38 hospitals sue HHS over site-neutral payment rule

https://www.healthcarefinancenews.com/news/38-hospitals-sue-hhs-over-site-neutral-payment-rule?mkt_tok=eyJpIjoiT0RrNVpXSmpZV1UzTTJVdyIsInQiOiJNNFh6MElhd0lmVE5Zc09kZTl5d3BPc1h3ZkRpZGNIbWhHSE9RNVp5NkN1MFwvXC9kK3h6WHh5KzRHTWdsQTlWZ203aitRRnhUYWZ5QTVScVZcL01HaTkyUm5LNDRvanVuY0NUdVN4Y0czMzRkMzdNZzMrdVp6WjlmV2N5WHYxMEkrNCJ9

Hospitals named in the suit include Vanderbilt Medical Center, Atrium Health, Rush University Medical Center, Ochsner Clinic Foundation, Montefiore.

A month and a half after several hospital advocacy groups joined together to sue the U.S. Department of Health and Human Services over it’s finalized site-neutral payment policy, 38 hospitals have followed, filing suit against HHS Secretary Alex Azar for a policy they say will deprive hospitals of hundreds of millions of dollars and could compel them to cut patient services due to loss of reimbursement.

The complaint argues that medical services provided in hospital outpatient departments are more “resource-intensive”–and therefore more costly–than those performed in an independent physician’s office. It also sharply criticized Secretary Azar, saying he “has blatantly disregarded a specific and unambiguous statutory directive, acted well beyond his authority and nullified that statutory exemption” that would have had hospital outpatient centers reimbursed for services at the higher grandfathered rate previously legislated.

The hospitals suing include Vanderbilt Medical Center, Atrium Health hospitals, Rush University Medical Center, Ochsner Clinic Foundation, Montefiore Health System and many others.

THE IMPACT

The outpatient prospective payment system seeks to equalize what physician offices and hospital outpatient departments are paid for certain clinical visits, a change that will be phased in over two years. The new rule cuts payments for hospital outpatient clinic visits at off-campus provider- based facilities in order to level them out against what is paid to physician offices. Half of the total reduction, $380 million, will take effect in 2019 and the remaining cuts will be phased the next year.

THE TREND

The Bipartisan Budget Act of 2015 amended the Social Security Act such that Medicare pays the same rates for medical services regardless of whether they are provided in a physician’s office or in an “off campus” hospital department. At the time, Congress provided an exemption from the rule for all off-campus hospital outpatient departments that were providing services before the enactment.

The AHA, in the suit they are part of, said the Azar’s reversal on the grandfathered exemption exceeds the administration’s legal authority. The AHA previously called the OPPS final rule  “unsupportable analyses and erroneous policy rationales,” and said it will have “negative consequences” for patients, with those in rural and vulnerable communities getting hit especially hard. The AHA and other hospital associations are already challenging the 340B policy included in the current outpatient rule.

ON THE RECORD

“The Secretary’s unlawful rate cut directly contravenes clear congressional directives and will impose significant harm on affected off-campus hospital outpatient departments and the patients they serve. Accordingly, this Court should declare the Secretary’s Final Rule to be ultra vires and enjoin the agency from implementing any payment methodology other than OPPS rates for all E/M services provided by excepted off-campus PBDs,” the complaint states.

Mark Polston, a partner with King & Spalding, the firm representing the plaintiffs: “Our clients’ mission is to provide high-quality healthcare. They have relied for years upon their off-campus departments to expand access to care and bring hospital services directly to their communities, many of which are underserved by other providers. Congress preserved their ability to do that work when it excepted them from the changes contained in Section 603 of the Bipartisan Budget Act of 2015. But the Secretary overstepped his bounds when he took that away. We are asking the court to reinstate the decision Congress made to preserve our clients’ ability to bring the best possible care to their patients.” Mark Polston, a partner with King & Spalding, the firm representing the plaintiffs:

 

 

 

Policy upheaval, tech giant disruption and megamergers: Healthcare Dive’s 10 best stories of 2018

https://www.healthcaredive.com/news/policy-upheaval-tech-giant-disruption-and-megamergers-healthcare-dives-1/543390/

Mobile health records and nurse protests also grabbed readers this year.

This year in healthcare was marked by sweeping changes, including seemingly constant vertical and horizontal consolidation, led by the $69 billion CVS grab of Aetna and Cigna’s $67 billion acquisition of Express Scripts.

As 2018 wound down, a federal judge took an ax to the Affordable Care Act as the Trump administration kept up its efforts to undermine the law, with CMS expanding short-term health plans many say are built to subvert the ACA. Elimination of the individual mandate penalty, Medicaid expansion and rising premiums all likely contributed to declined enrollment on ACA exchanges as well.

The administration encouraged states to use waivers to expand controversial Medicaid work requirements and proposed site-neutral payments, rattling health systems of all sizes that were already struggling under ferocious operating headwinds. Hospitals cut back on services and invested heavily in lucrative outpatient facilities in an attempt to reclaim volume.

Tech companies Apple and Amazon pushed further into the space, with the former focusing on mobile health apps and the latter focusing on, well, almost everything.

But that’s just scratching the surface. Here is a curated list of Healthcare Dive’s top stories from the last year.

    1. Optum a step ahead in vertical integration frenzy

      After a 2017 marked by failed horizontal mergers, vertical consolidation came into vogue during the year, led by CVS-Aetna, Cigna-Express Scripts and Humana-Kindred.

      Some smart observers saw a predecessor to these unions in UnitedHealth Group’s Optum: a pharmacy benefit manager plus a care services unit that employs over 30,000 physicians, using data analytics to capitalize on consumerism and value-based care.

      Our piece on Optum’s solid foothold in the space, and its likelihood of staying ahead of the nascent competition, was Healthcare Dive’s most-read article in 2018. Read More »

    2. New Medicare Advantage rules hold big potential for pop health

      A novel Medicare Advantage rule giving payers more flexibility to sell supplemental benefits to chronically ill enrollees sparked a fair amount of interest in our readers.

      The rule offered up a slate of new opportunities for insurers such as UnitedHealthcare and Humana that can now work with rideshare companies to provide transportation to medical appointments, air conditioners for beneficiaries with asthma and other measures around issues like food insecurity in a broad shift to recognizing social determinants of health. Read More »

    3. Apple debuts medical records on iPhone

      Outside players such as Apple, Amazon and Google moved forward in their bids to disrupt healthcare in 2018. Apple rang in the New Year with its announcement that customers would now be able to access their medical records on the Health app following months of speculation and buzz.

      The move looks to put access to personal, sensitive data back in the patients’ hands, an objective a lot of the entrenched healthcare ecosystem can get behind as well. Heavy hitters on the EHR side (Epic, Cerner, athenahealth) and the provider side (Johns Hopkins, Cedars-Sinai, Geisinger) are taking place in the initiative. Read More »

    4. At least 14 states have legislation addressing safe staffing currently, but California is the only one to implement a strict ratio at one nurse per every five patients. Looking to 2019, in Pennsylvania voters elected a governor who has voiced support for state legislation. Read More »
    5. More employers go direct to providers, sidestepping payers

      Employers ramped up their cost-containment creativity in 2018. One method? Cutting out the middleman and forging direct relationships with providers themselves, whether it’s contracting with an accountable care organization to manage an entire employee population or a simple advocacy role to fight for payment reform.

      Aside from some correlated CMS interest, big names forging inroads in the arena include General Motors, Walmart, Whole Foods, Boeing, Walt Disney and Intel, all with various levels of investment.

      Although only 6% of employers are doing so currently, 22% are considering solidifying some sort of provider relationship for next year according to a Willis Towers Watson survey. It’s also likely the Amazon-J.P. Morgan-Berkshire Hathaway venture will look at direct contracting in its (still vague) mission to lower employer costs. Read More »

    6. Amazon Business’ medical supply chain ambitions: 4 things to know

      Amazon’s B2B purchasing arm reached out and grabbed the healthcare supply chain this year, shaking a once-predictable business model.

      Under intense operating headwinds, supply chain professionals looked to trim the fat from traditional distribution and supplier models in 2018. Some looked to Amazon Business, which generated more than a billion dollars in sales its first year alone by relying on its marketplace model, streamlined ordering and a “tail spend” strategy.

      1. Healthcare Dive discussed this and more with global healthcare leader at Amazon Chris Holt in an exclusive interview that drove a lot of interest. Read More »

GE, Medtronic among those linking with hospitals for value-based care

Value-based care was a buzzword over the past year, with providers, payers and healthcare execs across the board looking (or saying they’re looking) for ways to cut costs and improve quality.

Although legal barriers stemming from the Anti-Kickback Statute and Stark Law persist, medical technology companies jumped on the bandwagon, with big names like GE, Philips and Medtronic coupling with hospitals to promote VBC initiatives. Read More »

  1. How Amazon, JPM, Berkshire Hathaway could disrupt healthcare (or not)

The combination of the e-commerce giant, a 200-year-old multinational investment bank and Warren Buffet’s redoubtable holding company joining forces to take on healthcare costs spooked investors in traditional industry players. The venture added a slew of big names to its C-suite, including Atul Gawande and Jack Stoddard for CEO and COO, respectively. Read More »