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May 18, 2015

Washington Health Policy Week in Review Archive be2673b8-03f3-4a7b-ab99-5422818d8cc2

Newsletter Article


Florida Health Care Debate Reaches Beyond Hospitals

By Marissa Evans, CQ Roll Call

May 13, 2015 -- Florida is about to lose federal support for its program to reimburse hospitals for caring for uninsured and indigent patients, and that worries road builders and educators.

That's because the loss of $1.3 billion for the state's so-called Low Income Pool, or LIP—which the administration of Republican Gov. Rick Scott has seen coming for almost a year—will blow a hole in the state budget and could mean less money for other state obligations, including transportation and education.

"When you just look at the amount of dollars related to LIP, some of it is going to have to be made up somewhere and there [are] just not that many options," said Bob Burleson, president of the Florida Transportation Builders Association. Even though the state legislature last year declined to expand Medicaid under the 2010 health care law, Florida officials were able to convince the federal agency that allocates Medicaid funds to the states to continue funding LIP for one more year.

That year is up on June 30, and the Scott administration is trying to convince the Centers for Medicare and Medicaid Services (CMS) to continue funding the program. CMS has another idea: Use the potential $51 billion in federal funds stemming from Medicaid expansion to help fill the LIP funding hole.

The Florida Senate has voted to do just that, while the more conservative House remains opposed. Both chambers are controlled by Republicans.

Scott's administration is negotiating with federal officials to continue the funding. An indication of the progress of those talks may have come on April 28 when he sued CMS for the funding. The governor has also visited Florida's congressional delegation in Washington to build support and, he said, convinced the House Energy and Commerce Committee to hold an as-yet-unscheduled hearing about the issue.

"Every day that passes without the Obama administration reversing course and continuing the Low Income Pool funding in Florida is just more proof that this absolutely is coercion," Scott said in a recent news release. "They will withhold these funds until we do exactly what they say."

Health care experts including Joan Alker, executive director of Georgetown University's Center for Children and Families, say the Scott administration has been in denial about the end of LIP funding.

"They didn't want to talk about Medicaid expansion and there's an inherent contradiction," Alker said. "'We want federal LIP dollars but we don't want federal Medicaid expansion dollars.' There's no rhyme or reason because [Medicaid expansion funding] would be larger and would cover people and would be much more reliable."

CMS Acting Director Vikki Wachino has told Florida officials that federal support of the LIP program will be based on three things: Use of Medicaid expansion dollars to cover uncompensated care, using Medicaid payments toward program beneficiaries, and adequate provider payment rates.

"We believe the future of the LIP, sufficient provider rates, and Medicaid expansion are linked in considering a solution for Florida's low-income citizens, safety-net providers, and taxpayers," Wachino wrote in an April 14 letter to Justin Senior, Florida's Deputy Secretary of Medicaid.

While Florida officials say that without LIP there would be more than $1 billion in uncompensated care and children's hospitals would lose $125 million, other groups with a stake in the budget have their own concerns.

Burleson, of the transportation builders group, says while he's concerned about what will happen with LIP funding, he's taken some comfort that the two chambers fully funded the state Department of Transportation and there were no cuts or money taken from the transportation trust fund during the first legislative session.

But Mark Pudlow, a spokesperson for the Florida Education Association, says that while he hasn't heard about any specific education programs or funding amounts that could be slashed if the House and Senate have to plug up the LIP funding gap, educators are still worried, especially as schools struggle to meet standardized testing requirements.

"We remain near the bottom when compared to other states as far as spending on public education is concerned," Pudlow said.

Pudlow said that the House and Senate proposed education budgets were similar but it's a toss-up now on how it'll turn out with the special session starting June 1.

"If there is a compromise it's going to potentially impact education funding in a state where we haven't funded education lavishly," he said.

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Health Law Markets' Financial Viability on Feds' Radar

By Rebecca Adams, CQ Roll Call

May 11, 2015 -- The Centers for Medicare and Medicaid Services will host state-based health law marketplace officials this summer in a conference to talk about the exchanges' financial viability, federal marketplace CEO Kevin Counihan recently said.

This is the first year in which state-run marketplaces must be financially independent, and several are struggling. A number of states use taxes on health insurance as a major revenue source, but health insurance industry officials are pushing back against increases.

Counihan said in remarks at the Health Insurance Exchange Summit in Washington that the upcoming conference will be one way that CMS officials will enhance communications with state-based exchange officials, with whom federal officials have regularly-scheduled calls twice a month.

"We've got good practical leadership there," Counihan said of state officials. But each exchange operates in a way that mirrors individual businesses, he said.

"Our role is to do everything we can to account for those differences and help those folks succeed," he said.

Counihan wouldn't comment on whether some state-run marketplaces might find the challenges so difficult that they could hand over part of their operations to the federal marketplace.

When asked if some states that currently rely on might want to switch to become a state-based marketplace, Counihan said the time it would take to make a conversion would depend on how much of the operations a state wanted to assume responsibility for overseeing.

Counihan said that if any wanted to fully transition all of the operations to state officials, it would be "a very, very complex activity."

"It takes a period of time," he said. "It's not something folks could do for this open enrollment" this fall.

The Supreme Court is expected to rule by the end of next month on a case about whether federal insurance subsidies should be allowed in both the federal exchange and state-run marketplaces or only in state-run marketplaces. Some policymakers are watching to see whether some states would try to change their status to state-run marketplaces if the court were to strike down federal subsidies in states that rely on the federal website for enrollment. Counihan declined to comment on the case, King v. Burwell.

CMS officials are in the process of collecting enrollment counts from state-run marketplaces, Counihan said, and will soon be releasing an updated report of how many people are enrolled in federal and state exchanges.

Next year, the federal exchange will be "better and faster" than this year because the administration in working on continued enhancements to the site, both in ways that consumers see and in back-end processes that are invisible to consumers but that affect business processes used by health insurers and others.

Counihan suggested that federal officials are trying to make it easier for consumers to get information by, for instance, making it simpler for patients to type in their primary care provider to see which health plans have the doctor in their networks or plug in the name of a drug they are taking to quickly compare which plans cover the medication.

Counihan also said CMS officials will meet with web brokers soon to discuss plans for next year.

And he said the agency is working collaboratively with insurers to ensure that consumers will get updated information in more granular detail about which providers are in each plan's network, so that a patient going into an emergency room won't have to worry that although the hospital is in the network, some medical providers may not be.

"We see that as part of our role," he said, adding, "We recognize that as someone's being pulled into an ER, they're not going to have a provider directory with them."

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CMS Official Points to Health Data Sharing Gains

By Kerry Young, CQ Roll Call

May 14, 2015 -- Increased ease of data sharing helped the Centers for Medicare and Medicaid Services (CMS) score a win this month for those who advocate shifting toward a more coordinated approach to delivering health services, a top agency official said last week.

CMS on May 4 announced savings of about $385 million from the Pioneer Accountable Care Organization, or ACO, model, which is aimed at improving communication between providers and Medicare patients and promoting more follow-up visits after hospital stays.

Some of this success is due to improved design of these programs, along with the use of systems allowing doctors and other health professionals more easily communicate about their work, Patrick Conway, the chief medical officer for CMS, said in a recent interview after a Senate Finance Committee hearing. Those working in ACOs have opportunities to share knowledge through both state and CMS networks, he said. The Pioneer ACO results mark a stark change from some earlier disappointing findings from experiments with coordinated care.

"Providers are learning from each other as they go," Conway said in an interview. "We are much more rapid cycle in both our sharing of data and our evaluation."

At the hearing, Senate Finance Chairman Orrin G. Hatch, R-Utah, highlighted a Congressional Budget Office (CBO) that had found discouraging results for 34 test programs that Medicare used to gauge disease management and care coordination. CBO had said in 2012 that, after accounting for the fees that Medicare paid to the programs, spending appeared to be either unchanged or higher for nearly all of them.

The finding ran counter to the widespread belief that coordinated care contain improve people's health while also leading to reduced spending on medical services. There's strong bipartisan support for the approach to medical care, seen as one of the tools to contain the growth of Medicare spending as the baby boomers age and experience more ill health. Older people are more likely to suffer from several simultaneous chronic conditions such as diabetes and heart disease. Hatch announced last week that he had appointed Johnny Isakson, R-Ga., and Mark Warner, D-Va., to form a chronic care reform working group.

Hatch said that he is expecting the work of CMS' Center for Medicare and Medicaid Innovation to provide his committee with more insight on how to shape Medicare to better treat those with chronic illnesses.

"My hope is that this research will yield long-term results," Hatch said. "By identifying cost-effective data-driven ways to improve patient health, policymakers can better target scarce federal resources to get more value for the dollars spent."

At CMS, the results seen for the Pioneer model are aiding in the expansion of this approach through what's called the Next Generation ACO program, which will include additional coverage for services provided in the home after hospital stays and telehealth, Conway said.

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Panelists Debate Broadening of Innovation Center Mandate

By Kerry Young, CQ Roll Call

May 15, 2015 -- Lawmakers should consider widening the mandate of the federal Center for Medicare and Medicaid Innovation, known as CMMI, to allow more work on programs that could keep people with debilitating illnesses in their homes longer, a researcher said during a recent briefing on the program's future.

"At some point, we may need to look at whether the CMMI authorizing legislation needs to be broadened a bit," said Karen Davis, director of Roger C. Lipitz Center for Integrated Health Care at Johns Hopkins University.

However, that approach would be met with resistance from congressional Republicans when funding for the Centers for Medicare and Medicaid Services' Innovation Center comes up for renewal after fiscal 2019.

Davis was among the speakers at an Alliance for Health Reform briefing looking at the challenges ahead for Medicare, with the federal health program for the elderly and disabled now covering more than 50 million Americans. The aging of the population in the United States will lead to a rise in the number of cases of people suffering from debilitating diseases. Increasing resources available for home treatments and services and support for family caregivers might work to reduce reliance on costly nursing homes for those afflicted, she said.

"They're going to need nonmedical personal services, daycare services, to be able to continue to live independently," Davis said.

Created as part of the 2010 health law, the center was provided with $10 billion to be expended over a decade. The program, which provides competitive grants, has worked well as a means of funding tests of new approaches to delivering health care, according to Davis. She would like to see it expanded to allow more testing of services to improve the care of those suffering from debilitating diseases.

"As we really get serious about how we are going to take care of Alzheimer's patients, how we are going to take care of people with Parkinson's who can't feed themselves any more or walk safely across the room, they will need personal care services or families may be able to help out if there is senior day care," Davis said, citing approaches that could use further research.

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Study: New Standards Change Nursing Home Grades

By Georgina Gustin, CQ Roll Call

May 14, 2015 -- Government-certified nursing homes don't appear to be performing as well as in the past, according to data analyzed with revised standards.

A report released last week by the nonpartisan Henry J. Kaiser Family Foundation found that only 45 percent of the country's Medicare- and Medicaid-certified nursing homes got a four- or five-star rating, the highest ratings on the five-point scale developed by the Centers for Medicare and Medicaid Services (CMS). That represents a drop from 54 in December, before the agency changed its methodology in response to complaints that scores were inflated and based on self-reported data.

The analysis found that more than 36 percent of all nursing homes scored only one or two stars.

"With relatively large shares of nursing homes in the four- and five-star rating group, questions arose as to consumers' ability to assess the relative performance among nursing homes in their area," the report says. To address those concerns, CMS reformulated its system by increasing the number of points necessary to earn a high-quality star rating and by changing the calculation for staffing.

The Kaiser analysis also found that for-profit nursing homes, which represent 70 percent of all certified facilities, generally had lower ratings, and smaller facilities have higher star ratings than larger ones. The report also said that ratings are higher for measures that are self-reported, such as quality measures and staffing levels, than from those stemming from state inspections.

The Omnibus Budget Reconciliation Act of 1987 (PL 100-203) required nursing homes that receive Medicare or Medicaid funding to meet minimum standards. In 1998 CMS established the Nursing Home Compare system to give consumers information on facilities, and in 2008 established the more user-friendly star rating system.

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Ways and Means Republicans Take Aim at Health Law

By Alan K. Ota, CQ Roll Call

May 15, 2015 -- House Ways and Means Committee Republicans are laying the groundwork for a veto showdown with President Barack Obama with plans the week of June 1 to mark up proposals to uproot parts of the health care law, including the medical device tax and a panel charged with holding down Medicare costs.

Ways and Means Health Care Subcommittee Chairman Kevin Brady, R-Texas, and other GOP tax writers confirmed in interviews that the full committee has set a target of marking up several health care bills that could be moved to the floor as stand-alone items or combined into larger vehicles, such as the reconciliation measure outlined in the GOP's fiscal 2016 budget blueprint (S Con Res 11).

The lawmakers said the projected early June markup would cover at least two high-profile bipartisan measures: a proposal (HR 160) by Erik Paulsen, R-Minn., to repeal the 2.3 percent excise tax on medical devices and an effort (HR 1190) by Phil Roe, R-Tenn., to eliminate the Independent Payment Advisory Board, or IPAB.

"It's sort of the ones that you would expect," said Brady.

He and other senior House GOP tax writers say they want to be able to move quickly on a reconciliation package or other measures, if necessary, once the Supreme Court rules in a case that takes up health law subsidies in states without their own state-run marketplaces. One option would be to hold stand-alone votes to demonstrate bipartisan support for items that could be included in what's expected to be a contentious reconciliation package—a move that would trigger a showdown with White House.

"I don't think any final decisions on reconciliation will be made until the Supreme Court rules," Brady said, referring to the still emerging strategy for moving the bills to the floor.

"I think we will have a package that we're going to put together," said Kansas Rep. Lynn Jenkins, vice chairman of the Republican Conference.

Paulsen said it was possible that his medical device tax repeal proposal could be moved on its own or in tandem with other measures. "We will move the bills in Ways and Means. And we'll see on the floor. Get a little momentum going," Paulsen said.

Ed Lorenzen, a senior advisor for the Committee for a Responsible Federal Budget, a fiscal watchdog group, said the reconciliation package would be limited to items scored as having an effect either on revenues or direct spending that is not subject to appropriations.

The proposal to scrap the medical device tax, with a projected 10-year cost of about $25 billion, would be eligible for reconciliation. Lorenzen said language eliminating IPAB would also be a candidate because its administrative costs are funded with direct spending. The board, established in the health care overhaul, is charged with making annual cost-cutting recommendations if Medicare spending exceeds a target growth rate. The conditions that trigger the recommendations haven't been met and Obama hasn't appointed any members.

The GOP budget plan calls for the reconciliation package to have more offsets than spending increases or tax hikes, requiring the overall package to reduce the deficit by at least $1 billion.

In the Senate, Health, Education, Labor, and Pensions Chairman Lamar Alexander, R-Tenn., said he planned to hold off moving health care legislation until after the Supreme Court ruling. Finance Chairman Orrin G. Hatch, R-Utah, said he did not plan to wait either for House action or a Supreme Court ruling, but that he wanted to spend more time building consensus for his own proposal (S 149) to repeal the medical device tax.

"Some of those votes on the Democrat side have slipped away. I've got to rebuild them up again...We'll do what we can," Hatch said.

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