Health Legislation Advances

Before recessing, the Senate HELP Committee passed H.R. 307, legislation to reauthorize through FY 2018 the current spending levels of the National Disaster Medical Program and the Public Health Emergency Preparedness Cooperative Agreement Program, among other improvements to chemical-biological-radiological (CBR) response programs; and S. 252, legislation to reauthorize through FY 2018 HHS efforts to conduct epidemiological studies on the clinical, biological, social, environmental, genetic and behavioral factors related to premature birth and to establish an Advisory Committee on Infant Mortality to help reduce infant mortality. In addition, the House passed H.R. 235, the Veteran Emergency Medical Technician Support Act of 2013, which directs HHS to establish a demonstration program to assist veterans with emergency medical technician (EMT) training to obtain state certification.

Senate Finance Committee Hearing on PPACA

At a Senate Finance Committee hearing on implementation of the Patient Protection Affordable Care Act (PPACA) matters, both Democrats and Republicans expressed concern over recent HHS actions. Senator Bill Nelson (D-FL) charged that HHS negotiated away funding for the Consumer Operated and Oriented Plan (CO-OP) program in the budget negotiations leading to the fiscal cliff relief legislation (the American Taxpayer Relief Act of 2012). The Consumer Information and Insurance Oversight (CCIIO) Director said his goal is to see that the 24 states given CO-OP funding will have successful programs, while Senators Nelson and Baucus (D-MT) expressed concern that the remaining 26 states will not have the opportunity to establish such programs. Also, Senator Maria Cantwell (D-WA) expressed concern that HHS delayed until 2015 implementation of the PPACA’s Basic Health Plan (BHP) provisions which were designed to help non-Medicaid eligible low-income families obtain health coverage other than through health insurance exchanges. She charged that HHS is using the delay to promote exchanges over such BHP alternatives. In addition, Senator Orrin Hatch (R-UT) expressed concern that HHS will have federally facilitated exchange (FFE) online insurance markets operating in time to start selling individual and small group plans beginning October 1st. The CCIIO Director responded that the Centers for Medicare and Medicaid Services (CMS) will receive insurer bids by the end of March and that HHS will review and act on the bids this summer. He also said that applications will be accepted via the HHS HealthCare.gov website and that the agency will determine eligibility for premium tax credit subsidies and Medicaid from information obtained from the Social Security Administration, the Internal Revenue Service, and the Department of Homeland Security. HHS will also provide funding for “navigators” in FFE states to help individuals submit their applications for coverage. At another forum, HHS Secretary Kathleen Sebelius called upon health care providers and others to assist in the implementation of the PPACA by educating patients about the law’s coverage options.

PCIP Enrollment Frozen

The CCIIO announced that, due to a projected lack of funding, the agency is immediately blocking new applications for coverage under so-called Pre-Existing Condition Insurance Plans (PCIP) which are currently operating in 23 states and in DC. The 135,000 individuals covered under the PCIPs and many others with pre-existing medical conditions will be eligible to seek enrollment under state-run health insurance exchanges or the FFE’s beginning this October. OMB is reviewing the final rules proposed by HHS which will move forward PPACA provisions, including: health insurance rate reviews; standards related to essential health benefits, actuarial value and accreditation; and notice of benefit and payment provisions.

Long-Term Care Commission Members

The temporary commission created under the American Taxpayers Relief Act to make recommendations on long-term care options has six new members leaving only three more members to be named by the President. House Minority Leader Nancy Pelosi (D-CA) and Senate Majority Leader Harry Reid (D-NV) previously named their three members. Last week, Speaker John Boehner (R-OH) named the following members: Judy Brachman of Bexly, Ohio, national co-chairwoman of the Jewish Federations of North America’s Aging and Family Caregiving Committee; Stephen Guillard of Chatham, Mass., a health care executive; and Grace-Marie Turner of Alexandria, Va., president of the Galen Institute. Senate Minority Leader Mitch McConnell (R-KY) selected the following to the panel: Bruce Greenstein, secretary of the Louisiana Department of Health and Hospitals; Neil Pruitt Jr. of Atlanta, a skilled nursing facility executive; and Mark Washofski, an official in the Treasury Department during the George W. Bush administration. Once all members are appointed, the panel will have six months to make its recommendations.

IRS Provides Transitional Relief for Employer Shared Responsibility Penalties

Internal Revenue Service (IRS) officials announced that employers can take advantage of a one-time transitional rule in 2013 to avoid penalties assessed when employers with 50 or more full-time-equivalent (FTE) employees do not offer “affordable” coverage and such employees obtain federally subsidized coverage under health insurance exchanges. Under the rule, employers can measure an employee’s hours from July 1, 2013 through December 31, 2013 to determine FTE (of 30 or more hours a week per month) employment for 2014 coverage purposes. Non-calendar year plans are also accorded relief until their plan year begins in 2014.

Congress Urged to Revise Physician Payment System

The chairman of the Medicare Payment Advisory Committee (MedPAC) testified before the House Energy and Commerce Health Subcommittee that Congress should soon replace the current sustainable growth rate (SGR) Medicare physician payment system, particularly in light of a recent Congressional Budget Office (CBO) cost estimate which makes the transition less expensive. He said the current system impedes access, particularly among those seeking primary care. He urged that the new system balance payment levels among primary care and specialty physician groups and include incentives for physicians to participate in new payment models (such as accountable care organizations (ACOs) and bundled payment demos). A new CBO report states that the ten-year cost of freezing Medicare physician payments has been re-estimated to decrease to $138 billion from $245 billion, mainly as a result of recent reductions in actual Medicare cost increases over the anticipated rate of increase. The ranking member, Frank Pallone (D-NJ), said that SGR reform still is too expensive to pay for with cuts to other Medicare program elements. Full-committee Chairman Fred Upton (R-MI) has indicated his desire to see the House pass reform legislation before the August congressional recess and send it to the President by year-end. Comments on an outline for legislative reform, as proposed by Republicans on the House Energy and Commerce & Ways and Means Committees is due by February 25th.

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