DCMedical News: Tuesday, December 11, 2018
DCMedical News-DCMN
Washington, D.C.
Tuesday, December 11, 2018
DCMedical News is published every day either the House or the Senate is in session.
THE BIG STORY TODAY IN HEALTH CARE
Year-End Tax, Spending Bills Take Shape: With the final appropriations bills deferred to December 21 under a Continuing Resolution, passed in both houses and signed by the President, attention has turned to the construction of a year-end tax bill. Yesterday the Chair of the House Ways & Means Committee announced a package which would delay the effective date for three key provisions of the Patient Protection and Affordable Care Act (PPACA, ACA). The bill (House Amendment to Senate Amendment to H.R. 88, here) would extend the medical device tax suspension for five years, through 2024; suspend a health insurance premium tax for two years, through 2021; and delay the “Cadillac tax” from taking effect for one additional year, through 2022.
DOCTORS, NURSES AND OTHER HEALTH PROFESSIONALS
MedPAC Discusses Physician Payments: The Medicare Payment Advisory Commission meeting December 6 – 7 discussed physician and other health professional services, and Medicare payments for those services (here). Total billing for such services was almost $70 billion in 2017, 14% of Medicare fee-for-service benefit spending (not including Medicare Advantage, see below). Of the 985,000 clinicians billing Medicare, almost 600,000 were physicians, the remainder Advanced Practice Registered Nurses (APRNs), Physician Assistants (PAs), and some others. There is no update anticipated in the physician payment rate under current law for the year 2020, but there is a 5% Advanced Alternative Payment Model incentive for some incentive program participants.
A relatively small number of Medicare beneficiaries report some difficulty in finding a new doctor, especially primary care doctors. Timely access to care (time to appointment, visit, referral) is “slightly better for Medicare beneficiaries than [for those] privately insured.”
MedPAC has previously recommended eliminating the Merit-based Incentive Payment System (MIPS) for physician incentive compensation. A report on 2017 MIPS results at the December 6 meeting showed that 95% of clinicians met or exceeded the performance threshold, with “71% of clinicians qualified for the positive MIPS adjustment plus exceptional performance bonus.” To not receive a bonus, physicians apparently had to not participate at all; 5% of the clinicians did not report any performance information, and therefore received the maximum penalty of negative 4%. Medicare’s payment rates to clinicians were 75% of commercial preferred provider organization (PPO) payment rates in 2017.
APRNs and PAs: Consistent with reports in the literature, nurse practitioners and physician assistants are increasingly practicing in specialties outside of primary care, for example in dermatology and orthopedics. Approximately half of nurse practitioners practice in primary care, with a little more than a quarter of the physician assistants practicing in primary care. From 2010 to 2017, nurse practitioner growth in billings averaged 17%, with the number of nurse practitioners billing Medicare growing an average of 14% per year. For physician assistants, growth in billings during this 2010-2017 period was 14% per year, while growth in the number of physician assistants was 10% per year.
“Incident-To” Billing: Medicare claims data do not reveal when a nurse practitioner’s or a physician assistant’s services are billed “incident to” that of a physician; MedPAC staff estimates that 40% of Medicare’s Evaluation & Management office performed by nurse practitioners for established patients in physician offices were billed under the physician’s NPI (National Provider Identifier) in 2016. Staff indicated the “incident to” billing probably increases Medicare and beneficiary spending, obscuring the identity of the practitioner providing the service.
HOSPITALS AND OTHER HEALTH CARE FACILITIES
Inpatient Rehabilitation Facility (IRF) Services: IRFs were reviewed at the MedPAC meeting December 6 – 7 (here), preparatory to MedPAC’s January meeting for final action on recommendations to Congress for 2019. As with other categories of payment, MedPAC only receives information on Medicare spending, namely the fee-for-service (FFS) but not the Medicare Advantage (MA) spending.
The roughly 1,200 IR facilities received $8 billion in FFS spending in 2017, with an approximate payment per case of $20,300. Coding appears to make patients sicker - - that is, as with other Medicare payments, upcoding is suspected in “high margin IRFs.” Says the staff, “Patients in high margin IRFs were less severely ill during preceding acute care hospital stay.” Three-quarters of the IRFs were hospital-based, one-quarter “freestanding,” with ownership split 56% non-profit, 33% for-profit, 11% government. (Almost half of the free-standing facilities are owned by one company.) The marginal profit for the free-standing IRFs was about 40% in all three years measured (2013, 2016, 2017), a little short of 20% in the hospital-based. (Medicare’s determination of “profit” is based on the utilization of Medicare definitions of allowable cost and marginal revenue.) Using its definition of cost, Medicare believes that payments have been rising faster than costs, continuously since 2009, with correspondingly higher profit margins. Notwithstanding the difference in coding and in diagnoses in the hospital-based vs. free-standing and non-profit vs. for-profit, the staff defined “efficiency” for IRFs and concluded that “Free-standing and for-profit facilities [were] disproportionately represented in [the] relatively efficient group.”
Long-Term Care Hospital (LTCH) Services: Also at the December 6 meeting, MedPAC reviewed payment adequacy for LTCHs (here). These are facilities which meet the Medicare “Conditions of Participation” for acute care hospitals, but have an average length of stay greater than 25 days for certain Medicare patients. Medicare spent $4.5 billion (FFS) on these facilities in 2017, with a mean payment per case of $38,000.
The payment methodology for LTCHs is based on MS-LTC-DRGs, adjusted for high cost and short stay outliers. Those cases that meet criteria for (1) an immediately preceding acute care discharge and (2) either three days in the intensive care unit of the referring acute care hospital or prolonged mechanical ventilation, are paid under the LTCH prospective payment system, with a mean payment per case of approximately $46,000. Those cases that don’t meet these criteria are paid at a “site neutral” rate being phased in over four years, with an average payment in 2017 of $24,000. The dual rate structure may have had a role in the 7% reduction in LTCHs during the past five years, accompanied also by occupancy rate decreases.
EVENTS & MEETINGS (Events Newly Added to This List Noted in Bold)
Dec. 11
10:15 a.m., the Subcommittee on Health of the House Energy and Commerce Committee will hold a hearing in room 2322 of the Rayburn House Office Building on “Implementing the 21st Century Cures Act: An Update from the Office of the National Coordinator.” This is the fourth in a series of hearings on the implementation of the 21st Century Cures Act, the previous ones on research and development, mental health initiatives, and FDA provisions. This hearing will focus on interoperability of Electronic Health Records (EHRs), as well as implementation of the law’s provisions regarding information blocking and the establishment of a Trusted Exchange Framework. According to the hearing announcement, “The Office of Management and Budget is currently reviewing a rule to guide implementation of these provisions of law and it is expected to be released this month.”
2:30-4:00 p.m., Bipartisan Policy Center, Financing Public Health Infrastructure, panel, 1225 Eye Street NW, Suite 1000, Washington, 202-204-2400
Dec. 12
9:00 a.m., Center for American Progress, Sen. Harris and full panel, “Eliminating Racial Disparities in Maternal and Infant Mortality,” 1333 H St., 10th floor, http://www.americanprogress.org.
Dec. 13
9:30-4:45 p.m., The December 2018 meeting of the Medicaid and CHIP Payment and Access
Commission (MACPAC) is on Thursday, December 13 from 9:30am–4:45pm and Friday, December 14 from 9:00am–12:00pm at the Ronald Reagan Building and International Trade Center’s Horizon Ballroom. This month’s Commission meeting covers a broad array of issues, including state innovations in drug spending, Medicaid managed care network adequacy, proposed rules on Medicaid managed care and care for dually eligible beneficiaries, and Medicaid in Puerto Rico. The Commission will also review potential 2019 recommendations on hospital payment. Complete agenda here, December MACPAC data book here.
Dec. 18
First meeting, the HHS Deputy Secretary’s Innovation and Investment Summit. Program announced, here; participants selected, list here; FAQs here.
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), 2019 House Calendar (here).
PUBLICATION SCHEDULE FOR DCMEDICAL NEWS
December publication dates: 12, 13, 14
Notes to: Fred Hyde, MD, JD, MBA; fredhyde@aol.com