NAUH Reiterates Call for Readmissions Program Risk Adjustment

In a letter to the chairmen of the House Ways and Means Committee and its Health Committee, the National Association of Urban Hospitals has again called on Congress to pass legislation requiring Medicare to add risk adjustment to its hospital readmissions reduction program.

NAUH LogoThe letter, spurred by a new CMS publication, Guide to Preventing Readmissions among Racially and Ethnically Diverse Medicare Beneficiaries, that in NAUH’s estimation incorrectly identifies why some hospitals have greater readmissions problems than others, cites the growing body of evidence showing that urban safety-net hospitals and others like them are treated unfairly by the readmissions reduction program.

Last year NAUH endorsed H.R. 1343, the Establishing Beneficiary Equity in the Hospital Readmission Program Act, that would require Medicare to add risk adjustment to the readmissions reduction program.

Go here to see NAUH’s letter.

Report on the State of Urban Health Care

kaiser health newsKaiser Health News has published a five-part report on the challenges facing urban health care providers in the nation’s cities.  Many private safety-net hospitals are located in urban areas.

The Kaiser report, “Special Report, Baltimore’s Other Divide,” consists of five parts:

  • In Freddie Gray’s Neighborhood, The Best Medical Care is Close But Elusive
  • Baltimore Hospitals Work to Repair Frayed Trust in Black Communities
  • Quest for Blood Pressure Cuff Highlights Inequality
  • At Clinic, Poverty Magnifies Health Problems
  • Hospital Trying to Win Community’s Trust

Go here on the Kaiser Health News web site for an introduction to the series and links to all five parts.

NAUH Weighs in on New Medicare Site-Neutral Payment Law

Last November Congress passed a law that established a new, site-neutral Medicare payment policy for newly acquired, provider-based, off-campus outpatient departments.

In response to protests about the new law, the House Energy and Commerce Committee’s Health Subcommittee invited the provider community to share its views on the law. In a letter to the committee, the National Association of Urban Hospitals identified four specific circumstances under which private safety-net hospitals believe outpatient payments should not be made on a site-neutral basis:

  • NAUH Logowhen a new outpatient project was under way at the time of the bill’s passage;
  • when an outpatient project would serve a formally designated Medically Underserved Area (MUA) or Health Professional Shortage Area (HPSA);
  • when the outpatient project is undertaken by a multi-campus hospital or a project of a hospital merger; or
  • when the outpatient project is an expansion or relocation of an existing outpatient facility.

See NAUH’s letter to the House Energy and Commerce Committee here.

DSH/340B Hospitals Have Lower Medicare Drug Costs

Medicare disproportionate share (Medicare DSH) hospitals that qualify for the federal 340B prescription drug discount program have lower Medicare Part B drug costs than other Medicare providers.

Prescription Medication Spilling From an Open Medicine BottleSo concludes a new study performed for 340B Health, an association that represents more 1100 public and non-profit hospitals and health systems that participate in the 340B drug pricing program.

According to the organization 340B Health,

Medicare pays disproportionate share hospitals in the 340B drug discount program on average 13 percent less for separately payable drugs reimbursed through Medicare Part B. This is in comparison to what it pays other hospitals and physician practices in the Part B market. The study also shows that 340B DSH hospitals are treating more vulnerable patients than other providers in terms of race, age, disability, and dual eligibility.

The study also found that 340B-eligible hospitals are

  • Nearly four times as likely as non-340B providers to treat patients with end-stage renal disease
  • More than twice as likely to treat patients dually eligible for Medicare and Medicaid
  • More than twice as likely to treat patients who are disabled
  • More than twice as likely to treat Black, Hispanic, and North American Native patients

Most of the country’s private safety-net hospitals are Medicare DSH hospitals and many participate in the 340B prescription drug pricing program as well.

For a closer look at the study and its findings, go here to see a 340B Health news release on the study and go here to see the study Analysis of Separately Billable Part B Drug Use Among 340B DSH Hospitals and Non-340B Providers.

President Proposes FY 2017 Budget

That budget proposal calls for numerous cuts in Medicare payments to hospitals, including significant reductions in Medicare bad debt reimbursement, medical education payments, and payments for inpatient rehabilitation services.

NAUH LogoIt also calls for restoring the Medicaid primary care payment increase through calendar year 2017.

NAUH has prepared a detailed memo outlining the potential implications of the proposed FY 2017 budget for private safety-net hospitals. Representatives of private safety-net hospitals may request a copy of this memo by using the “contact us” link at the top of this screen.

MACPAC: Medicaid DSH Payments Not Always Reaching Targeted Providers

In many cases, Medicaid disproportionate share payments (Medicaid DSH) are being made to hospitals that do not necessarily serve especially large proportions of Medicaid and other low-income patients.

So concludes a new report from The Medicaid and CHIP Payment and Access Commission (MACPAC), is a non-partisan legislative branch agency that performs policy and data analysis and makes recommendations to Congress, the Secretary of the U.S. Department of Health and Human Services, and the states on issues affecting Medicaid and the State Children’s Health Insurance Program (CHIP).

macpacAccording to a new MACPAC report,

Medicaid DSH payments provide substantial support to safety-net hospitals by helping to offset uncompensated care costs for Medicaid and uninsured patients. In 2014, Medicaid made a total of $18 billion in DSH payments ($8 billion in state funds and $10 billion in federal funds). About half of all U.S. hospitals receive such payments, with most going to hospitals that serve a particularly high share of Medicaid and other low-income patients, known as deemed DSH hospitals. But more than one-third of DSH payments are made to hospitals that do not meet this standard.

To remedy this problem, MACPAC recommends more and better data collection, noting that

The current variation in state DSH allotments stems from the variations that existed in state DSH spending in 1992.

Medicaid DSH has long been a subject of great interest to the nation’s private safety-net hospitals because, serving so many Medicaid and low-income patients, they are the very providers for which Medicaid DSH payments have always been intended.

The MACPAC analysis Report to Congress on Medicaid Disproportionate Share Hospital Payments covers a broad range of Medicaid DSH-related issues. Find it here, on the MACPAC web site.

Challenges In Determining Effectiveness of Dual-Eligible Programs

The federal government is encountering challenges in evaluating the effectiveness of programs designed to serve low-income elderly patients served by both Medicare and Medicaid – patients known as dual-eligibles.

Or so concludes the U.S. Government Accountability Office in a new report.

With the dually eligible accounting for 35 percent of total Medicare and Medicaid expenditures, the Centers for Medicare & Medicaid Services’ “Financial Alignment Initiative” has worked to find new and better ways to care for such individuals. Such efforts have been plagued, however, by challenges in locating such individuals at times because they are often part of a transient population. In addition, the GAO review, which examined programs in the first five states to launch such initiatives – California, Illinois, Massachusetts, Virginia, and Washington – found that the data reported by the individual states often differed, making it difficult to compare both different approaches to serving the dual-eligible population and overall program results.

gaoFinding new and better ways to care for dual-eligibles is especially important for private safety-net hospitals because such providers care for especially large numbers of low-income seniors.

The GAO has recommended that CMS develop new comparable data measures and better align the program’s existing methodologies.

To learn more about early experiments in serving the dual-eligible population, go here to see the GAO report Medicare and Medicaid: Additional Oversight Needed of CMS’s Demonstration to Coordinate the Care of Dual-Eligible Beneficiaries.

Dual Eligible Programs Show Mixed Results

The Affordable Care Act-inspired effort to find more effective ways to serve the so-called dual eligible population – mostly the disabled and low-income elderly covered by both Medicare and Medicaid – is not providing the kind of results policy-makers expected when they initiated new efforts to serve this high-cost population.

But not all of the news is bad.

iStock_000008112453XSmallOn one hand, enrollment figures for those eligible to participate have not met expectations, with some of those eligible afraid they might lose their providers and some of those providers persuading their patients not to participate. In addition, some health plans that participated in the earliest efforts have withdrawn in the face of declining enrollment.

On the other hand, employing care managers to serve members has shown signs of reducing hospitalizations and Medicare costs and individuals who do participate have expressed satisfaction with the service they are receiving.

Programs that serve dually eligible individuals are of special interest to private safety-net hospitals because the communities they serve typically have especially large numbers of such residents.

For a closer look at the effort’s expectations, where it has succeeded, and where it has encountered challenges, see this Wall Street Journal article.

MedPAC Addresses Major Issues for Private Safety-Net Hospitals

The independent federal agency that advises Congress on Medicare payment issues discussed several issues of great importance to private safety-net hospitals at its December 10 meeting in Washington, D.C.

new medpacDuring the course of a discussion about FY 2017 Medicare inpatient and outpatient payment increases, the commissioners of the Medicare Payment Advisory Commission (MedPAC) also considered staff recommendations that would alter the section 340B prescription drug discount program and Medicare disproportionate share hospital payments (Medicare DSH).

Medicare DSH and the 340B program are essential to private safety-net hospitals.

NAUH members have received a memo describing the proposals MedPAC commissioners discussed at their meeting. Representatives of private safety-net hospitals can request a copy of that memo by using the “contact us” link on this page.

Feds OK Medicaid Money for Housing

The Obama administration has informed state Medicaid programs that they may use federal Medicaid money to help the chronically homeless obtain housing.

While a June bulletin to state Medicaid directors technically only clarified existing policy, it signaled states that the administration will be receptive to Medicaid waivers that propose using Medicaid funding to help the homeless obtain housing.

Increasingly, state Medicaid programs have been finding that helping the homeless with housing is a key to improving their physical and behavioral health and can offer later savings as the individuals who have received such assistance live more stable lives, especially as more homeless people qualify for Medicaid benefits in states that have expanded their Medicaid programs.

iStock_000008112453XSmallThe National Association of Urban Hospitals (NAUH) has long identified homelessness and inadequate housing as challenges that private safety-net hospitals face in the low-income communities they serve.

To learn more about why officials believe housing is an important part of addressing the health care needs of the homeless and how some programs attempt to provide such assistance, see this Stateline report.