States Expect Medicaid Enrollment, Spending to Rise in FY 2021

States expect to see their Medicaid enrollment and spending rise in FY 2021, driven by increases in unemployment resulting from the COVID-19 pandemic and maintenance-of-effort requirements in legislation enacted earlier this year.

A Kaiser Family Foundation survey of state Medicaid directors found that those officials expect their Medicaid enrollment to rise 8.2 percent in FY 2021 and their Medicaid spending to increase 8.4 percent that same year.  Most states expect the 6.2 percentage point increase in federal Medicaid matching funds that was included in the Families First Coronavirus Response Act, passed this March, to expire at the end of 2020.

Learn more about how states see their Medicaid responsibilities changing in the coming year and the underlying causes of those changes in the Kaiser Family Foundation report “Medicaid Enrollment & Spending Growth: FY 2020 & 2021.”

Coronavirus Update for Tuesday, June 30

Coronavirus update for Tuesday, June 30 as of 2:30 p.m.

Department of Health and Human Services

  • An HHS spokesperson tweeted yesterday that “@HHSGov expects to renew the Public Health Emergency due to COVID-19 before it expires.”
  • HHS announced that it has entered into an agreement to secure a supply of remdesivir, a drug used to treat COVID-19. Hospitals will have to purchase the drug from the pharmaceutical company and its distributor at the negotiated price of about $3200 a treatment, with the amount each hospital can purchase to be determined by the federal government and state health departments based on recent COVID-19 caseloads.  Those allocation decisions will be made every two weeks, and beginning on July 6 hospitals will be asked to submit their data through the TeleTracking web portal by Monday at 8 p.m. ET every two weeks.

Centers for Medicare & Medicaid Services

CMS has updated its toolkit on state actions to mitigate the prevalence of COVID-19 in nursing homes.

CMS COVID-19 Stakeholder Calls

CMS hosts recurring stakeholder engagement sessions to share information related to the agency’s response to COVID-19.  These sessions are open to members of the health care community and are intended to provide updates, share best practices among peers, and offer attendees an opportunity to ask questions of CMS and other subject matter experts.

CMS COVID-19 Office Hours Calls

Tuesday, June 30th at 5:00 – 6:00 PM Eastern

Toll Free Attendee Dial In: 833-614-0820; Access Passcode: 5125839

Audio Webcast link:  go here.

Tuesday, July 7th at 5:00 – 6:00 PM Eastern

Toll Free Attendee Dial In: 833-614-0820; Access Passcode: 3048844

Audio Webcast link:  go here.

Tuesday, July 14th at 5:00 – 6:00 PM Eastern

Toll Free Attendee Dial In: 833-614-0820; Access Passcode: 2550919

Audio Webcast link:  go here.

Tuesday, July 21st at 5:00 – 6:00 PM Eastern

Toll Free Attendee Dial In: 833-614-0820; Access Passcode: 7477995

Audio Webcast link:  go here.

Tuesday, July 28th at 5:00 – 6:00 PM Eastern

Toll Free Attendee Dial In: 833-614-0820; Access Passcode: 1492795

Audio Webcast link:  go here.

Nursing Homes Call

Wednesday, July 8th at 4:30 – 5:00 PM Eastern

Toll Free Attendee Dial-In: 833-614-0820; Access Passcode: 2997138

Audio Webcast Link: go here.

Wednesday, July 22nd at 4:30 – 5:00 PM Eastern

Toll Free Attendee Dial-In: 833-614-0820; Access Passcode: 1143564

Audio Webcast Link:  go here.

Home Health and Hospice Calls

Tuesday, July 7th at 3:00 – 3:30 PM Eastern

Toll Free Attendee Dial-In: 833-614-0820; Access Passcode: 9480618

Audio Webcast Link: go here.

Tuesday, July 21st at 3:00 – 3:30 PM Eastern

Toll Free Attendee Dial-In: 833-614-0820; Access Passcode: 6080197

Audio Webcast Link:  go here.

Dialysis Organizations Call

Wednesday, July 8th at 5:30 – 6:00 PM Eastern

Toll Free Attendee Dial-In: 833-614-0820; Access Passcode: 8481378

Audio Webcast Link:  go here.

Wednesday, July 22nd at 5:30 – 6:00 PM Eastern

Toll Free Attendee Dial-In: 833-614-0820; Access Passcode: 7692208

Audio Webcast Link: go here.

Nurses Call

Thursday, July 9th at 3:00 – 3:30 PM Eastern

Toll Free Attendee Dial-In: 833-614-0820; Access Passcode: 9386539

Audio Webcast Link:  go here.

Thursday, July 23rd at 3:00 – 3:30 PM Eastern

Toll Free Attendee Dial-In: 833-614-0820; Access Passcode: 7971869

Audio Webcast Link: go here.

Lessons from the Front Lines

Friday, July 17th at 12:30 – 2:00 PM Eastern

Toll Free Attendee Dial-In: 833-614-0820; Access Code: 3096434

Web Link:  go here.

Conference lines are limited so CMS encourages interested parties to join via audio.  To listen to the audio files and read the transcripts for the COVID-19 Stakeholder calls, visit CMS’s Podcast and Transcripts page.

Food and Drug Administration

Centers for Disease Control & Prevention

Department of Labor

  • The Department of Labor has issued guidance on child labor, paid sick leave, and expanded family and medical leave amid school and camp closures necessitated by COVID-19. See the announcement, which includes links to department policy bulletins.

American Medical Association

Federal Funding Opportunities for Hospitals

  • NASH has prepared a document that collects and presents in one place the various new federal funding opportunities for hospitals resulting from legislation addressing the COVID-19 public health emergency.  Find that document here.

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Coronavirus Update for Thursday, June 4, 2020

Coronavirus update for Thursday, June 4 as of 2:30 p.m.

NASH Advocacy

Today NASH sent a letter to HHS Secretary Alex Azar and CMS Administrator Seema Verma expressing safety-net hospitals’ disappointment that HHS still has not made a targeted distribution of CARES Act Provider Relief Funds to providers of especially high volumes of care to Medicaid and government-insured patients and urging them to do so as soon as possible.  See NASH’s letter here.


Centers for Medicare & Medicaid Services

Department of Health and Human Services

Centers for Disease Control and Prevention

Food and Drug Administration

  • The FDA has introduced a new web-based resource, Testing Supply Substitution Strategies, that includes detailed information to help support labs performing authorized COVID-19 tests.
  • The FDA has updated the question-and-answer appendix in its guidance Conduct of Clinical Trials of Medical Products during COVID-19 Public Health Emergency with new information about compliance for electronic systems used to generate electronic signatures on clinical trial records.
  • The FDA has issued an alert to providers about the temporary absence of the “paralyzing agent” warning statement on the vial caps of the neuromuscular blocking agents vecuronium bromide and rocuronium bromide, both of which are often used for patients requiring medical ventilation.
  • The FDA has issued emergency use authorizations (EUAs) for five new commercial diagnostic tests for COVID-19. Find them here, here, here, here, and here.
  • Federal Funding Opportunities for Hospitals

    • NASH has prepared a document that collects and presents in one place the various new federal funding opportunities for hospital resulting from legislation addressing the COVID-19 public health emergency.  Find that document here.

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Coronavirus Update for April 10, 2020

The following is the latest information from federal regulators as of 3:30 p.m. on Friday, April 10.

Centers for Medicare & Medicaid Services

Federal Communications Commission (COVID-19 Telehealth Program)

Last week the FCC announced a $200 million grant program to help health care providers develop connected care services to patients at their homes or mobile locations in response to the COVID-19 pandemic.  Today the FCC announced that it will begin accepting applications for this money on Monday, April 13.  See this FCC news release for further details on the program and the application process.

Food and Drug Administration

Centers for Disease Control and Prevention

Federal Emergency Management Agency

FEMA has issued a news release announcing that it will seek to give states the option of assuming control of federal community-based COVID-19 testing sites.

White House

President Trump has issued a memorandum on providing federal support for governors’ use of the National Guard to respond to COVID-19.  A similar order was issued earlier this week and this new order adds 13 states to the list of those previously authorized to use the National Guard in this manner, with the Federal Emergency Management Agency directed to assume 100 percent of the associated costs.  The new states are Arizona, Colorado, Kentucky, Mississippi, Montana, Nevada, North Carolina, Oregon, Pennsylvania, South Carolina, Virginia, Wisconsin, and West Virginia.

Federal Funding Opportunities for Hospitals

NASH has prepared a document that collects and presents in one place the various new federal funding opportunities for hospitals resulting from legislation addressing the COVID-19 public health emergency.  Find that document here.

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NASH Endorses Surprise Medical Bills Legislation

The National Alliance of Safety-Net Hospitals has endorsed the Consumer Protections Against Surprise Medical Bills Act of 2020, surprise medical bills legislation developed by the House Ways and Means Committee.

In a letter to the committee’s chairman and ranking member, NASH wrote that

NASH supports the bill’s protection of patients from surprise medical bills for care they receive from out-of-network providers; we support the concept of patients receiving an “Advance Explanation of Benefits”; and most of all, we support a mediation process to be used when insurers and providers do not agree on appropriate payments that requires those parties to engage in good-faith negotiations; that employs mediated dispute resolution when those negotiations do not lead to agreement on payments; and that excludes from that mediation the use of specific, standard benchmark rates.

See the entire NASH letter here.

Health Care Groups Rebel Against Proposed Federal Regulation, Program

The administration’s proposed Medicaid fiscal accountability regulation and its guidance encouraging states to implement Medicaid block grants has incurred widespread opposition among a variety of health care groups.

The Medicaid fiscal accountability regulation would, if adopted, impose new restrictions on how states raise their share of their Medicaid spending, potentially limiting state participation in Medicaid or necessitating tax increases to fill the funding gap if long-accepted financing tools are no longer available to them.

The Medicaid block grant guidance offers states a blueprint for curtailing their Medicaid costs by imposing limits on that spending that they negotiate with the federal government.

Numerous health care groups have expressed reservations or direct opposition to one or both of the proposals.  Among them:

  • AARP
  • America’s Essential Hospitals
  • America’s Health Insurance Plans
  • American College of Emergency Physicians
  • American Health Care Association
  • American Hospital Association
  • American Medical Association
  • Association for Community Affiliated Plans
  • Association of American Medical Colleges
  • Coalition of Long-Term Acute-Care Hospitals
  • LeadingAge
  • National Alliance of Safety-Net Hospitals
  • National Association of State Budget Officers
  • National Association of Medicaid Directors
  • National Continuing Care Residents Association
  • National Governors Association
  • Private Essential Access Community Hospitals

Among the groups submitting formal comment letters to the Centers for Medicare & Medicaid Services in response to the proposed Medicaid fiscal accountability regulation was the National Alliance of Safety-Net Hospitals.  See NASH’s letter here.

Learn more about why these groups object to these two new policy developments in articles in Axios (“A little-noticed Medicaid proposal could have huge consequences”), Bloomberg Law (“Trump Plan to Tame State Medicaid Finance Schemes Sees Pushback”), Health Affairs (“Proposed Rules On Medicaid Financing Miss Mark And Threaten Access”), Healthcare Dive (“Payers, providers urge CMS to scrap rule targeting supplemental Medicaid payments”), Healthcare Finance News (“Providers, payers, others speak out against federal proposals for Medicaid funding”), McKnight’s Long-Term Care News (“Providers rally against proposed Medicaid supplemental payment rules that threaten ‘major financial burdens’”), McKnight’s Senior Living (“CMS proposal would be ‘major financial burden’ for CCRCs, residents, organizations say”),  and U.S. News & World Report (“Governors Warn Trump Rule Could Lead to Big Medicaid Cuts

Improper Medicare Payments Down in FY 2019

The amount of improper Medicare payments made by the federal government fell $7 billion in federal fiscal year 2019, the Centers for Medicare & Medicaid Services reports.

FY 2019 marked the third consecutive year that improper fee-for-service payments have fallen.  In FY 2018, improper payments accounted for 8.12 percent of Medicare fee-for-service spending but in FY 2019 that portion fell to 7.25 percent.  In FY 2019, CMS estimates that it made $28.9 billion in improper fee-for-service payments.

$5.32 billion of the $7 billion reduction came through corrective actions in Medicare home health payments.  Other Medicare Part B services accounted for $1.82 billion in savings and durable equipment improvements also accounted for significant savings.

Learn more about the decline in improper Medicare payments and the policy changes that contributed to it in this CMS news release, which also links to a CMS fact sheet and a full report.


Most Hospitals Hit With Medicare Readmissions Penalties

Nearly 2600 hospitals will be penalized by Medicare in FY 2020 for excessive patients readmissions under Medicare’s hospital readmissions reduction program, according to the Centers for Medicare & Medicaid Services.

In all, 83 percent of hospitals covered by the program will be penalized, forfeiting up to three percent of their Medicare payments with an average penalty of 0.71 percent of those payments.  The cumulative penalties for these hospitals will amount to $563 million in FY 2020.

In all, 1177 hospitals will be penalized more than they were last year and 1148 will be penalized less.  56 hospitals will be assessed the maximum penalty of three percent and 372 have not been penalized for the past two years.

More than 2000 hospitals, among them children’s, psychiatric, and critical access hospitals, are not covered by the program.

Learn more about how hospitals will be affected by Medicare’s hospital readmissions reduction program and what this may say about the value and effectiveness of the program in the Kaiser Health News story “New Round of Medicare Readmissions Penalties Hits 2583 Hospitals.”

NASH Comments on Proposed Medicare Outpatient Payment Regulation (part 1 of 4)

The National Alliance of Safety-Net Hospitals has submitted extensive comments to the Centers for Medicare & Medicaid Services about its proposed changes in the Medicare outpatient prospective payment system for 2020.

In its letter to CMS, NASH focuses on four issues:

• CMS’s price transparency proposal
• Reimbursement for 340B-covered prescription drugs
• Medicare site-neutral payment policy
• Proposed updates of the inpatient-only list of medical procedures

Today this blog features NASH’s comments about CMS’s price transparency proposal. Tomorrow, we present NASH’s views on reimbursement for 340B-covered prescription drugs; on Friday, we present NASH’s views on Medicare site-neutral payment policy; and on Monday we present NASH’s perspective on CMS’s proposal to permit Medicare to pay for certain medical services on an outpatient basis rather than limiting them to being performed only on patients admitted to a hospital.

See the complete NASH letter to CMS here.

The Price Transparency Proposal

NASH appreciates CMS’s interest in fostering greater consumer awareness of the prices hospitals charge for their services and in facilitating price shopping among consumers for non-emergency “shoppable” outpatient services. Despite this, NASH believes the price transparency requirements presented in the proposed regulation reflect an imperfect understanding of how hospitals charge and are paid for their services, how patients find their way to doctors and hospitals, and how providers interact with health insurers. Most important, we do not believe the proposed requirements, even if implemented perfectly by every hospital in the country by January 1, 2020, would be at all helpful to consumers shopping for the best prices for the outpatient care they need.

Problems Inherent When Listing Service “Prices”

Our first concern is that the proposed means of achieving price transparency for shoppable outpatient services, by requiring hospitals to post their gross charges (from their chargemaster) and their payer-specific charges (as negotiated with the insurers with which they work), does not reflect an adequate understanding of how hospitals work with insurers to charge for their services. Specifically:

  • Hospitals do not bundle services the same way Medicare does and often bundle them differently with different insurers, creating apples-to-oranges comparisons that would be of little value to consumers – and that could even be misleading to consumers.
  • Some private payers discount multiple surgeries in different ways.
  • While Medicare pays for services using HCPCS codes, DRGs, and APCs, such codes often are not used as the basis for payments between hospitals and commercial insurers.
  • Some insurers reimburse hospitals based on Medicare APCs, which include an entire logic of bundled or incidental codes, which means that the incidental code, when billed in another context, might be payable separately. Other private insurers might pay for the same services based on a percentage of a hospital’s charges on a line-by-line basis.
  • A few insurers’ radiology payments bundle professional services into their payments to the hospital but most do not.
  • Hospitals may charge for each item and service but each item and service is not necessarily associated with an HCPCS code, DRG, NDC, or APC, as the proposed regulation anticipates – nor do hospitals and insurers necessarily negotiate prices for each individual item and service.
  • As a result of hospitals and insurers not necessarily negotiating prices for each individual item and service, this proposed regulation may be requiring hospitals to publish data that does not exist.
  • Within individual DRGs or APCs, hospitals do not provide a standard set of items and services. Their standard services could differ from patient to patient, depending on patients’ needs; from insurer to insurer, depending on the outcome of rate negotiations between individual hospitals and individual insurers; and from hospital to hospital, because such matters are not standardized, freeing hospitals to make their own decisions about how to set their prices and negotiate payments with insurers.
  • Some insurers bundle the cost of implants and drugs into outpatient case rates while others do not, preferring hospitals to bill separately for those implants and drugs.
  • Physician services may or may not be included by some hospitals in their standard service packages.
  • Because private safety-net hospitals need to engage in more cost-shifting than the typical community hospital to compensate for the losses they incur caring for large numbers of uninsured and Medicaid patients, their commercial rates may be higher than those other hospitals. This could lead people to see these price differences and assume they would have to pay more for the services of such hospitals – which in most cases they would not. Thus, posting such prices without appropriate context could damage the very private safety-net hospitals that society has a great stake in protecting.
The Underestimated Cost of Posting Hospital Prices

In the proposed regulation, CMS estimates that posting the required information should take hospitals approximately 12 hours and cost them about $1000 in staff time. NASH believes this grossly underestimates the work involved in such an undertaking. One NASH member, for example, reports that in one calendar quarter of 2019 it interacted with 250 distinct insurers (including Medicare), and in the case of 41 of those insurers, that interaction involved just one patient. That means this hospital would need to post charge and price data for at least 250 insurers, a meaningful proportion of which have members the hospital only rarely serves.

Another NASH member shared agendas for two meetings for relevant staff to discuss the price-posting requirements from the 2019 outpatient prospective payment system regulation. Those staff meetings, held in the fall of 2018 to address new requirements that were less demanding than those proposed for 2020, both involved 32 participants, many of whom were there to report on work already undertaken to meet the 2019 requirements and others who left the meeting with new assignments. This contrasts sharply with the proposed rule’s assertion that compliance would require the participation of just one lawyer, one operations manager, one business specialist, and one computer systems administrator. This member’s business services team, in fact, estimated that compliance with this requirement, if adopted as proposed, would necessitate the year-round services of two full-time employees.

This suggests that CMS has significantly underestimated the time and cost involved in posting the proposed information. This is a legitimate concern for hospitals – as it should be for CMS as well in light of its frequent, publicly articulated commitment to reducing the paperwork burden on health care providers so those providers can focus on providing care rather than on paperwork.

The Problem Posed by Sharing Proprietary and Confidential Information

The rates set between hospitals and insurers are not objective, universal measures: they are the product of careful, deliberate, and at times contentious negotiations between the parties. As a result of these negotiations, some hospitals gain more advantageous rates than others. As tempting as it might be for hospitals to learn if their competitors are doing “better” than they are in rate negotiations, it is more important to them to keep the results of their own negotiations confidential. Coca-Cola is not required to share its soft drink recipe with its competitors and NASH believes it would be inappropriate, and possibly even foster a form of collusion, to require hospitals to share so publicly their rate information – proprietary information – with their competitors. Doing so also could violate confidentiality agreements between the negotiating parties.

The Biggest Challenge: The Required Information is Not Useful

The underlying rationale for this price transparency proposal appears to be that if consumers have more information they will be more likely to make better, more informed health care purchasing decisions. In the case of this particular proposal, however, NASH believes that more information will not be better information and that it will not lead to better, more informed purchasing decisions.

Without question, NASH’s biggest objection is that after all of the work hospitals would have to do to meet this proposed regulation’s requirements and after all of the “shopping” consumers might do once such information becomes available, we are convinced that consumers will find this information to be of little value. In the experience of hospitals, the reality of this situation, as opposed to the theory underlying it, is that patients are not interested in whether the shoppable service they need “costs” $10,000 or $15,000 – not interested because they have health insurance and know they will not be paying that $10,000 or $15,000 cost. In the experience of hospitals, patients are interested only – only – in what their out-of-pocket costs will be, which means their co-pays and deductibles for the outpatient service in question. In short, the “price” that this entire undertaking seeks to provide to consumers is not viewed by those consumers as a price at all and is irrelevant to them. This is comparable to a consumer purchasing a mattress with a list price of $3000 for a sale price of $1250. No one cares that the list price is $3000; all that matters is that the mattress can be purchased for $1250.

Instead, the overwhelming majority of patients who contact hospitals about costs prior to receiving outpatient services inquire only – only – about their anticipated out-of-pocket costs. Months can go by without patients referring to or asking about a hospital’s charges or its prices, let alone about its chargemaster; in fact, the word “chargemaster” is unknown to the vast majority of health care consumers. NASH encourages CMS officials to spend a few days in a hospital billing office and sit with customer service representatives as they field calls from patients who are considering procedures or have procedures scheduled. When you do, you will find that these patients virtually never inquire about a procedure’s price or cost; they are interested only in its cost to them, which is very different – and which will not be included in the vast amount of data this proposed regulation would compel hospitals to publish for consumer use. This has certainly been the experience of NASH members in California and Connecticut, where hospitals are already required to post extensive price and charge data on their web sites and where those hospitals tell us they seldom are asked by patients about their actual charges.

In the end, NASH believes, there are virtually no true “consumers” for this data at all, with the possible exception of competitors eager to learn if they are doing better, or doing worse, than nearby hospitals when negotiating rates with health insurers (or, for that matter, insurers eager to learn if they are overpaying or underpaying compared to other insurers). In the end, the time patients might spend visiting hospital web sites to research the cost of outpatient care and talking to hospital billing offices about their potential out-of-pocket costs would unquestionably be better spent talking to their insurers because those insurers, rather than hospitals, are more likely to have the answers to these questions and ultimately are the best source of information about the out-of-pocket costs patients can expect to incur when seeking medical care. This information is controlled and managed by insurers, not providers, so it is insurers that would be a more appropriate focus of CMS’s laudable effort to provide information that would be relevant to consumers and help inform their health care purchasing decisions.

See the complete NASH letter to CMS here.

Tomorrow: NASH addresses CMS proposal governing reimbursement for 340B-covered prescription drugs.

MedPAC Meets

Last week the Medicare Payment Advisory Commission met in Washington, D.C. to discuss a number of Medicare payment issues.

Among the issues on MedPAC’s March agenda were:

  • options for slowing the growth of Medicare fee-for-service spending for emergency department service
  • Medicare’s role in the supply of primary care physicians
  • evaluating an episode-based payment system for post-acute care
  • mandated report: changes in post-acute and hospice care following the implementation of the long-term care hospital dual payment rate structure

MedPAC is an independent congressional agency that advises Congress on issues involving the Medicare program.  While its recommendations are not binding on either Congress or the administration, MedPAC is highly influential in governing circles and its recommendations often find their way into legislation, regulations, and new public policy.

Go here for links to the policy briefs and presentations that supported MedPAC’s discussion of these issues.