By John Reichard, CQ HealthBeat Editor

March 5, 2013 -- After working for nearly three years behind the scenes overseeing the implementation of the massive health law, Marilyn Tavenner is increasingly stepping out in public to talk about her handiwork.

"I think we are going to have all the steps in place to get it done," Tavenner told a gathering of hospital executives last week regarding the historic 2014 expansion of health coverage under the overhaul law.

Last week, the acting Centers for Medicare and Medicaid Services (CMS) administrator plans to address health information technology executives at a conference sponsored by the Health Information and Management Systems Society.

And not too long from now, Tavenner hopes to be sitting behind a microphone at a planned—but not yet scheduled—hearing by the Senate Finance Committee on her nomination to become permanent head of CMS. Tavenner told reporters that she was very encouraged by a meeting she had last week with the committee's chairman Sen. Max Baucus, D-Mont., concerning her nomination.

Tavenner's remarks at the meeting, sponsored by the Federation of American Hospitals could hint at her testimony before the Finance committee. She cited various "metrics" detailing accomplishments under the health law (PL 111-148, PL 111-152).

But the main event in terms of metrics will come this fall when CMS sees how many people will be covered under expanded state Medicaid programs and how many come to insurance exchanges to obtain health coverage—"part of what we will call our insure America campaign," Tavenner said.

In that area, there is much uncertainty about how many of the uninsured will sign up.

"We are going to need your help," Tavenner told the hospital executives. CMS is holding off until summer in starting its enrollment outreach campaign, she said.

Research shows that if CMS gets too much of a head start in talking to people about tax credits to buy coverage in 2014, and then people are told those credits won't be available for six or seven months, "they start to lose interest," Tavenner said.

Tavenner was asked by a questioner what hospitals – often what he called "the first door" for the uninsured into the health system – could do to ease enrollment in health plans under the health care law. Many hospitals, she said, have someone in their emergency departments who acts as a Medicaid liaison. Those staffers will have enrollment information and will be trained, she said. Hospitals also will be able to help individuals with online enrollment, she added. And they'll be able to direct the uninsured to toll-free telephone lines with counselors available to provide guidance.

In states where the federal government will operate the exchange, federal officials will launch navigator programs to aid enrollment, including by having navigators in some hospital emergency departments. In states that operate their own exchanges, such programs are required. CMS will begin to roll out the navigator program between April and July, she said. In addition, the CMS regional offices will have liaison staff who will send out teams to individual hospitals to help them prepare to enroll the uninsured. She added that "all types" of volunteers will be trained to provide assistance, including those from faith-based organizations.

Health Law Measures

Tavenner reviewed for the hospital executives what CMS counts as the accomplishments so far under the health law: about three million people in their early to mid-twenties with coverage under their parents' health plan; 34.1 million Medicare beneficiaries who got some form of preventive care in 2011; 54 million privately insured Americans with improved preventive benefits; 135,000 Americans with costly pre-existing medical conditions who obtained coverage through the PCIP program; and 6.1 million Medicare enrollees with $5.7 billion in drug discounts under expanded drug coverage.

Another metric she cited relates to cost. "What we've seen is zero percent growth in health spending as a percentage of GDP between 2009 to 2011. This is the lowest sustained growth in 50 years and low growth is continuing into 2012 for Medicare and Medicaid," she said.

Tavenner likely will get an argument on that measure from Finance Committee Republicans. Economists tied much, if not most, of the slowdown in health costs to the downturn in the economy.

Some $2.1 billion has been returned to consumers in rebates under medical loss ratio rules, Tavenner said. The percentage of double digit premium increases by insurers "has gone from a high of 75 percent in 2010 to 14 percent so far in 2013," she said. Average family insurance premiums in 2012 rose four percent. "I think you would all agree that that's a lot lower than our history." Republicans would likely also question the link between the health law and that statistic.

Questions on Health IT

Tavenner also addressed the adoption of health information technology, which has received a big boost under the Obama administration. Recent press coverage has focused on inappropriate billing fueled by the technology and an absence of federal audits to confirm that providers are making "meaningful use" of health IT as they are required to in order to qualify for higher Medicare and Medicaid payments.

Tavenner said it's true that the wider use of electronic health systems has had the ill effect of an increase in inappropriate "upcoding" of bills submitted by facilities for Medicare payment. But the administration is "very much committed" to further IT adoption, she said. "We've seen great success" with health IT.

Some of the upcoding reflects having better tools to document care and so is appropriate, she indicated. But because of the way the records are designed in some cases "it may be a little too easy" for billing staff to upcode inappropriately and there may not be enough of a "firewall" between financial management and clinical management functions associated with the records, she added. Changes perhaps are needed "to make sure that physicians have a chance to review" the work of billing staff, she said.

"Part of what we're going to do this year is spend a lot of time around the education and around the audit process," she said. CMS is talking about having a series of seminars with providers throughout the year to foster appropriate billing, she added. Vendors are also going to need to have safeguards in their records to make sure that it's not too easy to enter the wrong code, she added.

"These are kind of the natural growing pains that we expect," Tavenner said. "What we'll do is spend 2013 pausing and reflecting on these areas to try and increase the education, make sure we have the vendors on board, make sure we do some small targeted audits."

By John Reichard, CQ HealthBeat Editor

March 6, 2013 -- The top official in charge of Medicare and Medicaid and the head of the federal health information technology office recently said they'll step up efforts to promote the computerized exchange of patient data among the various providers in the health system.

Despite the growing adoption of electronic medical records, that kind of information sharing is moving too slowly to make good on the promise of health information technology to cut care costs and improve patient safety and quality of care, critics say.

But Centers for Medicare and Medicaid Services (CMS) Acting Administrator Marilyn Tavenner said in a news release last week that "health IT and the secure exchange of information across providers are crucial to reforming the system, and must be a routine part of care delivery."

Farzad Mostashari, the National Coordinator for Health Information Technology, announced a "request for information" to invite comment on how to speed up information exchange. "We are interested in hearing about policies that could provide an even greater business case for such information sharing," he said.

Tavenner and Mostashari were scheduled to speak at a meeting in New Orleans sponsored by the Health Information and Management Systems Society.

Payment systems that reward providers for lowering costs and improving quality are expected to speed the pace of sharing lab results, medical imaging, prescription drug use summaries, and other clinical data, to avoid wasteful duplication of tests and treatments and ward off medical errors. But the current fee-for-service system lacks such incentives, the new request for information says.

"Both providers and their vendors do not yet have a business imperative to share person level health information across providers and settings of care," the request acknowledges.

It notes, for example, that only one of every four hospitals in 2011 "could exchange medication lists and clinical summaries with outside providers." And that year only 31 percent of doctors were exchanging clinical summaries with other providers.

CMS and the Office of the National Coordinator are using incentive payments to foster information exchange through the use of health IT and the certification of health IT systems. But in addition to those programs, Health and Human Services says in the notice that it intends "to rely on all applicable and appropriate statutory authorities, regulations, policies, and programs to accelerate rapid adoption of health information exchange across the care continuum."

The notice mentions ways in which the department might seek to spur more exchange of information. It says, for example, that "HHS can collaborate in the development of new e-specified measures of care coordination that encourage electronic sharing of summary records following transitions ins care." CMS "might consider new ways to require or encourage Medicare accountable care organizations to exchange health information," it adds.

The officials also announced a goal of having 50 percent of doctors' offices using electronic health records by the end of 2013 and 80 percent of eligible hospitals receiving "meaningful use" incentive payments by that time. They also said they aim to spur greater use of what they call the "Blue Button," an electronic way Medicare beneficiaries can now access their full Medicare records online. And to make sure that providers aren't using health IT to "upcode" and bill for more extensive services they are providing, they said HHS is "conducting extensive medical reviews and issuing comparative billing reports that identify providers."

Tavenner said in a speech earlier this week that "what we'll do is spend 2013 pausing and reflecting on these areas to try and increase the education, make sure we have the vendors on board, make sure we do some small targeted audits."

By John Reichard, CQ HealthBeat Editor

March 6, 2013 -- Insurance industry predictions that the health care law will make coverage unaffordable for many young Americans are overstated, say analysts at the Urban Institute.

The vast majority of the 10 million 21- to 27-year-olds who are currently uninsured and the 3 million in this age group who now have individual coverage will either qualify for Medicaid, the Children's Health Insurance Program, subsidies available through insurance exchanges, or their parents' coverage, analysts Linda J. Blumberg and Matthew Buettgens say.

So while premiums will rise for the young, in almost all cases out-of-pocket costs won't, the analysts say.

Congressional Republicans this week stepped up their criticism that the health care law will make insurance policies too expensive, not only for the young but for older Americans. The House Energy and Commerce Subcommittee on Health will hear testimony on the law's effect on premiums paid by the young. And committee Republicans joined with GOP leaders last week on the Senate Finance and Senate Health, Education, Labor and Pensions committees to distribute a report asserting that young adults and middle-class families will see their costs jump under the law (PL 111-148, PL 111-152).

Insurers say the law's ban on their setting premiums for older people more three times higher than those for the young should be changed. They argue for a "rating band" of 5-to-1 rather than 3-to-1 set in the law. In other words, they want to be able to charge older people premiums that are up to five times higher.

But Blumberg and Buettgens say in their analysis released earlier this week that "92 percent of adults age 21 to 27 enrolling in single plans in exchange-based coverage have incomes below 300 percent of the federal poverty line. In other words, the vast majority of young adults enrolled in these plans would not face different health care costs regardless of the rating bands chosen because of the protection afforded them by the Affordable Care Act's subsidies."

The same is true, they say, "for 88 percent of 18 to 20 year olds, 85 percent of 18 to 20 year olds, 85 percent of 28 to 44 year olds, 79 percent of 45 to 56 year olds, and 76 percent of those age 57 and older."

At the same time that many of the Americans who face rising rates would be cushioned from their effect, premiums for others, particularly among the older group, would fall. A shift to the 5-to-1 rating band would boost their costs, however. The Urban Institute analysis says research shows that "premium increases for older adults under 5:1 are approximately twice the savings experienced by younger adults." It added that evidence shows that under the 5-to-1 band, "older adults are actually overcharged, and younger adults are undercharged, based on the costs of people expected to enroll."

Overall, the analysts concluded that the claims by some in the insurance industry that the health care law as is "will have dramatic implications for the out-of-pocket costs of young adults are unfounded."

But the report distributed by House and Senate Republicans asserted otherwise. "Higher health care premiums are the last thing single young adults and working families can afford," it says, citing data "from over 30 studies and analyses" that project "massive" premium increases. Among the reports that it cites is one by the consulting firm Oliver Wyman that says "we estimate that almost 80 percent of those ages 21 to 29 with incomes greater than 138 percent of the federal poverty level who are enrolled in non group single coverage can expect to pay more out of pocket for coverage than they pay today—ever after accounting for premium assistance."

These seemingly conflicting conclusions mean confusion over the law's effects won't go away any time soon.

• Urban Institute Analysis (PDF)

By John Reichard, CQ HealthBeat Editor

March 8, 2013 -- Medicare Payment Advisory Commission (MedPAC) members recently agreed that doctors should give patients a much better sense of their treatment options for certain serious medical conditions. But they were at a loss to recommend how to make that happen on a widespread basis.

"Sometimes MedPAC's role is to say, 'here's a problem and here's a fix,'" MedPAC Chairman Glenn Hackbarth observed after a 90-minute discussion of the issue by commissioners. "But sometimes our role is to say, 'here's a problem and it's just not a problem that's amenable to being fixed by Medicare payment policy in a targeted way.'"

Commissioners specifically wrestled with "shared decision-making," an approach designed to better incorporate patient preferences when it comes to treating such diseases as prostate and breast cancer and cardiovascular conditions where the medical evidence is unclear about which of several treatment options is best.

It perhaps was most famously and vividly demonstrated by Dartmouth researcher Jack Wennberg, who, a number of years ago, developed videos in which doctors with prostate cancer described the treatment options they had and explained why they picked the one they did. Different doctors picked different options based on individual preference. Patients, after watching the videos, then discussed with their own doctors about what they wanted to do.

Some preferred not to have surgery, which often leads to impotence. Others, aware that other medical conditions are likely to kill a prostate cancer patient long before his cancer does, preferred to put off an operation.

One trend that emerged was a preference for "watchful waiting" of prostate cancer symptoms and a delay in having surgery. Often, with respect to other procedures as well, shared decision-making leads to fewer surgeries with potential savings to the medical system.

MedPAC staffer Joan Sokolovsky briefed commissioners on the research literature examining the use of the technique, which involves "decisions aids" and gives patients information about the trade-offs of various treatments.

"Studies have consistently shown that decision aids, used with counseling, increase patients' knowledge, give them a more realistic perception of treatment outcomes, increase the proportion of patients who are active in decision-making, and improve agreements between patient values and the options that they choose," she said. "In general, the studies also show a reduction in more invasive treatment options without adverse effects on health outcomes."

Sokolovksy noted that in a study of shared decision-making involving about 9,000 osteoarthritis patients at Group Health Cooperative in Washington state, knee replacement surgery rates dropped 38 percent and the rate of hip replacement surgery fell 26 percent after use of shared decision-making began. Cost for these patients also fell, she said.

But Sokolovsky also noted that doctors lack financial incentives to follow the shared decision-making in a health system dominated by fee-for-service medicine. Choosing not to do surgery, for example, can mean a loss of revenue for a hospital or surgeon. If doctors are paid a salary that doesn't vary with the procedures they do or make more money if they deliver more efficient and higher quality care, they may be more apt to use shared decision-making. But right now that's not the norm in Medicare's traditional fee-for-service program.

Sokolovsky noted in her presentation to commissioners that in 2010 they suggested that the development of ACOs and medical homes could provide the incentive and the infrastructure to make shared decision-making more feasible. Those delivery models give doctors a financial incentive to deliver savings and higher quality care.

Since then, the use of shared saving is increasing, "but at a very slow pace," Sokolovsky said. One commissioner expressed doubt that ACOs would have enough of an impact, observing that while a hospital might have a better chance of getting a shared savings payment if surgery rates fell, its loss of revenues from not doing the procedure would be greater than the savings payment.

Another approach discussed would involve establishing a payment code within the fee-for-service billing system to pay for shared decision-making. But some commissioners doubted that adding such a code would produce the kind of patient education and shared deliberations that are needed to make the model work. Successful adoption of the process requires a basic change in the medical culture, one member of the panel said.

Hackbarth commented that to have such a regulatory approach "you really need precise definitions." Establishing a system would entail defining what constitutes shared decision-making for payment purposes, what procedures it could be used for, and what educational aids were appropriate.

If fee for service were no longer the dominant system, doctors might have more of a financial incentive to adopt the model, commissioners agreed. But one, Scott Armstrong, an executive with Group Health Cooperative, the health plan that has used the model successfully, noted that even when the payment incentives are supportive, there are issues such as proper tracking to know which patients should be offered which educational and decision-making tool.

Another theme of the discussion was alarm that such discussions do not occur as a routine part of the informed consent process in medicine. Hackbarth spoke for other commissioners when he said he considers use of the model an ethical imperative.

"As we've said over and over again, in a broad way, changing the Medicare payment incentives could make a huge difference. But targeted, specific solutions, you know, sometimes just are not within our reach. One of the things that Congress looks to us for is, as well as 'do this, do that,' is don't do something. It could well be that activities outside of Medicare" would be good things to test and develop. "But as far as Medicare is concerned it may be that what we can do is pretty limited."

By Jane Norman, CQ HealthBeat Associate Editor

March 7, 2013 -- Hospitals are moving to reduce their readmissions in reaction to changes in Medicare policy, including financial penalties. But nothing's perfect, and Medicare Payment Advisory Commission members have continued their debate on ways to refine and revise the much-discussed fines.

The good news in the eyes of MedPac commissioners and their staff is that the relatively new Medicare readmissions policy might already be having an effect.

From 2009 to 2011, there was a 0.7 percent decline in the number of Medicare patients with all kinds of medical conditions who returned to hospitals within 30 days of discharge and whose second visits might have been prevented, the commission staff found. In addition, the Centers for Medicare and Medicaid Services has reported that readmission rates declined from 2011 to the second half of 2012, MedPac staff members said.

The CMS began a readmission reduction program in 2010, and the penalties went into effect in October 2012. Fines this year are based on hospitals' performance from 2009 to 2011 in connection with three conditions: heart failure, pneumonia and heart attack.

While the penalties, which amount to 1 percent of base operating payments, will be on average just $125,000 per hospital in 2013, they are scheduled to increase annually until 2015 and are a matter of major concern for hospitals as well as the patients they serve. A high readmission rate could be an indication of a low quality of care.

Hospitals Responding

In reaction to the new emphasis on readmissions, hospitals are doing more to identify the patients at increased risk of returning soon, improving transitions from the hospital to home with better patient education and self management as well as scheduling follow-up visits before discharge, MedPac staff said. Hospitals are also calling or visiting with patients after discharge and trying to communicate better with doctors or other health care providers outside the hospital.

But the MedPac staff also outlined problems with the new readmissions penalty policy. For example, even if hospital industry performance improves when it comes to readmissions, the percentage of the penalty doesn't change. And the socioeconomic status of patients served may affect readmission rates, MedPac staff said. Admission rates may be higher at hospitals that treat many low-income patients who have less access to adequate health care outside the hospital. Such patients arrive sicker and may wind up at the hospital again a short time after discharge.

One main question the commissioners debated was whether it would be better to take all medical conditions into account over a three-year period when calculating readmission rates, instead of just the three conditions now used. That would make it clearer whether performance is really improving at hospitals with small numbers of such cases. Most commissioners seemed warm to that idea. Mary Naylor of the University of Pennsylvania School of Nursing called it a "very important target," though she also said it's key to take socioeconomic status into account.

However, Bill Gradison, a former congressman now at the Fuqua School of Business at Duke University, objected to the idea that any changes in the readmissions policy should bring about an overall budget-neutral result. Budget policy frequently drives health policy and "not always in a wise direction," Gradison said. "The penalty ought to be we don't pay you for the readmission," he added.

Scott Armstrong of the Group Health Cooperative in Seattle said that excessive readmissions are a symptom of a health care system that's not working well and that he's frustrated by dealing only with "payment policy tweaks." Commission Chairman Glenn M. Hackbarth said MedPac began looking at readmissions with the idea that it would be an opportunity for study while larger changes in the Medicare fee-for-service system were embarked on.

Commissioners didn't take any action, but their continued consideration of readmissions policy may signal a recommendation down the line. MedPac also took on this issue in a September meeting.

The commission is an independent body that advises Medicare on policy, and its 2008 recommendation helped produce the Centers for Medicare and Medicaid Services policy that this year will mean some hospitals will see reductions of as much as 1 percent of their reimbursements because of excessive readmissions. That maximum possible reduction will rise to 3 percent by 2015.

By Dena Bunis, CQ HealthBeat Managing Editor

March 7, 2013 -- With the first drafts of an immigration overhaul expected to be released this month or next, hundreds of civil rights, health, labor, and religious groups are asking the president and members of Congress to include health care coverage in any legislative package.

"This is a widely diverse coalition of organizations that are interested in assuring that our communities are healthy and strong and thriving," Jenny Rejeske of the National Immigration Law Center said last week.

Her group has taken the lead in pushing for those who are granted any type of legal status under an immigration overhaul to be allowed to buy health insurance through the marketplaces created under the health care law (PL 111-148, PL 111-152). The center was among the 360 groups that sent an open letter to President Barack Obama and lawmakers asking them to include access to health care benefits as well as nutrition aid in any bill addressing changes to immigration policy.

By law, immigrants who are not citizens or legal residents cannot receive federal health care benefits, including subsidies to buy insurance through the exchanges. Those eligibility limits also apply to Medicaid or the Children's Health Insurance Program.

A bipartisan group of senators released a blueprint in late January that did not include health care benefits for the estimated 11 million people in the United States illegally even though they would have a chance to get provisional legal status. Obama, in his executive order allowing young people brought to the United States illegally by their parents to stay without fear of deportation, also did not include such health care benefits.

Rejeske said her group and others advocating for these benefits will push the notion that lawmakers are out of touch with the American public on this issue. She cited a February Kaiser Family Foundation tracking poll in which 59 percent of those surveyed said immigrants who would gain provisional status through an overhaul should be eligible for financial help from the federal government to buy health insurance. And 63 percent said immigrants should be eligible to enroll in Medicaid if their income is low enough to qualify.

Since 1996, non-citizen immigrants who are in the country legally cannot enroll in Medicaid or CHIP during their first five years in the United States. However, states can set aside that restriction for pregnant women and children.

"All people, including Latinas and immigrant Latinas, deserve access to affordable, quality, and comprehensive health care, including reproductive health care,'' Jessica González-Rojas, executive director of the National Latina Institute for Reproductive Health, said in a statement.

Supporters of allowing federal benefits for immigrants who gain provisional status acknowledge that getting Congress to agree to such a move could be difficult. But they say they still want to make their case for expanding current law in these cases.

"Until legislation is dropped, there continues to be an opening," Rejeske said.