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Federal Regulatory Update – What Should Be on Your Radar?
Alyssa KeefeCalifornia Hospital Association
Agenda
● Context Setting: Congressional and Administrative Priorities
● Federal Regulatory Hot Topics
● Site-neutral payment updates
● CMS price transparency requirements and out of network/surprise billing
● Medicare Condition of Participation updates
● CMS 1135 waiver and early lessons from wild fires
● CMS proposed rule on definition of a “Public Charge”
● Medicare audit updates
2
Congressional & Administration Health Policy Priorities
3
A New Congress – Divided Government
4
House Senate
235 Democrats
198 Republicans
2 Vacant or Disputed
45 Democrats
53 Republicans
2 Independent (caucus with Democrats)
A New Congress – Divided Government
5
● 35 day government shutdown (Dec. 22 – Jan. 25)● Disagreement over funding a border wall● Agreement to reopen government expires Feb. 15● HHS and CMS funded through Sept. 30
● Long term implications?● How much legislation can get
passed in this political environment?● What passes the House will likely die in
the Senate and vice versa
Legislative Health Care Priorities
6
Congressional Priorities
● Oversight
● Drug Pricing
● Protect Affordable Care Act
● Advance Medicare for All
● Rural Health Care
Hospital and Health System Priorities
● Preserve Medicare and Medicaid Funding
● Vulnerabilities: House PAYGO rules, CBO Deficit Reduction Report, Sequestration
● Oppose Medicaid DSH Cuts
● Oppose Expansion of Site Neutral Payments
● Promote Affordability
Trump Administration Health Care Priorities
7
Administration Priorities
● Drug Pricing
● Reduce Regulatory Burden
● Stark Law, Anti-Kickback, HIPAA
● Address the Opioid Crisis
● Price Transparency
● Out-of-Network Billing
Hospital and Health System Priorities
● Drug Pricing
● Reduce Regulatory Burden
● Oppose Public Charge Rule
● Support Health Care Coverage and Access
● Promote Affordability
Federal Regulatory Hot Topics
Site-Neutral Payment Updates
8
The Prevalence of Site-Neutral Payment Policies Across Sectors is Growing
9
MedPAC● Joint and Stroke
Patients (SNF/IRF)● E/M Visits● Common OP/ASC
procedures to be paid at ASC rates
● Free Standing ED visits (June 2018)
Legislative & Regulatory (Federal & State)
● BBA of 2013: Established and phased in LTCH site-neutral payment policy based on patient criteria
● IMPACT Act of 2014: Lays the ground work for a unified post-acute care prospective payment system: target date 2023 (HH, SNF, IRF and LTCH services)
● Section 603 of BBA 2016: Reduces payment to newly opened off-campus provider based HOPD to physician fee schedule or equivalent (rather than OPPS rates)
Commercial Payers & Medicare Advantage
● Anthem imaging policy, etc. ● Increasing prevalence of
non-payment/no pre-authorization for certain acute and many post-acute care services by Medicare Advantage Plans
Bush Obama Trump
Hospital Story: Site Differentiation Delivers Value
Hospital Based Outpatient Department Physician Office
● Physician based outpatient clinics typically don’t provide specialty services due to the low reimbursement associated with the professional fee.
● Many physicians in CA will not accept Medi-Cal patients since the corresponding payment doesn’t cover the cost of providing care.
● Physician based clinics only have to satisfy local plan inspection and meet title 24 requirements, far less costly and burdensome than title 22 and the Medicare Conditions of Participation.
● Hospital based outpatient clinics are on the hospital’s license and held to the same building and accreditation standards.
● Services range from primary care to specialty and tertiary care
● Hospital based outpatient clinics take all patients and provide essential access to care for beneficiaries.
● Title 24 Compliance● Title 22 Compliance● OSHPD 3 Building Requirements● Seismic Compliance● Medicare Conditions of Participation ● 24/7 Access to Emergency
Department● MD and RN Oversight
● Title 24 Compliance
10
Their Story: Site Neutrality Creates Savings
11
Site-Neutral Payment Policy Background
● Sec. 603 of the Bipartisan Budget Act (BBA) mandated site-neutral payment for non-ED services in certain “new” off-campus provider-based departments (PBDs) – those that first were paid under outpatient prospective payment system (OPPS) after Nov. 2, 2015
● 21st Century Cures Act allowed for mid-build exceptions● For 2017: “Non-excepted” (non-grandfathered) services paid
under the physician fee schedule (PFS) at 50% of OPPS rate● For 2018, non-excepted services paid at 40% OPPS rate
● For 2019, CMS finalized its proposal to continue to pay for non-excepted services at 40% OPPS rate
12CMS Modifier Guidance
Section 603 of the Balanced Budget Act of 2015
● Exemptions:
● On campus provider-based departments (grandfathered facilities billing before Nov. 2)
● A provider-based department within 250 yards
● A dedicated emergency department
● This does not apply to Critical Access Hospitals (CAHs), Rural Health Clinics (RHCs) or Federally Qualified Health Centers (FQHCs)
● This is a payment policy.
● This does not apply to physical therapy (PT), speech therapy (ST) or occupational therapy (OT) 13
CY 2019 OPPS Rule: A New Threat
Section 603 of the BBA
Section 1883(t)(2)(f) of
the SSA
● Reduce payment to 40% of the OPPS rate for services in new clinical families of services furnished in excepted off-campus PBDs
● Reduce payment for 340B acquired drugs to non-excepted off-campus PBDs
● Reduce payment for hospital outpatient clinic visits in excepted off-campus PBDs to 40% of OPPS rate ($760 million impact, CA estimated at $42 million)
NEW
14NOT BUDGET NEUTRAL TO OPPS
BUDGET NEUTRAL TO OPPS
Headed Down that Slippery Slope at High Speed
15
CY 2019 OPPS Final Rule: Site-Neutral Expansions
● 60% reduction of payments for clinic visits furnished in excepted off-campus provider-based departments (PBDs) phased in over two years
● Extension of 340B Drug Pricing Program payment cuts to non-excepted off-campus PBDs
16
Despite strong opposition from CHA and the hospital field, CMS finalized an expansion of its site-neutral payment policies:
Concerns: Growing Emergency Department Use
● Medicare outpatient ED use grew faster than nationwide ED use and Medicare physician visits
● 2 highest-paying levels of ED visits (levels 4 and 5) growing as a share of all Medicare ED visits
● Medicare outpatient ED payments increased 72% per beneficiary (2010-2016)
17
MedPAC Chairman’s Recommendations: EDs
● Urban Recommendation: Align payments to urban OCEDs with the cost of care
● Congress should reduce Type A emergency department payment rates by 30% for off-campus, stand-alone EDs that are within 6 miles of OCED
● Rural Recommendation: Preserve access to rural ED services
● Congress should allow rural stand-alone EDs to bill standard OPPS facility fees and provide such EDs with annual payments to assist with fixed costs (standby costs, emergency services, physician recruitment)
18
System Edits to Take Place April 1
● Increasingly, hospitals operate an off-campus, outpatient, provider-based departments and appropriate modifiers must be used on OPPS claims.
● Beginning Apr. 1, Medicare systems will validate service facility location to ensure services are being provided in a Medicare enrolled location. The validation will be exact matching based on the information submitted on the Form CMS-855A submitted by the provider and entered into the Provider Enrollment, Chain and Ownership System (PECOS). Providers need to ensure that the claims data matches their provider enrollment information.
● Testing has occurred, and a lot of rejected claims – look at your CMS 855 forms and PECOS!
20
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/SE18023.pdf
CMS Price Transparency Requirements
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CMS Price Transparency Requirements
● FFY 2019 IPPS final rule required hospitals to publicize a list of their standard changes online in a machine-readable format by Jan. 1, 2019
● California hospitals already make their charge masters available in a machine-readable format OSHPD website
● December 2018 CMS FAQ revised mandate to require hospitals also publicize the standard charges for each diagnosis-related group (DRG)
● The new requirement applies to all hospitals paid under Medicare’s inpatient prospective payment system
● While the format for posting standard charges for diagnosis-related groups is each hospital’s choice, CMS has offered a template of average standard charges by DRG on its website
22
Unexpected Medical Bills – OON and Balance Billing
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State Laws Protecting Against Balance Billing by Out-of-Network Providers in ED or In-Network Hospitals
More can be done to protect patients.
Senate Letter to Health Plans and Providers
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● Bi-partisan letter sent to selected health plans and providers
● Response requested by February 18
Medicare Conditions of Participation/Coverage Updates
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Emergency Preparedness Conditions of Participation
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New Guidance Out Now!
Regulatory Provisions To Promote Program Efficiency, Transparency, and Burden Reduction
● Proposed rule issued Sept. 20, 2018
● Comments submitted Nov. 18, 2018
● Final rule expected in 2019
● Intended to reduce regulatory burden for hospitals, critical access hospitals and other providers
28
CMS Proposals
● Increase organs for transplantation
● System approach to quality/ safety (QAPI)
● Flexibility on emergency preparedness training & CAH review of policies
● Greater flexibility on pre-op assessments
● Eliminate ambulatory surgical center (ASC) requirements to have agreements with hospitals in case something goes wrong
29
CHA Comment Letter
● Supported system approach to QAPI and more flexible emergency preparedness program review and testing requirements
● Supported elimination of documenting efforts to contact local, tribal, state and federal emergency preparedness officials and participate in collaborative and cooperative planning efforts
● Urged CMS to clarify in the final rule its definition for a mock disaster drill
● Asked the agency to proceed cautiously on the ASC requirements
30
CMS 1135 WaiversEarly Learnings of California Wild Fires
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Issuing Waivers
Presidential Declaration:
Stafford Act or
National Emergencies Act
HHS Secretary:
Public Health Emergency Declaration
Waivers May Be Issued
32
Public Health Emergency Declarations
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HHS Public Health Emergency Information
1135 Waivers
● Scope: Federal requirements only, not state licensure
● Purpose: Allow reimbursement during an emergency or disaster even if providers can’t comply with certain requirements that would under normal circumstances bar Medicare, Medicaid or CHIP payment
● Duration: Ends no later than the termination of the emergency period, or 60 days from the date the waiver or modification is first published unless the Secretary of HHS extends the waiver by notice for additional periods up to 60 days, up to the end of the emergency period
34
Examples of 1135 Waiver Authority
Conditions of Participation
Licensure for Physicians or Other to
Provide Services in Affected State
Emergency Medical Treatment and Labor
Act (EMTALA)
Stark Self-Referral Sanctions
Medicare Advantage Out of Network
ProvidersHIPAA
35
https://www.cms.gov/Medicare/Provider-Enrollment-and-Certification/SurveyCertEmergPrep/Downloads/All-Hazards-FAQs.pdf
1135 Blanket And Provider Specific Waiver Examples
EMTALA● Request to set up
Alternate Screening Locations
Critical Access Hospitals● 42 CFR 485.620● Requires 25-bed limit,
average patient stays less than 96-hours
Skilled-Nursing Facilities● SSA 1812 (f)● Three-day prior
hospitalization for SNFPatients
36
https://www.cms.gov/About-CMS/Agency-Information/Emergency/EPRO/Past-Emergencies/Wildfires.html
https://www.cms.gov/Medicare/Provider-Enrollment-and-Certification/SurveyCertEmergPrep/Downloads/Requesting-an-1135-Waiver-101.pdf
https://www.cms.gov/About-CMS/Agency-Information/Emergency/Downloads/MedicareFFS-EmergencyQsAs1135Waiver.pdf
Questions for Hospital Teams
● Have you reviewed the previously issued CMS 1135 blanket waivers and considered how you may utilize them in an emergency to continue to care for patients?
● What is your organization’s communications strategy in dealing with state and federal agencies regarding these waiver requests?
● Consider flagging your request with CHA to help us assess regulatory needs
● Do you have MOUs in place with other providers, not just for transfer of patients but perhaps to address staffing gaps?
● Is what you need really a waiver from a federal rule or is it a state regulatory issue? Would a temporary flex be more appropriate?
37
Early Lessons Learned
● Multi-disciplinary team is essential in navigating federal and state regulations to ensure patients can be served and payments received
● One point of contact is recommended for communication with Federal and State agencies on specific waiver needs
● Provider coordination and communication with CHA and agency staff has proven to be helpful
● All requests are time limited; thinking about the longer term implications beyond the waiver is critical when making the initial request
38
Public Charge Proposed Rule
39
Public Charge Proposed Rule
● On Sept. 22, Department of Homeland Security issued a proposed rule to change “public charge” policies
● Under long-standing policy, the federal government can deny individuals U.S. entry or any adjustment to their legal permanent resident status (e.g., green card) if they are determined likely to become a “public charge”
● Proposed rule would expand list of programs to be considered under “public charge” to include not only cash assistance and long-term care but also certain health care, nutrition and housing programs
40
Overview
41
Being determined a “public charge” puts an individual’s immigration status at risk. The proposed rule departs from existing guidance by, among other things:
● Expanding the list of public benefits considered● Increasing the importance of income and benefit use in
the public charge analysisThe rule does not change eligibility for benefits, but newly attaches consequences to use of benefits that some immigrants are eligible for:
● Medicaid, Children’s Health Insurance Program (CHIP), Marketplace, and Medicare coverage are only available to lawfully present immigrants
If finalized, the proposed rule would broadly impact consumers, providers, states and localities
Impact in California
● Manatt analysis, found that 4.3 million Medicaid/CHIP enrollees in California would forgo health care coverage due to concerns or confusion about the immigration consequences of program participation
● As California's uninsurance rate shrank from 16.4 percent in 2013 to 6.8 percent in 2017, the cost of providing uncompensated care at hospitals shrank from $21.3 billion to $7.4 billion — a decrease of 65 percent
● The proposed rule would reverse this trend, jeopardizing our fragile health care safety net
● Payments at risk under the proposed rule are estimated at more than $5 billion in 2016 — $2.2 billion for noncitizen enrollees and $2.9 billion for citizen enrollees who have a noncitizen family member
42
CHA Message
● The proposed rule if enacted will:
● Result in a chilling effect that will cause people to avoid getting the health care they need when they need it
● Result in poor health outcomes for our most vulnerable residents
● The health and wellbeing of our communities is put at risk when our friends and neighbors, including those from other countries, forgo accessing basic needs such as food, housing and health care services out of fear of being deported
43
CHA Comments
● CHA urged DHS to withdraw the proposed rule noting it could hurt health care
● Would result in an extraordinary administrative burden and would be costly to administer – counter to the administration’s previous significant steps to reduce regulatory and administrative burden across federal agencies
● CHA does not believe that DHS has presented the necessary evidence or data to suggest that a change in policy is warranted, particularly in light of the increased taxpayer costs needed to implement the policy
● CHA states its serious concerns with any change in immigration policy that will create a barrier to individuals accessing needed health care services and other programs that are essential to our collective well-being
44
Medicare Audit Updates
45
Medicare Contractors
Recovery Audits Contractors (RAC)
Identifies improper Medicaid payments made on healthcare claims
California Region 4 HMS Federal
Program Overview
Supplemental Medical Review
Specialty Contractor (SMRC)
Conducts medical reviews as directed by CMS
Noridian
Program Overview
Zone Program Integrity
Contractor (ZPIC)
Investigates instances of suspected fraud, waste and abuse
Program Overview
Quality Improvement
Organization (QIO)
Reviews appeals and complaints about health care for Medicare recipients; short stay reviews
Livanta
Program Overview46
● New MLN Article Released Jan. 24
● https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/SE19002.pdf
47
Short Stay Reviews of TKA
Worksheet S-10 “Desk Reviews”
● FFY 2019 IPPS Final Rule CMS noted
● “due to the overwhelming feedback from commenters emphasizing the importance of audits in ensuring the accuracy and consistency of data reported on the Worksheet S–10, we expect audits to begin in the Fall of 2018.” (83 FR 41424)
● Desk Reviews began in August 2018 and concluded Jan. 31
● Many MACs subcontracted
● Only 600 hospitals underwent reviews
● MAC adjustments are concerning and will have significant implications UCC payments if not corrected
48
Considerations
● Consider a multi-disciplinary approach to understanding all your uncompensated care data across the organization
● Raise awareness that S-10 revisions for Medicare DSH could impact EHR payments, and other programs that may consider use of S-10 in the future. ● CHA Resources www.calhospital.org/s-10
● Make sure all sources of community benefit are correlated ● Understand the difference in how amounts are reported across different
reports, like S-10 and IRS 990 Schedule H, OSHPD, etc. ● Provide a consistent story of the benefit hospitals provide to their community.● CHA Resource: https://www.calhospital.org/community-benefit-not-profit-
hospitals● Invest in the resources to report timely and accurately
Questions?
50
THANK YOU!
California Hospital Association Washington, D.C.
Alyssa KeefeVice President, Federal Regulatory Affairs(202) [email protected]
