United States: MedPAC – April Meeting Summary

Last Updated: April 30 2013
Article by Stephanie A. Kennan and Brian J. Looser

The Medicare Payment Advisory Commission (MedPAC) is an independent Congressional agency established by the Balanced Budget Act of 1997 (P.L. 105-33) to advise the U.S. Congress on issues affecting the Medicare program. On April 4-5, 2013, the commission met to discuss select policy initiatives. The meeting was divided into seven sessions, summarized below.


Session I: Medicare Accountable Care Organization (ACO) Update

Session II: Low-income Beneficiaries in a System of Competitively Determined Plan Contributions

Session III: Preparing Private Plans to Better Serve Dual-eligible Beneficiaries

Session IV: Medicare Hospice Policy Issues

Session V: Bundling Post-Acute Care Services

Session VI: Improving Medicare Payment for Chronically/Critically Ill Patients in Hospital Settings

Session VII: Medicare’s Coverage of Services Provided by Advanced-Practice Nurses and Physician Assistants


Session I: Medicare Accountable Care Organization (ACO) Update

Background: Accountable care organizations (ACOs), which are entities comprised of various health providers that hope to achieve savings through care coordination created by the Affordable Care Act (ACA), have been expanding rapidly in the Medicare program. Commissioners have been informed of the number and location of the new ACOs, of which there are now about 250 operating under Medicare serving four million beneficiaries, and some observations on the strategies they are expected to use to achieve cost savings and quality performance.

Key Points: The pattern of where they are locating is linked to markets served by Medicare Advantage plans, but with some noteworthy differences. Specifically, MedPAC is interested in understanding what circumstances could create an atmosphere in which ACOs may have a comparative advantage relative to Medicare Advantage plans, taking into consideration the position of ACOs as being somewhere between traditional fee-for-service Medicare and Medicare Advantage on the payment spectrum.

Session II: Low-income Beneficiaries in a System of Competitively Determined Plan Contributions

Background: The Commission has been examining design concepts for a system of competitively-determined plan contributions (CPC) for low-income beneficiaries in connection with possible benefit redesigns in Medicare including archetypes similar to Part D subsidies and any differences in a CPC model consisting of Medicare Parts A and B structures. Other topics discussed in the meeting include how dually-eligible beneficiaries would be accommodated in such a CPC system by examining existing issues in treatment in Medicare Advantage and traditional fee-for-service.

Key Points: While weighing the benefits of existing models will be crucial to crafting a an efficient CPC model, it is possible that the least costly option could include a piecemeal CPC bidding system or require plans to bid on an entire package. A lack of uniformity in Medicaid benefits and cost sharing elements in Medicare among states has made it difficult to design a CPC system model that incorporates dual eligible beneficiaries; questions exist about whether the population should be segmented to better accommodate the competitive bidding process.

Session III: Preparing Private Plans to Better Serve Dual-Eligible Beneficiaries

Background: Dual-eligible beneficiaries are enrolled in both Medicare and Medicaid benefits, and operationally receive medical services through two separate systems. The Commission has been looking into measures to better synchronize care for these beneficiaries through programs (typically operated by private health plans at a high risk.) There are only a small number of these Medicare-Medicaid (MMCP) programs, and most Medicare Advantage plans do not have familiarity with managing the full range of services for dual eligibles in a capitated environment.

Key Points: While literature suggests that MMCP can reduce utilization of certain high-cost services, such as hospital and nursing home utilization, Medicare and Medicaid programs may not realize savings due to reduced utilization. This session provided an overview of dual-eligible beneficiaries, reviewing spending patterns on these beneficiaries, in particular, long-term care services users and beneficiaries with chronic mental illness; the panel further discussed findings on care coordination activities in MMCP, including the complexity of physical health needs among beneficiaries, the coordination of electronic medical record sharing, and the lack of knowledge of MMCP care managers in social services and other resources in beneficiaries' communities. Suggestions for better coordination included financially aligning Medicare and Medicaid benefits and financially aligning those benefits in the context of a CPC system.

Session IV: Medicare Hospice Policy Issues

Background: In MedPAC’s March 2009 Report to Congress, the Commission made recommendations to improve the hospice payment system, including measures to increase accountability in benefits and enhance data collection systems. In the years since, several steps have been taken to support methods for accountability and data collection through PPACA and CMS administrative actions, while additional channels remain pending. In addition, PPACA gave CMS the authority to revise the payment systems for hospice care no earlier than fiscal year 2014. As it stands, no regulatory action has been taken to date on payment reform.

Key Points: The Commission continued its data collection and analysis related to hospice policy improvements, consistent with the Commission’s recommendations of payment reform and greater accountability. MedPAC staff suggested that larger changes in payments might need to be instituted to eliminate the higher profitability of long stays, as data findings show that long stays in hospice are tied to long survival post-discharge. Payment reduction for hospice care in nursing facilities could be considered as hospices provide more aide visits in nursing facilities than the home. The staff advised that reducing costs could be done be reducing a portion of the hospice payment rate in nursing facilities based on estimates of the labor cost visits of hospice vs. in home treatments due to differences in staff visit frequency.

Session V: Bundling Post-Acute Care Services

Background: The administration of care for post-acute incidents can vary substantially due to the type and amount and unexpected nature of treatment service after an acute event. Fee-for-service payments foster overuse of service, as there exists little motivation for a provider to curb the total costs to treat a beneficiary following hospitalization. MedPAC staff suggested the creation of a system of well-constructed bundled payments as a way to create enticements for providers to decrease the costs of care across settings while improving the care quality of services beneficiaries receive. However, the bundles must be designed carefully to avoid increased volume, stinting, or patient selection.

Key Points: Staff presented information on the construction of an illustrative bundle proposal and possible ways to establish episode benchmarks. Such payment bundles would encourage care coordination between providers, bolster better resource use across an episode of care, and narrow the variation in spending. Bundling could entail an initial FFS-based approach (minus a small withheld) with a risk-adjusted benchmark and compare provider’s actual spending with an episode benchmark set forth by CMS. Such a model would provide a quality and outcome gauges to monitor provider performance and which could be used for later discussion. Staff also outlined the model’s effect on beneficiary care and gave suggestions for potential transition implementation of bundled payments.

Commissioners provided comments on the principles for establishing bundled payments, recommended quality and outcome measures, suggested best-practices approaches to setting the necessary post-acute care service benchmarks, provided insights as the implications for beneficiaries, and suggested ways to transition to a system of bundled payments. The Commission anticipates this information will be added as a chapter in the June 2013 report.

Session VI: Improving Medicare Payment for Chronically/Critically Ill Patients in Hospital Settings

Background: Chronically/critically ill (CCI) beneficiaries, those that have spent at least 8 days in the ICU/CUU, have significantly increased without payment adjustments, efficiencies or incentives for improvements. As it stands, Medicare pays for the cost of caring for Chronically Critically Ill (CCI) beneficiaries under different payment systems depending on whether care is delivered at Acute Care Hospitals (ACHs), based on the inpatient prospective payment system (IPPS) with a built in outlier, or Long-term Care Hospitals (LTCHs), based on inflationary costs. Such a payment model is inequitable and creates financial incentives to provide services in more expensive LTCH facilities, inflating expenses for the Medicare program and/or encouraging transitions between care facilities.

Key Points: At the April meeting, MedPAC staff advocated that design concepts for payment reform should make payments should be site-neutral and patient centered by either reforming the IPPS to better align with costs of CCI or by bundling price adjusted codes costs in a new CCI MS-DRGS.

Session VII: Medicare’s Coverage of Services Provided by Advanced-Practice Nurses and Physician Assistants

Background: Generally, Medicare covers provider payments for services rendered by advanced-practice nurses (APNs—nurse practitioners and clinical nurse specialists), and physician assistants (PAs), provided licensed APNS and PAS services are within APN and PA’s scope of practice emanating from each states’ laws.

Key Points: MedPAC staff issued a paper that discusses state licensure, state scope-of-practice laws, provider policies, and other payer policies that affect the services provided by APNs and PAs. It should be noted that the variation in scope of practice laws do not follow regional patterns as states tend to be quite individualized in setting these rules. The paper also delineated Medicare’s coverage and billing policies for APN and PA services and presented an examination and analysis of claims activity regarding the types of services and facilities that APNs and PAs bill under the Medicare program.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
McGuireWoods LLP
Bradley Arant Boult Cummings LLP
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
McGuireWoods LLP
Bradley Arant Boult Cummings LLP
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions