Washington Healthcare Update

September 18, 2017

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This Week: Two more health bills to reform the U.S. health care system… Ways and Means and Energy and Commerce Committees move Medicare-related legislation… CBO releases new estimates on ACA spending.

1. Congress



2. Regulations Open for Comment

3. Reports

1. Congress


Energy and Commerce Health Subcommittee Moves Seven Medicare Bills

On Sept. 13, the House Energy and Commerce Health Subcommittee unanimously passed seven bipartisan Medicare-related bills. Many of these proposals are similar to provisions of the Senate Finance Committee’s CHRONIC Care Act. The House may combine these bills with others being considered by the Ways & Means Committee to create a parallel package to legislation approved by the Finance Committee.

The Senate’s CHRONIC Care Act includes provisions that cross the jurisdictions of both the House Energy and Commerce Committee and the House Ways and Means Committee. In the Ways and Means Committee, the “Increasing Telehealth Access in Medicare” bill and parts of the committee’s “Medicare Part B Improvement Act” are similar to provisions in the Senate legislation. Also on Sept. 13, Ways and Means cleared the telehealth legislation.

The bills cleared by the subcommittee are:

The Furthering Access to Telemedicine Act of 2017 – FAST ActH.R. 1148: This legislation would expand the ability of patients presenting at hospitals or at mobile stroke units to receive a Medicare-reimbursed neurological consult via telemedicine.

H.R. 3263:  This legislation would extend the Medicare Independence at Home Medical Practice Demonstration program for two years. The demonstration provides a home-based primary care benefit to high-need Medicare beneficiaries with multiple chronic conditions. The Senate CHRONIC Care Act would also extend the Independence at Home Demonstration Program.

The Steve Gleason Enduring Voices Act of 2017H.R. 2465: This legislation would make coverage of speech-generating devices under “routinely purchased durable medical equipment” permanent under the Medicare program.

The Protecting Access to Diabetes Supplies Act of 2017H.R. 3271: This legislation would address issues that beneficiaries have raised because of the inclusion of diabetes test strips in Medicare’s competitive bidding program. The bill would require enhanced reporting in a bid to help Congress and CMS ensure beneficiaries receive the diabetic testing supplies they need to manage their condition. Rep. Diana DeGette (D-CO) and Rep. Susan Brooks (R-IN) introduced an amendment making minor tweaks to the bill. The amendment was accepted without debate.

The Medicare Civil and Criminal Penalties ActH.R. 3245: The legislation would update both penalties within the Medicare program.

H.R. 3120: This legislation would seek to reduce the volume of future electronic health record-related significant hardship requests. The bill would amend the Health Information Technology for Economic and Clinical Health (HITECH) Act to remove the mandate that meaningful use standards become more stringent over time.

The Prostate Cancer Misdiagnosis Elimination Act of 2017H.R. 2557: This legislation would provide for coverage of DNA Specimen Provenance Assay (DSPA) testing for prostate cancer.

To view more information on the markup,click here.

Ways and Means Committee Clears Medicare Legislation

On Sept. 13, the House Ways and Means Committee passed three Medicare bills on bipartisan votes. However, a fourth bill, which would reauthorize a home visit program, passed on a party-line vote; Democrats did not support either a state-funding match measure in the bill or the way in which Republicans want to pay for the bill, which would cease Supplemental Security Income payments from going to people with outstanding arrest warrants for felonies or parole violations.  

The three bipartisan bills would ease oversight of physician self-referrals, encourage Medicare Advantage plans to cover telehealth services and extend Medicare add-on payments for ground ambulance services.

H.R. 3726 would let doctors self-report compensation arrangements that pose technical violations of Stark Law self-referral prohibitions so those can be quickly resolved.

H.R. 3727 would make it easier for Medicare Advantage plans to cover telehealth services by including the cost in their bids. Medicare fee-for-service limits reimbursement for telehealth services to medical facilities in rural areas, and the program only covers some types of remote monitoring. Consequently, Medicare Advantage plans must categorize most telehealth services as supplemental benefits and may not include them in their bids, so the services must be paid for with either higher premiums or rebates. The legislation is similar to a provision included in the Medicare chronic care bill passed by the Senate Finance Committee earlier this year.

H.R. 3729 would extend the add-on payments for urban, rural and super rural ground ambulance transportation. Ambulance services in urban areas receive a 2 percent increase. Rural ambulance services receive a 3 percent increase and services in so-called “super rural” areas get an increase of 22.6 percent. The bill also would establish cost reporting for ground ambulance services.

Most of the markup was spent debating a state-match provision inH.R. 2824, which renews for five years the Maternal, Infant and Early Childhood Home Visiting program. The program, which is run by the Health Resources and Services Administration, helps pregnant women and mothers care for their babies with such services as breast-feeding instructions and good-parenting techniques.

The home-visit bill would require states and territories to match federal funding dollar-for-dollar. Republicans delayed that match requirement for tribal governments. Democrats on the committee said the measure results in cutting federal funding for states that will not be able to come up with the match. Republicans said several other health care and welfare programs require state matching funds and that programs work better when states have money at stake.

For more information on the hearing,click here.


Senate Finance Committee Reaches Deal on CHIP

On Sept. 13, the Senate Finance Committee reached a deal to extend financing for CHIP (the Children’s Health Insurance Program) for the next five years. The program costs an estimated $8 billion and phases out the 23 percent ACA funding. This requires states to maintain eligibility through 2019. The agreement reached does not touch on the details of how Congress will pay for the funding extension. The offsets are currently being negotiated and the agreement does not preclude amendments at the markup, which has yet to be scheduled.

The program covers families with income between 138 and 405 percent of the federal poverty level. States determine the eligibility levels in those parameters, and further the ACA requires that states maintain these levels that were in place as of March 23, 2010. The ACA increased CHIP funding by 23 percent. The deal from Senate Finance maintains the funding next year and the following year but drops it in 2020 to 11.5 percent.

Two Bills Introduced on Health Reform in the Senate

On Sept. 13, two bills were unveiled related to health reform.

Sen. Bernie Sanders, joined by other Democrats, released his Medicare-for-all proposal, while Sens. Graham (R-SC) and Cassidy (R-LA), joined by Sens. Heller (R-NV) and Johnson (R-WI), unveiled a repeal and replace proposal. Neither proposal is likely to be acted upon in the near future.

Sanders’ proposal, “the Medicare for All Act of 2017,” establishes a national health insurance program called the Universal Medicare Program. Under this legislation, every resident of the United States will receive health insurance through an expanded Medicare program with improved and comprehensive benefits. Cosponsors of the legislation are Sens. Tammy Baldwin (D-WI), Richard Blumenthal (D-CT), Cory Booker (D-NJ), Al Franken (D-MN), Kirsten Gillibrand (D-NY), Kamala Harris (D-CA), Martin Heinrich (D-NM), Mazie Hirono (D-HI), Patrick Leahy (D-VT), Edward Markey (D-MA), Jeff Merkley (D-OR), Brian Schatz (D-HI), Jeanne Shaheen (D-NH), Tom Udall (D-NM), Elizabeth Warren (D-MA) and Sheldon Whitehouse (D-RI).

In addition to the legislation, Sanders published a paper outlining several options for funding the Universal Medicare Program. 

The bill is unlikely to be considered in this Congress.

For more information about the bill,click here. To read the bill’s language,click here.

The Graham-Cassidy legislation repeals the structure of Obamacare and replaces it with a block grant given annually to states to help individuals pay for health care. The block grant is run through the Children’s Health Insurance Program (CHIP) and is subject to a mandatory appropriation. The grant dollars would replace the federal money currently being spent on Medicaid expansion, Obamacare tax credits, cost-sharing reduction subsidies and the basic health plan dollars. In addition, it provides broader discretion to the states concerning how the funding is used to provide coverage. 

Majority Leader Mitch McConnell (R-KY) has asked the Congressional Budget Office to score the proposal. Sen. Cassidy states he almost has enough votes to pass this legislation, however, it is unclear if it can be considered before the budget reconciliation rules expire on Sept. 30. 

For more information,click here.

2. Regulations Open for Comment

CMS Proposes 2018 and 2019 Payment Changes for Medicare Home Health Agencies

The Centers for Medicare & Medicaid Services (CMS) on July 25 issued a proposed rule that would update payment rates and the wage index for home health agencies (HHAs) serving Medicare beneficiaries in 2018; it also proposes a redesign of the payment system in 2019. Comments are due Sept. 25, 2017.

CMS is planning a slight pay cut for home health agencies in 2018, by reducing Medicare payments to the agencies by 0.4 percent next year, saving the federal government an estimated $80 million. That change is driven in part by CMS’s planned phase out of a provision boosting pay rates for certain home health services delivered to rural patients. The agency is also floating a series of changes to the payment methodology beginning in 2019, which could result in a pay cut of up to 4.3 percent. That would translate to as much as $950 million in reduced Medicare payments to home health agencies.

Under the proposed rule, the home health payment update percentage for HHAs that submit the required quality data for the Home Health Quality Reporting Program would be 1 percent in 2018. The proposed rule also includes proposals to refine the HH PPS case-mix adjustment methodology, including a change in the unit of payment from 60-day episodes of care to 30-day periods of care, to be implemented for periods of care beginning on or after Jan. 1, 2019. Additionally, the proposed rule includes proposals for the Home Health Value-Based Purchasing Model and the Home Health Quality Reporting Program.

To view the proposed rule,click here.

For more information on the Home Health Prospective Payment System,click here.

3. Reports

GAO: Medicaid: States Fund Services for Adults in Institutions for Mental Disease Using a Variety of Strategies

Federal and state Medicaid spending on behavioral health services—mental health and substance abuse treatments—is projected to be $71 billion in 2017. However, some adults on Medicaid may have limited access to inpatient or residential behavioral health care because Medicaid generally doesn’t cover services for adults in institutions for mental disease.

Officials in the six states we reviewed tried an average of two to four strategies to fund this care through Medicaid, such as: applying for demonstration programs, covering these services through Medicaid managed care plans and relying on facilities that are too small to be considered “institutions.”

To view the report,click here.

GAO: Medicaid Managed Care: CMS Should Improve Oversight of Access and Quality in States’ Long-Term Services and Supports Programs

Medicaid beneficiaries who need long-term care can get it in their homes, community settings or an institution such as a nursing home. Many states contract with managed care organizations to provide this care.

The six states we reviewed used various methods (e.g., beneficiary surveys) to monitor access and quality in managed long-term care programs. However, the Centers for Medicare & Medicaid Services did not always require the states to report information it needs for oversight, such as beneficiary concerns or whether there are enough providers.

GAO recommended that CMS improve its oversight.

To view the report,click here.

GAO: Technology Assessment: Medical Devices: Capabilities and Challenges of Technologies to Enable Rapid Diagnoses of Infectious Diseases

Infectious diseases continue to represent a threat to the health and livelihoods of people worldwide. Many infectious diseases can initially present with similar symptoms, making diagnosis challenging.

To address this issue, federal agencies have identified technologies that can help diagnose infectious diseases by using multiplex assays—simultaneously testing for, or measuring, the presence of different pathogens. These technologies can also be deployed at or near the site of patient care. In this report, GAO discusses (1) the reported performance characteristics and costs of these technologies, (2) the technical challenges associated with multiplexing assays and (3) the potential benefits and reported implementation challenges associated with these technologies.

To conduct this technology assessment, GAO reviewed Department of Defense (DOD), Department of Homeland Security (DHS) and Food and Drug Administration (FDA) documentation and scientific literature, and interviewed agency officials, developers and users of these technologies. GAO conducted site visits to eight developers identified by DOD and DHS market surveys. Experts convened with the assistance of the National Academies provided technical advice to GAO and reviewed a draft of this report. GAO incorporated their comments in the final report as appropriate.

To view the report,click here.

Covered California Report Shows Shortcomings of Reducing Marketing Spending

On Sept. 13, Covered California released a report that stated due to the administration’s cuts in marketing, one million fewer Americans will have health insurance and premiums are likely to rise 2.5 percent. The California exchange will outspend the federal government following CMS’s announcement to cut navigator funds by 42 percent. Federal government spending will drop to $47 million, one-quarter of funding provided in the previous signup season. The report estimated that to meet Covered California’s outreach efforts, the federal government would have to spend $480 million.

To view the report,click here

CBO Updates ACA Spending Estimates

On Sept. 14, the Congressional Budget Office updated a score for the federal spending on health care over the next decade, which will be $137 billion lower than originally estimated. The score assumes subsidies for the individual market coverage, which include CSRs and the Basic Health Plan. Further, four million fewer Americans are estimated to enroll in the exchanges. CBO notes that it was not able to put out the new estimate in time to score legislation over the past eight months. CBO has also not scored the repeal and replace bill by Sens. Bill Cassidy (R-LA), Lindsay Graham (R-SC), Dean Heller (R-NV) and Ron Johnson (R-WI). According to CBO and JCT, net spending on health care will total about $705 billion in 2017 and grow to $1.7 trillion by 2027.

To read the report, click here

If you have any questions, contact the following individuals atMcGuireWoods Consulting:

StephanieKennan, Senior Vice President
Anne Starke, Research Associate

Founded in 1998,McGuireWoods Consulting LLC(MWC) is a full-service public affairs firm offering infrastructure andeconomic development, strategic communications & grassroots, and governmentrelations services. McGuireWoods Consulting is a subsidiary of theMcGuireWoods LLPlaw firm and has been named in The National Law Journal’s special annualreport, “The Influence 50,” for the past several years. In the most recentreport, McGuireWoods Consulting was ranked 15th of the 1,900 governmentrelations firms in Washington, D.C.

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