Hospitals also were pleased that the bill will add a short-term socioeconomic-status modifier to the Medicare program that penalizes hospitals with larger numbers of readmissions.

Nov. 30—The U.S. House of Representatives passed omnibus healthcare legislation Wednesday that would preserve payment rates for more off-campus hospital outpatient departments, among other provisions sought by hospitals.

The 21st Century Cures Act, which the House passed on a bipartisan vote of 392 to 26, included a provision that would expand the number of hospital outpatient departments (HOPDs) that could continue to receive standard Medicare HOPD payment rates, instead of the lower rate required for new off-campus HOPDs. The bill would achieve that by extending a date that grandfathered payments for off-campus HOPDs under the 2015 Bipartisan Budget Act from Nov. 2, 2015, to Dec. 31, 2016, or 60 days after the new measure’s enactment, whichever is later.

Darrell Kirch, MD, president and CEO of the Association of American Medical Colleges (AAMC), said in a written statement that he was “gratified to see that off-campus teaching hospital outpatient departments  already under development will continue to receive Medicare outpatient payment rates rather than the payment cuts imposed on new outpatient departments.”

Other highly sought provisions of the bill included an adjustment to the Hospital Readmissions Reduction Program (HRRP) to account for socioeconomic status. Specifically, the bill would require creation of a transitional risk adjustment methodology to serve as a proxy of socioeconomic status for the HRRP, followed by permanent implementation of a more refined methodology after completion of an analysis required by an earlier law, the Improving Medicare Post-Acute Care Transformation Act of 2014.

Hospital advocates had urged the change to address concerns that many readmissions are caused by poverty-related factors beyond the hospitals’ control, especially in the cases of hospitals that serve large shares of low-income patients. Among research bolstering that point was an October study in Health Affairs that found “most readmissions after the seventh day post-discharge were explained by community- and household-level factors beyond hospitals’ control.”

“Adjusting the HRRP for the challenges vulnerable patients face puts essential hospitals on a level playing field when evaluating readmission rates,” Bruce Siegel, MD, president and CEO of America's Essential Hospitals, said in a written statement. “It also can break a vicious circle in which penalties further deplete the already scarce resources essential hospitals have to reduce readmissions. In such cases, the HRRP worsens, rather than fixes, the problem.”

The Centers for Medicare & Medicaid Services (CMS) had resisted such an adjustment over concerns that it would allow hospitals to deliver low-quality care to low-income patients without penalty.

Blair Childs, a senior vice president for Premier, a hospital quality improvement company, hailed provisions of the bill “that will enhance the [Food and Drug Administration] approval process to advance the entry of new drugs and devices to the market with a goal of creating more competition and lower prices.”

Other hospital-sought provisions included:
  • Extending the Rural Community Hospital Demonstration program for five years
  • Barring enforcement of a payment policy for long-term care hospitals, the 25 percent threshold rule, until Oct. 1, 2017
  • Prohibiting the U.S. Department of Health and Human Services from enforcing “direct supervision” regulations in CY16 for outpatient therapeutic services provided in critical access hospitals and certain small, rural hospitals
  • Funding state efforts to address the opioid abuse crisis
  • Improving mental health and substance abuse disorder services

IT Provisions

The legislation also aims to spur the interoperability of electronic health records (EHRs) through several measures, including use of a voluntary model framework and common agreement for the secure exchange of health information.

 The bill also would create a reporting system to gather information about EHR usability, interoperability, and security. The bill’s authors hope such data would inform providers during the process of choosing EHR products.

Those changes “would significantly improve the ability of hospitals and other providers to exchange accurate patient data and advance personalized care,” Russell Branzell, president and CEO of The College of Healthcare Information Management Executives (CHIME), said in a written statement.

CHIME also applauded the inclusion of provisions aimed at accurately identifying patients and matching them to their health records.

“The absence of national solutions for patient identification and patient matching not only poses serious risks to patient safety, but also leads to resources being wasted on cleaning up duplicative medical records, as well as creating other inefficiencies,” Branzell said.

Insurance Provisions

Among the ways in which the 996-page bill affects insurers is by prohibiting CMS from ejecting the Medicare Advantage (MA) plans with the worst quality ratings until the end of 2018.

That provision drew concerns from some insurer advocates, who worry that it effectively negates the advantage anticipated by insurers that have undertaken costly quality improvement initiatives.

However, the delay would not prevent CMS from terminating plans based on their performance in 10 other categories considered in performance reviews, according to a summary.

The Senate is expected to take up the bill with no amendments early next week, according to media reports. And the White House issued a statement that President Barack Obama plans to sign the measure, which includes many priorities he supports, such as funding for his “signature biomedical research initiatives.”

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare


Publication Date: Thursday, December 01, 2016