DCMedical News: Thursday, December 15, 2022
DCMedical News is published every day both the House and the Senate are scheduled to be in session. The 117th Congress is almost over. The 118th Congress will convene January 3, 2023, when publication of DCMN will resume.
THE BIG STORY Thursday, December 15, 2022
End of the 117th Congress, Continued
The Hill reported that “The House on Wednesday passed a short-term funding bill to avert a government shutdown, kicking Friday’s funding deadline to next week to allow lawmakers more time to strike a deal on spending for the remainder of fiscal year 2023. The continuing resolution passed in a 224-201 vote. It now heads to the Senate, where it must pass and be sent to President Biden’s desk before midnight on Friday to avoid a shutdown.”
Health Spending Up in 2021, But Not Much
CMS reported (here) in an article in Health Affairs that “Health care spending in the US grew 2.7 percent to reach $4.3 trillion in 2021, a much slower rate than the increase of 10.3 percent seen in 2020. The slower rate of growth in 2021 was driven by a 3.5 percent decline in federal government expenditures for health care. The 2021 federal spending was up in part due to a dramatic upturn in 2020 in response to the COVID-19 pandemic.”
Volume increases were not significant enough to drive up overall spending at the rate of spending increases in 2019 and 2020. In 2019, health spending was 17.6% of GDP, in 2020 it was 19.7% and in 2021 it was 18.3%. Spending on physician care and clinical services accounted for 20% of total expenditures and grew 5.6%, slower than the 6.6% growth in 2020.
“Medicare spending for personal healthcare increased 10.6% in 2021, compared with the 1.7% growth in 2020, driven by increased spending growth for hospital care and physician and clinical services . . . Fee-for-service Medicare spending accounted for 54% of overall Medicare spending in 2021 and increased 3.9% in 2021, after a decline of 4.1% in 2020. Medicare private health plan spending (including Medicare Advantage) grew 14.1% in 2021 -- down slightly from a 15.6% increase in 2020.”
“Medicaid spent $734 billion in 2021 -- a 9.2% increase, roughly the same as in 2020 "but much faster than the average rate of 2.9% during 2017-19.”
DOCTORS, NURSES AND OTHER HEALTH PROFESSIONALS
Financial Stress—Is Private Equity Relief For Providers, or a New Cause?
STAT+ reports (here) that “Nine in 10 health care companies with financial stress are owned by private equity.” A new Moody’s report (here) shows “an industry weakened by private equity’s practice of loading companies with debt, making them less resilient to challenges like Covid-19, rising interest rates, litigation, or changes from a new federal law against surprise billing. Among the 193 North American health care companies Moody’s rates, the agency had placed almost 18% at or below its rating that indicates credit stress, B3 negative, as of Nov. 30. That’s compared with just 4% at the end of 2015.”
One analyst said “This business model of trying to charge patients more and extracting more money from them is simply not sustainable . . . Clearly the private equity industry is realizing this in a very painful way, that you can’t do this.” Companies included in the analysis include TeamHealth, Envision and Air Ambulance.
MEDICARE, MEDICAID AND COMMERCIAL HEALTH INSURANCE
CMS Proposes Rules to Rein In Medicare Advantage Abuse
CQ reports that “Medicare Advantage plans would be subject to new rules around marketing, the use of prior authorizations and network adequacy under a proposal released Wednesday by the Centers for Medicare & Medicaid Services,” (here). The 957-page proposal is “a response to thousands of complaints against Medicare Advantage plans, [and] is aimed at improving coverage for the millions of people enrolled in those plans.”
“We are taking feedback from thousands of Americans and turning it into concrete action to strengthen Medicare for the millions of Americans who rely on it,” said Health and Human Services Secretary Xavier Becerra. “From streamlining prior authorization to cracking down on misleading marketing, we are committed to ensuring that everyone can have peace of mind and get the health care they need.”
Says CQ, “The proposed rule touches on several aspects of Medicare Advantage, including prior authorizations, which plans say reduces unnecessary care but physicians argue delays or blocks access to needed services. Under the proposal, Medicare Advantage plans would have to use Medicare coverage rules when determining whether a request is ‘medically necessary.’ Currently, plans can create their own criteria for making prior authorization decisions, and that information is often shielded from the public.”
A report earlier this year (here) by the Health and Human Services Office of Inspector General focused on the effect of prior authorization denials by MA plans. Some 13 percent of the denials were for services that would have been covered by traditional Medicare, which has no “prior authorization.”
Says CQ, “The rule would require prior authorization approvals remain valid for the duration of a course of treatment. Providers often complain that they have to seek multiple authorizations while treating a patient for the same illness, disrupting access to care. Plans would also be required to establish a ‘utilization management committee’ to annually review policies around the use of prior authorization and ensure it is consistent with Medicare guidelines. The rule would also ‘clarify’ that behavioral health services may qualify as emergency services that do not require prior authorization.”
“The proposed rule would also restrict certain kinds of marketing of Medicare Advantage plans, after complaints that television advertisements were increasingly becoming misleading. CMS is proposing prohibiting ads that do not mention a specific plan name as well as ads that use words, imagery or logos in a misleading or confusing way.”
PUBLICATION SCHEDULE FOR DCMEDICAL NEWS
January 3, 4, 5, 9, 10, 11, 12, 24, 25, 26, 27, 30, 31
February 1, 2, 6, 7, 8, 9, 27, 28
March 1, 7, 8, 9, 10, 22, 23, 24, 27, 28, 29, 30
Notes to Fred Hyde, MD, JD, MBA, news@dcmedicalnews.org