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.


Negotiators Finalize Medicare Physician Payment Reform Legislation

Before recessing last week, the leaders of the three committees negotiating to find a compromise to replace the current Medicare sustainable growth rate (SGR) formulated physician payment system reached an agreement, H.R. 4015/S. 2000, the “SGR Repeal and Medicare Provider Payment Modernization Act,” which was introduced in the Senate by Senator Max Baucus (D-MT) and in the House by Rep. Michael Burgess (R-TX). The bipartisan legislation was the last major legislative achievement of Chairman Baucus in that he was unanimously confirmed last Thursday as the next ambassador to China. Senator Ron Wyden (D-OR) is expected to take his place as chairman of the Senate Finance Committee this week. The Congressional Budget Office (CBO) is said to have estimated the legislation’s cost to be about $128 billion over ten years. However, the means to offset the legislation’s cost was not included in the introduced legislation, although members indicated they are still working to develop agreeable spending/revenue offsets. Senator Baucus summed up the route the legislation has taken to reach this point: “Congress has spent a decade lurching from one ‘doc fix’ to the next, creating a new, unnecessary threat to seniors’ care each time. Enough is enough. This proposal would bring that cycle to an end and fix the broken system. Our bill makes Medicare’s physician payments more modern and efficient, and it will protect seniors’ access to their doctors….This bill is the product of years of hard work, and I hope Congress comes together to pass it.” If Congress is unable to move this compromise legislation by the end of next month, then it is likely that Congress will again have to extend the March 31 date after which severe cuts to Medicare physician payments will be made under current law. There remains an outside chance that the SGR Reform legislation could be added as a sweetener to legislation the House is expected to take up in the next several weeks to increase the federal debt limit. In urging Congress to take immediate action on the debt limit, Treasury Secretary Jacob Lew said that his department would have to begin taking “extraordinary” measures to avoid a default on federal obligations by the end of this month. House Speaker John Boehner (R-OH) was noncommittal as to the form that any add-on would take. Reports are that House Republicans have been unable to coalesce around an add-on that would repeal the Patient Protection and Affordable Care Act’s (PPACA) “risk corridor” provisions, but a repeal of the law’s medical device tax and the SGR reform legislation or a temporary patch are still being discussed as add-on’s to the debt limit bill. The major provisions of the compromise SGR repeal legislation which contain variations on the Senate Finance, Ways and Means and Energy and Commerce passed bills (S. 1871 and H.R. 2810) can be summarized as follows:

  • SGR would be repealed;

  • Medicare extenders and other provisions in Senate Finance bill (S. 1871) are excluded;

  • 0.5% increase in Medicare physician payments over 5 years (2014-2018) as under H.R. 2810 (E&C version);

  • starting in 2018 payments would be based on performance in four categories (quality, resource use, electronic health records (EHR) meaningful use and clinical practice improvement activities) for listed professional categories participating in the new Merit-Based Incentive Payment System (MIPS) which would consolidate the Physician Quality Reporting System, the Value-Based Modifier and the “meaningful use” of electronic health records system;

  • bonuses of 5% would be available for significant participation (beginning at 25%) in alternative payment models (APMs), such as medical homes, accountable care organizations (ACO) and other forms to be developed;

  • the Department of Health and Human Services (HHS) would be required to publish utilization and payment data on the Physician Compare website which qualified users could use to help develop APMs and quality improvement activities;

  • a technical advisory committee would be established to recommend physician developed APMs;

  • HHS would be required to make public a list of clinical-decision support tools by April 1, 2016 which clinicians must use in ordering scans while utilizing “Appropriate Use Criteria” before Medicare coverage would be approved (non-compliance would result in pre-authorization requirements);

  • EHRs would be required to be “interoperable” by 2017 and providers would be prohibited from deliberately blocking information sharing with other EHR vendors; and

  • the use of quality performance measures as “standards of care” in medical malpractice claims brought in any court of law would be prohibited.

Health Legislation Recently Introduced cont.

H. RES. 473 (CANCER PREVENTION), expressing support for designation of Feb. 4, 2014, as National Cancer Prevention Day; ISRAEL; to the Committee on Energy and Commerce, Feb. 4.

H.R. 3999 (FAMILY MEDICAL LEAVE), to amend the Family and Medical Leave Act of 1993 and Title 5, U.S. Code, to allow employees to take, as additional leave, parental involvement leave to participate in or attend their children’s and grandchildren’s educational and extracurricular activities, and to clarify that leave may be taken for routine family medical needs and to assist elderly relatives, and for other purposes; CAROLYN B. MALONEY of New York; jointly, to the committees on Education and the Workforce, Oversight and Government Reform, and House Administration, Feb. 5.

S. 2000 (MEDICARE), to amend Title XVIII of the Social Security Act to repeal the Medicare sustainable growth rate and improve Medicare payments for physicians and other professionals, and for other purposes; BAUCUS; to the Committee on Finance, Feb. 6.

S. 2005 (MEDICARE), to amend Title XVIII of the Social Security Act to provide for the reporting of certain hospital payment data under Medicare, and for other purposes; COBURN; to the Committee on Finance, Feb. 6.

H.R. 4010 (AUTISM), to provide for enhanced treatment, support, services and research for individuals with autism spectrum disorders and their families; CARTWRIGHT; to the Committee on Energy and Commerce, Feb. 6.

H.R. 4015 (MEDICARE), to amend Title XVIII of the Social Security Act to repeal the Medicare sustainable growth rate and improve Medicare payments for physicians and other professionals, and for other purposes; BURGESS; jointly, to the committees on Energy and Commerce, Ways and Means and the Judiciary, Feb. 6.

H.R. 4016 (MEDICAID), to amend Title XIX of the Social Security Act to provide a standard definition of therapeutic foster care services in Medicaid; DELAURO; to the Committee on Energy and Commerce, Feb. 6.

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