DCMedical News: Wednesday, April 18, 2018
DCMedical News
Washington, D.C.
Wednesday, April 18, 2018
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THE BIG STORY TODAY IN HEALTH CARE
Spending: The House will miss the first deadline for a FY2019 budget, many Members skeptical of the exercise as Senators eschew significant limits, other Members seek to eliminate the “ceiling” on debt, and the President seeks additional rescission (line-item veto) authority (not popular in the Senate). Expect to hear about “minibuses” (two or more of the appropriations bills for FY2019 moving together) or (less likely) an “omnibus” (all twelve at once).
DOCTORS, NURSES, HEALTH PROFESSIONALS
AMA-ASAM Proposed P-COAT Treatment Model: The American Medical Association and the American Society of Addiction Medicine have proposed (document from ASAM here) a new payment model for addiction treatment, Patient-Centered Opioid Addiction Treatment (P-COAT). Medical and social services now provided for separately or not at all in the treatment of opioid addiction would include non face-to-face consultation (phone calls, telemedicine, emails), Medication-Assisted Treatment (MAT), also favored by HHS, but, according to ASAM, significantly underutilized, transportation and other non-medical social services. ASAM cites a recent Blue Cross study, indicating that the number of BCBS members with an opioid use disorder diagnosis surged almost 500%, but the number of individuals using MAT rose by only 65%. Another target: cumbersome prior authorization requirements.
HOSPITALS AND HEALTH CARE FACILITIES
Payment for Emergency Care: At its April meeting MedPAC recommended (transcript, here) significant changes in payment for emergency care when that care takes place in settings outside of or beyond the traditional hospital emergency room. The MedPAC proposal would reduce Medicare payment rates by 30% at hospital-affiliated free-standing emergency departments (EDs) located within six miles of an on-campus hospital emergency department (transcript, pg. 4ff.). Executive director of MedPAC James Mathews says, “There has been a growth in free-standing emergency departments in urban areas that does not seem to be addressing any particular access need for emergency care,” an artificial stimulation of demand.
As part of its work product, MedPAC staff analyzed five urban markets, finding that three-quarters of the free-standing facilities were within six miles of a hospital, with an average drive time of ten minutes. Free-standing emergency care is not only more expensive than would be found in a physician’s office, but utilization is increasing more rapidly; per Medicare beneficiary visits to outpatient emergency departments increased 13.6% from 2010 to 2015, compared to a 3.5% growth in visits to doctor offices. Not affected by the MedPAC recommendation: independent free-standing emergency departments not affiliated with a hospital, about one-third of all free-standing facilities, which are not currently eligible for Medicare payment, in any event. (See the testimony of Dr. Justin Hensley pg. 114 ff. on the transcript; his free-standing center in rural Texas, 32 miles from the closest hospital, saw almost 500 Medicare patients in the last four months of 2017, billed $888,000, was paid zero.) For isolated rural stand-alone EDs, MedPAC recommended payment of OPPS facility fees and an annual subsidy for fixed costs; they would need to be 35 miles from another ED to qualify.
G&A: General and administrative costs in hospitals continue to rise absolutely and as a percentage of total costs. This month’s Healthcare Financial Management (here) chronicles the increase in total cost growth (2005 – 2016), the increase of G&A as a percentage of total cost (18% increasing to 20.5%) and year-over-year growth.
HEALTH INSURANCE, MEDICARE, MEDICAID
MIPS: Does your practice have challenges in reporting for MIPS (the Merit-based Incentive Payment System)? You can get MIPS credit by participating in a study (here) on the “burdens associated with reporting quality measures to receive improvement activity credit for 2018.”
United marches along: UnitedHealth Group reported its first quarter results Tuesday (8-K with press release, here). First quarter revenue of $55 billion was up 13%, earnings at $4 billion up 19%, net earnings per share up 28%. UNH has 285,000 employees. Some questions and answers (see earnings call transcript from SeekingAlpha, here):
On point of sale rebates at pharmacies: “So to that end, beginning 1/1/2019, for more than 7 million fully insured members we are changing our practice to apply manufacturer rebates at the point of sale for consumers. So today, we apply rebates towards reducing overall premium, so shifting it to the point of sale has a very minimal impact overall but has a very big impact to individuals taking those impacted drugs.”
On Medicare Advantage: “[T]he Medicare Advantage market continues to be severely underpenetrated. It's 33% today. We see a path, as we mentioned previously, to over 50% over the next 5 to 10 years. And we believe this set of policies and the funding that we see in 2019 are enablers in that regard.”
On direct services: “[W]e're positioned to be the leading high-value medical group and ambulatory care organization in the country with an ambition to serve 75 markets.” (Credit all transcript quotes, SeekingAlpha.)
PHARMA
Amazon and Pharma: The company is likely to remain active in selling medical supplies and equipment to clinics and hospitals, through partnerships with, for example, Cardinal Health, but now appears unlikely to make major inroads with big pharma clients, especially hospitals. Challenges include “complexities,” “logistics,” and (per CNBC) “Amazon has not been able to convince big hospitals to change their traditional purchasing process, which typically involves a number of middlemen and loyal relationships,” and perhaps even conflicts.
EVENTS & MEETING
April 19
9:30 a.m., MACPAC: the Medicaid and CHIP Payment and Access Commission (MACPAC) is on Thursday, April 19 from 9:30 a.m.–3:45 p.m. and Friday, April 20 from 9:00 a.m.–11:45 a.m. at the Ronald Reagan Building and International Trade Center’s Horizon Ballroom. MACPAC’s April meeting covers a broad agenda, with sessions ranging from social determinants of health, to Section 1115 waiver evaluations, to provider payment policy. The Commission also reviews two chapters in its forthcoming June Report to Congress on Medicaid and CHIP, on access to substance use disorder (SUD) treatment and managed long-term services and supports (MLTSS).
April 19
10:00 a.m., Senate Finance Committee hearing on opioids, Medicare and Medicaid.
May 6
American Hospital Association Annual Membership Meeting (Washington, DC), through May 9.
May 8
Subcommittee on Oversight and Investigations (House E&C) will hear testimony from the chief executives of AmerisourceBergen, Cardinal and McKesson, concerning pill dumping in W. Virginia and other matters.
June 19
AHIP Institute & Expo, San Diego, through June 22.
June 24
HFMA Annual Conference, Las Vegas, through June 28.
FOR REFERENCE
Members of the Senate (here) and Members of Senate Committees (here), Senate Calendar (here).
Members of the House with their House Committees (here), House Calendar (here).
PUBLICATION SCHEDULE FOR DCMEDICAL NEWS
DCMedical News is published every day that either the House of Representatives or the Senate is in session.
Past issues can be accessed by clicking on “View this email in your browser.” Subscription information is found at the bottom of these pages. Trial subscriptions may end without notice.
April publication dates: 19, 20, 23, 24, 25, 26, 27.
May publication dates: 7, 8, 9, 10, 11, 14, 15, 16, 17, 18, 21, 22, 23, 24, 25.
Notes to: Fred Hyde, MD, JD, MBA; fredhyde@aol.com