State Loan Forgiveness Program Accepting Applications

Starting tomorrow, July 1st, the Primary Care Office will open up the next opportunity of funding for the Colorado Health Service Corps (CHSC). CHSC is the state's health professions loan repayment program, which provides funding to primary care physicians, nurse practitioners, physician assistants, certified nurse midwives, licensed mental health professionals and oral health professionals who agree to practice in a rural or underserved area of our state. Applicants are eligible to receive up to $105,000 in loan forgiveness for a committment of two or three years of service. Eligible health professionals must be employed or seeking full-time employment in an outpatient practice in an area of Colorado with a health professional shortage.

For more information on the CHSC or to learn how to apply, please visit the CHSC website.

July 7th - Rural Hospital Webinar on 340B Enrollment

With the passage of federal health reform, a number of new catagories of hospitals are eligible for the 340B drug discount program. Newly eligible hospitals include Critical Access Hospitals, Sole Community Hospitals, and Rural Referral Centers. Safety Net Hospitals for Pharmaceutical Access along with the National Rural Health Association is holding a free webinar next Wednesday, July 7th from 11a - 12:30p MST. Registration is limited to hospitals and non-profit organizations that work with hospitals. Click here to be taking to the registration page.

Comment on State Policy Recommendations for Disabled Citizens

The Colorado Department of Health Care Policy & Financing (HCPF) is seeking comment on a document entitled Olmstead: Recommendations and Policy Options for Colorado. This report recommends policy options for the state in regards to disabled citizens and people with long term care needs who wish to live in community based settings. You have until 5p on Saturday, July 17th to submit comments.

Temporary SGR Fix Extended Until November 30th

On Friday, President Obama signed into law the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010. Whew! That's a mouthful. What this means is that Medicare claims will now be processed with a 2.2% increase (retro to June 1st). This slight bump in reimbursement will be in effect until November 30, 2010. It is assumed that Congress will come up with a permanent fix to the Medicare SGR rate in the interim, though if history repeats itself, we will be scrambling again in November to try and avoid major cuts to physicians who care for Medicare patients.

The Center for Medicare & Medicaid Services (CMS) released a statement stating that all Medicare claims are on hold temporarily until the 2.2% increase can be tested to ensure that claims will be processed correctly and paid at the new rate. They expect to begin processing claims with the increase no later than July 1st.

Rural Health Research & Policy Center: Rural Health Care & Health Reform

The Rural Health Research & Policy Center just released an 85 page document summarizing the impact of federal health reform on rural healthcare delivey called: The Patient Protection and Affordable Care Act: A Summary of Provisions Important to Rural Health Care Delivery.

HHS Announces $250 Million for Primary Care Workforce

With all the doom and gloom in regards to the state budget and reimbursement delays & cuts, I am happy to share with you the following news. Kathleen Sebelius, Secretary of Health & Human Services, along with the Health Resources & Services Administration (HRSA) announced the availability of $250 million over the next 5 years to strengthen the primary care workforce. RFPs have already been released for some of the following:

Creating additional primary care residency slots: $168 million for training more than 500 new primary care physicians by 2015;

Supporting physician assistant training in primary care: $32 million for supporting the development of more than 600 new physician assistants, who practice medicine as members of a team with their supervising physician, and can be trained in a shorter period of time compared to physicians;

Encouraging students to pursue full-time nursing careers: $30 million for encouraging over 600 nursing students to attend school full-time so that they have better odds of completing their education;

Establishing new nurse practitioner-led clinics: $15 million for the operation of 10 nurse-managed health clinics which assist in the training of nurse practitioners. These clinics are staffed by nurse practitioners, which provide comprehensive primary health care services to populations living in medically underserved communities.

Encouraging states to plan for and address health professional workforce needs: $5 million for states to plan and implement innovative strategies to expand their primary care workforce by 10 to 25 percent over ten years to meet increased demand for primary care services.

June 2010 State Economic Forecast

Ladies & Gentleman. The moment we've all been waiting for.......The offical first day of summer! And for policy wonks like myself, the June Revenue Forecast (listed under Budget Balancing News in the middle of the page).

An initial glance does not look promising. Even with the delay in Medicaid payments, the state is approximately $74 million short for FY09-10, which ends June 30th. With this updated forecast, it appears that the FY10-11 budget is close to $215 million short. I would imagine an official announcement of the June revenue forecast and what sort of cuts our state can expect will occur shortly.

21% Physician Medicare Cuts in Effect

The Senate passed a temporary fix to the Medicare SGR on Friday, but the House still needs to vote on the bill before it can become law. The Centers for Medicare and Medicaid (CMS) has been holding Medicare claims since June 1st waiting to see if Congress would stop the 21% cut. Beginning today, CMS will be processing claims as of June 1st with the 21% cut.

The temporary SGR extension passed by the Senate would postpone the 21% cut until November 30 2010. It would also give a 2.2% increase for Medicare reimbursement retroactive to June 1st. The House is expected to vote on the bill this week. If the House does pass the Senate fix, Medicare claims will be processed with the enhanced 2.2% Medicare increase, but in the meantime, physicians will be scrambling to cover costs of providing care to seniors.

In other words, welcome to a total administrative mess. If the House passes this 2.2% increase and postpones the 21% cut until November 30th, CMS will be processing claims twice (once with the 21% cut and then again with the 2.2% increase) and we will be back here in November talking about a 21% Medicare cut to physicians. And this will be right after elections. Again......what a mess!

Originally, the Medicare SGR fix was going to be included in the tax extenders bill that has been in the Senate for the past few weeks. That bill is still being debated and is trying to extend unemployment & COBRA benefits, as well as extend the FMAP increase that states have been receiving to help with Medicaid caseloads.

Senate to Scale Back Tax Extender Bill

The Senate has been debating what is known as the tax extender bill for the past few days and it looks like they are going to have to cut back on what they initally hoped to achieve. The bill includes a temporary fix to the Medicare SGR, which expired June 1st. Without any sort of extension to the SGR, Medicare reimbursement to physicians will be cut by 21%. Originally, the Senate had hoped to extend the Medicare SGR through 2011, though there is talk that it may only be extended through 2010. If this, in fact, is what passes in the bill; we will be right back here having this same conversation at the end of 2010. I know there is no easy answer. I certainly don't have the answer, but how many times can Congress temporarily fix Medicare payments?!?!? Physicians are already exhausted as this is the 3rd time this year they have been worried about being cut by 21%. In the meantime, Medicare patients may be thinking they can't find a doctor to see them because of healthcare reform, which is not the case. Congress needs to decide how to provide a sustainable Medicare reimbursement rate that will allow providers to see patients without continually having to worry of a large impending cut. Now that would be real healthcare reform.......

Similarly, the FMAP bump that has been helping states with the unprecedented growth in Medicaid caseloads may not be extended out in the tax extenders bill. A large number of states created their FY10-11 budget with the expectation that the FMAP bump would be extended to June 2011. Without any additional action by Congress, the FMAP bump will end December 2010. We shall see what the Senate is able to pass....

Wating on Congress........again........

Well, the Center for Medicare & Medicaid Services (CMS) is holding Medicare payments until Friday (6.18) to see if Congress acts this week to stop the 21% Medicare reimbursement cuts to physicians that was expected to begin today. The Senate is wrapping up debate on the tax extenders bill, which will hopefully include provisions that will stop the Medicare cuts. The tax extenders bill may also possibly extend an increased FMAP bump that Colorado has been receiving to help with the increased Medicaid caseload.

Welcome to The Rural Voice!

Welcome to The Rural Voice! I know some of you have been subscribed and reading my policy rants for quite some time now, but for those of you who've never received this before......Aloha!

If you're really not interested in reading about policy or already get too much email, no problem! Just click unsubscribe at the bottom of the page.

For those of you who have previously signed up for my postings , you should still be getting this in your inbox at the regular schedule of your choice. For those who've never seen my postings before and you'd like to continue to receive them, you can decide if you'd like to receive this in your inbox on a daily, weekly, or monthly basis. Just click on your preference!

Thanks to everyone for your continued support of the Colorado Rural Health Center and helping us to ensure that rural Coloradans have access to afforable, quality healthcare services!

Small Businesses & Healthcare Reform

The following article is from the Center for Rural Affairs regarding federal healthcare reform and what it means for small businesses:

Small Businesses & Health Care Reform
June 2010

Small businesses dominate the rural economy. In fact, they dominate the American economy in terms of the number of business firms. So it’s important to know, understand, and accurately portray the effects of the newly adopted health care reform law, on small businesses.

First though, we need to understand what the new law - the Patient and Affordable Care Act - means by “small business.” In many respects, “small employer” is a more accurate term. In fact, Section 1421 (Credit for Employee Health Insurance Expenses of Small Businesses) uses that term.

Self employed sole proprietors who are not employers (non-employers in statistical parlance) and their immediate family members do not qualify for the small business tax credit benefits described below. They will qualify for the individual credits and premium assistance beginning in 2014 and the more immediate health insurance reforms.

Do small businesses have to provide health insurance to their employees or face penalties?

No. The law has a general requirement that employers provide health insurance. But it specifically exempts from this employer responsibility any business with 50 or few¬er employees (Section 1513). The result is that nearly all businesses in the nation, including those in rural areas, are exempt from any health insurance requirements or mandates and are free from any penalties for not doing so.

According to the U.S. Census Bureau’s County Business Patterns, 95 percent of all business establishments in the nation have fewer than 50 employees. The House of Representatives Small Business Committee estimates the employer mandate will apply to less than two percent of businesses.

How do small businesses afford health insurance under the law?

In many respects the health insurance reform law is all gain and no pain for small businesses, particularly at first. Section 1421 of the law establishes a Small Business Tax Credit for those businesses who do provide health insurance for their employees. The initial credit exists for tax years 2010 through 2013. A second credit exists for any two years beginning in 2014 when the Health Insurance Exchanges begin.

To be eligible for the tax credits, a small business must have fewer than 25 full-time equivalent employees, have average annual wages less than $50,000, purchase health insurance for employees, and contribute at least 50 percent of the cost of the premium.

The Small Business Tax Credit provides both immediate and longer term health insurance premium assistance for small businesses, especially the smallest businesses that dominate rural economies. The immediate tax credit beginning in 2010, and lasting through four tax years, acts as a bridge to the Health Insurance Exchange system that begins in 2014. The exchange system will act as large insurance pool for the nation’s small businesses (more on that below).

The longer term two year credits also allow the exchange system to be fully operational and for the pooling and risk spreading aspects of them to take effect. The Congressional Budget Office estimates that with the law’s small business tax credits, the average premiums per person in the small group market will decline by up to 8 to 11 percent in 2016 relative to the current law.

Can small businesses pool together to purchase insurance?

Yes. In fact, the Health Insurance Exchange concept is based on the pooling idea. The health reform law mandates the creation of exchanges in every state by 2014, and allows businesses of up to 100 employees to participate (Sections 1304 and 1311).

The result is the creation of a health insurance pool of small businesses, their employees and the self-employed. When fully implemented the exchange will allow for more attractive insurance as a result of lower administrative costs (costs will be spread across the larger pool) and the spreading of risk across the larger pool. A larger pool will also allow annual premium volatility to moderate and enhance competition (more potential customers in the larger pool).

The law also allows states to create the Small Business Health Options Program (SHOP), a special exchange for small businesses, either within the larger state exchange or as a separate exchange. The SHOP Exchange is designed to assist small business employers in enrolling their employees in small group health plans.

The law also enables other insurance alternatives within the exchanges that could result in small business pools or groups. It makes possible establishment of state-based nonprofit health insurance cooperatives and funds such efforts with loans. Regional, interstate or multistate exchanges may also exist if the states involved permit and they are approved by the federal government.

Will the health reform law cause my taxes to go up?

Probably not. The health reform law imposes some new taxes and increases others. But the real question is who is responsible for those taxes. While each individual and business has unique circumstances that will determine tax liability, it is clear that most rural small businesses will not be affected by the tax changes contained in the law. Some of those changes are:

A new 10 percent excise tax on indoor tanning services (for services provided after June 30, 2010). This excise tax will obviously be paid only by those businesses providing indoor tanning services.

A 0.9 percent Medicare surcharge on the wages of single taxpayers earning more than $200,000 per year and couples earning more than $250,000 per year (starting in 2013). In addition, these taxpayers would incur a special Medicare tax of 3.8 percent on unearned income (interest, dividends, capital gains, annuities, royalties and rents). While some rural small business taxpayers may earn enough income to activate these taxes, that case will be extremely rare. The non-partisan Tax Policy Center finds that less than two percent of taxpayers with small business income are in the federal income tax brackets that include the $200,000/$250,000 income levels.
An excise tax beginning in 2018 on insurance companies providing “high-cost” employer sponsored health plans, defined as those with values exceeding $10,200 for individual coverage and $27,500 for family coverage. The tax is equal to 40 percent of the value of the plan exceeding the threshold amount. This tax will likely not apply to many health plans offered by rural small businesses as the 2008 average value of health plans offered nationally by businesses with 10 or fewer employees ranged from $4,536 (individual) to $11,952 (family) and for businesses with 11 to 25 employees ranged from $3,984 (individual) to $1,051 (family).

Fees assessed on businesses that do not provide health insurance to employees will only be charged to businesses with 50 or more employees— a small fraction of businesses nationwide and even fewer in rural areas.

As we have written before, many circumstances related to health insurance act as barriers to creating a strong rural economy based on entrepreneurial development. The Patient and Affordable Care Act will begin to lower these barriers for many rural small businesses.

While exempt from mandates requiring insurance coverage for employees, the tax credits provided by the law will make health insurance more affordable for businesses and provide an incentive to help insure employees. Over time as the primary features of the law are implemented and take effect, particularly the Health Insurance Exchanges, rural small employers will reap the benefits of pooling and larger group coverage that provides comprehensive, affordable, and continuous health care coverage for their business and their employees.

Contact: Jon Bailey, jonb@cfra.org or 402.687.2103 x 1013 for more information. This is the second article in our new series on what health reform means for rural Americans.

Delayed Medicaid Payments

Due to a lower than expected state budget revenue forecast, which will be made public June 21st, the Department of Health Care Policy & Finance is required to delay Medicaid payments for the last two weeks of June.

YOU MUST SUBMIT MEDICAID CLAIMS BY THIS FRIDAY, JUNE 11TH TO RECEIVE PAYMENT IN JUNE. CLAIMS NOT IN THE SYSTEM BY JUNE 11TH WILL NOT BE PAID UNTIL JULY 9TH.

If you have any questions about the delayed payments, please contact Eric Wolf at 303-866-5963 or eric.wolf@state.co.us

CO FY10-11 budget will be short if no FMAP extension

According to a report published by the National Conference of State Legislatures, almost 30 states, including Colorado, balanced their budgets relying on Congress to extend the Federal Medical Assistance Percentages (FMAP) enhancement that has been in place since the American Recovery and Reinvestment Act (ARRA) was passed. The FMAP is the amount of Medicaid support the federal government provides to states. Prior to ARRA, Colorado received a 50:50 match. With the ARRA bump, Colorado has been receiving about a 60:40 match. This FMAP boost to states is set to expire December 2010. As previously stated, close to 30 states believed Congress would extend the FMAP bump through June 2011, since most state budget cycles are from July 1 - June 30.

Prior to the Memorial Day recess, the House passed the Tax Extenders bill, which orignially included extention of the FMAP, but due to political pressure and not wanting to add to the federal deficit, the bill that was passed did not include extending the FMAP increase. The Senate is expected to debate and vote on the bill this week. If the Senate does not include an FMAP extension, Colorado will be approximately $130 million short for FY10-11 as the budget was balanced including the increased FMAP. What sort of cuts this would mean for our state is unknown. Stay tuned to see what the Senate does this week.......

Authorized vs. Funded Provisions in Federal Health Reform

As our state & country move forward on implementing provisions in the federal healthcare reform bill that was passed in March, it should be mentioned that certain provisions were funded while others were merely authorized. Provisions that are authorized will have to wait, beg, and/or plead to be funded by the Appropriations Committee. While I don't have a timeline to share with you as to when this may or may not happen, I do have a list from the Congressional Budget Office (CBO) of the provisions that were only authorized by Congress. Unfortunately, a large portion of these authorized provisions are focused on rural and healthcare workforce issues. As implementation moves forward, I will be encouraging all of us to contact our Congressional leaders and implore them to fund the following critical pieces of healthcare reform that would dramatically increase access to healthcare services in rural & underserved areas.

Title V
5102 - State Healthcare Workforce Development: Planning Grants & Implementation
5103 - Workforce Assessment: National Center; State & Regional Centers
5203 - Healthcare workforce loan repayment program: Pediatric Medical & Surgical; Pediatric Behavioral
5204 - Public Health Workforce Loan Repayment Program
5208 - Nurse Managed Health Clinics
5403 - Area Health Education Centers: Continuing Educational Support for Health Professionals in Underserved Communities
5601 - FQHC Grants

Congress on Vacation until June 7th - Medicare Claims on Hold

For the third time this year, physicians face a 21% cut in Medicare reimbursement rates due to inaction by Congress. The House passed an amendment included in the tax extenders bill prior to the Memorial Day recess that would temporarily patch Medicare cuts for 19 months. The SGR amendment postpones the 21 percent Medicare physician payment cut an additional 19 months until Jan. 1, 2012. It provides a 2.2 percent increase on June 1, 2010 and an additional 1 percent increase on Jan. 1, 2011. However, in 2012 physician Medicare reimbursement would be cut by a reported 33 percent as the payment methodology reverts to the current SGR formula. The Senate is expected to begin debate on this bill and amendment when they return from recess June 7th.

The Centers for Medicare & Medicaid have instructed contractors to hold Medicare claims for 10 days; giving the Senate a few days to pass the House amendment without disrupting Medicare reimbursement. If the Senate makes any changes to the amendment, it will have to go back to the House to be voted on again before being sent to the President. In the meantime, physicians will be struggling to provide care to Medicare patients while Medicare patients will struggle to find physicians willing to accept them. Let's hope the Senate acts quickly when they return next week.