On September 5, 2014, CMS is publishing a final rule that specifies additional options for annual eligibility redeterminations and renewal and re-enrollment notice requirements for qualified health plans (QHP) offered through the ACA insurance Exchange/Marketplace, beginning with annual redeterminations for coverage for plan year 2015. The rule provides an auto-enrollment process intended to provide current Marketplace consumers with a simple way to keep their 2014 QHP, although CMS encourages consumers to reevaluate their plan options and financial assistance eligibility for 2015. The rule also gives state-based Marketplaces flexible options to implement annual redetermination procedures.
On August 22, 2014, CMS will publish a final rule to update the Medicare hospice wage index for FY 2015 and make other payment and policy changes. CMS estimates that hospice payments will increase by 1.4% ($230 million) in FY 2015 compared to FY 2014 under the final rule. Specifically, CMS will update the hospice per diem rates by 2.1% (reflecting a 2.9% market basket increase that is reduced by 0.8 percentage points under ACA-mandated adjustments), but this update is partially offset by a 0.7 percentage point cut resulting from the use of updated wage data and CMS’s continued phase-out of its wage index budget neutrality adjustment factor. Hospices that fail to report quality data will have their market basket update reduced by 2 percentage points.
CMS is finalizing a number of policy proposals. For instance, the final rule requires hospices to file a beneficiary Notice of Election (NOE) within five calendar days after the effective date of hospice election (compared to three days in the proposed rule). If an NOE is not filed timely, the days from the effective date of election to the date of filing the NOE would be the financial responsibility of the hospice (unless there are exceptional circumstances). Likewise, CMS is requiring hospices to file a notice of termination/revocation within five (rather than the proposed three) calendar days of a beneficiary’s discharge or revocation, unless the hospice has already filed a final claim. The rule also, among other things: requires the hospice to identify the attending physician on the election form; revises the applicability of quality reporting penalties to new hospices; requires hospices to complete their hospice cap determinations within five months after the cap year but no sooner than 3 months after the cap period and remit any overpayments; and describes the development of the CAHPS® Hospice Survey.
This post was written by Susan Edwards.
The Centers for Medicare & Medicaid Services (CMS) published the final FY 2015 Medicare skilled nursing facility (SNF) prospective payment system (PPS) rule on August 5, 2014 (Final Rule). The Final Rule largely adopts the proposals set forth in the FY 2015 proposed SNF PPS rule (Proposed Rule). CMS estimates that the Final Rule will result in a $750 million increase in aggregate payments to SNFs during FY 2015 as compared to FY 2014. The Final Rule will implement a market basket update of 2%, resulting from a market basket increase of 2.5 percentage points, reduced by the Multifactor Productivity Adjustment of 0.5 percentage points, as required by the Affordable Care Act (ACA). Below we discuss highlights of the Final Rule, including: (1) the adopted wage index update; (2) revised change of therapy (COT) Other Medicare Required Assessment (OMRA) policy; (3) revisions to the Civil Money Penalties (CMP) regulations; and (4) CMS’s responses to comments regarding the agency’s observations on therapy trends.Continue Reading...
On August 22, 2014, CMS is publishing a final rule to update the Medicare acute hospital inpatient prospective payment system (IPPS) and long-term care hospital (LTCH) prospective payment system (PPS) for fiscal year (FY) 2015, which begins October 1, 2014. The following are highlights of the sweeping regulations.Continue Reading...
On August 6, 2014, CMS published its final rule to update Medicare payment policies under the inpatient rehabilitation facility (IRF) PPS for FY 2015. Under the final rule, CMS expects aggregate Medicare payments to IRFs will increase by $180 million, or 2.4%, compared to 2014 levels. The standard payment conversion factor for discharges for FY 2015 is $15,198, up from $14,846 in FY 2014. The update to the conversion factor reflects a 2.9% market basket update, reduced by a -0.5% MFP adjustment and an additional -0.2 percentage point adjustment mandated by the ACA. CMS also is decreasing the outlier threshold amount for FY 2015 to $8,848 from $9,272 in FY 2014, which increases IRF PPS payments by about 0.2%. In addition, CMS adopted a freeze in the facility-level adjustment factors (e.g., adjustments for Low-Income Percentage, teaching status, and location in a rural area, if applicable) for FY 2015 and all subsequent years at FY 2014 levels while the effects of FY 2014 changes are evaluated.
In other policy areas, the final rule revises the list of impairment group codes that presumptively meet the “60 percent rule” compliance criteria; however, in response to public comments, CMS is delaying the effective date for these changes and revisions finalized in the FY 2014 IRF PPS final rule until compliance review periods beginning on or after October 1, 2015. In addition, the rule adds a therapy data item to the IRF patient assessment instrument. Beginning October 1, 2015, IRFs must record the total number of therapy minutes received and the type of therapy provided (i.e. individual, group, concurrent or co-treatment) during the first two weeks of an IRF stay. CMS also is revising the IRF Quality Reporting Program to update measures, add a reconsideration policy, and adopt a data accuracy validation policy. The final rule also discusses the transition from ICD-9-CM to ICD-10-CM for use on Medicare claims (although this transition has been put on hold temporarily as a result of the Protecting Access to Medicare Act of 2014).
CMS has published a final rule that updates prospective payment rates for Medicare inpatient hospital services provided by inpatient psychiatric facilities (IPFs) for FY 2015. Under the final rule, the federal per diem base rate will be increased by 2.1%, reflecting a market basket increase of 2.9%, offset by a 0.3 percentage point reduction and a productivity adjustment reduction of 0.5 percentage points (both reductions were mandated by the ACA). CMS also anticipates that the final update to the outlier fixed-dollar loss threshold amount will provide an additional 0.4% boost in overall payments to IPFs. In light of all payment policies, CMS estimates that total payments to IPFs under the final rule will increase by $120 million (2.5%) compared to FY 2014 payments. The final rule also, among other things, establishes a new methodology for updating the cost of living adjustment (consistent with the inpatient hospital methodology), expands quality measures under the IPF Quality Reporting Program, adopts coding changes related to comorbidity categories and unspecified codes, and discusses CMS’s future plans to propose an IPF-specific market basket. The final rule was published August 6, 2014.
CMS has announced that it is extending for an additional 6 months its current enrollment moratoria for new ground ambulance suppliers and home health agencies (HHAs)within designated metropolitan areas. The moratoria, which affect enrollment in Medicare, Medicaid, and the Children’s Health Insurance Program, apply to new ground ambulances in the Houston and Philadelphia metropolitan areas and new HHAs in the metropolitan areas of Chicago, Fort Lauderdale, Detroit, Dallas, Houston, and Miami. CMS discusses its rationale for extending the enrollment moratoria, including the qualitative and quantitative factors suggesting a high risk of fraud, waste, or abuse, in an August 1, 2014 notice. The extension is effective July 30, 2014. CMS may lift the moratoria before the end of the 6-month period or announce extensions in the Federal Register notice.
On July 14, 2014, the Centers for Medicare & Medicaid Services (CMS) published its proposed rule to update the Medicare Hospital Outpatient Prospective Payment System (OPPS) and the Ambulatory Surgical Center (ASC) Payment System rates and policies for calendar year (CY) 2015. The following are highlights of this major rulemaking:Continue Reading...
On July 11, 2014, CMS published its proposed rule to update the Medicare physician fee schedule for CY 2015. The proposed rule reflects enactment of the Protecting Access to Medicare Act (PAMA) of 2014, which provides for a 0% update to the conversion factor (CF) for MPFS services furnished between January 1, 2015 and March 31, 2015. In the Proposed Rule, CMS estimates that with the application of a budget neutrality adjustment, the CF for the first quarter of 2015 would be $35.7977 (compared to $35.8228 in 2014). Under PAMA, the CF will be adjusted on April 1, 2015 according to the Sustainable Growth Rate (SGR) formula unless Congress takes additional legislative action. CMS does not speculate on the CF that will be applicable April 1, 2015 through December 31, 2015, but CMS previously estimated that the SGR would result in about a 20.9% cut in MPFS payments for 2015 if Congress does not again intervene. There is an expectation that Congress eventually will override this payment cut, but the timing and extent of any such relief cannot be assured at this time. Other key provision in the proposed rule include the following:Continue Reading...
On July 11, 2014, CMS published a proposed rule to update the Medicare end-stage renal disease (ESRD) PPS for CY 2015, which CMS anticipates would increase total payments to all ESRD facilities by 0.3% compared to CY 2014. While CMS projects that the ESRD market basket update, as adjusted for MFP, would have been 1.6%, the “Protecting Access to Medicare Act of 2014” (PAMA) sets the CY 2015 ESRD payment update at 0.0 percent. After applying a proposed wage index budget-neutrality adjustment factor, CMS estimates that the CY 2015 ESRD PPS base rate would be $239.33 under the proposed rule. The proposed rule also would, among other things: rebase the ESRD bundled market basket using 2012 data; update outlier Medicare Allowable Payment (MAP) and fixed dollar loss amounts (which will increase payments to ESRD facilities for beneficiaries requiring higher resource utilization); revise the market basket measures; update the labor -related share value with a two-year transition; clarify the eligibility criteria for the low volume payment adjustment ; and implement a PAMA provision providing that payment for ESRD-related oral-only drugs will not be made under the ESRD PPS prior to January 1, 2024. CMS also proposes updates to the ESRD Quality Incentive Program (QIP) for payment years 2017 and 2018. Finally, the proposed rule would make significant changes to Medicare reimbursement policy for DME, prosthetics, orthotics, and supplies (DMEPOS). CMS will accept comments on the proposed rule until September 2, 2014.
CMS Proposes Major Changes to Medicare DMEPOS Payment/Coverage Policy Inside/Outside of Competitive Bidding Areas
On July 2, 2014, the Centers for Medicare & Medicaid Services (CMS) released a proposed rule that would make a series of significant changes to Medicare coverage and payment policies for durable medical equipment (DME), prosthetics, orthotics, and supplies (DMEPOS). Notably, the proposed rule would establish a methodology for adjusting Medicare DMEPOS fee schedule payment amounts across the country using information from the Medicare DMEPOS Competitive Bidding Program (CBP) – which CMS estimates would cut Medicare DMEPOS reimbursement by more than $7 billion in FYs 2016 through 2020. The proposed rule also would: test the use of bundled monthly payment amounts for DME and enteral nutrition under the CBP; modify CBP change of ownership (CHOW) and termination of contract rules; clarify qualifications for providing custom fitting services for orthotics; and revise Medicare hearing aid coverage policy. These provisions, which were part of a broader proposed rule that would also update the Medicare end-stage renal disease prospective payment system for 2015, are summarized in our Client Alert.
CMS Proposes Changes to Sunshine Act "Open Payments" Regulations in 2015 Medicare Physician Fee Schedule Rule
Today the Centers for Medicare & Medicaid Services (CMS) issued an advance copy of the CY 2015 Medicare Physician Fee Schedule (PFS) proposed rule, which includes certain changes to the regulations implementing the Physician Payment Sunshine Act, also known as the Open Payments program. These proposed changes come just three days after the inaugural deadline for applicable manufacturers and group purchasing organizations (GPOs) to report to CMS detailed information regarding payments and transfers of value made to physicians and teaching hospitals, as well as physician ownership information.
As previously reported, the Physician Payment Sunshine Act and related regulations require pharmaceutical and medical device manufacturers and GPOs to register with and submit to CMS data on their financial relationships with physicians and teaching hospitals. This financial data will be made publicly available on the CMS Open Payments website.
In the PFS proposed rule, CMS proposes the following changes to the Physician Payment Sunshine Act regulations:
- Deleting the definition of “covered device” as duplicative of the definition of “covered drug, device, biological or medical supply”
- Deleting the reporting exclusion for payments made to speakers at accredited continuing medical education events when certain requirements are met. Although CMS is deleting this express exclusion, it notes that such payments may still be excluded generally from reporting under the separate exclusion for indirect payments, which applies in those instances in which the applicable manufacturer is unaware of the identity of the covered recipient. In other words, the practical impact of this change may not be significant in the long run.
- Requiring the reporting of the marketed name of the drug, device, biological, or medical supply related to the payment being reported. Previously, CMS finalized that for drugs and biologicals, manufacturers must report the market name of a related product, but that for devices and medial supplies, manufacturers could report either the name under which the product is marketed or the general therapeutic area or product category associated with the device or medical supply.
- Requiring manufacturers to report stocks, stock options or any other ownership interest as distinct categories.
The proposed rule will be published in the Federal Register on July 11, 2014, and comments are due to CMS by September 2, 2014.
Today CMS released its proposed rule to update Medicare home health prospective payment system (HH PPS) rates for CY 2015. CMS estimates that the rule would reduce Medicare payments to home health agencies by approximately $58 million (-0.3%) in 2015 compared to 2014 levels. Specifically, while CMS anticipates a 2.2% home health payment update percentage ($427 million increase), the increase would be more than offset by implementation of the second year of a four-year phase-in of the rebasing adjustments to the HH PPS rates, which would result in a -2.5% adjustment ($485 million decrease).
The proposed rule also includes a number of policy proposals, including: simplification of the face-to-face encounter documentation requirements and clarification of when such documentation is required; changes to the HH PPS case-mix weights; revisions to the home health quality reporting program; simplification of therapy reassessment timeframes; a revision to the Speech-Language Pathology personnel conditions of participation; and limitations on the reviewability of CMS’s decision to impose a civil monetary penalty for noncompliance with federal participation requirements. Finally, the rule discusses insulin injections under the HH PPS and the delay in implementation of ICD-10-CM, and it solicits comments on the HHA value-based purchasing.
The official version of the rule is scheduled to be published on July 7, 2014. CMS will accept comments until September 2, 2014.
Yesterday CMS submitted to the White House Office of Management and Budget (OMB) a proposed rule to make changes to the Medicare Shared Savings Program, including provisions relating to Medicare payments to providers participating in ACOs. These changes would apply to existing ACOs and approved ACO applicants participating in the program beginning January 1, 2016. The text of the rule is not available until it is cleared by OMB and sent to the Federal Register.
On June 17, 2014, the Centers for Medicare & Medicaid Services (CMS) published a notice making changes to the Medicare payment adjustment for low-volume hospitals and to the Medicare-dependent hospital (MDH) program under the inpatient prospective payment system (IPPS). The adjustments, which were mandated by the Protecting Access to Medicare Act of 2014, apply to the second half of fiscal year (FY) 2014, or April 1, 2014 through September 30, 2014. The payment adjustments are expected to increase overall IPPS payments in FY 2014 by $227 million (an additional 0.24%) compared to the previous estimate of FY 2014 payments to all IPPS hospitals published in the IPPS final rule for FY 2014. Specifically, CMS estimates that approximately 600 hospitals qualifying as low-volume hospitals through September 30, 2014 will experience an increase in payments of approximately $161 million compared to CMS’s earlier estimate in the FY 2014 IPPS final rule, and 118 MDHs will experience an overall increase of approximately $66 million compared to CMS’s estimate in the final IPPS rule.
On May 23, 2014, CMS published a final rule revising the Medicare Advantage (MA) and Part D prescription drug program regulations to implement various statutory requirements, strengthen beneficiary protections, improve program efficiencies and payment accuracy; and clarify program requirements, generally effective for contract year 2015. CMS estimates that the proposed rule would reduce Medicare spending by $1.615 billion between 2015 and 2024. Among many other things, the final rule:
- Requires that Part D “negotiated prices” be inclusive of all price concessions from network pharmacies except contingent price concessions that cannot reasonably be determined at the point-of-sale, effective beginning with contract year 2016. CMS also specifies that additional contingent amounts, such as incentive fees, that increase prices and that cannot reasonably be determined at the point-of-sale are always excluded from the negotiated price.
- Implements an ACA requirement that MA plans and Part D sponsors report and return identified Medicare overpayments.
- Addresses prescription drug abuse by, among other things, authorizing CMS to revoke a physician’s or eligible professional’s Medicare enrollment if he or she has a pattern of prescribing Part D drugs that is abusive and represents a threat to beneficiary health and safety or otherwise fails to meet Medicare requirements, or if the prescriber’s Drug Enforcement Administration (DEA) certificate of registration or state license is suspended or revoked. The rule also requires prescribers of Part D drugs to enroll in Medicare or have a valid record of opting out of Medicare as a condition of coverage for their prescriptions, effective June 1, 2015.
Note that CMS is not finalizing its proposed changes to the ACA “drug categories or classes of clinical concern” requirement; instead, CMS will maintain the existing six protected classes. CMS also is not finalizing its proposal to require consistently lower negotiated prices at pharmacies offering preferred cost sharing in light of its adoption of a different definition of negotiated price than originally proposed. Moreover, CMS is not finalizing its proposed “any willing pharmacy” contracting provisions, nor the proposed changes to limit the authorized levels of cost sharing, pending further study.
On May 27, 2014, CMS published a final rule updating ACA Affordable Insurance Exchange and insurance market standards beginning in 2015. Among other things, the rule addresses standards related to: standardized consumer notices regarding insurance product discontinuation and renewal; Qualified Health Plan (QHP) quality data reporting to support quality ratings for plans on the insurance marketplace beginning in 2016; non-discrimination standards; employee choice in the Small Business Health Options Program (SHOP); enforcement remedies in federally-facilitated exchanges; the imposition of civil money penalties for providing false or fraudulent information to the Exchange and for improperly using or disclosing information; updated standards for “Navigators” and other consumer assistance programs; increases the risk corridor calculation ceiling on allowable administrative costs and the floor on profits by 2% “to account for uncertainty and changes in the market prior to and during benefit year 2015”; and modifies the allocation of reinsurance collections if those collections do not meet projections. The rule also provides for an expedited prescription drug exceptions process based on exigent circumstances (defined as when an enrollee is suffering from a health condition that may seriously jeopardize the enrollee’s life, health, or ability to regain maximum function, or when an enrollee is undergoing a current course of treatment using a non-formulary drug). Under this provision, health plans must make coverage determinations within 24 hours after receiving the request; once an exception is granted, issuers must continue to provide the drug throughout the duration of the exigency. CMS states that it will continue to monitor this issue to consider whether it should propose additional standards.
CMS has published a proposed rule that would formally adopt a previously-announced change to the EHR meaningful use stage timeline. Specifically, the rule would extend Stage 2 through 2016 and begin Stage 3 in 2017 (instead of 2016). The proposed rule also would allow providers to use 2011 Edition Certified Electronic Health Record Technology (CEHRT) or a combination of 2011 and 2014 Edition CEHRT for the EHR reporting period in 2014; beginning in 2015, all eligible hospitals and professionals would be required to report using 2014 Edition CEHRT. CMS will accept comments on the proposed rule until July 21, 2014.
CMS has just released a proposed rule that would require Medicare prior authorization (PA) for certain Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) items that the agency characterizes as “frequently subject to unnecessary utilization.“ As part of the rulemaking, CMS has developed a “Master List” of initial items that it considers to meet this standard based on being (1) identified in a GAO or HHS OIG national report published in 2007 or later as having a high rate of fraud or unnecessary utilization; or (2) listed in the 2011 or later Comprehensive Error Rate Testing (CERT) program's Annual Medicare FFS Improper Payment Rate Report DME Service Specific Overpayment Rate Appendix. CMS also proposes limiting the items on the Master List to those with an average purchase fee of at least $1,000 or an average rental fee schedule of at least $100 to allow CMS to focus on items with the largest potential savings for the Medicare Trust Fund. CMS proposes that the Master List will be “self-updating” annually, and that items generally will remain on the list for 10 years. Note, however, that presence on the Master List would not automatically require prior authorization. CMS would limit the PA requirement to a subset of items (called the “Required Prior Authorization List") “to balance minimizing provider and supplier burden with our need to protect the Trust Funds." CMS would publish the Required Prior Authorization List in the Federal Register with 60-day notice before implementation. CMS also proposes that the PA program could be implemented nationally or locally. The proposed rule does not announce the first items on the Required Prior Authorization List. Instead, CMS is seeking public comment on the number of items that should be selected initially and in the future, and the frequency with which CMS should select items.
The proposed PA process would not create new clinical documentation requirements for the selected DMEPOS items. Instead, the same information necessary now to support Medicare payment for the item would be submitted to the contractor, but before the item could be furnished to the beneficiary and before the claim could be submitted for payment. Upon receipt of a PA request, CMS or its contractors would determine whether the item complies with applicable coverage, coding, and payment rules, and then communicate a decision that provisionally affirms or non-affirms the request. CMS or its contractors would “make reasonable efforts” to provide a decision within 10 days of receipt of all applicable information, unless this timeline could “seriously jeopardize the life or health of the beneficiary,” in which case the target review period would be 2 business days.
The proposed rule also discusses, among other things: the process for updating the Master List; liability for an item on the Required Prior Authorization List if authorization is submitted and denied, the opportunity for unlimited PA resubmissions, and applicability to competitive bidding areas. The rule also would add a contractor's decision regarding prior authorization of coverage of DMEPOS items to the list of actions that are not initial determinations and therefore not appealable. The official version will be published on May 28, 2014. CMS will accept comments on the proposed rule until July 28, 2014.
In a related development, CMS has announced that it is expanding its current demonstration for prior authorization for power mobility devices to 12 additional states. CMS also will launch two payment model demonstrations to test prior authorization for hyperbaric oxygen therapy and repetitive scheduled non-emergent ambulance transport; information from these models will inform future CMS policy decisions on the use of prior authorization.
On May 12, 2014, the Centers for Medicare & Medicaid Services (CMS) published a final rule that reforms federal health policy regulations that CMS has identified as unnecessary, obsolete, or excessively burdensome on health care providers and suppliers. The rule also is intended to eliminate or reduce requirements that impede quality patient care or that divert resources away from providing high quality patient care. CMS estimates that the rule will result in annual recurring savings of about $660 million, plus a $22 million one-time savings to long-term care facilities from a sprinkler deadline extension. Highlights of the wide-ranging rule include the following:Continue Reading...