Hart Health Strategies provides a comprehensive policy briefing on a weekly basis. This in-depth health policy briefing is sent out at the beginning of each week. The health policy briefing recaps the previous week and previews the week ahead. It alerts clients to upcoming congressional hearings, newly introduced bills, regulatory announcements, and implementation activity related to the Patient Protection and Affordable Care Act (PPACA) and other health laws.


Health Legislation in the Spotlight

Last week the House passed legislation which would delay the Patient Protection and Affordable Care Act’s (PPACA) employer and individual mandate (see below) and also set the stage for legislation to replace the current Medicare physician payment sustainable growth rate (SGR) formula and make significant changes to Medicare along the lines recommended in the Administration’s fiscal year (FY) 2014 budget (see below). Also, the House Energy and Commerce Committee passed H.R. 698, the HIV-positive Organ Transplant Act, which would authorize the Organ Procurement and Transplantation Network to adopt certain standards with respect to organs infected with HIV if they ensure that such organs may be transplanted only into individuals who also have HIV. The House Financial Services Committee also approved FY 2014 Treasury/Internal Revenue Service (IRS) appropriations which included a statement that “…the IRS has demonstrated little ability to self-police or self-correct, the IRS is on the precipice having even more authority over policing Americans’ health coverage. The Committee finds this expansion of IRS authority to be unacceptable and, therefore, prohibits funding to implement the individual mandate and prohibits transfers from the Department of Health and Human Services to fund the IRS’ implementation of the Affordable Care Act.” The House is also scheduled to take up amendments under H.R. 2397, the Department of Defense Appropriations Act.

House Sends to Senate a Bill to Delay PPACA Mandates

The House passed, and sent to a likely Senate grave, the following PPACA measures which were combined into one bill: H.R. 2667 (the Authority for Mandate Delay Act), which would codify the Treasury Department’s delay of the employer mandate until 2015 (35 Democrats voted with Republicans); and H.R. 2668 (the Fairness for American Families Act), which in the same manner would delay until 2015 the law’s individual mandate (22 Democrats voted with Republicans). The White House issued a Statement of Administration Policy (SAP) which said the President would veto the bill if passed by the Senate. During hearings held by the House Committees on Ways and Means and Energy and Commerce regarding the employer mandate delay, the Deputy Assistant Secretary For Retirement And Health Policy, said that “While the 2014 transition relief for reporting by employers would make it impractical to implement the employer responsibility provisions, it would not have a comparable effect on implementation of the individual responsibility provisions, which as a practical matter are necessary for implementing ACA’s insurance market reforms that guarantee access to affordable insurance for individuals….” Witnesses also testified that delaying the individual mandate would result in higher health insurance rates offered in the PPACA exchanges due to the potential for adverse selection. Republicans also questioned how the individual premium tax credit subsidies could be administered in 2014 without the reporting by employers in 2014 of employment-based health coverage. Republicans continued to question the authority for the delay. The Treasury witness said the agency has the authority under Internal Revenue Code (IRC) 7805(a) which has been used by Republican and Democrat administrations to provide transitional tax relief. At another hearing, the Government Accountability Office (GAO) and Treasury Inspector General (IG) office testified that they have concerns about the timely and fully-functional implementation of the PPACA’s health insurance exchanges by October 1st when they are to begin enrollment operations. In addition, at a joint hearing by two subcommittees of the House Oversight and Government Reform and Homeland Security committees, the Center for Medicare and Medicaid Services (CMS) Administrator and IRS Principle Deputy Commissioner testified that they have concerns that sequestration may hamper the efforts of their agencies to implement the various data hubs and insurance market databases that are key to fully implementing the law as intended. Despite these potential problems, the President opened a full court press to promote the benefits of the law and efforts to encourage enrollment in the state and federal health insurance exchanges. He announced that “Just yesterday, state officials in New York announced that average premiums for consumers who buy insurance in their new marketplace will be at least 50% lower next year than they are today….” Adding to the number of critics of the law, the presidents of the International Brotherhood of Teamsters, the United Food and Commercial Workers and Unite Here sent a letter to Senate Majority Leader Harry Reid (D-NV) and House Minority Leader Nancy Pelosi (D-CA) stating that the PPACA needs to be changed in relation to union-negotiated “multiemployer” plans or it “will shatter not only our hard-earned health benefits, but destroy the foundation of the 40-hour work week that is the backbone of the American middle class.” They would like the PPACA’s individual tax credits to be available to their multiemployer-plan low-income workers in the same manner as under the exchanges and want changes to remove the incentive for employers to reduce worker hours below 30 hours in order to avoid the employer mandate.

CMS Report on Pioneer ACO Performance

CMS issued a one-year progress report on the thirty-two entities participating in the “Pioneer” accountable care organization (ACO) program which found that all ACO’s successfully performed better than benchmark rates in fee-for-service Medicare for 15 clinical quality measures which qualified them to receive incentive payments. However, only thirteen of the ACOs met certain cost benchmarks enabling them to share in savings under the Medicare program.

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