DCMedical News: January 17, 2018
DCMedical News
Washington, D.C.
Wednesday, January 17, 2018
THE BIG STORY TODAY IN HEALTH CARE
The budget extension: House Republican leaders have introduced a “stop-gap” appropriations measure which would carry the government through February 16, just prior to the “Presidents’ Day” holiday weekend. The bill, found here, includes a six-year reauthorization of the Children's Health Insurance Program, a one year suspension of the health insurance tax (to 2020), a two-year suspension of the medical device excise tax (to 2020), and a two year suspension of the Cadillac tax on high-cost employer-sponsored health care plans (to 2022), all of which were creatures of the Patient Protection and Affordable Care Act (PPACA, “Obamacare,” P.L. 111-148 and 111-152).
Behind the budget debate (extension deadline; health bills including CHIP, FQHCs, DHS, 340B, PPACA taxes and the budget itself, with the potential for sequestration; non-health issues, especially DACA extension), regulatory wrestling matches continue (MedPAC, CMS, HHS generally). States may eventually play a larger role, not unlike the role of Provinces in the Canadian health system. Complexity in the regulatory environment (especially involving payment) continues to favor consolidation among providers and to cause non-clinical expense increase.
DOCTORS
MedPAC at its January 11-12 meeting engaged in a review of payment adequacy for providers under the Medicare program.
Here is the summary for physicians and other health professionals. Medicare Fee-For-Service (FFS) spent $70 billion on health professionals in 2016, 15% of the total of FFS spending. [MedPAC reports only on the FFS expenditures; the third or so of Medicare spending included under Medicare Advantage or MA programs is not included in most MedPAC analyses.] MedPAC staff assess and report on the ease with which beneficiaries are able to obtain care from the particular provider group, the provider participation and the relationship of payments to private rates. For doctors, “Most beneficiaries are able to obtain care when needed, small share face problems.” In 2016 Medicare paid 589,000 physicians, 203,000 APRNs and PAs and 160,000 therapists and other providers. Medicare payment rates in 2016 were 75% of private PPO commercial rates, a decline from 78% in 2015, and the volume of services overall increased by 1.6%
Payment updates for doctors under the Medicare Access and CHIP Reauthorization Act of 2015 (the current statutory basis for physician payment updates) call for half a percent in the years 2016-2019, and nothing 2020-2025. There is a 5% incentive payment each year 2019-2024 for participation in the Advanced-Alternative Payment Models (APM) of quality and prevention scores. There is (unless Congress accepts MedPAC’s recommendation to get rid of it) a non-APM Merit-based Incentive Payment System (MIPS) for individual clinicians remaining in FFS Medicare, starting in 2019, variable based on multiple measures of quality, cost and clinical practice improvement. MIPS could involve penalties, however, 4% downward adjustment rising to 9% down by 2022. (See pg. 325-385 of the transcript of the January 14, 2016 meeting of MedPAC, found here, and credit then-Commissioner Willis Gradison with questions about how MIPS would actually work).
In another slide from the January 11 meeting, entitled “MIPS cannot succeed,” there is an indictment of MIPS, as follows: [It] “Replicates flaws of prior value-based purchasing programs,” is “Burdensome and complex,” involves the reporting of information which is “not meaningful,” has “Scores not comparable across clinicians,” involves payment adjustments which “will be minimal in the first two years, large and arbitrary in later years.” In summary, “MIPS will not succeed in helping beneficiaries choose clinicians, helping clinicians change practice patterns to improve value, or helping the Medicare program to reward clinicians based on value.”
In fact, the now-recommended-for-repeal MIPS program replaced three other (also) now defunct programs: PQRS, the Physician Quality Reporting System; a modifier of physician bills for “value-based payment;” and the MU—Meaningful Use—rewards from electronic medical records. PQRS, VBP for doctors and EMR-MU payments taken together put an estimated additional $40-$50 billion of expense into the American medical system, even without accounting for the time, effort and expense to physicians and medical practices in compliance.
(For more on the history of CMS experiments in “quality” and “value” demonstrations see The Physicians Foundation web site for surveys on physician burnout, and especially http://www.overregulationofmedicalpractice.org)
HEALTH INSURANCE, MEDICARE, MEDICAID, COMMERCIAL
In its presentation to the January 11 MedPAC meeting, staff reported on the status of the Medicare Advantage program. The slides are found here, and indicate that in 2017 there were 19 million MA enrollees, 32% of all Medicare beneficiaries. “Coding intensity” (code creep or sicker patients, your choice) caused MA “risk scores” to be 2-3% higher than Medicare FFS. “Star switching” occurs frequently, with companies consolidating contracts so that the “consumed” contracts receive the “star” rating of the “consuming” contract. Over 100 such contracts involving MA contracts moved from under four stars (receiving no bonus) to four star or higher. This involved 20% of the total MA enrollment, a full 8% moving at the end of 2017 for coverage at the beginning of 2018. The staff concluded that contract star switching resulted in increased program expenditures, inaccurate information for consumers and quality claims not representative of actual performance.
In an unrelated January 3rd letter to CMS, found here, MedPAC commented on other issues with the MA program.
EVENTS & MEETINGS
Your January & February Calendar:
January 17: 9:30 a.m. Reinventing Rural Health, BiPartisan Policy Center, 1225 Eye Street, Washington, D.C.
January 17: 4:00 p.m. Regulatory Relief Webcast, AHA CEO Pollack and CMS Administrator Verma, contact: (800) 424-4301
January 23: 7:00 p.m. Senator Sanders with “Medicare for All Town Hall Meeting” on digital media outlets
January 25: 8:30 a.m. MACPAC, 1800 M. Street, Suite 650, Washington, D.C., and continuing to Friday, January 26
January 29: 8:30 a.m. COGME, at https://hrsa.connectsolutions.com/cogme-council/, also January 30
February 1: 9:00 a.m. Health Affairs, kick-off for cost control series, sponsored by National Pharmaceutical Council (!)
OTHER PUBLICATIONS
DCMN: DC Medical News publishes every day that either the House or the Senate of the U.S. Congress is in session. Publication dates for the remainder of January: 18, 19, 22, 23, 24, 25, 26, 29, 30, 31
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Notes to: Fred Hyde, MD, JD, MBA; fredhyde@aol.com