Every year, the Centers for Medicare & Medicare Services (CMS) publishes in the Federal Register a draft regulation describing how it proposes paying hospitals for the inpatient care they provide to their Medicare patients in the coming fiscal year. The proposed inpatient prospective payment system regulation for FY 2015 was published on May 15, and as always, CMS invited interested parties to submit written comments.
The National Association of Urban Hospitals has always found CMS to be receptive and even responsive to its comments and therefore takes the opportunity to submit detailed comments and suggestions about the agency’s annual proposal.
NAUH is presenting excerpts from its comment letter to CMS. The subjects and the dates they will be published are:
June 26 – the size of the Medicare DSH pool
Today – the manner in which CMS uses CBO estimates of changes in insurance status
June 30 – the methodology for distributing Medicare DSH funds
July 1 – the need for appropriate risk adjustment in the hospital readmissions reduction program
July 2 – a much-needed adjustment to the methodology employed by the hospital readmissions reduction program
July 3 – hospital inpatient rates
July 7 – short hospital stays (two-midnight rule)
NAUH’s complete comment letter to CMS can be found here.
The Manner in Which CMS Uses CBO Estimates of Changes in Insurance Status
NAUH understands that CMS is required to use Congressional Budget Office (CBO) estimates of changes in the number of uninsured as a result of Affordable Care Act reforms to reduce the Medicare DSH pool but is concerned about the manner in which CMS uses those estimates.
The Affordable Care Act envisioned significant expansion of Medicaid in all 50 states. The Supreme Court changed that, however, making Medicaid expansion optional for the states, and consequently, about half of the states have not expanded their Medicaid program. As a result, reductions in the number of uninsured people are not occurring in a more or less across-the-board manner, as both the reform law and CBO anticipated, instead occurring at very different rates depending on whether individual states have or have not expanded their Medicaid programs.
Another complicating factor is the challenges the uninsured faced using health insurance exchanges to enroll in Medicaid and purchase private insurance. The federally facilitated marketplace had a troubled launch and 27 states chose to rely solely on that marketplace; another seven operated marketplaces in partnership with the federal government. These operations were all handicapped to a degree by the problems encountered during the initial launch of the federal marketplace. Another 17 states operated their own exchanges – with varying degrees of success. Some worked well but others encountered problems as great at those experienced by the federal exchange. Whether federal or state-operated, the troubled exchanges had one thing in common: they detracted from the number of people who obtained health insurance during the enrollment period – but they did so unevenly, with people in some states having more trouble than people in others. Yet another complicating factor is that at this time, we cannot completely discern how many of those who enrolled in health insurance through the exchanges are newly insured and how many simply took advantage of the exchanges to obtain new insurance.
Together, these factors suggest that reducing the Medicare DSH pool based on the CBO estimates will be especially advantageous for hospitals in some states and especially harmful for hospitals in others. For this reason, NAUH recommends that CMS reduce its planned cuts in the Medicare DSH pool so it does not needlessly create winners and losers and does not jeopardize access to care in some communities.
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Monday: The methodology for distributing Medicare DSH funds
NAUH’s complete comment letter to CMS can be found here.
