Friday, September 30, 2011

CMS has News to Share about the EHR Incentive Programs

AHIMA Conference
Are you attending the 2011 AHIMA Convention and Exhibit, which takes place from September 30 – October 6 in Salt Lake City, Utah? CMS will be at booth #1631, and will have representatives from the CMS EHR Incentive Programs on-site to provide information about the programs and hear your participation stories. Attendees are encouraged to visit the booth and get the resources they need to successfully participate in the EHR Incentive Programs.
CMS has posted new videos to the CMS, including:

Updated Registration and Payment Numbers 
As of August 31, 2011, more than 90,000 providers have registered for the EHR Incentive Programs, and more than $652 million has been received in incentive payments for both the Medicare and Medicaid programs. If you have not already done so, take a look at CMS' Educational Materials page on the EHR website to find helpful information about eligibility, registration, meaningful use, and attestation. 
Want more information about the EHR Incentive Programs?
Make sure to visit the EHR Incentive Programs  website for the latest news and updates on the EHR Incentive Programs. 

North Carolina Blues, Allscripts to hook up 750 docs with EHRs

Blue Cross and Blue Shield of North Carolina (BCBSNC) is collaborating with health technology company Allscripts to roll out electronic health records to more than 750 North Carolina physicians, including more than 150 physicians in 39 free clinics, allowing them to connect to the statewide health information exchange.
BCBSNC will cover 85 percent of EHR cost for eligible independent practices and 100 percent for eligible free clinics, including training and support for participating practices.
The new initiative, called the North Carolina Program to Advance Technology for Health (NC PATH), also provides training and ongoing support for the practices to implement the certified EHR technology, and work towards achieving meaningful use status and becoming patient-centered medical homes.
"This alliance with Allscripts puts our state on a path to better health outcomes driven by high standards," said Brad Wilson, BCBSNC president and CEO. "By providing more than 750 physicians with this technology and support, they are better able to coordinate care – an important step toward improving our healthcare system."  
As part of the program, participating practices receive support for their efforts toward earning PCMH recognition, which has shown results in enhancing healthcare quality and managing costs. BCBSNC, working with the NC Area Health Education Centers (NC AHEC) Regional Extension Center programs, will help practices identify quality improvement opportunities in order to achieve PCMH status. In addition, BCBSNC is working with the North Carolina Health Information Exchange (NC HIE) to create a program to enable all participating providers to connect to the HIE.
"North Carolina is taking real action and leading the charge toward more effective, more efficient healthcare," said Glen Tullman, CEO of Allscripts. "Electronic health records are a critical part of a future that provides Americans with more affordable, higher quality care. Collaborations like this one that expand the reach of technology are a step in the right direction."
Cost and use of EHR technology
BCBSNC is investing $15 million into the NC PATH program with Allscripts sharing in the cost, continuing its support of North Carolina healthcare initiatives. The investment allows BCBSNC to cover 85 percent of the software and setup costs for 600 physicians in eligible independent practices and 100 percent of the costs for 39 eligible free clinics over the next five years, eliminating the largest barrier of entry for utilization of EHR technology.  
Participation in NC PATH will help physicians meet key provisions of the HITECH Act, including:
  • Adoption of certified EHR technology to support 'meaningful use' requirements.
  • Eligibility for up to $44,000 in 'meaningful use' EHR incentive payments under the HITECH Act. This is in addition to the BCBSNC subsidy.
  • NC AHEC Regional Extension Center support in achieving meaningful use well in advance of the 2015 deadline, which avoids potential reduced Medicare reimbursements.
  • Practices that implement meaningful use certified EHR technology show improvements in the quality of provided care, reduced medical errors and reductions in redundant or unnecessary care, which helps to rein in medical costs. 

Thursday, September 29, 2011

CMS will Pay $20 per Patient Monthly Medical-Home Fee

September 29, 2011 — The Centers for Medicare and Medicaid Services (CMS) put a price tag on the much-discussed medical-home concept when it unveiled a plan yesterday to strengthen primary care through new test models for delivering and paying for services.
Physicians participating in the Comprehensive Primary Care Initiative (CPCI) will receive a monthly care-management fee on top of their usual Medicare fee-for-service reimbursements during a 4-year trial run. CMS will initially pay clinicians an average of $20 per Medicare beneficiary per month in the first 2 years. Actual payments will range from $8 to $40 per month because of risk-adjustments based on patients' claims histories and medical status. The agency also will adjust care-management fees up or down to reflect geographic differences in costs.
Richard Baron, MD, director of the Seamless Care Models Group at the CMS Innovation Center, said at a briefing today that the care-management fees are 40% to 50% more than Medicare invests now in primary care.
The care-management fee drops to $15 in the third and fourth years of the CPCI based on the CMS assumption that physicians will become more efficient in this work. In addition, the agency wants to "shift reliance to accountable forms of payment" such as shared savings, which kick in during year 2. Under a shared-savings arrangement, physicians attempt to come under budget in caring for a group of Medicare patients while meeting quality standards. If they succeed, they receive a slice of the savings.
Private Insurers Needed to Make Plan Work
CMS states that the CPCI, an outgrowth of healthcare reform, builds on and extends the patient-centered medical-home concept that many primary care physicians view as the salvation of their specialty. In this delivery model, primary care physicians are financially rewarded for care-management chores — such as talking to a patient's family members or managing specialty referrals — that typically go unreimbursed in traditional fee-for-service Medicare. Medical homes emphasize prevention, patient and caregiver engagement, continuity of care, easy access, and the use of electronic health record (EHR) software to help make it all happen.
CMS is inviting private insurers to participate in the CPCI as well and either pay care-management fees to physicians or support them with embedded care managers, health educators, or pharmacists. Getting these insurers to sign up is critical for the initiative's success, according to the agency. Medicare alone cannot motivate physicians to switch to a new care model.
"Having a majority of a practice's payers supporting enhanced primary care will ensure that a practice can implement a more consistent and comprehensive approach to treating patients," the agency stated in a solicitation for insurers to apply. "Without that majority, practices risk not having enough sustained support to provide the services we are seeking."
Private insurers have until January 17, 2012, to submit an application to participate. CMS will then choose insurers in 5 to 7 markets and recruit 75 primary care practices in each one to come aboard. The agency expects to begin selecting the practices by the spring of 2012 and start paying them under CPCI by the summer.
"We believe that participating practices, depending on the degree of (private) insurance participation, may see a 30% to 50% increase in their gross revenue," said Dr. Baron. The boost in pay, he said, will enable them to invest in the staffing and information technology needed for this "new business model of primary care."
CMS Innovation Center Director Richard Gilfillan, MD, added today that by giving primary care physicians more time and resources to care for patients, healthcare costs will eventually stabilize, patients will be healthier and happier, "and doctors will be more fulfilled."

Wednesday, September 28, 2011

CMS to start Appeal Process for EHR Incentive

The Centers for Medicare and Medicaid Services (CMS) intends to establish an appeals process for the Medicare electronic health record (EHR) incentive program.

CMS, to that end, has awarded a $2.25 million contract to Provider Resources Inc., of Erie, Pa., to help develop the administrative appeals process, and evaluate and promote the infrastructure to support it.

Provider Resources, which provides analysis and education about program integrity and healthcare quality, will also support CMS with problem identification and system solutions for the appeals process, according to a Sept. 22 notice in Federal Business Opportunities.

The vendor will also work with CMS and other partners to conduct outreach about the appeals process.
CMS said in August that it is working to come up with the policy and procedures for an appeal process for Medicare providers participating in the EHR incentive program.

Monday, September 26, 2011

Bipartisan Group to equip with 48 million Medicare enrollees with SmartCards

A bipartisan group of lawmakers has introduced legislation that would equip the nation’s 48-million-and-counting Medicare enrollees with smartcards, thus improving access to healthcare and saving an estimated $30 billion a year in fraud and waste.
The proposed legislation comes as three other lawmakers are petitioning the Government Accountability Office to evaluate the Centers for Medicare & Medicaid Services’ Medicare eligibility system, saying it sometimes takes far too long to determine beneficiary eligibility.
The Medicare Common Access Card Act of 2011, sponsored by Sens. Mark Kirk (R-Ill.), Ron Wyden (D-Ore.) and Marco Rubio (R-Fla.) in the Senate and Reps. Jim Gerlach (R-Pa.), Earl Blumenauer (D-Ore.) and John Shimkus (R-Ill.) in the House, would create a two-stage process for the smartcard program. The first stage would consists of a number of pilot programs to embed microchips in Medicare identification cards, while the second would expand those programs nationwide.
The pilot programs would study the smartcards’ ability to improve quality and access to care and accuracy of Medicare and reduce the likelihood of identity theft, waste, fraud and abuse.
The Department of Justice has estimated the cost of Medicare fraud at $60 billion per year, while the Office of Management and Budget said more than $48 billion in improper payments were made by Medicare in 2010. Supporters of the smartcard proposal say it would reduce fraud and improper payments by authenticating providers, patients and services at the point of care. Under the current process, Medicare generally pays all claims, then tries to recoup fraudulent payments after they’ve been made.
The enhanced cards would not display Social Security numbers and would require a PIN for verification. Under the proposal, healthcare providers would also be issued with cards with biometric security features, and both the providers and the patient would have to insert their cards into a reader at the point of care to confirm that services were rendered.
The program is modeled on the Common Access cards now used by some 20 million Department of Defense personnel and Military Health System enrollees.
“Building on the smartcards already issued to all Americans in uniform, we can offer seniors more protection for their identities while reducing fraud and waste in the strained Medicare system,” Sen. Kirk said in a press release issued by the six lawmakers. “By removing a senior's social security number from the front of the card and including the security upgrades used on the cards of our troops, this secure Medicare Common Access Card will also help end Medicare's current 'pay then chase' policy that allows so much fraud and waste.”
The proposal has received support from the Secure ID Coalition, a group of four companies that offer identity protection services like smartcards, and the AARP. The SIDC has launched a website,
“This innovative bill will protect our nation’s seniors by issuing them an upgraded, secure Medicare card similar to the identity credential used by the Department of Defense, known as the Common Access Card. Based on a smart card platform – a proven, tested, and trusted technology used throughout government – the modernized Medicare card will also help to protect our senior’s privacy and security by taking the Social Security number off of the front of the Medicare card. This is a basic privacy protection seniors have been demanding for years, and it’s about time they were heard,” said Kelli Emerick, the SIDC’s executive director, in a press release.
Officials estimate the new program would cost $19 per person in cards and readers if enacted on a nationwide basis.
The smartcard program could aid the Medicare eligibility system called into question on Sept. 22 by Republican Sens. Richard Burr (North Carolina), Tom Coburn (Oklahoma) and Orrin Hatch (Utah). In a letter sent to CMS, the three lawmakers cited “concerns about recurring problems with” CMS’ HIPAA Eligibility Transaction System (HETS).
The senators said some healthcare providers and beneficiaries have complained of long wait times in trying to confirm eligibility, as well as a lack of telephone access to CMS.
“If HETS is failing to serve providers and seniors – whether due to increased transaction volume because of the new Medicare beneficiaries aging into the program or to mismanagement and neglect – Congress deserves to know the facts … in order to help CMS make the necessary course corrections before the problem becomes more acute,” the letter read.

Humana to acquire Medicare Advantage HMO MD Care

Chris Anderson

Humana Inc. announced today an agreement to acquire Southern California’s MD Care, a Medicare Advantage HMO with approximately 15,000 members.
When completed the deal will add to Humana’s existing book of MA business in California where it has more than 200,000 members. MD Care’s 2010 revenue was $155 million. Terms of the agreement were not disclosed
“As Humana continues growing its Medicare business in the western U.S., MD Care offers an opportunity to expand our Medicare footprint and the suite of products and services we offer in California,” said Thomas J. Liston, senior vice president of senior products for Humana in a press release announcing the deal.
Four-year-old MD Care currently offers Medicare beneficiaries a choice of Medicare Advantage plans that serve as an alternative to traditional fee-for-service Medicare. MD Care’s medical plans include two Medicare Advantage plans including a special needs plan, and Medicare Part D insurance for prescription drug coverage. MD Care’s market area includes all of Los Angeles County and Orange County; and select zip codes San Bernardino County and Riverside County.
According to company information, MD Care’s medical delivery model focuses on preventive care, health maintenance and access to health services, which are safe, evidence-based and quality driven.
The transaction is subject to both federal and state regulatory approvals and is expected to close in late 2011. Humana’s acquisition of MD Care is not expected to materially impact the company’s financial earnings this year.

States choose diverse paths to expand Medicaid managed care

Mary Mosquera, Senior Editor

New York, North Carolina and Texas are examples of how states take different paths to expand and improve Medicaid managed care, including medical home models, new services and health plan competition. Regardless of the tools, managed care is fast approaching as the primary method to deliver health care to low income populations.
New York has the largest Medicaid program in the country based on its annual budget of $53 billion and serves 5 million New Yorkers, about 25 percent of the state’s population, according to Jason Helgerson, Medicaid director in the Office of Health Insurance Programs, New York State Department of Health.
The state has gravitated to managed care on a voluntary basis but left individuals with complex and chronic conditions in its fee-for-service program, “sort of a halfway point to real managed care for the entire population but not going into those higher cost areas. That has changed in the last few months,” he said at a recent briefing sponsored by the Kaiser Family Foundation.
A Medicaid redesign team in New York “put the state on a three-year glide path to get out of fee-for-service in our state,” Helgerson said 
New York wants to expand the mandatory managed care umbrella to the dual eligible population, who drive 36 percent of the total Medicaid budget, to bring them into integrated and coordinated care. “We have a number of small programs, but they haven’t grown to sufficient size yet,” he said. The state has also mandated that managed long-term care will take effect in April 2012.
New York has 820,000 Medicaid patients in medical homes and pays a bonus to physicians who meet National Committee for Quality Assurance (NCQA) accreditation standards. Most of those patients are in low-income health plans. “We’re gearing up for the move which includes identifying very specific performance measures that we’re going to hold plans accountable for,” Helgerson said. "We’re now looking at outcomes of those members to see if that extra payment of millions of dollars is seeing a return on investment."
To use managed care effectively, states have “to structure the contractual relationship, provide the right financial incentives and have the right checks in the system to ensure getting the outcomes you want,” Helgerson said. 
Elsewhere, North Carolina has expanded its pioneering Community Care of North Carolina (CCNC) Medicaid medical home model across all the state’s 100 counties and serves 1 million Medicaid recipients. CCNC, established as a not-for-profit organization, has 14 provider networks that develop care management and coordination practices, and an informatics center to collect and analyze claims data for quality purposes.
North Carolina plans to add incentive-based upon metrics to further drive quality, said Dr. Craigan Gray, director, medical assistance division, North Carolina Department of Health and Human Services. For example, pharmacy services will fill more generic prescriptions based on tiered reimbursement. CCNC has also added a pregnancy medical home model, with measures to improve clinical outcomes.
“We’ll pay the obstetrician a little more. It’s data and claims driven, and there is surveillance through in-office chart review to make sure they meet the quality outcome metrics,” he said.
“But that does not measure the collateral benefit that we receive from this program from getting healthier kids and avoiding the later costs that Medicaid would undoubtedly bear from being very low birth weight,” Gray said.
The medical home model in North Carolina has demonstrated enough cost savings and quality improvements to attract the attention outside of Medicaid of several large employers within the state. These organizations, including the manager of North Carolina’s health plan for state workers, Blue Cross and Blue Shield, have engaged CCNC as an option to their health coverage. The overwhelming majority of primary care providers in North Carolina participate in CCNC.
“This is truly engaging the power of the Medicaid program to improve the standard of care across the state,” Gray said.
Texas plans to grow its STAR Medicaid managed care program throughout the state by March 2012 from just large metropolitan areas, in part to be prepared for the anticipated spike in individuals eligible for Medicaid under health reform.
Medicaid growth in general is outpacing infrastructure, and states are going to have to respond, said Joe Vesowate, deputy director of managed care operations, Medicaid and CHIP divisions, Texas Health and Human Services Commission.
Care coordination is a cornerstone, along with adding services to support that, such as a pharmacy benefit.
In March 2012, Texas Medicaid will add a managed care dental program for its children’s insurance program and expand to most parts of the state its STAR Plus managed care program for acute and long-term services for the disabled and chronically ill.
A critical characteristic underlying the expansion of managed care and controlling costs is Texas’ competitive procurement for healthcare services. ”The key is having these competitive relationships, good business environment and the right number of managed care organizations for the capacity,” Vesowate said.

Friday, September 23, 2011

An Important EHR Incentive Program Deadline is Approaching

Looking Ahead
Take a look at all of the other EHR Incentive Program important dates that are coming up by going to our CMS Medicare and Medicaid EHR Incentive Programs Milestone Timeline, or reviewing the “Important Dates” section of the EHR Incentive Programs’ Overview page.
Want more information about the EHR Incentive Programs?Make sure to visit the CMS EHR Incentive Programs website for the latest news and updates on the EHR Incentive Programs.

Only 15 Percent of Healthcare Executives are "Very Familiar" with ACOs

Chris Anderson

The 2011 Accountable Care Organization (ACO) Readiness Study released recently by Beacon Partners shows that only 15 percent of healthcare executives are “very familiar” with ACOs. Nonetheless, more than half surveyed said they are moving ahead with plans for ACOs.
“Clearly, there is still a lot of confusion and uncertainty surrounding ACOs, but most healthcare organizations understand that they need to move forward with an ACO strategy,” says Kevin Burchill, director at Beacon Partners in a press release. “This is most likely due to the fact that many C-level executives are optimistic regarding the potential benefits that an ACO model will provide to their organization.”
The study found that 62 percent of healthcare executives were “somewhat familiar” with ACOs and – even though there was still a high level of uncertainty and many didn’t have a high level of familiarity with the ACO concept – 92 percent of respondents said they are either in development or in the pre-planning stages for their own ACO. This marks a significant jump from a study by Beacon released earlier this year that showed only 47 percent of healthcare organizations were in the planning and development stages.
Healthcare organizations are going to need to becoming much more conversant in exactly what an ACO is and what its benefits are in order to successfully promote the concept, Burchill noted.
“It’s crucial for the industry to improve upon their communication of an ACO’s structure, rules and benefits, otherwise there will continue to be some level of negativity surrounding ACOs,” he said.
Other findings in the report include:
  • 45 percent of those surveyed have not committed money from their operating budgets to ACO planning efforts and 27 percent are unsure what their budget is for ACO planning
  • 49 percent of respondents named their CEO as the person responsible for ACO development
  • 53 percent of respondents have not yet created a department or executive role to develop an ACO
  • 44 precent of respondents have no plans to hire personnel to handle ACO development, and another 25 percent plan to reallocate existing personnel
  • 48 precent of respondents are unsure as to how an ACO will affect their organization
  • 31 percent of respondents listed undefined rules and confusion of ACO structure as their top concern in the market, followed by high start-up costs (17 precent) and regulatory issues (14 precent)
“Perhaps none of this should be surprising given that ARRA and PPACA regulations have challenged providers to move forward without the benefit or clarification of final rules and regulations,” Beacon noted in the report’s executive summary. “Nor should it surprise that this confusion has also led to uncertainty about how to communicate ACO developments to their patients.”

Thursday, September 22, 2011

Materials from CMS' National Provider Calls Now Available Online

  • Who is eligible?
  • How much are the incentives and how are they calculated?
  • How does one get started?
  • What are major milestones regarding participation and payment?
  • How does one report on meaningful use?
  • Where can helpful resources be found?
  • Defining "meaningful use"
  • The requirements for Stage 1 of meaningful use (2011 and 2012)
  • Attestation for meaningful use
  • Goals of the Meaningful Use Objectives Specification Sheets
    • Stage 1 EHR Meaningful Use Specification Sheets for Eligible Professionals 
    • Stage 1 EHR Meaningful Use Specification Sheets for Eligible Hospitals 
  • Question & answer session
Want more information about the EHR Incentive Programs? 
Make sure to visit the Medicare and Medicaid EHR Incentive Programs website for the latest news and updates on the EHR Incentive Programs. 

CMS will create ACO claims, provider database

The Centers for Medicare and Medicaid Services will create a database containing the health information of Medicare beneficiaries who receive treatment with providers participating in an accountable care organization.
CMS said it will use the data collection to support policy activities and reimbursement for its programs to bundle payments and share savings.
Besides Medicare beneficiaries, the database will contain personally identifiable information about certain individuals participating in the ACOs, including healthcare sole proprietors, providers, key leaders and managers of ACOs and contact persons.

Some of the information could be patient claims number, which could incorporate a Social Security Number, address and date of birth, or ACO eligibility and contact records, including the home address of a key leader or manager; or ACO participant tax identification number, according to an announcement in the Sept. 19 Federal Register. The database will become effective Oct. 19. The public may comment on it until then.
Federal agencies must report when they intend to establish a new system with personally identifiable information and assure safeguards against its disclosure for other than its stated uses, including determining the eligibility of ACO applicants, to meet quality and other reporting requirements, under the Privacy Act.
“Relevant HHS personnel, and any CMS contractors, grantees and consultants assisting them, will use personally identifiable information from this system on a ‘need to know’ basis,” the notice said.
The Medicare Shared Savings Program aims to reward quality care and takes steps toward paying for quality and efficient care by promoting accountability for a patient population and coordinates inpatient and ambulatory services and encourages investment in health IT and redesigning care processes. Under the Pioneer ACO Model, up to 30 provider organizations will test alternative payment models that include escalating financial accountability and arrangements based on outcomes in quality and patient experience. 
The programs are designed to carry out new delivery and reimbursement provisions under the Patient Protection and Affordable Care Act.

Wednesday, September 21, 2011

Providers seek vendor help with ACOs

By: Mike Miliard

As health organizations begin to feel their way toward accountable care models, a new report from KLAS explores how providers and vendors are putting the pieces together, finding varying levels of confidence in IT solutions' integration ability.
 For the new report, titled "Accountable Care: Providers Forge the ACO Trail," KLAS interviewed 197 providers at 187 organizations to get a picture of how they're approaching accountable care – and how health IT tools are helping (or hindering) their efforts.
The accountable care organization (ACO) is a care delivery model where groups of healthcare providers take collective responsibility for managing patients' long-term continuum of care. ACOs that cut care costs without missing quality targets receive a portion of the savings.
While only a third of providers surveyed by KLAS plan to pursue a formal Medicare ACO designation, the majority agree that accountable care is the way of the future.
"Accountable care will touch every aspect of an organization," said Jason Hess, author of the report. "Its changes have the potential of turning the healthcare world upside down – from patient care to administration to revenue cycle management to IT infrastructure. The internal challenges appear endless. Unfortunately, planning an ACO is further complicated by the fact that the final government rules have not yet been published."
There are no one-stop shops for providers' ACO IT needs, says Hess, especially since each ACO will be different. Many providers are looking to leverage a combination of technology solutions to fill in the gaps and meet ACO requirements. That said, providers see some vendors are more prepared than others – with the most integrated rising to the top.
Top-tier healthcare vendors Cerner and Epic currently lead the way in provider confidence as being most ACO-ready, according to the KLAS report. Despite a few integration and offering gaps, Cerner has already integrated many of the IT pieces needed to complete an ACO puzzle and is taking a proactive approach to working with individual needs of interested providers.
Epic is also perceived as being close to ACO-ready, the survey finds, with gaps found primarily in their analytic capabilities and their ability to share data with non-Epic systems.
The KLAS report also examines provider perceptions of ACO readiness for Allscripts (Eclipsys), CPSI, GE Healthcare, McKesson, MEDITECH, QuadraMed and Siemens.
"Providers describe a variety of planned HIT purchases for their ACO projects - including data warehousing and analytics, HIE and patient portals," said Hess. "Vendors whose offerings integrate best with providers' in-house systems will top the selection lists going forward."
To learn more about this report, visit

Tuesday, September 20, 2011

Obama Deficit Plan Has Medicare Provider, Beneficiary Cuts

September 19, 2011 — A deficit-reduction plan unveiled by President Barack Obama today would wring $248 billion in savings from Medicare over 10 years, in part by cutting special payments to rural physicians and hospitals, requiring prior authorization for expensive imaging services, and reducing support for teaching hospitals.
Another $72 billion in savings would come from Medicaid and other healthcare programs.
In all, the president's plan would trim the deficit by more than $3 trillion through a mix of spending cuts and tax hikes that follow the so-called Buffet Rule (suggested by billionaire Warren Buffett): People making more than $1 million should not have lower tax rates than the middle class. Obama's proposed surgery on the deficit comes on top of roughly $1 trillion excised by the federal debt-ceiling deal in August.
The new proposal will become fodder for Congress and its newly appointed Joint Select Committee on Deficit Reduction, also known as the "super committee." That bipartisan group was tasked by the debt-ceiling legislation to find $1.5 trillion in additional savings that Congress must enact by December 23. Given that Congressional Republicans, who control the House and have enough votes in the Senate to filibuster, have announced stony opposition to tax increases, the Obama plan faces a tough, if not impossible, going.
President Barack Obama called for new deficit cuts of $3.0 trillion.
Nicholas KAMM/AFP/Getty Images
However, the president has signaled he will play hardball on the tax issue. He warned today that he would veto any deficit-reduction package that reduces Medicare benefits for seniors but fails to "raise serious revenues" from the wealthiest Americans and biggest corporations.
"We are not going to have a one-sided deal that hurts the folks who are most vulnerable," Obama said today.
Program Cuts Called Modest
The Obama administration characterizes the $320 billion in cuts to Medicare and Medicaid as both modest and necessary for the long-term viability of the programs. Physicians would feel their nick in a number of ways:
  • Medicare traditionally has paid physicians and hospitals in underserved rural areas a little extra, but these payments "may be greater than necessary to ensure continued access to care," according to the Obama administration. It therefore wants to end an "add-on payment" for physicians and hospitals in certain low-population states in 2013.
  • The dramatic growth of Medicare spending for imaging services has led some experts to question whether such scans are always necessary or reasonably priced. Accordingly, the Obama administration would require prior authorization for the most expensive imaging services, beginning in 2013, along with lower reimbursement for them.
  • As part of an initiative to reduce improper Medicare payments, the administration would penalize providers who fail to update their enrollment information.
  • Residency training programs could experience pain under a proposal to reduce Medicare subsidies for teaching hospitals, saving $9 billion over 10 years. The subsidies exist because teaching hospitals, by their very nature, are less efficient, and are therefore costlier to operate. However, the administration believes current subsidy payments exceed the extra costs that these hospitals incur by training residents.
The quest for Medicaid savings would target high prescribers. The government wants to require states to track Medicaid drug claims for signs of waste, fraud, and abuse, and prevent it from happening in the first place.
Deductibles, Premiums Would Increase for Some Beneficiaries
Medicare belt-tightening in the president's proposal affects beneficiaries, as well as providers:
  • Beneficiaries who are already paying higher Medicare Part B and Part D premiums on account of their high income would pay 15% more beginning in 2017.
  • The annual deductible for Medicare Part B would increase by $25 in 2017, 2019, and 2021 for new beneficiaries. The idea here is to motivate seniors to seek "high-value healthcare services"; that is, good care at a lower price.
  • Also in 2017, beneficiaries would begin to owe a $100 copayment for home-health episodes with 5 or more visits that are not preceded by a hospital stay.
  • The government has determined that seniors who purchase MediGap policies to pay for costs not covered by Medicare — copays, for example — tend to use more healthcare services, driving up Medicare spending. The administration proposes to add a hefty surcharge to Medicare Part B premiums in 2017 whenever beneficiaries buy a MediGap policy that subjects them to little if any cost-sharing. Presumably, the surcharge would discourage seniors from obtaining such generous MediGap policies.
To apply the brakes even more to Medicare spending, Obama today reiterated an earlier proposal to strengthen a creation of the new healthcare reform law, the Independent Payment Advisory Board (IPAB). The job of the IPAB is to counsel Congress on how to slow down Medicare spending if it exceeds growth-rate targets set by the law. If Congress does not implement what the IPAB recommends, it must come up with its own cost-cutting plan, or else let the Department of Health and Human Services devise one.
In 2018, the IPAB target is growth in the gross domestic product plus 1%. Obama wants to make it gross domestic product growth plus 0.5%.
The American Medical Association and other medical societies view the IPAB with hostility because it represents an additional threat to physician revenue. Many Congressional Republicans have advocated repealing the IPAB, saying that it will ration healthcare for seniors, even though the Affordable Care Act prohibits the board from increasing beneficiary premiums or cost-sharing, or restricting benefits.
Deficit-Reduction Math Factors in Doc Fix
The American Medical Association quickly identified at least one thing it liked about the administration's deficit-reduction plan: Obama's numbers assume passage of a "doc fix" to the Medicare reimbursement crisis created by the program's sustainable growth rate formula for setting physician pay. That formula will trigger a 29.5% reduction in Medicare rates on January 1 unless Congress acts to avert it.
Current federal budget projections assume this massive reduction will occur. Repealing the sustainable growth rate and freezing Medicare rates for 10 years would cost $300 billion, which is an amount that must be factored into deficit-reduction math, the Obama administration said. "Failure to do so simply masks the worsening long-run deficit."
In a press release today, American Medical Association President Peter Carmel, MD, commended the president for recognizing that deficit reduction must take sustainable growth rate repeal into account.

Medicare Payment Advisory Commission (MedPac) doc fix doesn't impress

Stephanie Bouchard

The Medicare Payment Advisory Commission is proposing to fix the Sustainable Growth Rate by sharing the cost of repealing the SGR among physicians, other health professionals, providers in other sectors and beneficiaries. The response from those in the industry has been less than supportive.

MedPAC, a body that advises Congress on Medicare payment policy, presented a draft of its proposal last week. In it, MedPAC said its SGR repeal would cost about $200 billion. To pay for its repeal plan, MedPAC suggests instituting a 10-year payment rate freeze for primary care physicians and three years of reduced payments at 5.9 percent each for specialists followed by a seven-year payment freeze. It also recommends offsets totaling about $235 billion. Those offsets would come from cuts to Medicare Part D drug plans (32 percent); post-acute care facilities (21 percent); Medicare benefits to seniors (14 percent); hospitals (11 percent); laboratories (9 percent); durable medical equipment (6 percent); Medicare Advantage (5 percent); and others (2 percent).
“While we fully appreciate the need to correct problems in the Medicare payment system for physicians, we are deeply concerned that this MedPAC outline to address the so-called 'doc fix' disproportionately targets the (skilled nursing facility) sector – and the net impact of these proposed Medicare cuts would place seniors' care at deep risk, jeopardize jobs across America and further destabilize the nation's second largest health facility employer," said Alan G. Rosenbloom, president of the Alliance for Quality Nursing Home Care in a statement.
“… As we have in the past, we will continue to insist today that the U.S. Congress should make its Medicare funding decisions based upon the complete set of funding variables and economic realities facing skilled nursing facilities, our patients and our workforce,” he added. “This MedPAC outline inherently fails to recognize these realities."
Organizations representing physicians are balking at the proposed cuts and freezes to physician payment rates. In a statement, the American College of Surgeons praised MedPAC for recognizing the need to eliminate the SGR but the organization criticized the commission for undervaluing the role of physicians.
“Unfortunately, while the MedPAC recommendations being considered do eliminate the SGR, they fail to meet the goal of quality and further jeopardize access to care,” reads ACS’ statement. “The recommendations do not value the role all physicians have in the continuum of care and would have a devastating impact on access to surgical care.”
“We do not believe that cuts are the answer,” ACS’ statement continues. “We believe that a replacement of the SGR needs to be created that leverages quality, bends the cost curve, pays down the SGR debt and incentivizes value in the future. Over the next several years, the cost of caring for the frail and elderly will place an enormous strain on the country's healthcare resources. As a result, the ACS supports redesigning the delivery system to meet this critical demand by applying a shared savings model centered around quality and value incentivizing all physicians to adopt better practices.”
Follow HFN associate editor Stephanie Bouchard on Twitter @SBouchardHFN.

Monday, September 19, 2011

Removal of Online Malpractice Data Sparks Outcry

September 17, 2011 — Journalists and consumer groups are calling on a federal agency to reverse its decision to remove a public data file on payments in medical malpractice cases and clinician disciplinary actions from the National Practitioner Data Bank (NPDB)Web site.
The Health Resources and Services Administration (HRSA), which operates the NPDB, removed the file from the Web site on September 1 after news organizations such as the Kansas City Starmanaged to use it to identify physicians frequently accused of malpractice who went undisciplined by state medical boards. The NPDB data does not include physician names or addresses, but journalists have traced the data to individuals by piecing it together with other data sources.
"Federal law mandates that information about individual physicians remains confidential," HRSA spokesperson Martin Kramer told Medscape Medical News. "We have a responsibility to make sure federal law is being followed."
Individual researchers can still access the malpractice data by contacting the NPDB, and HRSA may post it online again after the agency figures out how to prevent clinicians, patients, and healthcare organizations from being outed. That deliberation will take at least 6 months, according to HRSA.
In the meantime, a group called Investigative Reporters & Editors has posted a copy of the file — downloaded from the NPDB Web site in August — on its own Web site.
The IRE along with the Society of Professional Journalists and the Association of Health Care Journalists sent a letter to HRSA Administrator Mary Wakefield on September 15 asking her to repost the so-called Public Use Data File on the NPDB Web site.
"The Public Use (Data) File...provided invaluable information about the functioning of state medical boards and hospital disciplinary systems," the letter stated. "Reporters for years have used the data to identify flaws in their states' regulatory systems that have led to patient harm. As a result of these stories, states have enacted new legislation and medical boards have taken steps to investigate problem doctors."
The journalism associations also said they disapproved of an intimidating letter that HRSA sent to Kansas City Star reporter Alan Bavley about a story that he was researching with the help of NPDB information about a much-sued neurosurgeon. That news story was published on September 3.
AMA Applauds Removal of Online Malpractice Data
Other groups that have demanded the reposting of the malpractice data include Consumer Union, the publisher ofConsumer Reports; and the watchdog group Public Citizen. The groups wrote in separate letters to HRSA that its decision to take the information off the NPDB Web site runs counter to a push for more transparency within the Department of Health and Human Services and other government agencies.
One group that applauded HRSA's action is the American Medical Association (AMA), which considers the NPDB an unreliable source of information about the overall qualifications of physicians.
"The AMA has long opposed public access to the National Practitioner Data Bank and welcomes the decision to stop posting its public data file online to prevent breaches of physician confidentiality in the future," AMA President Peter Carmel said in a written statement. "Duplicate entries, inaccurate data, and inappropriate information in the NPDB provide, at best, an incomplete and haphazard indicator of a physician's competence or quality."
Congress created the NPDB in 1986 to give hospitals, insurers, state medical boards, and other government entities a way to check up on physicians, dentists, and other licensed healthcare professionals. The Public Use Data File contains information reported to the NPDB on such matters as:
  • Payments in medical malpractice cases (settlements as well as jury awards)
  • Adverse actions on licensure, clinical privileges, and membership in professional societies
  • Adverse actions taken by the Drug Enforcement Administration
  • Exclusion from Medicare and Medicaid
  • Criminal convictions
In the past, the online file had been updated quarterly, but Public Citizen complained in its letter to HRSA that, earlier this year, updates "have not been posted in a timely fashion."

Medicaid plans can expect more fraud, overpayments scrutiny

By: Mary Mosquera, senior editor

Medicaid health plans will need to pay more attention to waste, abuse and fraud as federal and state agencies step up scrutiny to cut incorrect payments and reduce costs.
Medicaid plans can expect to increase screening of hired or contracted professionals brought into their healthcare networks, inspect for overpayments and recoveries, and work with new fraud investigations by the states.
“State fines and penalties have concentrated on Medicaid contract compliance but not regulatory compliance,” said Stuart Freedman, compliance director of Molina Healthcare of Washington, at a Sept. 15 conference sponsored by America’s Health Insurance Plans.
The health reform law also makes provisions for more anti-fraud activities related to Medicaid. As part of that, the Health and Human Services Department released Sept. 14 its final rule to develop a Medicaid recovery audit contractor (RAC) program, similar to one for Medicare, which will rely on states to procure contracts to establish a system to detect fraud and handle overpayments.
Nobody knows how much fraud is in the healthcare system, said Louis Saccoccio, executive director of National Health Care Anti-Fraud Association and a former prosecutor. In 2010, HHS estimated $70 billion in improper payments, including fraud, in Medicare and Medicaid.
“If you’re in the fraud business and you’re looking for an area where you can potentially make a lot of money, health care has it. There are organized crime or enterprise crime groups, not just Mafia, that want to get in on it,” he said.
Earlier this month, an interagency fraud strike force under HHS and the Justice departments broke up Medicare scam operations in eight cities, resulting in charges against 91 individuals, including physicians, whose schemes involved $295 million in false billing.
Saccoccio said it’s important for Medicaid managed care plans to develop a relationship with their state Medicaid fraud control units to go after fraud and share information.
Information sharing and data analysis are especially important because there is not an all-claims database for health care like in the property and casualty lines of insurance.
“You need to be sharing data with investigators, and the investigators need to be talking with you. Data analytics is critical, and once you get information from the tools you are using, you need to share that information,” Saccoccio said.
Among anti-fraud tools, he recommended using:
  • Predictive modeling, which is more effective than fraud detection systems because the perpetrators are becoming more sophisticated
  • Geographic data to identify members who travel often and great distances to see particular providers
  • Social networking sites to help with investigations
  • Subscriber pictures and thumbprints on Medicaid cards for identification, better security around enrollees’ identity
The Centers for Medicare & Medicaid Services is continually intensifying its efforts to reduce incorrect payments througha varied of initiatives including increasing law enforcement efforts against fraud, applying sophisticated methods and technology to root out suspicious activities before payments go out the door and sharing information with states, other federal agencies and healthcare fraud units.
While most of these tools have been targeted at rooting out Medicare fraud, CMS will now also target Medicaid fraud, said Dr. Peter Budetti, CMS deputy administrator and director for the Center for Program Integrity. 
“We will always be doing pay and chase. Our law enforcement colleagues say we can’t prosecute our way out of this. We have to prevent this. We want to get those guys when they’re at $30,000, not $300 million,” he said.
Freedman offered a number of controls that managed care plans should establish, measure and report to reduce the risk of fraud, including:
  1. standards or code of conduct and policies in place about how the organization conducts business and communicate it with partners, contractors and employees.
  2. governing authority or board of directors that tackles issues, with a committee that deals with compliance, and an organization compliance officer with a direct line to the president or CEO.
  3. training and education, including basic employee training, ongoing and advanced training as rules change, and specialized training for those who handle claims and provider network areas.
  4. audit and monitoring of compliance plan, including reporting audits to board and re-audit after correcting any problems. Engage leadership about what keeps them up at night and what might reduce the risk and monitor that.
  5. discipline and screening-Even with credentialing process, frequently check employees, network providers and contractors. Establish policies to address fraudulent activity.
  6. detection and corrective action. Employ investigative log to track detection through correction. Build rules-based edits into the front end of the system to assure claims accuracy before payment.