The Centers for Medicare and Medicaid Services (CMS) on Nov. 29 released the first ranking of the nation’s poor-performing nursing homes.
Release of the list was prompted by the number of facilities that were consistently providing poor quality of care, yet were periodically instituting enough improvement that they would pass one survey only to fail the next (for many of the same problems as before). Such facilities with a “yo-yo” compliance history rarely addressed underlying systemic problems that were giving rise to repeated cycles of serious deficiencies.
As of October 2007, there were 128 special focus facilities (SFFs) out of about 16,000 active nursing homes. These nursing homes, at the time of their selection as an SFF, had survey results that were among the poorest 5 percent or 10 percent in each state. Typically, these facilities achieve improved survey results after being selected for the initiative. The CMS data indicate that about 50 percent of the nursing homes identified as SFFs significantly improve their quality of care within 24-30 months, while about 16 percent are terminated from Medicare and Medicaid. Download background information on the SFF program program and a list of the SFF facilities in the "Downloads" section at the bottom of the CMS nursing home certification and compliance page.
According to the CMS web site, some healthcare providers have reported their Social Security numbers (SSNs), or the SSNs of other healthcare providers, in their National Plan and Provider Enumeration System (NPPES) records in fields that the Freedom of Information Act (FOIA) requires that CMS make publicly available. For example, there are instances in which SSNs are reported in the “Other Provider Identification Numbers,” “License Number,” and “Employer Identification Number (EIN)” fields in providers’ NPPES records. The information that providers report in these and certain other fields is fully disclosable by CMS to the public; therefore, SSNs should never be reported in any of these fields.
Because SSNs are nine-digit numbers, CMS has been suppressing all nine-digit numbers found in any FOIA-disclosable field except for ZIP code and telephone/fax number fields. This means that these nine-digit numbers--whether or not they are SSNs--are not displayed in the National Provider Identifier (NPI) registry and cannot be found in the monthly NPPES downloadable file. If these numbers are legitimate EINs, provider identification numbers, or license numbers, health plans and others who are using the NPI registry and the downloadable file are not able to see them, thus making it more difficult to link NPIs to legacy identifiers. In some cases, this may adversely affect payments to providers by health plans.
It is imperative that providers immediately look at their NPPES records to ensure that they did not inadvertently report their, or someone else’s, SSN in a FOIA-disclosable field; if they did, they need to delete that SSN immediately and, if appropriate, replace it with the correct information.
Medicaid has evolved to become the primary payer for long-term care (LTC) services and supports to low-income elderly and disabled individuals, financing 42 percent of the nation’s spending on long-term care services. The structure and cost associated with the program’s role are key considerations as states begin to implement some of the changes passed as part of the Deficit Reduction Act of 2005.
The Kaiser Family Foundation’s Kaiser Commission on Medicaid and the Uninsured has released a report that presents an overview of Medicaid as a provider of LTC and highlights policy challenges facing the Medicaid program today. Some of the issues addressed include integration of services for people who use LTC; varying disability criteria for Medicaid LTC coverage, which can create potential inequalities across beneficiary groups and states; and achieving a balance between institutional and community-based care, especially with the recent shift toward more community-based alternatives. Download the report.
The Centers for Medicare and Medicaid Services (CMS) will conduct a listening session on Dec. 17 as part of the selection of hospital-acquired conditions (HAC) and implementation of present-on-admission (POA) indicator reporting. The session is being held as a joint partnership between CMS and the Centers for Disease Control and Prevention.
Hospitals, hospital associations, representatives of consumer purchasers, payers of healthcare services, and other interested parties are invited to attend and make comments in person or in writing. Although it will also be possible to listen to the session by teleconference, telephone participants will not be able to make verbal comments because of time constraints. Informal written comments will be accepted and should be sent by e-mail to hacpoa@cms.hhs.gov.
The listening session will be held on Monday, Dec. 17, 2007, from 10 a.m. to 5 p.m. EST. The meeting will be held in the main auditorium of the central building of CMS, 7500 Security Blvd., Baltimore, Md. 21244-1850. Those interested in attending the meeting or listening by teleconference should register by Dec. 10. To complete the online registration, go to http://registration.intercall.com/go/cms2. Get more information.
The Secretary of Health and Human Services on Nov. 26 released its Report to Congress: Plan to Implement a Medicare Hospital Value-Based Purchasing Program, suggesting ways to continue transforming Medicare into a prudent purchaser of higher-quality health care for Medicare beneficiaries. The report includes a plan for the proposed Medicare hospital value-based purchasing (VBP) program.
The plan provides that quality of care information will be available to patients on the Centers for Medicare and Medicaid Services (CMS) Hospital Compare web site. Inclusion of a broad range of quality measures in VBP is intended to enable Medicare beneficiaries and other consumers to compare hospitals and make informed decisions about where to seek care. It builds on the foundation of the current pay-for-reporting program, which ties a portion of the annual payment update under the Medicare inpatient prospective payment system to a hospital’s reporting on a defined set of inpatient quality measures.
Under VBP, a percentage of the hospital’s diagnosis-related group payment would be contingent on the hospital’s actual performance on a specific set of measures. The transition from pay-for-reporting to an incentive based completely on performance would occur over a three-year period. Public reporting of quality measures on Medicare’s Hospital Compare site would remain an essential component of VBP. By tying a portion of hospital payments to actual performance on quality measures, VBP is intended to provide additional incentives for hospitals.
The plan will require Congressional action for implementation, said Kerry Weems, CMS acting administrator, on a press call announcing the release. Download the report.
The physician fee schedule update for CY08 will be -10.1 percent, announced the Centers for Medicare and Medicaid Services (CMS) in a final rule published in the Nov. 27 Federal Register. (This is the official release of the final rule, originally announced on Nov. 1.)
Among other issues, the final rule with comment period also discusses refinements to resource-based practice expense relative value units (RVUs); geographic practice cost indices changes; malpractice RVUs; clinical lab fee schedule issues; payment for renal dialysis services; expiration of the physician scarcity area bonus payment; physician self-referral issues; a durable medical equipment update; a Medicare economic index data change; revisions to the ambulance fee schedule; the ambulance inflation factor for CY08; and amending the e-prescribing exemption for computer-generated facsimile transmissions. CMS has also finalized the CY07 interim RVUs and issued interim RVUs for new and revised procedure codes for CY08.
The agency also announced that the initial estimate for the sustainable growth rate for CY08 is -0.1 percent, and the conversion factor for CY08 is $34.0682. Download the final rule.
In the Nov. 27 Federal Register, CMS published a final rule with comment period revising the Medicare hospital outpatient prospective payment system (OPPS) and making changes to the amounts and factors used to determine the OPPS payment rates in CY08. (This is the official release of the final rule, originally announced on Nov. 1.) The rule also sets forth the applicable relative payment weights and amounts for services furnished in ambulatory surgery centers (ASCs), specific HCPCS codes to which the final policies of the ASC payment system apply, and other pertinent rate-setting information for the CY08 ASC payment system. In addition, the rule will make changes to the policies regarding the necessary provider designations of critical access hospitals and to several of the current conditions of participation requirements.
The agency also changed the provisions in its previously issued FY08 IPPS final rule and has established a new policy, retroactive to Oct. 1, 2007, of not applying the documentation and coding adjustment to the FY08 hospital-specific rates for Medicare-dependent, small rural hospitals and sole community hospitals. One section on which CMS is soliciting comment and is considering “interim final” are the regulations relating to graduate medical education payments made to teaching hospitals that have Medicare affiliation agreements for certain emergency situations. Download the final rule.
The percentage of employees enrolled in a health insurance plan that required a deductible was 48 in 2002--and 64 in 2005, according to a new issue brief from the Agency for Healthcare Research and Quality. And by 2005, small firms’ employees were almost as likely as large firms’ employees to have a deductible: 65.5 percent versus 63.6 percent.
The average amount of the deductible for a single coverage plan in 2005 had risen to $652, from $446 in 2002--a 46 percent increase. In both years, enrollees at small firms had a much larger single deductible than those of large firms, said the report.
The same was true for family coverage for employees of small firms compared with those of large firms: For all firms, the average deductible for family coverage went up from $958 in 2002 to $1,232 in 2005--a 29 percent increase. Read the issue brief.
The Centers for Medicare and Medicaid Services (CMS) last week announced a new web location that will serve as a resource for states, health plans, and providers to use in the design and development of Medicare and Medicaid integrated care delivery systems. The new web site contains an overview page and a road map that provides a summary of (and link to) Medicare and Medicaid documents and tools instrumental to building integrated models of care for dually eligible beneficiaries. It includes recently released CMS guidance on an integrated Medicare and Medicaid appeals process for special needs plans. There is also a mailbox for submitting questions or comments to CMS. The agency will continue to update this site with new materials as they are developed and approved.
Healthcare providers, insurance companies, and drug makers should make information about prices available to the public, according to a new survey of leaders in health care and health policy. The latest Commonwealth Fund/Modern Healthcare Health Care Opinion Leaders Survey finds widespread support for such measures: In addition to the reporting of provider quality and prices, 86 percent of respondents support public reporting of drug prices charged to major purchasers, and 82 percent support the public reporting of medical loss ratios--the share of premium dollars that private insurance companies spend on actual medical care, rather than marketing, administration, and other expense or profit.
Improved transparency can help reduce the ever-increasing spiral of healthcare costs, the respondents said, but only to a small degree. Two-thirds (69%) of opinion leaders see improved transparency as a means of reducing healthcare spending. There is great variability of opinion on how great an impact transparency would have on cost. Seventeen percent believe it will reduce spending by more than 5 percent, while 31 percent think it will reduce spending by 1 percent to 5 percent.
On the other hand, four out of five (81%) opinion leaders think that more widespread public reporting of information could stimulate providers to improve their performance through quality improvement activities. “Transparency is important because it motivates physicians and hospitals to assess and improve their care,” said Commonwealth Fund President Karen Davis. “For those providers that aren’t doing well, public reporting serves as a wake-up call to identify problems and improve performance.” Access the survey report.
CoverKids, Tennessee’s health insurance program for uninsured children, is now serving more than 16,000 children; two weeks ago, the state had announced that the program enrollment had reached more than 15,000 following a fall back-to-school enrollment campaign. During the campaign, CoverKids referred another 10,577 children to TennCare, the state’s Medicaid program, for possible eligibility. CoverKids, Tennessee’s State Children’s Health Insurance Program (SCHIP), provides comprehensive health insurance to uninsured children who do not qualify for TennCare.
“This milestone shows how far we’ve come in a relatively short amount of time,” said Andrea D. Willis, MD, CoverKids director. “In June 2006, the Kaiser Family Foundation ranked Tennessee 51st nationally in SCHIP enrollment because Tennessee had no program. Now, just months after the launch of CoverKids, we’re 36th and climbing quickly as we work to meet Gov. Bredesen’s goal to close the healthcare gap for Tennessee’s uninsured children.”
Although CoverKids launched in March this year, enrollment was slow to build; according to The Tennessean, only 1,250 children were signed up during the first two months.
The Massachusetts Hospital Association announced on Nov. 20 that all Massachusetts hospitals will adopt a uniform policy to not charge patients or insurers for certain serious adverse events as defined by the National Quality Forum (NQF), including wrong-site surgeries and serious medication errors. In doing so, Massachusetts becomes the second state in the nation, after Minnesota, to take this voluntary action.
The policy, to be put into effect in early 2008, is based on nationally accepted definitions and will cover nine rare but serious adverse events and any subsequent care needed to manage those events, including surgery on wrong body part or on wrong patient, wrong surgical procedure, and medication error injury. Read the press release.
As emergency departments face ever-rising demands, hospitals are confronting greater problems obtaining emergency on-call coverage from specialist physicians, according to a study released Nov. 20 by the Center for Studying Health System Change (HSC).
Factors influencing physician reluctance to provide on-call coverage include decreased dependence on hospital admitting privileges as more services shift to nonhospital settings; payment for emergency care, especially for uninsured patients; and medical liability concerns, according to the study. Hospital strategies to secure on-call coverage include enforcing hospital medical staff bylaws that require physicians to take call, contracting with physicians to provide coverage, paying physicians daily or monthly stipends, and employing specialists.
The study’s findings are detailed in a new HSC issue brief, Hospital Emergency On-Call Coverage: Is There a Doctor in the House? The study is based on HSC’s 2007 site visits to 12 nationally representative communities: Boston; Cleveland; Greenville, S.C.; Indianapolis; Lansing, Mich.; Little Rock, Ark.; Miami; northern New Jersey; Orange County, Calif.; Phoenix; Seattle; and Syracuse, N.Y. HSC has been tracking change in these markets since 1996.
The leading Republican and Democratic presidential candidates are proposing two very different approaches to reform the U.S. healthcare system, according to an analysis released today by PricewaterhouseCoopers’ Health Research Institute. Democrats promise broader and more immediate changes to decrease costs, improve quality, and mandate coverage for the uninsured. The Republicans have similar goals but less detailed proposals that mostly rely on tax credits or incentives for individuals to purchase insurance without federal mandates.
According to the report, Beyond the Sound Bite: November 2007 Review of Presidential Candidates’ Proposals for Health Reform, both parties’ plans will expand the federal government’s role in health care, drive growth in the private insurance market, and affect consumer pocketbooks and business bottom lines in significantly different ways.
Among key findings of the report, both parties’ approaches may have far-reaching consequences for the insurance market with a huge boost to the individual market and some of the first cracks at the historically employer-dominated insurance system. Republicans want to grow the individual market through tax incentives and deemphasize the employer sponsored insurance market, while Democrats want to mandate individual and employer insurance. Either approach is likely to expand the existing private insurance market, which has seen minimal growth recently despite the introduction of tax-advantaged health savings accounts. Access the report.
A study released Nov. 19 finds that half of those caring for a loved one 50 years or older are spending on average more than 10 percent of their annual income on caregiving expenses and often sacrifice their own long-term financial and personal wellbeing to do so. The Evercare®/NAC Study of Caregivers: What They Spend, What They Sacrifice finds that family caregivers, who have annual median income of $43,026, spend an average $5,531 a year on caregiving--$400 more than the average American household spends each year on health care and entertainment combined, according to the Bureau of Labor Statistics. Further, the study found that at lower income levels, the annual average costs remained about $5,500--making their financial burden even heavier.
The study also uncovered that one in three respondents (34 percent) had used some of their savings to cover the cost of caregiving, and 23 percent said they had cut back on their own healthcare spending.
The study was undertaken by Evercare, a national healthcare coordination program, in collaboration with the National Alliance for Caregiving (NAC), a national research authority on caregiving. It builds on data uncovered in a 2004 NAC/AARP study, which found that 34 million people care for a loved one 50 years or older. The Evercare/NAC study also uncovered significantly higher costs related to caregiving--in fact, more than twice as much as previously reported. Read the press release.
Key financial challenges for hospitals over the next five years include aligning incentives with physicians, accelerating regulatory requirements, inadequate Medicare payment, and increasing cost of capital, according to HMFA’s recently released Healthcare Finance Outlook: 2008-2013. The report, based on a survey of and interviews with industry experts, forecasts industry trends related to volume, cost, price/payment, and capital, as well as identifying indicators of change and strategies to succeed in the face of those trends.
Other key trends identified include the shift to nonhospital treatment, financial stress on safety net hospitals, increased supply and pharmaceutical spend, state mandates for uninsured coverage, enhanced health plan bargaining power, and threats to not-for-profit status. Among the action steps proposed are:
“It's daunting to anticipate the future,” said Richard L. Clarke, DHA, FHFMA, president and CEO of HFMA. “Yet maintaining future-focused perspective is vital to ensure resources are available to fulfill the critical mission of health care for the long term.” Access the Outlook.
On Nov. 14, the Government Accountability Office (GAO) released a report showing that more than 30,000 Medicaid providers had more than $1 billion in unpaid federal taxes. As a result, the GAO is recommending that the IRS conduct a study to determine whether Medicaid payments can be incorporated into the continuous levy program and evaluate 25 cases for additional collection action and criminal investigation.
The GAO study arose from previous studies into unpaid federal taxes by government contractors. The study selected 25 Medicaid providers with high federal tax debt for more in-depth investigation and found criminal activity. Read the GAO report.
Most Massachusetts businesses believe that they have a responsibility to help provide health benefits to their workers, support “play-or-pay” provisions of the state’s landmark 2006 health care reform legislation, and even believe that the play-or-pay requirements should apply to firms with 10 or fewer workers, which they currently do not. Moreover, small employers in the state are not planning to restrict or end coverage in response to the recent reforms, according to survey results reported Nov. 14 in a Health Affairs web exclusive.
The research was based on a survey of employee benefit managers at 1,056 randomly selected public and private Massachusetts firms. The survey was conducted from February through June 2007, before any of the Massachusetts legislative provisions affecting employers went into effect, and is intended to serve as a baseline against which future research can measure the impact of the reforms. In addition to questions about businesses’ attitudes toward and knowledge of the reforms, the survey included questions about the benefits offered by Massachusetts employers and the premiums faced by these firms. A follow-up survey will be conducted in 2008.
The survey found broad support among Massachusetts businesses both for the concept of employer responsibility for health benefits and for the specific provisions of the Massachusetts reforms. Seventy-seven percent of employers in the state either “strongly” (34 percent) or “somewhat” (43 percent) agreed with the statement that “all employers bear some responsibility for providing health benefits to their workers.” However, the survey found one worrisome sign for reform efforts: At the time the survey was done, small firms had a surprisingly low level of knowledge about the 2006 legislation. Among firms with three to 10 workers, only 14 percent of respondents said that they understood the reform plan “very well,” and 35 percent understood it “somewhat well.” Overall, though, the NORC researchers say that their survey results paint an encouraging picture of the initial stages of reform in Massachusetts: “Early results are encouraging, with no serious signs of crowd-out and employers seemingly comfortable with the objectives and spirit of reform. Stay tuned for forthcoming results.”
Ensuring that everyone in the United States has health insurance is essential, but it is not enough to drive the kind of reform the health system needs, according to a new report released Nov. 15 by the Commonwealth Fund Commission on a High Performance Health System.
Guaranteeing affordable health insurance for all, changing the way physicians and other healthcare providers are paid, better organizing and coordinating care delivery, investing in implementing an electronic information system in a reasonable period of time (aiming for five years), and establishing national goals and doing what it takes to reach them through strong national leadership should all be on the next president’s healthcare agenda, says the report.
“This report outlines how essential it is that we pursue improvements in health care quality and efficiency at the same time as we pursue universal coverage,” said James Mongan, MD, commission chair and CEO of Partners Health System. “We cannot and should not hold either of these facets of reform hostage while we wait for the other to happen”
In the report, A High Performance Health System for the United States: An Ambitious Agenda for the Next President, the commissioners call for bold changes to the health care system in the next five years, including affordable coverage for all, aligned incentives and effective cost control, accountable coordinated care, a higher aim for quality and efficiency, and accountable leadership.
On Nov. 13, HHS Secretary Mike Leavitt announced that the department, through the Centers for Medicare and Medicaid Services (CMS), is proposing rules to adopt new standards to advance the use of electronic prescribing (e-prescribing) for formulary and benefit as well as medication history transactions used under the Medicare prescription drug benefit. The proposed standards will be published in the Nov. 16 Federal Register.
The Medicare Modernization Act of 2003 requires CMS to adopt final standards for e-prescribing. All providers and pharmacies transmitting prescriptions electronically for Medicare-covered drugs are required to comply with any CMS standards in effect. The standards cover:
Download the proposed standards.
Federal Communications Commission (FCC) Chairman Kevin J. Martin on Nov. 14 announced a comprehensive proposal to fund a $400 million rural healthcare pilot program (RHCPP) that would expand access to health care to America’s rural and underserved communities through the creation of broadband telehealth networks in 42 states and three U.S. territories.
The healthcare facilities qualified to participate in the pilot program would utilize funding to leverage existing telehealth networks or build out new, comprehensive systems for telehealth projects. RHCPP participants would be eligible for universal service funding to support up to 85 percent of the costs associated with the design, engineering, and construction of innovative and highly efficient broadband systems.
In addition, healthcare providers participating in the pilot program would be strongly encouraged to coordinate in the use of their telehealth networks with HHS and, in particular, the U.S. Centers for Disease Control and Prevention in instances of national, regional, or local public health emergencies such as bioterrorism events, pandemics, or disease-related outbreaks. In such public health emergencies, selected participants would provide access to their supported networks to public health officials so that they could share critical, time-sensitive information and risk management guidance as part of a comprehensive response effort.
American hospitals are making measurable strides in the quality of care provided for patients with heart attacks, heart failure, pneumonia, and surgical conditions, according to the Joint Commission’s second annual report on healthcare quality and patient safety in the nation’s hospitals. The detailed report portrays the aggregate performance of accredited hospitals against the Joint Commission’s standardized national performance measures and its National Patient Safety Goals.
Improving America’s Hospitals: The Joint Commission’s Annual Report on Quality and Safety 2007 also shows, however, that whether or not patients receive proven treatments for these common reasons for hospitalization often depends on where they live. For example, statewide performance of hospitals on the measure of providing discharge instructions to patients with heart failure ranges from 49 percent to 91 percent.
Among the specific findings, hospitals demonstrated 90 percent or higher compliance with 10 of 16 National Patient Safety Goal requirements that address issues such as medication safety, caregiver communication, and preventing patient falls. However, noncompliance rates for six of those 16 requirements range between 16 percent and 37 percent. Also, significant variability exists in the performance of hospitals by state, as well as between the highest- and lowest-performing hospitals. For example, on the measure of providing pneumococcal vaccination, performance ranged from 55.5 percent to 91 percent. On specific measures of surgical care, the difference between the highest state rate and the lowest state rate ranged as high as 80 percent.
A nuclear attack on a major U.S. metropolitan city would be compounded by the loss of hospitals, physicians, nurses, and medical equipment--so what can a city do to prepare for this nightmare scenario? A new report in the American Medical Association’s (AMA) journal Disaster Medicine and Public Health Preparedness outlines steps a city can take to better prepare for a nuclear attack that would devastate its healthcare system, leaving tens of thousands of burn victims in need of urgent care.
The study, “Prediction Modeling to Determine the Adequacy of Medical Response to Urban Nuclear Attack,” analyzes the effects that a 20- and 550-kiloton nuclear detonation would have on the cities of Los Angeles and Houston. According to the report, a 550-kiloton attack in downtown Los Angeles would result in 786,000 burn victims, with about 185,000 likely to survive. In Houston, a similar attack would produce 257,579 burn casualties, with only about 59,000 likely to survive.
The study outlines necessary improvements for cities to consider to better prepare for an urban nuclear attack, including an expansion of medical personnel (including nonphysicians) who are trained in burn care, and the creation of regional mobilization systems, such as air transport, to move medical resources and personnel in the event of a nuclear attack.
H.R. 4105, introduced Nov. 7, would place a one-year hold on the Centers for Medicare and Medicaid Services’ (CMS) Medicare recovery audit contractor (RAC) program, which is currently operating in California, Florida, Massachusetts, New York, and South Carolina. Sponsored by Reps. Lois Capps, D-Calif., and Devin Nunes, R-Calif., the bill also directs CMS to provide Congress with a detailed program status report. Some members of Congress are concerned that the RAC program is too burdensome and unfairly penalizes health providers and their patients.
In September, California healthcare providers had informed members of the California congressional delegation that CMS was issuing a “pause” in the RAC process for inpatient rehabilitation claims. According to a statement issued by Capps, CMS did not directly inform Congress of that change in policy and ignored repeated requests for the details of the new policy in writing.
The Centers for Medicare and Medicaid Services (CMS) will be offering a new e-mail update service that delivers Medicare information to fee-for-service (FFS) providers, suppliers, and their staffs’ in-boxes. Visitors to the CMS web site will be able to sign up to receive the specific Medicare FFS provider payment messages of their choice, FFS related-topic messages for which they want to receive information, or both.
The service is free, and users do not have to take any action; CMS will migrate users’ e-mail addresses automatically to the new e-mail service. Users who prefer to subscribe to the new e-mail update service on their own may unsubscribe from their current e-mail lists at this site before Monday, Nov. 26, 2007.
The messages that are currently sent from CMSProviderResource@cms.hhs.gov will come from cmslists@subscriptions.cms.hhs.gov. To ensure receiving subscription e-mails and announcements, please add that e-mail address to contact lists, and adjust spam settings.
A new study presented as part of a Cornell University symposium finds that “pay or play” laws, which require employers to provide health insurance to their employees or pay a fine, will reduce employment for the least skilled members of the work force.
Healthcare Reform: The Economics of Employer ‘Pay or Play’ Mandates, sponsored by the Employment Policies Institute and authored by Cornell University economists Richard Burkhauser and Kosali Simon, uses federal Current Population Survey data to calculate that for every 100 newly insured employees resulting from a pay-or-play law, 10 low-wage employees will lose their jobs.
Pay-or-play laws are increasingly being proposed as a solution to America’s healthcare crisis. At least a dozen state legislatures, including California, Illinois, Maine, and Minnesota, have seriously considered instituting a pay-or-play mandate. And all three Democratic presidential frontrunners--Hillary Clinton, Barack Obama, and John Edwards--include a version of pay-or-play in their healthcare reform platforms. Download the report.
The Healthcare Administrative Simplification Coalition (HASC) announced on Nov. 8 that it has launched a web site to broaden awareness of the problem of administrative complexity in health care and draw attention and support to simplification efforts nationwide. The coalition is a public/private partnership that includes payers, government agencies, providers, employers, and others.
“The coalition developed this site as a home base and source of support for the range of efforts under way nationwide making headway in reducing administrative complexity,” said William F. Jessee, MD, president and CEO of the Medical Group Management Association, HASC founding member. “One of our primary goals as a coalition is to educate various constituencies on the cost of administrative complexity, demonstrating that streamlining our current system is not only possible, but benefits everyone, especially patients.”
In addition to raising awareness and supporting simplification efforts, HASC aims to reduce redundancy in the credentialing of physicians and other healthcare professionals, and standardize processes for the healthcare industry to request and report patient health insurance eligibility verification and benefits coverage.
The Centers for Medicare and Medicaid Services (CMS) has added to its web site information on reporting and coding hospital-acquired conditions. As of Oct. 1, 2007, all inpatient prospective payment system (IPPS) hospitals have been required to submit present-on-admission (POA) indicator information for all primary and secondary diagnoses. CMS will be using a phased implementation for the POA indicator.
On Jan. 1, 2008, CMS will begin processing POA indicator data and will provide feedback to IPPS hospitals on reporting errors. From Jan. 1 to March 31, 2008, hospitals will be educated on reporting errors and will not be subject to returned claims.
As of April 1, 2008, claims that are submitted for payment that do not contain proper reporting of the POA indicator will be returned. Read the reporting requirements.
The Metropolitan Chicago Healthcare Council (MCHC) and the Illinois Hospital Association (IHA) on Nov. 6 challenged the Cook County Assessor’s report, Exempt Hospitals: Valuation Estimates and Appraisal Methodology, as a flawed attempt to estimate the property value of 54 tax-exempt hospitals in Cook County, Ill. The associations, which represent more than 200 hospitals and health systems in the Chicago area and across the state, are calling on policymakers, the news media, and the public to dismiss the report, which the groups say is based on incorrect assumptions and incomplete data.
The report purports to estimate the property value of the 54 tax-exempt hospitals in Cook County as well as the aggregate tax liability of these properties if they were on the tax rolls. However, the report is based on methods that the assessor’s office has labeled as “subjective” and had previously disregarded. Furthermore, the report makes no adjustments for the normal and customary appeals process, which can decrease these numbers by as much as 40 percent.
“Non-profit, tax-exempt hospitals in Cook County provide more than $2.3 billion dollars annually in free care, research, education, and other charitable community benefits; more than three times the budget of the County Bureau of Health and 10 times the assessor’s estimated tax liability," said Scott Ziomek, MCHC director of government relations. “The non-profit, mission-driven hospitals have shouldered the burden of last year’s $100 million cut in services to the county’s health system.” Read the press release.
Community Catalyst, a national consumer health advocacy organization, has launched a web-based software program that allows users to “build” their own state legislation aimed at setting standards for patient financial assistance and free care laws. The introduction of the Patient Financial Assistance Act tool comes on the heels of a roundtable discussion sponsored by the Senate Finance Committee on the issue of not-for-profit hospital community benefits.
The tool was developed to address the fact that hospital standards for providing free or reduced care are vague, in particular for not-for-profit hospitals who seek tax-exempt status as charities. It is intended to help advocates understand the various components of financial assistance laws and provides important model language for strong state legislation.
The “build-a-bill” web tool allows users to select standards for various key components: from reporting and eligibility standards to publicity and billing and collections practices. Users can select among three different model acts, or they can customize their own legislation based on their own state circumstances. Access the tool.
The Certification Commission for Healthcare Information Technology announced Nov. 6 that six electronic health record (EHR) products designed for use in acute care hospitals, representing an estimated 25 percent of the inpatient vendor marketplace, applied for and achieved CCHIT-certified status after undergoing inspections that demonstrated their compliance with 100 percent of the commission’s published criteria.
In addition to meeting underlying criteria such as security, the certified products were examined for computerized physician order entry and medication administration capabilities, including related clinical decision support. The commission focused certification testing on these areas first because they have the lowest rate of adoption in hospitals but have been shown to offer the highest value for improvement of care.
The commission also announced that nine EHR products for office-based physicians have been certified under the 2007 criteria, bringing the total number of product certifications to 98--or an estimated 40 percent of the ambulatory vendor marketplace--since the program began in 2006. Read the press release.
The changing age-mix of the U.S. population has had only a modest effect on the growth of healthcare spending, and that trend is expected to continue even as the nation ages dramatically over the next four decades, experts at the federal government’s Centers for Medicare and Medicaid Services reported Nov. 6 in a Health Affairs web exclusive. Consistent with other studies, the authors found that per capita health spending grew faster for those under age 65 than for those age 65 and older, although the difference--0.2 percent annually between 1987 and 1999--was much less than previously reported.
Among the elderly, the largest decline in spending relative to the nonelderly occurred among those age 85 and older. Because the oldest elderly are a relatively small subgroup of the elderly, the slower spending growth for this group has not had a large effect on overall trends in per capita spending for seniors. That could change in the future, though, when those over age 85 make up a greater share of the nation’s population.
The more significant impact on Medicare spending is anticipated to come from Medicare enrollment--1.6 percent average annual growth between 2004 and 2050--rather than through a change in the age-mix of the Medicare population, according to the researchers. Read the abstract.
The overall health of the nation declined over the past year, despite progress made in several key health indicators, according to a report issued Nov. 5 by United Health Foundation, the American Public Health Association, and Partnership for Prevention. The 18th annual edition of America’s Health Rankings: A Call to Action for People & Their Communities indicates that the overall health of the nation declined by a rate of 0.3 percent since last year.
Although the report shows there have been modest gains in reducing the rates of cancer and cardiovascular mortality, these improvements continue to be dwarfed by increasing obesity, increasing numbers of uninsured people, children in poverty, and the persistence of risky health behaviors. This lack of progress is in sharp contrast to the nation’s average annual improvement of 1.5 percent between 1990 and 2000. In fact, since 2000, there has been a virtual stagnation in health improvement.
The report also ranks the healthiness of each state. Vermont surpassed Minnesota as the healthiest state in the nation this year, with Minnesota (2), Hawaii (3), New Hampshire (4), and Connecticut (5) rounding out the top five. Mississippi ranks as the least healthy state, with Louisiana (49), Arkansas (48), Oklahoma (47), and Tennessee (46) completing the bottom five.
Left unchecked, most trends in how physicians organize and practice medicine are likely to lead to higher spending and declining access to care for lower-income people, according to an article by Center for Studying Health System Change (HSC) researchers in the November/December Health Affairs.
“Physicians are moving into larger practices and loosening affiliations with general hospitals; providing more ancillary services; and investing in enterprises that compete with hospitals for outpatient, or even inpatient, services,” write Hoangmai H. Pham, MD, a senior HSC researcher, and Paul Ginsburg, PhD, president of HSC.
The authors also point to the steady decline in the proportion of physicians willing to care for uninsured and Medicaid patients, writing that, “More disturbingly, current trends in the delivery of physician services may contribute to an increasingly tiered delivery system. Physician-owned facilities are less likely than general hospitals to serve Medicaid beneficiaries or the uninsured. The increasing prevalence of physicians opting to drop contracts with insurers to receive higher out-of-network payments from patients will contribute further to disparities in access to providers.” Read the abstract.
Medical group practices that participate in Medicare’s quality reporting program incur additional administrative work and costs, according to new research by the Medical Group Management Association (MGMA). The association collected responses from 190 members, representing more than 3,079 practicing physicians.
Of practices responding to an MGMA questionnaire, 11 percent participated in the Physician Voluntary Reporting Program (PVRP), now called the Physician Quality Reporting Initiative (PQRI), and 44 percent are reporting measures for the PQRI. Approximately 35 percent of the respondents indicated that they had to create an addendum to their “superbill” paperwork to capture information to report the quality codes; approximately 22 percent required additional staff support; and 17 percent had to increase staff salaries.
However, only 13 percent of participants in the research rated the PQRI’s helpfulness to patients as good or excellent; 16 percent rated improvement of care outcomes as good or excellent. Additionally, respondents indicated low satisfaction with the information they receive about the PQRI. Read the press release.
By a vote of 64-30, the Senate on Nov. 1 passed a revised version of H.R.3963, the Support for Injured Servicemembers Act, which included provisions to extend and expand the State Children’s Health Insurance Program. Similar to the bill vetoed by President Bush earlier this month, the legislation would expand SCHIP to cover 10 million children and increase spending on the program to $35 billion over five years. According to the Congressional Quarterly, Republicans oppose the bill partly because it would limit coverage to children in families with annual incomes below 300 percent of the federal poverty level; the GOP wants the program to cover only families at or below 200 percent of that level before covering families with higher incomes.
No Democrats opposed the measure, and 17 Republicans voted in favor of it. Presidential candidates Hillary Clinton, D-N.Y.; Chris Dodd, D-Conn.; John McCain, R-Ariz.; and Barack Obama, D-Ill., did not vote.
A growing share of Medicare beneficiaries’ income was spent on health care, with median out-of-pocket health spending up from 11.9 percent of income in 1997 to 15.5 percent in 2003, according to a new study published in the November-December 2007 issue of Health Affairs. The study found that about four in 10 beneficiaries spent at least one-fifth of their income on health care in 2003. The top 10 percent of beneficiaries spent more than half of their income on health care.
Using data from the Medicare Current Beneficiary Survey, the study found that growth in out-of-pocket health spending outpaced growth in income over time. Between 1997 and 2003, median out-of-pocket health spending increased by $1,116--a 50 percent increase, while median individual income rose by just 15 percent. Premiums for Medicare and supplemental insurance were the largest component of the increase, followed by payments for medical care providers and services.
Spending on prescription drugs accounted for a relatively small share of total out-of-pocket health spending in 2003 (13.7 percent), but accounted for 18.1 percent of the out-of-pocket spending increase between 1997 and 2003. The authors note that it is too early to determine the effect of the Medicare Part D drug benefit on the overall financial burden of healthcare spending by Medicare beneficiaries. Read the abstract.
At a time when the United States spends more than double what other countries spend for medical care--$6,697 per capita in 2005--a new Commonwealth Fund seven-nation survey published Nov. 1 as a Health Affairs web exclusive finds that U.S. patients are more likely to report experiencing medical errors, to go without care because of costs, and to say that the healthcare system needs to be rebuilt completely.
In the survey of 12,000 adults in Australia, Canada, Germany, the Netherlands, New Zealand, the United Kingdom, and the United States, one-third of U.S. adults called for rebuilding the system--the highest rate in any country surveyed. Adults in all seven countries said that they place high value on having a relationship with a regular source of primary health care that is accessible and coordinates their care. Read the abstract.
On Nov. 1, the Centers for Medicare and Medicaid Services (CMS) continued its initiative to link payment with quality in a final rule with comment period updating the hospital Outpatient Prospective Payment System (OPPS), effective for services furnished during CY08. The rule also updates the payment rates for the revised ambulatory surgical center (ASC) payment system beginning in CY08.
After taking into account the market basket update and other factors that affect the level of payments, CMS estimates hospitals will receive an overall average increase of 3.8 percent in Medicare payments for outpatient services in CY08. The CMS Office of the Actuary projects that payments (including beneficiary coinsurance) under the OPPS will increase by about 10 percent to approximately $36 billion in CY 2008 from $32.7 billion in CY 2007, due in part to increased use of hospital outpatient services.
Hospitals that are paid under the Inpatient Prospective Payment System are required to report the applicable hospital outpatient quality measures in order to receive the full OPPS market basket update in CY 2009; otherwise, their CY 2009 update will be reduced by 2.0 percentage points.
In addition, the final rule provides larger payment bundles for certain OPPS services, which is intended to provide hospitals with greater flexibility in managing their resources.
The final rule will be published in the Federal Register on Nov. 27, 2007. View the final rule. Read the CMS press release.
Under a final physician payment rule issued yesterday, the Centers for Medicare and Medicaid Services (CMS) estimates that it will pay approximately $58.9 billion to about 900,000 physicians and other healthcare professionals. The revised payments, quality incentive rates, and related policy changes, which will become effective Jan. 1, 2008, are included in the Medicare physician fee schedule final rule. The rule will be published in the Nov. 27 Federal Register.
Since July 1, 2007, under the Physician Quality Reporting Initiative (PQRI), eligible professionals who report specific measures on quality of care furnished to Medicare beneficiaries may earn incentives up to 1.5 percent of their total allowed charges, subject to a cap.
The Medicare law includes a statutory formula requiring CMS to implement a negative 10.1 percent update in payment rates for physician-related services. This formula compares the actual rate of growth in spending to a target rate, which is based on such factors as the growth in the number of Medicare fee-for-service beneficiaries and statutory or regulatory changes in benefits. According to a press release, “CMS has no choice but to implement this negative update because it is mandated by a statutory formula.”
Download the final rule. Read the CMS press release.
A new study examining the effect of the Medicare prescription drug benefit on the elderly shows that it led to the consumption of an additional 158 million prescriptions in 2006 at a cost of $32 billion to Medicare. Many seniors already had prescription drug coverage, so the new benefit reduced the average amount paid by seniors per day of therapy by 18.4 percent, and increased the elderly’s prescription drug use by only 13 percent, say researchers in a study published Nov. 1 in the 25th anniversary issue of Health Affairs.
Researchers found that Medicare patients paid about 66 cents per day of medication therapy in September 2004. By December 2006--after implementation of Medicare Part D--Medicare patients paid about 53 cents per day of therapy. However, with the subsequent increase in utilization that came after Part D, the study showed that the program reduced the total amount paid by patients by only 5.6 percent. The program increased the amount that private insurers paid by 22.3 percent.
“Our findings do not necessarily mean that the Medicare Part D program is economically inefficient, because there are potential long-term health care savings when people can afford to take necessary medications,” said study coauthor Frank Lichtenberg, a business professor at Columbia University. “However, we need to think carefully about the economic implications of this program, which the federal government will ultimately have to raise taxes to pay for.” Read the abstract.
On Oct. 30, HFMA participated in a roundtable convened by the Republican staff of the Senate Finance Committee. The roundtable included representatives from health care, academia, and patient advocacy groups brought together to discuss the issues addressed in a draft paper prepared by the staff of Sen. Charles Grassley, R-Iowa. HFMA Board member Ralph Lawson, executive vice president and CFO, Baptist Health South Florida, addressed the issues of the difference between charity care and the broader concept of community benefit, problems with setting a fixed threshold for charity care, and the proper way to quantify charity care based on cost.
In addressing the group, Grassley said he is stilling deciding whether legislation is necessary. During the roundtable, examples of how the industry was moving toward better billing and disclosure practices included references to HFMA’s PATIENT FRIENDLY BILLING® project and HFMA’s Principles and Practices Board Statement 15. The committee’s scrutiny of legislative reforms is in addition to the IRS proposed revisions to Form 990 for tax-exempt organizations, including the new Schedule H, which tax-exempt hospitals must use to disclose their community benefit efforts. View HFMA’s comment letter to the IRS on the draft redesigned Form 990.
On Oct. 30, Department of Health and Human Services Secretary Mike Leavitt announced a five-year demonstration project intended to encourage small to medium-sized physician practices to adopt electronic health records (EHRs).
Conducted by the Centers for Medicare and Medicaid Services (CMS), the demonstration would be open to participation by up to 1,200 physician practices beginning in spring 2008. Over a five-year period, the program will provide financial incentives to physician groups using certified EHRs to meet certain clinical quality measures. A bonus will be provided each year based on a physician group’s score on a standardized survey that assesses the specific EHR functions a group employs to support the delivery of care.
During the five-year project, it is estimated that 3.6 million consumers will be directly affected as their primary care physicians adopt certified EHRs in their practices. To amplify the effect of this demonstration project, CMS is encouraging private insurers to offer similar incentives for EHR adoption. Read the press release.
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