News Briefs: The expiration of the COVID-19 PHE brings an end to key provisions

As published in the Summer issue of hfm magazine, a monthly roundup of top news for healthcare finance professionals.

May 30, 2023 5:22 pm

The termination of the COVID-19 public health emergency (PHE) on May 11 meant providers lost many of the accommodations and regulatory flexibilities that were in place since Jan. 31, 2020.

For example, Medicare’s 20% add-on payment for treating COVID-19 cases in the inpatient setting no longer is available.

With reported cases and hospitalizations steadily trending downward, that may not constitute a significant revenue loss. But the margin per case will be affected, especially given the reported costs of treating COVID-19 patients in the inpatient setting.

On the operations side, Medicare has reverted to requiring a three-day hospital inpatient stay before covering skilled nursing facility care. The change could exacerbate the difficulty hospitals have been experiencing with patient throughput.

Administratively, hospital data reporting to the CDC on COVID-19 cases is required weekly rather than daily since the PHE ended. Reporting will continue through April 30, 2024, unless the U.S. Department of Health and Human Services amends the closing date.

Kaiser Permanente agrees to acquire Geisinger in a deal with major industry ramifications

In a move with implications for not-for-profit (NFP) healthcare business models, Kaiser Permanente (KP) has announced plans to acquire Geisinger and form a new organization.

Upon acquisition, Geisinger will join Risant Health, an NFP organization being launched by Kaiser Foundation Hospitals, part of Kaiser Permanente. The Danville, Pennsylvania-based Geisinger system and future acquisitions will operate as distinct entities and retain their current branding and local control, according to a news release.

Risant Health likewise will be separate from Kaiser Permanente while building on KP’s “80 years of expertise in value-based care.” That’s a reference to the organization’s history of integrating provider and health plan operations dating back to the World War II era.

The plan is for five to seven systems to join Risant Health over the next few years. Oakland, California-based Kaiser Permanente essentially is seeking to scale up value-based payment strategies coast to coast.

In initial reactions, industry analysts reflected on what the deal suggests about the long-term direction of the U.S. healthcare market.

“Risant Health is a health system response to the large-scale payvider trend,” Blake Madden, an industry analyst and author of the Hospitalogy newsletter, wrote on Twitter.

New data on No Surprises Act arbitration cases show providers are faring well amid systemic challenges

Providers are having success in challenging out-of-network payment amounts under the No Surprises Act, at least when they can get their cases through the arbitration system.

CMS published an update showing that between April 15, 2022, when the independent dispute resolution (IDR) portal opened, and March 31, arbitrators issued payment determinations in 42,158 disputes. Initiating parties — meaning providers in almost every instance — prevailed in 71% of those decisions.

The success rate stands to increase over time. New regulatory guidance that likely favors providers was available to arbitrators only for the last two weeks of the nearly year-long period. Issued on March 17 in response to a court decision, the modified guidance instructs arbitrators to more directly consider multiple criteria that generally would be advantageous to providers.

The IDR portal is available to settle disputes over out-of-network payments in scenarios where the No Surprises Act protects patients from being balance-billed. However, the portal has been beset by delays.

During the first 50 weeks after the portal opened, nearly 335,000 disputes were filed, which CMS notes is almost 14 times greater than the agency’s initial estimates for a full calendar year.

Almost 40,000 disputes were deemed ineligible for the process. Eligibility was challenged by non-initiating parties in 122,800 cases, adding to the backlog by requiring arbitrators to investigate.

Hospital price transparency updates include stricter enforcement and new fines

Enforcement of hospital price transparency regulations is becoming more exacting, with CMS incorporating new policies. In addition, the agency recently fined two hospitals.

Among the changes is implementation of a strict 90-day window for coming into full compliance after CMS issues a request for a corrective action plan (CAP).

Hospitals continue to have 45 days to submit a CAP from the time CMS identifies ongoing deficiencies and requests that a CAP be filed. Taking the full allotment would leave only 45 more days to come into full compliance, with civil monetary penalties levied for missing the deadline. Previously, when filing their CAP, hospitals could propose their own schedule for complying.

Hospitals also can expect penalties to become more routine for failing either to submit a CAP within 45 days or to come into compliance within 90 days of the CAP request.

And for any hospitals that appear to have made little effort to comply to begin with, CMS likely will skip issuing a preliminary warning notice and instead move right to the CAP request.

In April, a small for-profit hospital in New Hampshire was fined $102,660, while a physician-owned hospital in Texas received a penalty of $117,260. They are the third and fourth organizations to be fined since the regulations began in 2021, joining two that were penalized last June.

Update: Appeals court stays decision on removing an ACA coverage requirement

A federal judge’s ruling to remove the mandate for health plans in the Affordable Care Act (ACA) insurance marketplaces to cover the full cost of certain preventive services has been stayed while the government’s appeal is heard.

The U.S. Court of Appeals for the Fifth Circuit issued the stay May 15, meaning all ACA coverage requirements remain in place for now.

Since its passage, the ACA has required health plans to cover the full cost of services that received an “A” or “B” rating from the U.S. Preventive Services Task Force. Barring a successful appeal, a federal judge in Texas ended that requirement with a March 30 decision.


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