United States: Weekly Washington Healthcare Update - October 27, 2014

This Week: CMS Makes Agreements with Health Insurers over Potential Loss of ACA Subsidies... DeSalvo Leaves Post at ONC to Assist HHS Ebola Response Team... 2015 Social Security Cost-of-Living Adjustment (COLA): Increase of 1.7 Percent.

1. CONGRESS

House

Oversight Committee Examines Federal Coordination of Ebola Response

On Oct. 24, the House Oversight Committee held a hearing entitled "The Ebola Crisis: Coordination of a Multi-Agency Response." The hearing examined the federal response to the recent outbreak of ebola in West Africa, which has recently spread in isolated incidents in the United States. Officials from the US Department of Health and Human Services and the Department of Defense, among others, testified as to whether the government is adequately training and equipping American health care workers and military personnel who treat patients infected with the deadly virus.

Witnesses:

For more information, or to view the hearing, please visit oversight.house.gov.

Senate

Upcoming -- Appropriations Committee Hearing on the US Government Response to Ebola Outbreak

On Nov. 6, 2014, at 2:00 p.m., US Senator Barbara A. Mikulski (D-MD), Chairwoman of the Senate Appropriations Committee, will hold a Full Committee hearing on the US Government response to the ebola outbreak. Witnesses have not yet been announced, however, on Oct. 16, the House Energy and Commerce Committee held a similar hearing in which CDC Director Tom Frieden and National Institute of Allergy and Infectious Disease Director Anthony Fauci, along with other officials, offered testimony outlining the federal government's response to the recent outbreak of ebola in West Africa, including recent patients in the United States.

2. ADMINISTRATION

$31 Million in NIH Research Grants Available to Promote Diversity in Biomedical Sciences

In an Oct. 22 press release, the National Institutes of Health (NIH) announced the availability of $31 million in research grants as a means to develop new ways to bring more researchers from underrepresented groups into the field of biomedical sciences. The grant awards are part of a projected five-year program to support more than 50 awardees and partnering institutions in establishing a national consortium to develop, implement and evaluate approaches to encourage individuals to start and stay in biomedical research careers. Supported by the NIH Common Fund and all NIH 27 institutes and centers, 12 awards will be issued as part of three initiatives of the Enhancing the Diversity of the NIH-Funded Workforce program. "At the Department of Health and Human Services we believe that delivering impact begins with building strong teams that have the talent and focus necessary to get results," said Secretary Sylvia M. Burwell in a statement. "These awards will leverage the power of our country's diversity so that together, we can continue to advance biomedical research and unlock the cures to some of the great health challenges of our times." The awards have been made to a geographically diverse group of institutions serving multiple populations underrepresented in biomedical research. These awardees will draw upon research to develop approaches to training and mentoring to encourage students from underrepresented groups to enter into and stay in research careers.

CMS Introduces New Web Interface Tools for Consumers Accessing Open Payments Data

According to an Oct. 17 blog post from a CMS official, the Centers for Medicare & Medicaid Services (CMS) announced the debut of a simplified search interface for its Open Payments database, allowing consumers to search provider information by name, city, state and specialty. Disclosure provisions within the Affordable Care Act (ACA) require that physicians, teaching hospitals and drug and device manufacturers disclose general payments, research payments and company ownership stakes to the Food and Drug Administration (FDA) as a means to promote transparency and prevent special interests from influencing patient safety and care. Further interface improvements are expected over the next few weeks, such as allowing Open Payments data to be displayed in a chart or graph format, Shantanu Agrawal, Deputy Administrator of the CMS and Director of its Center for Program Integrity, said in the blog post. CMS previously released, on Sept. 30, unsearchable data displaying aggregated provider and manufacturer transactions for the last five months of 2013 and is expected to release Open Payments data covering all of 2014 in June 2015.

CMS Makes Agreements with Health Insurers over Potential Loss of ACA Subsidies

On Oct. 22, the Centers for Medicare and Medicaid Services (CMS) sent an email to health insurers over the REGTAP website, a site that contains technical information for health insurers operating in the Affordable Care Act (ACA) marketplaces, that included language allowing insurers to terminate health insurance contracts if subsidies are no longer available to enrollees in the federally run health insurance exchanges. The agreement includes a provision that says the CMS "acknowledges" that qualified health plans have developed products for the federally facilitated marketplace based on the assumption that advance payments of the premium tax credit and cost-sharing reductions "will be available to qualifying Enrollees. In the event that this assumption ceases to be valid during the term of this Agreement, CMS acknowledges that Issuer could have cause to terminate this Agreement subject to applicable state and federal law." As it stands, legal challenges have been filed against an Internal Revenue Service (IRS) rule allowing subsidies to go to people buying plans through the federally managed exchange, because the language of the ACA says only that the subsidies are to go to patients buying plans through state-based exchanges. In July, two federal appeals courts reached different conclusions about the validity of the IRS rule on subsidies for people in the federally facilitated marketplace. Currently, ACA subsidies are available to people earning between 100 percent and 400 percent of the federal poverty level, and the federal government is operating its insurance marketplace in 36 states.

OMB Begins Review Process for 2016 Proposal on Benefit and Payment Parameters Within ACA

According to the reginfo.gov website, the White House Office of Management and Budget (OMB) on Oct. 16 began its review of a proposed Department of Health and Human Services (HHS) rule affecting health insurance coverage for 2016 under the Affordable Care Act (ACA). The proposed rule (RIN 0938-AS19; CMS-9944-P), officially entitled the Notice of Benefit and Payment Parameters for 2016, would establish the CY 2016 payment parameters for the cost-sharing reductions, advance payments of the premium tax credit, reinsurance and risk adjustment programs as required by the ACA. The rule is categorized by OMB as economically significant and has a legal deadline for release of a final rule by March 2015. Worth noting, in March of this year, HHS released its Notice of Benefit and Payment Parameters for 2015 final rule (CMS-9954-F), which, among other areas, made it easier for health insurers to obtain risk adjustment payments, in part because of Administration policies that affect the populations of people who will enroll in ACA marketplace plans.

HHS Announces $840 Million for Transforming Clinical Practice Initiative

Department of Health and Human Services' (HHS) Secretary Sylvia Burwell announced in an Oct. 23 press release that the agency will be providing $840 million for a new initiative aimed at creating Practice Transformation and Support and Alignment networks to help health care providers adapt and develop quality improvement strategies. The new initiative, entitled Transforming Clinical Practice Initiative, hopes to reach as many as 150,000 providers and will also help fund the existing Quality Improvement Organization program. Strategies for the program include giving doctors better access to patient information, including prescription drug use; expanding creative ways for patients/clinician communications; improving the coordination of patient care by specialists and primary care doctors; and better utilizing electronic health records. "The administration is partnering with clinicians to find better ways to deliver care, pay providers and distribute information to improve the quality of care we receive and spend our nation's dollars more wisely," said Secretary Burwell. "We all have a stake in achieving these goals and delivering for patients, providers and taxpayers alike." The initiative is part of a larger HHS strategy advanced by the Affordable Care Act (ACA) to strengthen the quality of patient care and spend health care dollars more wisely.

DeSalvo Leaves Post at ONC to Assist HHS Ebola Response Team

On Oct. 23 Dr. Karen DeSalvo left her position as head of the Department of Health and Human Services' (HHS) Office of the National Coordinator for Health Information Technology (ONC) to help HHS lead the federal government's response to the ebola virus outbreak. HHS Secretary Sylvia Mathews Burwell announced DeSalvo's departure and new role as Acting Assistant Secretary for Health in an email notice to staffers. "As the acting assistant secretary for health, [DeSalvo's] experience as a practicing physician, a senior member of the HHS team, and as a nationally recognized leader in public health, will be invaluable to the department and me." She added that DeSalvo "will bring her knowledge and real-world experience to bear on some of the most important issues confronting our department, especially our Ebola response efforts." Dr. DeSalvo will serve in an acting capacity until confirmed by the Senate as Assistant Secretary. As it stands, Lisa Lewis, the ONC's chief operating officer, is serving as Acting National Coordinator.

2015 Social Security Cost-of-Living Adjustment (COLA): Increase of 1.7 Percent

On Oct. 22, the Social Security Administration (SSA) announced that monthly Social Security and Supplemental Security Income (SSI) benefits for nearly 64 million Americans will increase 1.7 percent in 2015. The 1.7 percent cost-of-living adjustment (COLA) will begin with benefits that more than 58 million Social Security beneficiaries receive in January 2015. Increased payments to more than 8 million SSI beneficiaries will begin on Dec. 31, 2014. The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor's Bureau of Labor Statistics. Some other changes that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $118,500 from $117,000. Of the estimated 168 million workers who will pay Social Security taxes in 2015, about 10 million will pay higher taxes because of the increase in the taxable maximum.

3. STATE ACTIVITIES

Report Finds Three Kansas Managed Care Insurers Lost $110 Million in 2013

According to a report issued by the Kansas Health Institute, the three insurers operating managed care plans for Kansas's Medicaid program lost nearly $73 million in the first six months of this year and $110 million in 2013. KanCare, an initiative launched by Gov. Sam Brownback on Jan. 1, 2013, moved virtually all the state's Medicaid enrollees into health plans run by Amerigroup, UnitedHealthcare Community Plan and Sunflower Health Plan, a subsidiary of Centene. The three managed care organizations, in information to be filed with the National Association of Insurance Commissioners, reported a total of about $96 million in underwriting losses in the first half of this year.

Aetna to Exit Delaware Medicaid Program

On Oct. 15, Aetna Medicaid announced that Delaware Physicians Care (DPCI) will not renew its contract to participate in the State of Delaware's Medicaid and other assistance programs. As a result, DPCI will close its operations, effective Dec. 31, 2014. The insurer claims it is withdrawing after several months of extended negotiations with the state, which have failed to result in a rate agreement that would cover the costs of operating the plan. Members and providers are being notified; service will continue through the end of the year.

4. REGULATIONS OPEN FOR COMMENT

Basic Health Program; Federal Funding Methodology for Program Year 2016

On Oct. 21, CMS issued a proposed rule outlining the agency's methodology for determining federal payment amounts to states that establish a Basic Health Program (BHP) for 2016. Under the proposed methodology, in determining the federal BHP payment amount, CMS will take into account the age and income of the enrollee, whether the enrollment is for self-only or family coverage, geographic differences in average spending for health care across rating areas, the health status of the enrollee for purposes of determining risk adjustment payments and reinsurance payments that would have been made if the enrollee had enrolled in a qualified health plan through an Exchange, and whether any reconciliation of the credit or cost-sharing reductions would have occurred if the enrollee had been so enrolled. The proposed payment methodology takes each of these factors into account. In addition, the proposed methodology that is the same as the 2015 payment methodology, with updated values but no changes in methods. States that elect to operate a BHP will make affordable health benefits coverage available for individuals under age 65 with household incomes between 133 percent and 200 percent of the FPL who are not otherwise eligible for Medicaid, the Children's Health Insurance Program (CHIP) or affordable employer-sponsored coverage. Comments are due Nov. 24. CMS plans to issue a final notice by February.

CMS Releases Proposed Rule on Revised Conditions of Participation for Home Health Agencies

The Centers for Medicare & Medicaid Services (CMS) released a proposed rule on Oct. 6 revising and modernizing the current conditions of participation for home health care agencies that want to take part in the Medicare and Medicaid programs. The CMS rule, published in the Federal Register on Oct. 7, "reflects the most current home health agency practices by focusing on the care provided to patients and the impact of that care on patient outcomes. This proposed regulation focuses on assuring the protection and promotion of patient rights; enhances the process for care planning, delivery, and coordination of services; streamlines regulatory requirements; and builds a foundation for ongoing, data-driven, agency-wide quality improvement." Specific new provisions in the proposed rule include patients' rights measures, coordination of services and quality of care measures utilizing an interdisciplinary team approach, quality assessment and performance improvement (QAPI) measures, and infection prevention and control measures, among others. Comments on the proposed rule are due to CMS by Dec. 8, 2014.

CMS Seeks Stakeholder Input on Innovative Health Plan Designs

On Oct. 2, the Centers for Medicare and Medicaid Services issued a request for information (RFI) for input from health plans and other stakeholders to explore innovative ways to improve Medicare. The CMS specifically would like information about stand-alone Medicare prescription drug plans (PDPs), Medigap and retiree supplemental health plans, Medicare Advantage and Medicare Advantage prescription drug plans, and Medicaid managed care plans. The request is intended to help CMS improve Medicare plan design, care delivery, beneficiary and provided engagement, and network design. CMS would like to receive the information by Nov. 3.

OIG Proposed Rule Would Expand Medicare Anti-Kickback Statute Safe Harbors

The Department of Health and Human Services Office of the Inspector General (OIG) released a proposed rule (RIN 0936-AA06) on Oct. 2 that would add new safe harbors to the anti-kickback statute covering some Medicare Part D activities and expand the list of conduct exempted from civil monetary penalties (CMPs). The proposed rule would cover a variety of behaviors, including: pharmacy cost-sharing waivers for impoverished Medicare Part D beneficiaries; cost-sharing waivers for emergency ambulance services offered by state or municipal-owned organizations; manufacturer discounts for drugs provided through the Medicare Coverage Gap Discount Program; and certain interactions between Medicare Advantage plans and federally qualified health centers (FQHCs). Lewis Morris, former chief counsel to the OIG, said the rule illustrates that the "inspector general is really working hard to find ways to promote quality of care in an integrated delivery system while still protecting the integrity of the program and its beneficiaries." Comments on the proposed rule are due Dec. 2.

5. REPORTS

Medicaid & CHIP: August 2014 Monthly Applications, Eligibility Determinations and Enrollment Report

According to a report recently released by CMS, the 51 states (including the District of Columbia) that provided enrollment data for August 2014 reported that over 67.9 million individuals were enrolled in Medicaid and CHIP. This enrollment count is point-in-time (on the last day of the month) and includes all enrollees in the Medicaid and CHIP programs who are receiving a comprehensive benefit package. In addition, 735,279 additional people were enrolled in August 2014 as compared to July 2014 in the 51 states that reported both August and July data. Notably, among states that had implemented the Medicaid expansion and were covering newly eligible adults in August 2014, Medicaid and CHIP enrollment rose by more than 22 percent compared to the July-September 2013 baseline period, while states that have not, to date, expanded Medicaid reported an increase of approximately 5 percent over the same period.

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