaid itself. I imagine that the administration sees the 340B program as a potential concern here, but again it is not obvious why CMMI could not waive the best-price rule as part of its existing authority.

FDA Activities

As I have written here previously, FDA Commissioner Scott Gottlieb has been at the forefront of the Trump administration’s efforts on drug pricing. He has taken a number of actions to promote generic competition, and although it will take some time to observe their benefits, the FDA’s existing legal authority to address drug pricing issues is quite narrowly circumscribed. The CEA white paper and budget proposal largely acknowledge this point, with the white paper lauding the actions the FDA has taken thus far on expediting review of generic drug applications, providing guidance on the development of complex generics, and other similar activities.

President Trump’s budget proposal calls for Congress to give the FDA more power to promote generic competition, by “ensur[ing] that first-to-file generic applicants who have been awarded a 180-day exclusivity period do not unreasonably and indefinitely block subsequent generics from entering the market beyond the exclusivity period.” More specifically, the concern is that first-to-file generic applicants—perhaps those whose initial applications may be rejected—can unduly delay generic entry while they remedy the deficiencies in their application. The administration projects that this reform will save the government $1.8 billion in Medicare savings over 10 years.

Other pieces of legislation have called for reform of the 180-day exclusivity period in different ways. Last year, Democrats in both the House and Senate introduced the Improving Access to Affordable Prescription Drugs Act, which included provisions preventing generic entrants from receiving the statutory 180-day exclusivity benefit if they had engaged in pay-for-delay conduct (Sections 402 and 403). But the idea in the president’s budget proposal may dovetail nicely with the FDA’s efforts to improve first-cycle approval rates for abbreviated new drug application products, as well.

What’s Missing

Perhaps what’s most notable about the budget proposal and the CEA white paper is not what’s included, but rather what is missing. Gone are some of President Trump’s older arguments that Medicare should negotiate drug prices, or that drug importation should be permitted more widely. Some of the more significant cost-saving provisions from President Obama’s budget, like a reform that would have put low-income patients back on Medicaid prices, are also absent.

A key set of missing proposals are those which would directly assist privately insured patients. The budget’s focus on Medicare and Medicaid may well have a positive impact on the more than 100 million Americans enrolled in those programs. But for the roughly half of Americans (closer to 160 million) with employer-sponsored insurance, these reforms will provide no assistance. Growing numbers of Americans with employer-sponsored insurance are enrolled in high-deductible plans, and many of them may face the same affordability concerns that Medicare beneficiaries are facing.

You could imagine proposals that would address the drug pricing problem more broadly, rather than just within the publicly-insured population. The above-mentioned Improving Access to Affordable Prescription Drugs Act would have addressed the problem of drug pricing for a broader segment of the population. As I’ve explained here, the Act would have taxed companies which engage in large, year-over-year list price increases. It would also have capped patient out-of-pocket costs in Affordable Care Act-regulated plans, at $250 per month for an individual or $500 per month for a family.

More generally, even these proposals which would affect drug companies directly would have a minimal impact on their bottom lines. This set of proposals is largely very friendly to the pharmaceutical industry and is primarily aimed at curtailing patients’ financial burdens and tweaking incentives for stakeholders at the margin.

In this blog post, I have covered just a handful of the many different drug pricing-related proposals included in the new budget proposal and in the CEA white paper. As usual, observers should stay tuned to the actions CMS and the FDA take on this front, as they will show whether the administration is serious about these proposals or is merely posturing.

 

No Car, No Care? Medicaid Transportation At Risk

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No Car, No Care? Medicaid Transportation At Risk

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For over 50 years, the program for the poor and sick has been required to ferry certain clients to and from medical appointments. Though California is not among the states out to cut this service, it could feel the pinch if the feds slash Medicaid funding overall.

This  special series examines the reach and the role of Medicaid, the federal-state program that began as a medical program for the poor but now provides a wide variety of services for a large swath of America.

EVERETT, Wash. — Unable to walk or talk, barely able to see or hear, 5-year-old Maddie Holt waits in her wheelchair for a ride to the hospital.

The 27-pound girl is dressed in polka-dot pants and a flowered shirt for the trip, plus a red headband with a sparkly bow, two wispy blond ponytails poking out on top.

Her parents can’t drive her. They both have disabling vision problems; and, besides, they can’t afford a car. When Maddie was born in 2012 with the rare and usually fatal genetic condition called Zellweger syndrome, Meagan and Brandon Holt, then in their early 20s, were plunged into a world of overwhelming need — and profound poverty.

“We lost everything when Maddie got sick,” said Meagan Holt, now 27.

Multiple times each month, Maddie sees a team of specialists at Seattle Children’s Hospital who treat her for the condition that has left her nearly blind and deaf, with frequent seizures and life-threatening liver problems.

The only way Maddie can make the trip, more than an hour each way, is through a service provided by Medicaid, the nation’s health insurance program started more than 50 years ago as a safety net for the poor.

Called non-emergency medical transportation, or NEMT, the benefit is as old as Medicaid itself. From its inception, in 1966, Medicaid has been required to transport people to and from such medical services as mental health counseling sessions, substance abuse treatment, dialysis, physical therapy, adult day care and, in Maddie’s case, visits to specialists.

“This is so important,” said Holt. “Now that she’s older and more disabled, it’s crucial.”

More than 1 in 5 Americans, about 74 million people, now rely on Medicaid to pay for their health care. In California, one-third of the population — about 13.5 million people — are enrolled in the state’s Medicaid program, called Medi-Cal.

Nationally, the numbers have grown dramatically since the program expanded in California and 31 other states, plus the District of Columbia, to cover prescription drugs, health screening for children, breast and cervical cancer treatment and nursing home care.

With a Republican administration vowing to trim Medicaid, Kaiser Health News is examining how the U.S. has evolved into a “Medicaid Nation,” where millions of Americans rely on the program, directly and indirectly, often unknowingly.Medicaid’s role in transportation is a telling example. Included in the NEMT coverage are nearly 104 million trips each year at a cost of nearly $3 billion, according to a 2013 estimate, the most recent, by Texas researchers.

Citing runaway costs and a focus on patients taking responsibility for their health, Republicans have vowed to roll back the benefits, cut federal funding and give states more power to eliminate services they consider unaffordable.

Already, states have wide leeway in how to provide and pay for the transportation.

In California, Medi-Cal members in managed care get transportation through their health plans, while fee-for-service enrollees can arrange for the service through their counties, said Amber Christ, a Los Angeles-based staff attorney for Justice in Aging, a legal advocacy group.

Medi-Cal transportation is a “lifeline” for the low-income seniors she works with, she said.

“Most of them cannot afford a car, or if they have a car they can’t afford to keep gas in that car, or they can’t use public transportation,” she said. “Medicaid transportation is the only way they are going to their doctor appointments.”

California has not proposed cutting this service, but should the federal government slash Medicaid funding overall, “you could see where states would feel the pressure to make cuts, and this might be one of the first places to do that,” Christ said.

Proponents of limiting NEMT say the strategy will cut escalating costs and more closely mirror private insurance benefits, which typically don’t include transportation.

They also contend that changes will help curb what government investigators in 2016 warned is “a high risk for fraud and abuse” in the program. In recent years, the Centers for Medicare & Medicaid Services (CMS) reported that a Massachusetts NEMT provider was jailed and fined more than $475,000 for billing for rides attributed to dead people.

Last year, a public interest law office in Los Angeles sued a company contracted to provide transportation to Medicaid enrollees in California and other states for allegedly failing to provide “safe, reliable and timely transportation” to fragile patients — some with brain injuries and amputations. That caused them to miss appointments, the suit alleges.

Two ambulance programs in Connecticut paid almost $600,000 to settle claims that they provided transportation for dialysis patients who didn’t have medical needs for ambulance transportation. And the mother of a Medicaid patient who was authorized to transport her child for treatment billed Medicaid for trips that didn’t take place. She was sentenced to 30 days in jail and ordered to pay $21,500.

Last March, Rep. Susan Brooks, an Indiana Republican, introduced a resolutionthat would have revoked the federal requirement to provide NEMT in an effort to provide states with “flexibility.” That effort stalled.

Another Republican proposal in 2017 would have reversed the Affordable Care Act’s Medicaid expansion and reduced federal funding for the NEMT program. It failed, but other efforts by individual states still stand.

Former Health and Human Services Secretary Tom Price and CMS Administrator Seema Verma encouraged the nation’s governors to consider NEMT waivers, among other actions, in a March letter to them.

“We wish to empower all states to advance the next wave of innovative solutions to Medicaid challenges,” they wrote. The Trump administration has used state waivers to bypass or unravel a number of the Obama administration’s more expansive health policies, and has granted some states’ requests.

At least three states, Iowa, Indiana and Kentucky, have received federal waivers — and extensions —allowing them to cut Medicaid transportation services. Massachusetts has a waiver pending.

Critics of the cuts worry the trend will accelerate, leaving poor and sick patients with no way to get to medical appointments.

“I wouldn’t be surprised to see more of these waivers in the pipeline,” said Joan Alker, executive director of the Georgetown University Center for Children and Families.

Because medical transportation isn’t typically covered by the commercial insurance plans most Americans use, it’s unfamiliar to many people and could be seen as unnecessary, said Eliot Fishman, senior director of health policy for Families USA, a nonprofit, nonpartisan consumer health advocacy group.

Formerly a Medicaid official in the federal government, Fishman called the transportation program “vital” not only for children with severe disabilities, but also for non-elderly, low-income adults.

CMS released results of a 2014 survey of Medicaid users, which found that lack of transportation was the third-greatest barrier to care for adults with disabilities, with 12.2 percent of those patients reporting they couldn’t get a ride to a doctor’s office.

“This is not something to be trifled with lightly,” Fishman said. “We’re talking about a lifesaving aspect of the Medicaid program.”

About 3.6 million Americans miss or delay non-emergency medical care each year because of transportation problems, according to a 2005 study published by the National Academy of Sciences.

That same study analyzed costs for providing NEMT to patients facing 12 common medical conditions and found that providing additional transportation is cost-effective. For four of those conditions — prenatal care, asthma, heart disease and diabetes — medical transportation saved money when the total costs for both transportation and health care were tallied.

Medicaid is required to provide NEMT services using the most appropriate and least costly form of transportation, whether that’s taxis, vans or public transit.

Most states rely on NEMT brokers or managed-care organizations to administer the transportation services. Other states run the service directly, paying providers on a per-ride basis, while some use local ride services and pay independent taxi firms to shuttle patients.

Proponents of revamping NEMT note that disabled children like Maddie and other people with serious disabilities are in little danger of losing services. In Iowa and Indiana, Medicaid transportation remains available to several groups of patients, including those classified as “medically frail,” though the definition of who qualifies can vary widely.

In addition, one managed-care provider, Anthem, continues to transport Indiana Medicaid patients, despite the waiver that was first enacted in 2007.

Still, Medicaid clients like Fallon Kunz, 29, of Mishawaka, Ind., are often stuck. Kunz, who has cerebral palsy, migraine headaches and chronic pain, uses a power wheelchair. When she was a child, she qualified for door-to-door service to medical appointments, she said.

Today, she lives with her father, whose home is outside the route of a Medicaid transit van. Getting to and from medical appointments for her chronic condition is a constant struggle, she said. Taxis are too expensive: $35 each way for a wheelchair-enabled cab.

“The only way I can get rides to and from my doctor’s appointment is to ride the 2 miles in my wheelchair, despite all kinds of weather, from my home, across the bridge, to the grocery store,” she said. “Right outside the grocery store is the bus stop. I can catch the regular bus there.”

Sometimes, she’s in too much pain or the Indiana weather — warm and humid in the summer, frigid and windy in the winter — is too much to battle and she skips the appointment.

“Today I didn’t go because it was too cold and my legs hurt too much,” she said on a December Tuesday. “I didn’t feel like getting blown off the sidewalk.”

In Maddie Holt’s case, she was shuttled to Seattle Children’s on a rainy Tuesday morning in a medical van driven by Donavan Dunn, a 47-year-old former big-rig trucker. He works for Northwest Transport, one of several regional brokers that manage NEMT services for Washington state.

Dunn said he received special training to transport patients like Maddie, who is loaded onto a motorized platform, wheelchair and all, into the van and then carefully strapped in.

“I have to drive different,” said Dunn. “I have to watch my corners, watch my starts, watch my stops. It’s always in the back of my mind that I have somebody on board that’s fragile.”

We’re talking about a lifesaving aspect of the Medicaid program.

Eliot Fishman, senior director of health policy for Families USA

The transportation service can be used only for medical visits to the specialists who treat Maddie’s condition, which is caused by mutations in any one of at least 12 genes. If Meagan Holt needs to pick up prescriptions or get groceries, she leaves Maddie and a second daughter, Olivia, 3, at home with their dad and takes the bus or walks to her destinations.

Caring for a severely disabled child is not the life she expected, Meagan Holt said, but she cherishes time with Maddie, who has learned to communicate through tactile sign language spelled into her hand.

“She knows about 100 words. She knows the alphabet,” Meagan said. “She likes Disney princesses. She loves ‘Frozen.’”

Maddie is one of hundreds of NEMT-eligible children transported to Seattle Children’s each month. Last September, for instance, more than 1,300 clients made more than 3,600 trips at a cost of more than $203,000, according to the Washington Health Care Authority, which oversees the state’s Medicaid program called Apple Health.

The need is so great, in fact, that the hospital created a transportation will-call desk to help organize the comings and goings.

“When we realized how much transportation is a barrier to getting to your appointment, we decided to do something about it,” said Julie Povick, manager of international exchanges and guest services at Seattle Children’s.

“The majority of our patients are in survival mode,” Povick added. “You need a lot of handholding.”

But Verma, the architect of Indiana’s Medicaid overhaul plan, has suggested that too much handholding might be “counterproductive” for patients — and bad for the country.

In a 2016 Health Affairs essay, Verma noted that early analysis of the effects of curtailing NEMT in Indiana showed that more Medicaid patients with access to the program said transportation was a primary reason for missed appointments than did members without access.

“Moreover, 90 percent of [Healthy Indiana Plan] members report having their own transportation or the ability to rely on family and friends for transportation to health care appointments,” she wrote.

But Marsha Simon, a Washington, D.C., health policy consultant who has tracked NEMT for years, said Medicaid is the option of last resort. People who are able to get rides on their own already do.

“If 90 percent can and 10 percent can’t, what about the 10 percent?” Simon said.

It’s a question that haunts Kunz every day.

“I’m a college student, I have a cat,” said Kunz, who is studying psychology online at Southern New Hampshire University. “I’m just a regular human trying to do things, and the inaccessibility in this area is ridiculous.”

 

Fewer doctors are opting out of Medicare

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http://www.modernhealthcare.com/article/20180130/NEWS/180139995

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The CMS saw a sharp decrease in the number of providers opting out of Medicare in 2017, after several years where thousands indicated that they did not want to participate in the program.

Physicians and practitioners who do not wish to enroll in the Medicare program may file an “opt-out” affidavit that will prevent the provider and beneficiaries seeing them from submitting bills to the CMS.

For years, the CMS had few providers opting out of Medicare, with the number first hitting triple digits in 2010, with 130. But those numbers jumped to over 1,600 opt-out requests going into effect in 2013, more than doubling to over 3,500 in 2015, and spiking at 7,400 in 2016. Opt-outs dropped to just 3,732 in 2017, according to data released by the CMS Monday.

The agency did not elaborate on why it may have seen such a change.

One theory is that MACRA ended the need for providers to renew opt-out affidavits every two years; now opt-outs can be indefinite, and providers must ask to rejoin the program.

“Figures from 2015 and 2016 may represent the first wave of physicians opting out and lower 2017 data may reflect the fact that physicians no longer need to file affidavits to renew,” said Anders Gilberg, senior vice president of government affairs for the Medical Group Management Association.

Doctors have shown less and less interest in Medicare participation as the program’s reimbursement has not kept up with the cost of providing care and regulations have increased, according to Donna Kinney, director of research and data analysis at the Texas Medical Association.

“Between price controls and the administrative burden, there is real concern about Medicare,” Kinney said.

Medicare remains a vital part of many doctor practices. But some clinicians, particularly in wealthy metropolitan areas, feel they can opt out of the program because they can fill their practice with patients who have commercial insurance or are willing to pay out-of-pocket for care, according to Dr. Charles Rothberg, president of the Medical Society of the State of New York.

“Patients in these areas are not as price-sensitive as they may be in other places,” Rothberg said.

New York City, for instance, had a 76% acceptance rate for Medicare patients in 2017 compared to a 100% acceptance rate in Fargo, N.D., according to Merritt Hawkins, a physician search firm.

Some groups like the American Medical Association have noted that by and large, doctors are staying in Medicare and accepting patients. The CMS estimates that just over 1.3 million providers now bill Medicare.

However, in a time when overall wait times are growing longer, even a few thousand doctors choosing to opt out of Medicare could mean restricted access to care for some individuals, especially in rural areas, Rothberg said.

Even if doctors chose to not opt out of Medicare, there are increasing reports that some are capping the number of Medicare patients they’re seeing, Kinney said.

The Texas Medical Association found in a 2016 survey that 35% of its members said they would not accept new Medicare patients, up from 22% in 2000.

The drop in opt-outs may also stem from the nation’s aging population. As many as 10,000 Americans become eligible for Medicare every day, thus decreasing the number of patients in other forms of coverage.

“As the percentage of Medicare patients goes up it makes it harder to walk away from that program,” said Dr. Jaan Sidorov, CEO of the Care Centered Collaborative, a consulting firm founded by the Pennsylvania Medical Society to help independent physicians with regulatory matters.

Another reason may be that physicians are increasingly employed versus being in private practice, and their contracts may prohibit them from opting out of Medicare, according to Dr. Jane Orient, an internist and executive director of the Association of American Physicians and Surgeons, a far-right provider group.

Senate overwhelmingly agrees to short-term spending bill, ends government shutdown

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https://www.fiercehealthcare.com/healthcare/senate-agrees-to-short-term-spending-bill-ends-government-shutdown?mkt_tok=eyJpIjoiWVdJd1pqQXdOekF3WkRSayIsInQiOiJ4UFpvSldiZ2oyelBmS1VNVEZFSFwvS2M1Ujh4cUZyWVl0WjBHeENYMXZLVzIrWXhac3dock56YVk0U291OGJaSk1EZStpVmtRZTh3Q005ZjExeGV1RFBxQk9mK2NNQ1F4dHVrOVRwS2Jtbk9SZVFTV2IxV01kejlzOHg3Wk52UVwvIn0%3D&mrkid=959610

hhs

The Senate agreed to a short-term spending bill Monday that effectively ended the government shutdown.

The 81-18 vote to approve the spending bill came after Majority Leader Sen. Mitch McConnell, R-Ky., promised Sunday to take up debate on immigration issues if the Senate hadn’t reached agreement on Deferred Action for Childhood Arrivals (DACA), which provides protections for young immigrants brought to the country by their parents without proper documentation.

The vote puts an end to the government shutdown, three days after it began at midnight Saturday when the Senate fell 10 votes short the 60 votes needed to approve a House-passed spending bill. However, the spending bill passed by the Senate is for three weeks, not the four that the House approved.

The failure to reach an earlier agreement on a spending bill that eventually led to the shutdown set a precedent as the Republican party controls the House, Senate and presidency. The White House said Saturday it would refuse to negotiate on immigration until funding was restored.

The shutdown temporarily put more than 40,000 employees who work for the Department of Health and Human Services and its related agencies and offices on furlough Monday morning. Under the HHS contingency plan the furloughs would:

  • limit disease surveillance by the Centers for Disease Control and Prevention,
  • stop work by the Office of the National Coordinator for Health Information Technology on standards coordination, and
  • halt implementation and testing required under the Health Information Technology for Economic and Clinical Health and 21st Century Cures (Cures) acts by the Office of the National Coordinator for Health Information Technology.

 

Senate votes to reopen government, averts major setback to health agencies

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http://www.healthcarefinancenews.com/news/government-reopens-averts-major-setback-health-agencies?mkt_tok=eyJpIjoiTldRek16STVORGd5WXpnMiIsInQiOiJ4XC9LYmRhVVpueHBOS2o1OWhxMWsyd0xPbVREQ0F6R2ZoK05rVGl3VWZIbWNlOFNORVwvU1dkbkFvakJRUU15UUJMYnBtdzQ0MDFvcHBiZ0FneTF1UFdSSGRLdVRZMTNFcUl2SmhcL0paaEVidlVrTmdjemp3R3BycDJtamp2VjlaWSJ9

Debate on the Senate floor on Jan. 22. Credit: C-span

Here’s a look at HHS, ONC and CDC plans during a government shutdown.

The Senate voted on Monday to approve a temporary funding measure that keeps the government running through Feb. 8.

The vote came after the government had been shut down for two days with the U.S. Department of Health and Human Services contingency plans already kicking in as of Monday morning when about 50 percent of its staff stayed home on furlough.

The Office of the National Coordinator for Health Information Technology is not operating. However, the NIH is continuing care for current NIH Clinical Center patients.

A contingency staffing plan is keeping other operations going, including Medicare and Medicaid payments, though an extended shutdown could result in delays in claims processing, audits, and other administrative functions.

In the short term, the Medicare program will continue largely without disruption during a lapse in appropriations, according to HHS.

States will have sufficient funding for Medicaid through the second quarter.

The Centers for Medicare and Medicaid Services will maintain the staff necessary to make payments to eligible states from remaining Children’s Health Insurance Program (CHIP) carryover balances.

CMS is continuing key federal exchange activities, such as open enrollment verification.

Other ongoing HHS activities include substance abuse and mental health services for treatment referral and the suicide prevention lifeline.

The Administration for Children and Families and Temporary Assistance for Needy Families (TANF), along with child support and foster care services continues.

The Centers for Disease Control and Prevention is maintaining its 24/7 emergency operations center.

The CDC will continue to track the data on the flu, which has been virulent this season.

Here’s how states are trying to overhaul Medicaid — without Congress

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http://money.cnn.com/2018/01/18/news/economy/medicaid-state-waiver-requirements/index.html

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Work requirements are only the beginning.

Mandating Medicaid recipients work in order to receive benefits is in the spotlight right now, but states are seeking to make a host of other changes to their programs. These include requiring enrollees to pay premiums, limiting the time they can receive benefits, testing them for drugs and locking them out if they fail to keep up with the paperwork.

Many provisions would apply to working age, non-disabled adults who gained coverage under the Affordable Care Act’s Medicaid expansion. But several states also would require some who qualify under traditional Medicaid — very low-income parents, mainly — to meet these new rules.

Trump administration and state officials say these measures will help people gain independence and prepare them to purchase health insurance on their own. Critics, however, argue states are putting additional hurdles in place to winnow down their rolls.

“The practical impact of all these proposals is that it will knock people off of coverage,” said Patricia Boozang, a managing director at Manatt Health Solutions, a consulting firm.

Republicans have long wanted to overhaul the 53-year-old Medicaid program, which covers nearly 75 million mainly low-income children, parents, elderly and disabled Americans. The broadening of Medicaid to low-income adults under Obamacare — roughly 11 million have gained coverage under the health reform law’s Medicaid expansion provision — has further spurred GOP efforts.

Congress attempted last year to revamp the safety net program, hoping to sharply curtail federal support and turn more control over to the states. Studies showed that millions would lose coverage, helping to sink the measure in the Senate.

States, however, are undeterred. They are ramping up efforts to customize their Medicaid programs through the federal waiver process.

States have long had this power, but the Obama administration rejected any waivers with work requirements and only sparingly granted requests to tighten eligibility. Many of the states that used waivers tied provider payments to performance goals or expanded mental health and substance abuse services and eligibility, for instance. A few turned to waivers to implement alternative Medicaid expansion models that include charging premiums or enrolling recipients in private insurance and covering the premiums, for example.

Indiana, for example, broke new ground in 2015 by getting permission to levy premiums on some traditional Medicaid enrollees, such as very low-income parents, and to lock out expansion recipients above the poverty line for six months if they don’t keep up with their payments.

But the Trump administration has taken a different approach. Seema Verma, who leads the Centers for Medicare & Medicaid Services, sent a letter to governors hours after she was confirmed in March asking them to file waivers that promote a path to self-sufficiency. At least 10 states have responded with waivers that include work requirements and a host of other provisions. Last week, CMS granted Kentucky’s waiver to implement work requirements, marking the first time ever a state can mandate recipients work for their benefits.

Kentucky also can start charging its Medicaid enrollees monthly premiums ranging from $1 to $15, depending on income, and suspend some of those who fall behind on payments. The state will also provide recipients with a high-deductible health savings account, which it will fund, and offer incentives to purchase additional benefits, such as dental and vision coverage.

And the state can lock recipients out of the program for up to six months if they don’t renew their paperwork on time or promptly report changes in income that could affect their eligibility — the first time the federal government has granted such a request.

All told, Kentucky is expecting about 95,000 fewer people to be in its Medicaid program by the end of its five-year waiver period.

Kentucky joins Indiana, Michigan, Arizona, Montana and Iowa in gaining permission to charge premiums. However, states such as Maine and Wisconsin — that didn’t expand Medicaid — are also looking to levy premiums on certain enrollees, primarily low-income parents or childless adults.

Wisconsin also wants to implement additional changes, including drug testing and a 48-month time limit, after which the recipient loses coverage for six months. Months during which the enrollee works or participates in training programs wouldn’t count toward the limit. Utah, meanwhile, wants to impose a lifetime limit on coverage of 60 months. Arizona, Kansas and Maine also want to set caps on the length of time residents can be on Medicaid.

Other states want to reduce the income threshold for Medicaid expansion eligibility. Arkansas and Massachusetts have asked to cover adults only up to 100% of the poverty level, or roughly $24,600 for a family of four, rather than 138%, but the states would still get the enhanced federal match. Those who would fall off would be able to sign up for subsidized policies on the Obamacare exchanges, though consumer advocates say that coverage would be too pricey for most low-income Americans.

Each of these provisions is complicated and having to comply with multiple requirements could prove too much for some recipients, said MaryBeth Musumeci, an associate director at the Program on Medicaid and the Uninsured at the Kaiser Family Foundation.

“There’s a very real risk that eligible people can lose coverage,” she said.

MedPAC votes 14-2 to junk MIPS, providers angered

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http://www.modernhealthcare.com/article/20180111/NEWS/180119963

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The Medicare Payment Advisory Commission voted 14-2 to repeal and replace a Medicare payment system that aims to improve the quality of patient care. Providers immediately slammed the move.

To avoid penalties under MACRA, physicians must follow one of two payment tracks: the Merit-based Incentive Payment System, or MIPS, or advanced alternative payment models like accountable care organizations.

On Thursday, the Commission voted to asks Congress to eliminate MIPS and establish a new voluntary value program in which clinicians join a group and are compared to each other on the quality of care for patients. Physicians who perform well would receive an incentive payment. The suggestion will be published in the advisory group’s annual March report to Congress.

MedPAC wants to junk MIPS because it believes the system is too burdensomefor physicians and won’t push them to improve care. Members have criticized the program’s design for primarily measuring how doctors perform, including whether they ordered appropriate tests or followed general clinical guidelines, rather than if patient care was ultimately improved by that provider’s actions.

The CMS estimates that up to 418,000 physicians will be submitting 2017 MIPS data.

Prior to the vote, the majority of the debate centered on whether or not MedPac had developed an adequate replacement for MIPS.

David Nerenz, one of the no votes, said he was against the replacement because he worried that only providers with healthy patients would ban together, while those with high risk patients would face difficulty finding anyone to partner with.

He also said evidence was lacking that the group reporting approach would be an effective way to hold providers accountable for quality.

Dr. Alice Coombs, a commissioner and critical-care specialist at Milton Hospital and South Shore Hospital in Weymouth, Mass., was the other no vote. She said she was against getting rid of MIPS as providers are just now getting used to it. Those concerns increased when MedPac staff noted that MIPS repeal likely wouldn’t take place until 2019 or 2020 depending when or if Congress accepted its recommendation.

Warner Thomas, a commissioner and CEO of the Ochsner Health System in New Orleans, LA voted yes, but said he did so with some trepidation as MedPac had not received comments from industry that they were supportive of what the Commission was doing in terms of repealing and replacing MIPS.

“There hasn’t been any support from the physician community around this, and we should be cautioned by that fact,” Thomas said.

Clinicians and providers criticized MedPac following the vote.

“I think they’re wrong,” Dr. Stephen Epstein, an emergency physician at Beth Israel Deaconess Medical Center in Boston said in a tweet. “MIPS could change practice patterns by aligning incentives with performance measures.”

The Medical Group Management Association said it did not support the Commission’s suggestion for a replacement to MIPS.

“It would conscript physician groups into virtual groups and evaluate them on broad claims-based measures which is inconsistent with the congressional intent in MACRA to put physicians in the driver seat of Medicare’s transition from volume to value,” Anders Gilberg, senior vice president of government affairs at MGMA said in a statement.

 

CMS launches voluntary bundled payments model, first since spiking mandatory bundles

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The agency’s Innovation Center said the new Bundled Payments for Care Improvement Advanced model is the first APM that would qualify under MACRA.

The Centers for Medicare and Medicaid Innovation Center has launched a new voluntary bundled payment model called Bundled Payments for Care Improvement Advanced — which CMS Administrator Seema Verma said is the first Advanced APM.

The current Bundled Payments for Care Improvement Initiative, or BPCI, is scheduled to end on Sept. 30. BPCI Advanced starts on Oct. 1 and runs through Dec.  31, 2023.

The BPCI will qualify as an an advanced alternative payment model under the quality payment program for MACRA. With advanced APMs, providers take financial risk, but can also reap an incentive payment reward.

The model gives incentive payments if all expenditures for an episode of care are under a spending target that factors in quality.

“BPCI Advanced builds on the earlier success of bundled payment models and is an important step in the move away from fee-for-service and towards paying for value,” Verma said.

BPCI Advanced participants may receive payment for performance based on 32 different clinical episodes. The clinical episodes in BPCI Advanced add outpatient episodes to the inpatient episodes that were offered in the previous BPCI model, including percutaneous coronary intervention, cardiac defibrillator, and back and neck except spinal fusion.

Last year, the Centers for Medicare and Medicaid Services cancelled or scaled back on mandatory bundled models for joint replacement, hip fractures and cardiac care, but promised to release new voluntary models.

CMS cancelled the episode payment model and the cardiac rehabilitation incentive payment model, which were scheduled to begin on Jan. 1.

The agency also reduced the number of mandatory geographic areas participating in the comprehensive care for joint replacement model, from 67 to 34. Participants in the 33 remaining areas could take part on a voluntary basis.

In BPCI Advanced, participants will be expected to redesign care delivery to keep Medicare expenditures within a defined budget while maintaining or improving performance on specific quality measures. Participant bear financial risk, have payments tied to quality performance, and are required to use certified electronic health record technology.

Like all models tested by CMS, there will be a formal, independent evaluation to assess the quality of care and changes in spending under the model.

Remedy Partners, which works with providers in the current BPCI program, reported in June 2017 that bundles resulted in a $500 million reduction in the cost of unnecessary medical expense over that past year for more than 1,000 providers. In addition, hospital readmissions decreased by 6.1 percent and a patient’s length of stay at a skilled nursing facility decreased by 6.3 percent, Remedy said.

 

These 6 healthcare leaders say quality improvement is an organizationwide effort and a cultural imperative

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Executive looking out window

Despite recent uncertainty about the government’s commitment to value-based care, healthcare organizations remain focused on efforts to improve quality, patient care and employee engagement.

In 2017 the Centers for Medicare & Medicaid Services cancelled mandatory bundled payment models for hip fractures and cardiac care and also asked providers for feedback on other value-based payment models.

But healthcare organizations seem committed to the initiatives they have already put in place to improve quality. Indeed, last year healthcare leaders shared their successes, challenges and lessons learned as they worked to improve quality and patient outcomes. We’ve rounded up the most memorable quotes from these healthcare thought leaders about quality, the importance of physician engagement and how to achieve a culture of patient safety.

Here are six of our favorite quotes from our interviews and industry news and event coverage over the past 12 months:

1. “We had to challenge our old paradigms. Physicians are instrumental in setting the tone, and unless the physicians believe we’re on the right path we don’t have the kind of alignment that will help us move forward.”

Gary Kaplan, M.D., chairman and CEO of Virginia Mason Health System, explained in a webinar this fall how the Seattle system improved patient safety using a patient-centered approach. Virginia Mason’s safety culture transformation began in 2001, Kaplan said, when system leaders realized that a physician-centered approach alone would not improve patient care.

2. “You need to start with the early adopters. You can’t start with folks who will fight you tooth and nail. You want to start with early successes and then evolve from there.”

Felipe Osorno, an executive administrator at Keck Medicine of the University of Southern California, spoke at the Institute for Healthcare Improvement’s annual quality forum about strategies to engage physicians in improvement initiatives. The secret was designing a program in which physicians were respected for their competency and skills, their opinions were valued, they had good relationships with their medical colleagues, they had a broader sense of meaning in their work and they had a voice in clinical operations and processes, he said.

3. “We really want to attract folks who believe at their core, not just intellectually but in their heart, that kindness can heal. … If we do it right the first time and we assess candidates based on the fit of the organization, ideally we will have more engaged employees who deliver care in a way that is patient-centered.”

Wanda Cole-Frieman, vice president of talent acquisition at Dignity Health, talked to FierceHealthcare this summer after the California system was named by an online job platform as the best place to interview in 2017. Among its techniques: It assesses candidates’ behavioral competencies for human kindness, compassion and the human experience.

4. “To create a true culture of safety and reliability we need to engage everyone, and it can only be driven when we have strong alignment. Everyone can play a role in safety.”

Gary Yates, M.D., a partner in strategic consulting at Press Ganey, explained in an interview that building and promoting a culture of safety at healthcare organizations is important to retain current staff members, but is also an especially effective recruiting tool for millennials, who will make up half of the workforce by the year 2020.

“People talk, and people ask about the culture inside different organizations,” Yates said. Putting the spotlight on safety and quality could “tip the scales” for young people.

5. “Our focus is safety, to fundamentally be a safe hospital. If we start there or if any hospital starts there, patient experience will take care of itself, quality metrics will take care of itself as will employee morale.”

FierceHealthcare caught up with Nicholas “Nico” R. Tejeda, CEO of The Hospitals of Providence Transmountain Campus in El Paso, Texas, at an American College of Healthcare Executives event. He talked about opening a new teaching hospital and establishing the culture of the organization from the beginning and with every hire.

There are no acceptable levels of errors, he said. And while it may be nearly impossible to achieve zero incidents, he still wants the organization he leads to strive for perfection.

6. “We don’t see quality as just a clinical goal. It’s an enterprisewide priority that encompasses customer service, compliance and wellness.”

A few years ago, Anthem decided to make a “rigorous” effort to boost the quality of its plans. And it’s demonstrating results, Anthem’s then-CEO Joseph Swedish said during the 2017 AHIP Institute & Expo. Now, more than half of the insurer’s Medicare Advantage enrollees reside in 4-star plans, compared to just 22% the year before.

 

Payer Roundup—Mississippi gets 10-year Medicaid waiver extension; A third of Americans believe ACA is repealed

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Medicaid

CMS approves 10-year Medicaid waiver extension for Mississippi

Last week, the federal government approved its first 10-year extension of a Section 1115 Medicaid demonstration program.

The Mississippi program provides family planning services for people ages 13-44 with income of up to 194% of the federal poverty level. To get approval for its 10-year extension, the state agreed to submit monitoring reports and participate in calls with CMS every year.

The lengthy waiver extension, according to CMS Administrator Seema Verma, lets Mississippi administer its Medicaid program “without the inconvenience of obtaining routine approvals from CMS.” The action also shows the agency’s “continuing commitment to giving states the flexibility they deserve to meet the unique needs of their people,” she said.

Alabama won’t freeze CHIP enrollment or stop coverage—for now

Because of the temporary funding for the Children’s Health Insurance Program included in Congress’ year-end spending bill, Alabama officials canceled their plans to freeze CHIP enrollment on Jan. 1.

The state will also not follow through with its plan to terminate coverage for current CHIP enrollees by Feb. 1, according to AL.com. But Cathy Caldwell, director of the Alabama Bureau of Children’s Health Insurance, told the publication that “we desperately need Congress to act, hopefully in January.”

Federal funding for CHIP expired Sept. 30, and Congress’ effort to reauthorize funding have been bogged down by partisan disputes. The short-term spending bill passed before the holiday break set aside $2.85 billion to temporarily tide states over.

One-third of Americans believe ACA has been repealed

President Donald Trump was not correct when he said that the GOP tax bill repealed the Affordable Care Act, but a new poll indicates a sizable chunk of Americans believe it nonetheless.

According to the poll (PDF), conducted by The Economist/YouGov, 31% of respondents indicated that Trump has delivered on his promise to repeal the healthcare law. Forty-nine percent said that he didn’t, and 21% were unsure.

The sweeping overhaul to the tax code that Republicans passed before the holiday break did repeal the ACA’s individual mandate, a key part of its insurance market reforms. But experts disagree on how big of an impact that will have, and other core components of the law—like premium subsidies—remain intact.

ACA expert to stop blogging for Health Affairs

Timothy Jost, who has chronicled nearly every Affordable Care Act-related development over the past 8½ years, will no longer contribute to the Health Affairs Blog’s “Following the ACA” series.

Jost, a Washington and Lee University professor emeritus, wrote more than 600 blog posts about the adoption and implementation of the healthcare law, plus the omnipresent political battles surrounding it. Jost wrote in his final post that “I am getting older and believe it is time to slow down.” He will continue to write a monthly “Eye on Reform” column for Health Affairs, however.

Katie Keith, a health policy expert with a law degree from Georgetown University and a master of public health from Johns Hopkins University, will take the helm as the author of the Health Affairs blog series on the ACA.