United States: Washington Healthcare Update - August 11, 2014

Last Updated: August 18 2014
Article by Stephanie A. Kennan and Brian J. Looser

1. Congress

House

District Work Period -- No Legislative Activity

Senate

State Work Period -- No Legislative Activity

2. Administration

PCORI Grants Awarded for Comparative Effectiveness

The Patient-Centered Outcomes Research Institute (PCORI) released a series of funding announcements offering up to $76 million in support for patient-centered comparative clinical effectiveness research (CER) projects under PCORI's five broad National Priorities for Research. In releasing this latest round of PCORI Funding Announcements (PFAs), PCORI has further streamlined its application process based on applicant feedback, offering more guidance on research areas and topics of greatest interest. Furthermore, more support is available under two of the PFAs: a maximum of $5 million in direct costs through the Improving Healthcare Systems announcement and $1.5 million under the Improving Methods for Conducting Patient-Centered Outcomes Research PFA. Beginning with this funding round, all Letters of Intent (LOIs) for proposals, due Friday, Sept. 5, will be "competitive," meaning they will be screened for their responsiveness to the announcement and how well they fit program goals.

June 2014 Medicaid and CHIP Enrollment Data Released

According to a report released Aug. 8 by CMS entitled "Medicaid & CHIP: June 2014 Monthly Applications, Eligibility Determinations and Enrollment Report," 602,210 additional people were enrolled in June 2014 as compared to May 2014 in the 49 states that reported both June and May data. In addition, since October when the ACA's open enrollment began, among the 48 states reporting both June 2014 enrollment data and data from July-September of 2013, approximately 7.2 million additional individuals are enrolled in Medicaid and CHIP, a 12.4 percent increase over the average monthly enrollment for July through September of 2013. And among states that adopted the Medicaid expansion and whose expansions were in effect in June 2014, Medicaid and CHIP enrollment rose by over 18.5 percent compared to the July-September 2013 baseline period, while states that have not, to date, expanded Medicaid reported an increase of approximately 4 percent over the same period.

3. State Activities

Massachusetts Exchange to Remain State-Based

Officials at the Massachusetts health insurance exchange announced that the state will continue, in 2015, to operate its own insurance marketplace, which served as a model during development of the ACA. While the Massachusetts exchange has experienced significant difficulties aligning with some requirements of the ACA, software developer hCentive, which also helped to build the Kentucky and Colorado exchanges, has been tapped to help improve the functionality of the exchange. Joining the federal exchange was considered a backstop in the event the state felt it would be unable to establish a marketplace. "Massachusetts will remain a state-based marketplace," said Maydad Cohen, a special assistant to the governor on the Obamacare exchange. "We've successfully demonstrated hCentive's ability to deliver a smooth consumer experience."

4. Regulations Open for Comment

Medicare Program; Revisions to Payment Policies under the Physician Fee Schedule, Clinical Laboratory Fee Schedule, Access to Identifiable Data for the Center for Medicare and Medicaid Innovation Models & Other Revisions to Part B for CY 2015

CMS released its proposal for the 2015 Medicare physician fee schedule on July 3 with suggested changes relating to Chronic Care Management (CCM) and Accountable Care Organizations (ACO). Medicare doctors who provide CCM services may be required starting in 2015 to use an electronic health record or other health information exchange platform to ensure their patients" care plans are electronically accessible to any provider caring for those patients. Medicare providers would also be required to use electronic health records certified under the Office of the National Coordinator for Health Information Technology"s certification program as having the capabilities to capture and report CCM data. ACOs were also addressed in the new fee schedule, as the proposed rule would increase the number of ACO quality measures with an increased focus on outcomes. Under the proposal, the total number of measures for quality reporting would increase from 33 to 37. Under the Medicare Shared Savings Program (MSSP), ACOs must meet certain quality targets to claim shared savings bonuses. Specifically, new measures would be added to focus on avoidable admissions for patients with multiple chronic conditions, heart failure and diabetes; depression remission; all-cause readmissions to a skilled nursing facility; and stewardship of patient resources, the agency said. The agency added that the existing composite measures for diabetes and coronary artery disease would also be updated. Comments must be received by Sept. 2, 2014.

Medicare and Medicaid Programs: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Physician-Owned Hospitals: Data Sources for Expansion Exception; Physician Certification of Inpatient Hospital Services; Medicare Advantage Organizations and Part D Sponsors: Appeals Process for Overpayments Associated with Submitted Data

CMS has issued a proposed rule that would revise the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for CY 2015 to implement applicable statutory requirements and changes arising from continuing experience with these systems. The proposed rule describes the proposed changes to the amounts and factors used to determine the payment rates for Medicare services paid under the OPPS and those paid under the ASC payment system. In addition, this proposed rule would update and refine the requirements for the Hospital Outpatient Quality Reporting (OQR) Program and the ASC Quality Reporting (ASCQR) Program.

CMS is also proposing changes to the data sources used for expansion requests for physician-owned hospitals under the physician self-referral regulations; changes to the underlying authority for the requirement of an admission order for all hospital inpatient admissions and changes to require physician certification for hospital inpatient admissions only for long-stay cases and outlier cases; and changes to establish a three-level appeals process for Medicare Advantage (MA) organizations and Part D sponsors that would be applicable to CMS-identified overpayments associated with data submitted by these organizations and sponsors. Comments must be received by Sept. 2, 2014.

Medicare Program; End-Stage Renal Disease Prospective Payment System, Quality Incentive Program, and Durable Medical Equipment, Prosthetics, Orthotics, and Supplies

This rule proposes to update and make revisions to the End-Stage Renal Disease (ESRD) prospective payment system (PPS) for calendar year (CY) 2015. This rule also proposes to set forth requirements for the ESRD quality incentive program (QIP), including payment years (PYs) 2017 and 2018. This rule also proposes to make a technical correction to remove outdated terms and definitions. In addition, this rule proposes to set forth the methodology for adjusting Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) fee schedule payment amounts using information from the Medicare DMEPOS Competitive Bidding Program (CBP); make alternative payment rules for DME and enteral nutrition under the Medicare DMEPOS CBP; clarify the statutory Medicare hearing aid coverage exclusion and specify devices not subject to the hearing aid exclusion; update the definition of minimal self-adjustment regarding what specialized training is needed by suppliers to provide custom fitting services if they are not certified orthotists; clarify the Change of Ownership (CHOW) and provides for an exception to the current requirements; revise the appeal provisions for termination of a contract and notification to beneficiaries under the Medicare DMEPOS CBP, and add a technical change related to submitting bids for infusion drugs under the Medicare DMEPOS CBP. Comments must be received by Sept. 2, 2014.

Draft Guidance for Industry on Drug Supply Chain Security Act Implementation: Identification of Suspect Product and Notification; Availability

On June 11, 2014, FDA announced the availability of a draft guidance for industry entitled "Drug Supply Chain Security Act Implementation: Identification of Suspect Product and Notification." The draft guidance addresses new provisions in the Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Drug Supply Chain Security Act (DSCSA). The draft guidance is intended to aid certain trading partners (manufacturers, repackagers, wholesale distributors and dispensers) in identifying a suspect product and terminating notifications regarding illegitimate product. This draft guidance identifies specific scenarios that could significantly increase the risk of a suspect product entering the pharmaceutical distribution supply chain; provides recommendations on how trading partners can identify the product and determine whether the product is a suspect product as soon as practicable; and for product that has been determined to be illegitimate, or (for manufacturers) has a high risk of illegitimacy, sets forth the process by which trading partners should notify FDA of illegitimate product and how they must terminate the notifications, in consultation with FDA. Public comments on the draft guidance will be accepted through Aug. 11, 2014.

CMS Proposed Rule: Medicare, Medicaid EHR Incentive Program

On May 23, 2014, CMS issued a proposed rule that would change the meaningful use stage timeline and the definition of certified electronic health record technology (CEHRT). It would also change the requirements for the reporting of clinical quality measures for 2014. Certified EHR technology is defined for the Medicare and Medicaid HER Incentive Programs at 42 CFR 495.4, which references the Office of the National Coordinator for Health Information Technology's (ONC) definition of CEHRT under 45 CFR 170.102. For Stages 1 and 2 of meaningful use, CMS and ONC worked closely to ensure that the definition of meaningful use of CEHRT and the standards and certification criteria for CEHRT were coordinated. The definition of CEHRT under 45 CFR 170.102 requires, beginning with federal fiscal year (FY) and calendar year (CY) 2014, EHR technology certified to the 2014 Edition EHR certification criteria. Therefore, all EPs, eligible hospitals and CAHs must use 2014 Edition CEHRT to meet meaningful use under the Medicare and Medicaid EHR Incentive Programs, beginning with FY 2014 and CY 2014. Beginning in 2015, all eligible hospitals and professionals would still be required to report using the 2014 Edition CEHRT. The proposed rule also includes a provision that would formalize CMS' and ONC's previously stated intention to extend Stage 2 through 2016 and begin Stage 3 in 2017.

To view the CMS press release on the proposed rule, visit cms.gov.

5. Reports

OIG: Part D Beneficiaries with Questionable Utilization Patterns For HIV Drugs

According to a report issued by the HHS-OIG, Medicare Part D paid $2.8 billion for HIV drugs in 2012. Almost 1,600 Part D beneficiaries had questionable utilization patterns for HIV drugs. These beneficiaries had no indication of HIV in their Medicare histories, received an excessive dose or supply of HIV drugs, received HIV drugs from a high number of pharmacies or prescribers, or received contraindicated HIV drugs (i.e., HIV drugs that should not be used in combination with one another). In total, Medicare paid $32 million for HIV drugs for these beneficiaries. While some of this utilization may be legitimate, all of these patterns warrant further scrutiny. These patterns may indicate that a beneficiary is receiving inappropriate drugs and diverting them for sale on the black market.

TIGTA: Accuracy of Responses to Exchange Requests for Income and Family Size Verification Information and Maximum Advance Premium Tax Credit Calculation

As of March 31, 2014, the IRS had received more than 27 million IFSV information requests and more than 11 million APTC requests. TIGTA's review of the IRS's response to 101,018 IFSV requests received by the IRS between Oct. 1 and Oct. 4, 2013, showed that the IRS, based on the information furnished by the Exchange, provided accurate responses for 100,985 (99.97 percent) of the 101,018 requests. However, TIGTA identified 33 requests for which the IRS incorrectly notified the Exchange that it could not provide tax information for individuals for whom the Exchange was requesting information because the IRS was unable to match the name on the application to IRS data records. These responses were incorrect because the individual's name used on the application was in fact available in IRS data records. This resulted from a computer programming error in which IRS data used to provide information in response to Exchange requests did not always contain the most recent name information shown on the individual's tax account.

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.

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