IN THIS WEEK’S ISSUE:
- Add-on Cut to Flatten SNF PPS Payment Increase
- CMS Will Address Concerns About Specialty Hospitals
- Kentucky Hospitals Make Prices Public
- PCAOB: Auditors Should Focus on Big Picture
- AHRQ Asks Hospitals to Test Revised HCAHPS Survey
- Report Pessimistic about Adoption of Charity Care Principles
- Leadership Panel: Healthcare IT Is an Essential Priority
- Medicare Coding and Billing Update
- Quick Links
- New on the HFMA Web Site
1. ADD-ON CUT TO FLATTEN SNF PPS PAYMENT INCREASE
Skilled nursing facilities (SNFs) would get a 3.0 percent increase in their FY06 Medicare payments under a proposed rule published in yesterday’s Federal Register, but with the elimination of the temporary add-on amounts there will be virtually no change in overall payments in FY06. As part of the update, CMS proposes to refine the resource utilization groups by introducing nine new payment categories. These refinements, CMS notes, will result in more accurate payments to nursing homes for the care of medically complex patients by creating categories that more closely match the kind of services being provided.
The proposed rule also includes discussion of SNF consolidated billing requirements, the three-day prior hospitalization requirements for SNF eligibility, concurrent therapy, and the payment adjustment for SNF residents with AIDS. Comments on the proposed rule are due July 12.
2.CMS WILL ADDRESS CONCERNS ABOUT SPECIALTY HOSPITALS
At a House Energy and Commerce health subcommittee hearing May 12, CMS administrator Mark McClellan downplayed the need to extend the moratorium on specialty hospitals, claiming that CMS has an approach to address community hospitals’ concerns about a level playing field. The Medicare Modernization Act put specialty hospital development on hold until June 8. Also testifying was Glenn Hackbarth, chairman of the Medicare Payment Advisory Commission, representatives of a specialty hospital, and representatives of a community hospital that has joint ventured a specialty hospital with physicians.
The day before the hearing, Senate Finance Committee chairman Charles Grassley (R-IA) and ranking minority member Max Baucus (D-MT) proposed legislation to “rein in the growth of physician-owned specialty hospitals.” The bill, known as the “Hospital Fair Competition Act of 2005,” would become effective on the date the specialty hospital moratorium expires.
3. KENTUCKY HOSPITALS MAKE PRICES PUBLIC
The Kentucky Hospital Association this week launched a consumer web site that lists median acute care hospital charges for the top 25 DRGs in the state. The site also lists the median lengths of stay, median patient ages, and number of discharges for the top 25 DRGs, which represent about half of hospital discharges in the state. Consumers can search for the information by hospital, and by DRG and severity level. KHA plans to update the site annually.
4. PCAOB: AUDITORS SHOULD FOCUS ON BIG PICTURE
On May 16, the Public Company Accounting Oversight Board (PCAOB) issued a board policy statement and a series of staff questions and answers regarding implementation of Auditing Standard (AS) No. 2. The guidance encourages auditors to exercise more judgment when auditing a corporation's internal controls in order to conduct effective and cost-effective internal control audits. The guidance addresses comments from issuers, auditors, and investors about the benefits and burdens of implementing Sarbanes-Oxley Act Section 404.
The guidance focuses on primary issues that drive the cost of Section 404 compliance: the scope of the internal control audit and how much testing of a company's internal control over financial reporting is required. In particular, PCAOB seeks to correct the false impression that certain provisions of AS No. 2 need to be rigidly applied and that auditors are discouraged from exercising judgment to conduct efficient internal control audits.
5. HOSPITALS ASKED TO TEST REVISED HCAHPS SURVEY
Hospitals, vendors, and other interested parties are invited to test a revised draft of the hospital consumer assessment of health plans (HCAHPS) survey instrument, according to a notice published by the Agency for Healthcare Research and Quality (AHRQ). Once finalized, the 27-item survey would be the standard instrument for gathering information on patients’ perspectives on their hospital care. AHRQ notes that this project provides an opportunity to test items added to the instrument, evaluate the impact of its integration into the instruments currently being used, and test and evaluate the data collection methods before national implementation. Requests to test the revised draft must be submitted by June 8.
6. REPORT PESSIMISTIC ABOUT ADOPTION OF CHARITY CARE PRINCIPLES
Even though a large number of hospitals have committed to the American Hospital Association's voluntary charity care principles, "one cannot reliably conclude that they have actually changed their billing, collections, and charity care policies and practices," asserts a new report from Boston-based community action group the Access Project.
The group asked 61 randomly selected hospitals if they had signed the AHA's Confirmation of Commitment and, if so, how they were implementing it. Because only a quarter of the hospitals responded, the study's authors declined to make definitive statements about implementation of the principles, but declared that "the unwillingness of so many hospitals to participate itself raises concerns about whether they are conforming to the AHA's call for hospitals to be more transparent in sharing their financial assistance policies."
7. LEADERSHIP PANEL: HEALTHCARE IT IS AN ESSENTIAL PRIORITY
HHS secretary Mike Leavitt released a new report citing investment in information technology as an essential priority for the American healthcare system and economy. The report, presented at the Business Roundtable’s Chief Executive Officer Health Care Summit May 11 in Washington, was a part of Leavitt’s and Treasury secretary John Snow’s discussion about the burden of rising healthcare costs on the U.S. economy and the role of health IT in managing these costs.
The report was developed by the Health Information Technology Leadership Panel, which consisted of corporate executives in large companies (including the CEOs of Wal-Mart, FedEx, and General Motors), that purchase a substantial amount of health care for their employees.
8. MEDICARE CODING AND BILLING UPDATE
New transmittals recently posted to the CMS web site include:
- Instructions for a new patient status code to define discharges or transfers to a critical access hospital, and
- A list of the latest tests FDA-approved waived tests under CLIA.
- HFMA staff review CMS notices regularly for transmittals that affect healthcare financial managers, and post links to those transmittals on HFMA's web site.
- For links to these and other key transmittals, bookmark HFMA's Internet Guide to Medicare Coding and Billing.
9. QUICK LINKS
COST-CUTTING MEASURES SURVEY. Rewarding more efficient and high-quality providers (commonly referred to as pay-for-performance plans) ranked first among effective ways to cut healthcare costs, according to a Commonwealth Fund survey.
UPDATED OIG EXCLUSIONS AND REINSTATEMENTS. The OIG has posted the full updated list of excluded individuals and entities (LEIE) database file reflecting all OIG exclusion and reinstatement actions through April 2005.
FUNDING FOR UNDOCUMENTED ALIEN CARE. The guidance on how to get funding for emergency care to undocumented and other aliens (see HFMA Express News, May 13) was published in the May 13 Federal Register as “Emergency Clearance: Public Information Collection Requirements Submitted to the Office of Management and Budget (OMB).”
CMS DRUG BENEFIT EDUCATION RESOURCES. CMS has added tools to its Web site that will help providers educate staff and patients on the Medicare prescription drug benefit.
REVISED EMERGENCY DRILL STANDARDS. JCAHO has proposed revisions to standards requiring organizations to more thoroughly evaluate planned emergency management drills. The deadline for feedback is Friday, June 17, 2005.
10. NEW IN THE RESOURCE CENTER
IMPROVING CLINICAL, OPERATIONAL, AND FINANCIAL PERFORMANCE IN ORTHOPEDIC SURGERY. This new educational report focuses on two key performance improvement opportunities in orthopedic surgery: the prevention of deep vein thrombosis and standardized and improved resource utilization.
INTERNET GUIDE TO FRAUD AND ABUSE. Use this handy guide to find links to fraud and abuse reports, government resources, and related organizations.
Copyright 2005 Healthcare Financial Management Association, all rights reserved. HFMA Express News ISSN: 1540-0689. Volume XII, Number 20. Editor: Rob Fromberg rfromberg@hfma.org, (800) 252-HFMA, ext. 385.
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