Obama Signs Doc-Fix Bill

A 64-35 Senate vote Monday cleared the measure through Congress. The law also delays nationwide implementation of the ICD-10 diagnostic codes until 2015.

The $21 billion bill would stave off a 24% cut in Medicare reimbursements to doctors for a year and extend dozens of other expiring healthcare provisions, such as higher payment rates for rural hospitals. The legislation is paid for by cuts to healthcare providers, but fully half of the cuts won't kick in for 10 years.

This patch comes after lawmakers failed to reach a deal on financing a permanent fix. Read the article in Modern Healthcare here.

With ICD-10 Delayed, Answers Needed from CMS

As part of the House's Protecting Access to Medicare Act of 2014, which delays cuts in physician's Medicare rates (SGR) by another year, the national implementation of the next-generation medical coding system known as ICD-10 has also been pushed out. This delay has focused intense attention on the Centers for Medicare and Medicaid Services (CMS) to provide clarity for how hospitals, doctors, insurance companies should move forward.

The bill signed by President Obama on Tuesday prohibits CMS from enforcing any mandate to switch to the newer system until at least Oct. 1, 2015, but the act leaves CMS with many questions to answer. Among them:

• Will Oct. 1, 2015, become the new deadline?
• Will the agency allow organizations that are ready to implement ICD-10 to do so voluntarily?
• Would the agency scrap ICD-10 altogether and instead wait for ICD-11, which is due to be released in 2017?

Read the article in Modern Healthcare here.

Update from the National Rural Health Association on HR 3402

On Monday the Senate passed a 12-month delay of cuts scheduled to take affect under the Medicare Sustainable Growth Rate (SGR). In addition to the delay of these cuts, the bill (H.R. 3402) would extend the Medicare Dependent Hospital Program, Low-Volume Hospital adjustment, current rural and “super-rural” ambulance payment rates, and the rural “work floor” in the geographic practice cost index. The National Rural Health Association (NRHA) is appreciative of efforts made to extend these programs permanently in the Senate as well as the one year extension of the programs.

NRHA also sought to include regulatory relief as part of this bill, including addressing issues with the 96-hour condition of payment rule currently experienced by Critical Access Hospitals as well as mandating that supervision levels for outpatient therapy services be reverted to a level of “general.” While these issues were not included in the package passed Monday, NRHA will continue to advance these efforts through NRHA-supported legislation that has already been introduced in both the House and Senate.​

Update on the Doc Fix

From the National Rural Health Association (NRHA): Early this morning the House Rules Committee posted a bill that would delay all scheduled cuts under the Sustainable Growth Rate (SGR) for 12 months. In addition to the delay in SGR cuts, the bill includes a number of rural Medicare extenders that NRHA has been advocating for. Specifically, the current ambulance payment rates for rural and super-rural trips, the "work floor" in the geographic practice cost index, the Medicare Dependent Hospital program, and the Low-Volume Hospital adjustment were included in the package. The therapy cap exception process is also included in this bill. 

While NRHA had hoped that a permanent fix for the SGR and permanent extension of the rural Medicare programs could be accomplished, we are pleased that the House has decided to include these critical programs in another patch. The inclusion of these programs will stave off draconian Medicare cuts for rural providers throughout the nation. It is important to note, however, that some of the offsets or "pay-fors" proposed in this bill would harm rural providers. Extension of the Medicare sequester and modification of Medicaid DSH payments will harm many providers.

Read what Modern Healthcare had to say about the doc fix in this article posted yesterday.

House Passes SGR Bill Without Rural Extenders, Senate Bill To Come to Floor Next Week

A once-bipartisan proposal to finally reform the deeply flawed way that Medicare pays doctors succumbed Friday to the partisan politics of Obamacare, particularly the unpopular individual mandate. The House voted 238-181 to replace the payment formula -- the complicated equation that for more than a decade has required annual "doc fixes" -- and to pay for it by delaying Obamacare's individual mandate for five years. Read the full article in Politico here.

An article posted Friday in Modern Healthcare said the legislation to pay for a permanent repeal of Medicare's physician-payment formula by delaying financial penalties for those without health insurance coverage by five years would increase the number of Americans without health insurance by about 13 million in 2018, the nonpartisan Congressional Budget Office reports. Read the article here.

S. 2110, the Medicare SGR Repeal and Beneficiary Access Improvement Act of 2014 will likely come to the Senate Floor next week. This bill, introduced by Senate Finance chairman Ron Wyden late last week, is modified from previous Senate legislation but is similar to a strong rural bill that was reported out of the Senate Finance committee last December. S. 2110 contains a permanent fix to the SGR and includes all rural Medicare extenders (the Work geographic adjustment, Medicare payment for therapy services, Medicare ambulance services, the Medicare Dependent Hospital program and the Low Volume Hospital adjustment) and make all but the ambulance provisions permanent.

The bill’s passage is in doubt and strong grassroots support is needed. A likely partisan fight will occur over how to pay-for the bill. (Democrats support using savings from the scaling down of overseas conflicts and Republicans support eliminating the health insurance mandate in the ACA). Ranking Finance member, Orrin Hatch introduced a Republican bill (S.2122) which also contains the rural Medicare extenders but utilizes the ACA cuts as a pay-for.

House Passage of H.R. 4015, the SGR Repeal and Medicare Provider Payment Modernization Act of 2014

The following note regarding the passage of HR 4015 was released today, March 14th, by the National Organization of State Offices of Rural Health (NOSORH).  It provides some helpful insight into the next steps and political viability of the bill.    

Today, in a largely partisan vote, the House of Representatives passed a bill permanently repealing the Medicare Sustainable Growth Rate (SGR). H.R. 4015, the SGR Repeal and Medicare Provider Payment Modernization Act of 2014, is the previously agreed upon bipartisan/bicameral framework put forth by the three Congressional Committees with jurisdiction over the SGR.

In addition to formally repealing the SGR, the bill:

• Authorizes annual automatic 0.5% payment update for five years (2014 – 2018).
• Consolidates the three existing Medicare quality programs into a single value-based incentive program.
• Provides incentives for providers to switch to alternative payment models (APMs) such as a 5% bonus to providers who receive a significant portion of their revenue from an APM.

Although the framework for the permanent fix has broad support, finding $138B over ten years to pay for the permanent fix has been a serious obstacle that has become increasingly partisan as today’s vote approached.

The bill passed today by the House, pays for the permanent fix with a Republican supported measure delaying the Affordable Care Act’s individual mandate for five years (starting next year). In addition to covering the cost of a permanent fix, the Congressional Budget Office has estimated that this “pay for” will save an additional $30B but will also result in 13 million more people being uninsured and an average increase of health insurance premiums between 10 and 20 percent. Democrats have attempted to use unspent war funds as the offset; however Republicans are adamantly against such a measure.

The bill still must pass through the Democrat-controlled Senate and be signed by the President in order to become law. The prospect of this bill, with a five year delay of the individual mandate as the offset, becoming law is extremely unlikely. The Democrats in the Senate are publicly opposed to this offset and the President has already stated he will veto the bill if it comes to his desk in this form.

Congress has until March 31st, when the current patch expires, to prevent automatic 24% cuts in Medicare payments to physicians under the SGR. Congress could still come together to figure out agreeable offsets for a permanent fix or they could pass another short-term patch to give them more time to come to an agreement on offsets. A nine-month patch to prevent the 24% cuts through the end of the year has been discussed.

It's Looking Likely That We'll See Yet Another SGR Patch (That Makes 18!)

Lawmakers can't agree on a way to plug the $122 billion hole in the budget that would be created by the elimination of the reimbursement cuts and "chances are not great" for a permanent fix by the March 31 deadline, says the co-chair of the GOP Doctors' Caucus.

Congress likely will not find a permanent solution for the Sustainable Growth Rate (SGR) funding formula before the deadline expires at the end of March, and will impose yet another temporary fix and re-address the issue later this year, a leading House Republican says. Read the rest of the article in Health Leaders Media here.

For more information, check out last week's article by Emily Ethridge of CQ Roll Call, or read the article by Kristin Paulson, CIVHC's Senior Manager of Policy and Initiatives, on how the Doc Fix has the potential to improve readmissions here.

SGR "Pay-fors" Still Up in the Air

If Congress doesn't take action, the current SGR patch is set to expire at the end of March enacting a 24% pay cut.  While ideas for "pay-fors" for the repeal seem to be scarce, provider groups agree on one thing - the time to repeal the SGR is now.  Discussion of a nine month delay until after the elections surfaced, but Congressional leaders and provider groups rejected that proposal.  The delay would have been the 17th temporary legislative patch delaying the cuts.  Read more in Modern Healthcare. 

As part of a discussion draft of pay-fors, the Senate Finance Committee looked at Critical Access Hospital (CAH) mileage and reimbursement.  While these are ideas and not endorsed options, CAHs are vulnerable.  It's important to continue to advocate.  Engage your mayor, Chamber of Commerce, and county commissioners - make your letters to your electeds patient-focused.  Critical Access Hospitals protect patient access, protect the rural economy and save taxpayer dollars.

Will the "Doc Fix" Really Happen? The SGR Explained

After years of legislative wrangling and last-minute patches, expectations are high among physician groups, lawmakers and Medicare beneficiaries that Congress could act by March 31st of this year to permanently replace the current Medicare physician payment formula. While committees in both chambers have approved their own "doc fix" proposals, the approaches have yet to be reconciled, and none have identified how they would pay for a repeal.

Kaiser Health News printed these frequently asked questions and answers about the Sustainable Growth Rate (SGR) formula and how Congress may change it. It's one of the best explanations on the SGR I've read. If you have questions, I encourage you to check it out!