MedPAC Meets

Last week the independent agency that advises Congress on Medicare payment issues met for two days in Washington, D.C.

new medpacAmong the issues on the agenda of the Medicare Payment Advisory Commission were:

  • payments for hospital inpatient and outpatient services, ambulatory surgery centers, dialysis facilities, and hospice care
  • payments for post-acute-care providers
  • a unified payment system for post-acute-care services
  • Medicare Advantage
  • Medicare Part B and Part D payments
  • Medicare-covered primary care services
  • implementation of the Medicare Access and CHIP Reauthorization Act of 2015

Go here for links to the issue briefs and presentations used at the MedPAC meeting and for a transcript of the meeting.

MedPAC Talks Payments

At public meetings in Washington, D.C. last week, members of the Medicare Payment Advisory Commission discussed the adequacy of current Medicare payments and whether they need updating in the next fiscal year.

Among the payment areas MedPAC reviewed were inpatient services, outpatient services, physician and health professional services, ambulatory surgical center services, skilled nursing facilities, home health services, inpatient rehabilitation hospitals, long-term-care facilitiies, outpatient dialysis services, and hospices.

Find the issue briefs and presentations used to guide these discussions here, on MedPAC’s web site.

MedPAC Still Unhappy With Doc Pay

Despite the recent regulation implemented by the Centers for Medicare & Medicaid Services to prevent hospitals from continuing to acquire physician practices so they can receive higher outpatient payments than those physicians receive in private practice, members of the Medicare Payment Advisory Commission appear to think that more needs to be done to equalize physician payments regardless of where they provide outpatient services.

Stock PhotoOr so MedPAC commissioners discussed during their public meeting in Washington, D.C. last week.

One commissioner observed that physicians appear to become less productive when their practice is acquired by a hospital. Others noted the added costs to Medicare when patients are treated at a hospital-based outpatient facility rather than a private physician’s office. In general, MedPAC members seemed “unimpressed” that CMS’s recent regulation alone will be enough to address the problem and that a better approach would be to reduce or eliminate the pay differentials between the two types of providers. MedPAC staff pointed to the $1.6 billion Medicare spent in 2015 on “evaluation and management “payments only to practices owned by hospitals.

Learn more about what MedPAC’s commissioners think about this issue and what they might do to try to address in this CQ Roll Call article presented by the Commonwealth Fund.

MedPAC Meets

The Medicare Payment Advisory Commission met in Washington, D.C. last week to discuss a number of issues on which it is contemplating advising Congress.

Those issues were:

  • the role of Medicare policy in provider consolidation
  • stand-alone ERs
  • payments from drug and device manufacturers to physicians and teaching hospitals
  • determining benchmarks and beneficiary premiums under a premium support system for Medicare
  • Medicare outlier payments and hospital charging practices
  • Medicare Advantage: calculating benchmarks and coding intensity
  • population-based outcome measures: healthy days at home and potentially preventable admissions and ER visits

Go here to see the issue briefs and presentations associated with MedPAC commissioners’ discussions about these issues.

MedPAC Offers Recommendations in Annual Report to Congress

In its annual report to Congress, the independent agency that advises Congress on Medicare payment issues offered a variety of suggestions for changes in how Medicare payments for health care.

Among the recommendations offered by the Medicare Payment Advisory Commission are policies affecting:

  • payments for drugs under Medicare Part A and Part D
  • the development of a unified payment system for post-acute care
  • a new framework for paying physicians
  • using competitive pricing to set Medicare beneficiary premiums
  • the preservation of access to emergency care in rural areas
  • telehealth services in the Medicare program
  • dual-eligible beneficiaries

To learn more about these and other proposals see this MedPAC news release or go here to see the entire June 16, 2016 MedPAC report to Congress.

MedPAC Urges Socio-Economic Risk Adjustment of Readmissions Reduction Program

The independent agency that advises Congress on Medicare payment issues has urged the administration to revise the Medicare hospital readmissions reduction program to adjust for the socio-economic status of the patients different hospitals serve.

In a May 31 letter to CMS acting administrator Andrew Slavitt as part of broader comments on Medicare’s proposed FY 2017 inpatient prospective payment system regulation, the Medicare Payment Advisory Commission reminded the Centers for Medicare & Medicaid Services that

… our June 2013 report discussed evaluating hospital readmission rates against a group of peer hospitals with a similar share of low-income Medicare beneficiaries as a way to adjust readmission penalties for socioeconomic status.

NAUH has long urged CMS to add socio-economic risk adjustment to Medicare’s hospital readmissions reduction program to reflect the more challenging nature of the patients private safety-net hospitals serve.

See the entire MedPAC letter to CMS here.

Low Participation Plagues Dual-Eligibles Demo

A federal demonstration program that seeks to improve care for those eligible for both Medicare and Medicaid is suffering from under-participation.

This perspective was presented during last week’s meeting of the Medicare Payment Advisory Commission, the independent federal agency that advises Congress on Medicare payment and policy issues.

Among the factors affecting participation have been difficulties identifying eligible participants, resistance from providers, and low provider payments.

iStock_000008112453XSmallBecause of the low participation, it has been difficult to measure the program’s effectiveness in better coordinating patients’ care.

Currently 61 health plans in 12 states participate in the program.

Such programs are important to priivate safety-net hospitals because those hospitals serve especially large numbers of low-income seniors.

Learn more about the program and the challenges it has faced in this McKnight’s Long-Term News article.

MedPAC Addresses Issues at April Meeting

Last week the Medicare Payment Advisory Commission met in Washington, D.C. On its agenda were the following issues on which MedPAC is advising Congress:

  • new medpacthe development of a unified prospective payment system for post-acute care
  • improving Medicare Part D
  • Medicare Part B drug and oncology payment policy issues
  • using encounter data for risk adjustment in Medicare Advantage
  • hospice and Medicare spending
  • measuring low-value care
  • preserving access to emergency care in rural areas
  • CMS’s financial alignment demonstration for dual-eligible beneficiaries

Go here to find the issue briefs and presentations used during the two-day meeting.

New Approaches to Readmissions Reduction Program?

While Medicare’s readmissions reduction program has produced a decline in the number of Medicare readmissions within 30 days of discharge, critics – among them the National Association of Urban Hospitals – argue that the program is unfair to hospitals that serve especially large numbers of low-income patients whose distinct needs pose a greater risk of requiring readmission to address.

In a new report, the journal Health Affairs notes that such arguments have given rise to a number of proposals for possible changes in the readmissions reduction program. Among them, the Medicare Payment Advisory Commission

…has proposed a revision to the method for calculating readmissions. Rather than including patient SES [note: socio-economic status] in the risk-adjustment step, which MedPAC argues would take years to develop empirically and could mask true quality disparities, MedPAC suggests grouping hospitals into peer groups based on their share of low-income Medicare patients and then set readmissions targets for each peer group. Put another way, hospitals with similar shares of low-income patients would be compared with each other instead of all hospitals.

health affairsOther suggestions for modifying the readmissions reduction program include shortening the window on readmissions, which might better reflect the quality of care a hospital provides rather than the nature of the patients it serves; changing the quality measures on which hospitals are judged, choosing new measures that might be less sensitive to socio-economic factors; and providing additional financial or other support to hospitals that serve especially large numbers of low-income patients.

To learn more about the kinds of challenges Medicare’s hospital readmissions reduction program pose and what might be done to address them without discarding the program entirely, go here for the Health Affairs article “The Challenges Of Rewarding Value Over Volume Without Penalizing Safety-Net Hospitals.”

MedPAC Offers DSH, 340B Recommendations

The Medicare Payment Advisory Commission has recommended that Congress direct changes in the 340B prescription drug discount program and in the manner in which Medicare makes disproportionate share hospital payments (Medicare DSH).

In its annual report to Congress, MedPAC recommended a reduction in 340B prescription drug payments to hospitals. The proposed reduction would cut 340B program spending approximately $300 million.

MedPAC then recommended that those 340B savings be redirected to the Medicare DSH uncompensated care pool.

And it also called for distributing the money in that pool based on better data on the uncompensated care hospitals provide, as reported on hospitals’ Medicare cost report S-10 worksheets, so that the Medicare DSH uncompensated care program would “…better target additional payments to hospitals that provide above average shares of uncompensated care.”

NAUH has long argued against the use of S-10 data in the calculation of Medicare DSH payments and reiterated this opposition, as well as its opposition to the reduction of 340B payments and the diversion of 340B savings to the Medicare DSH uncompensated care pool, in past correspondence with MedPAC.

To learn more about these and other MedPAC recommendations, see the news release that accompanied the MedPAC report to Congress; a fact sheet on that report; and the report itself.