Republicans Question Loans to CO-OPs

In a letter to HHS, Republican Senators Coburn, Enzi and Hatch and Reps. Boustany and Rehberg asked the agency for information on the process used for awarding PPACA loans to Consumer Operated and Oriented Plans (CO-OPs).  They expressed their concerns that “Based on the HHS efforts to date, there appears to be little evidence that the CO-OP program will promote greater competition and lower costs in most state insurance markets….”

MLR Update

HHS issued a final rule which requires health insurers to send annual notices to policyholders when the insurers meet the PPACA’s minimum loss ratio rules, thus expanding on a previous rule which required notice only when MLR failures occurred.

Health Care Innovation Challenge Awards

HHS Secretary Kathleen Sebelius announced that CMS has granted $122.6 million in PPACA Health Care Innovation Challenge awards to 26 collaborations of hospitals, physicians, nurses, pharmacists, technology innovators, community organizations and advocacy groups.

PPACA Grants for School-Based Health Clinics

HHS announced that $75 million in PPACA grants will be made for the building and renovation of school-based health clinics.  In total $200 million will be granted over three years.

Revised Medicare Physician Payment Suggestions Requested

The Senate Finance Committee held hearings to elicit comments on how the Medicare sustainable growth rate (SGR) formula used to reimburse doctors and other Part B providers should be reformed for the long term.  Four former CMS administrators testified that there is no viable alternative to the current physician payment system ready to be implemented.  They suggested that in the short-term Congress could direct CMS to change the current system to better reflect physician treatment patterns and to reward doctors for providing quality care.  In the long-term, they said the current SGR system should be replaced by a new system based on capitated and bundled payments and quality of care measures.  Chairman Max Baucus asked the witnesses--Gail Wilensky, Tom Scully, Bruce Vladek, and Mark McClellan--to provide the committee a list of possible fixes for the payment system within one month.  However, the Chairman indicated that no decision has been made whether to unveil a possible legislative solution.  The House Ways and Means Committee has also asked physician and other provider groups for their reform ideas.  Responses are due May 25th to the committee on: their use of quality and outcome measures, including utilizing such tools as electronic health records and patient registries; their experiences with alternative methods, such as bundled payments and shared saving models; and their advice about encouraging beneficiaries to seek appropriate care and what regulatory burdens stand in the way of helping beneficiaries.  In related news, Reps. Joe Heck and Allyson Schwartz announced they are developing a new bill designed to reform the SGR.

PPACA Boost in Medicaid Physician Payments

CMS announced a proposed rule under which $11 billion in PPACA funds will be made available to states to implement the law’s requirement that Medicaid reimburse family medicine, general internal medicine, pediatric medicine and related subspecialists at Medicare levels in CY 2013-2014.  CMS said the action is designed to help encourage primary care physicians to continue and expand their efforts to provide checkups, preventive screenings, vaccines and other care to Medicaid beneficiaries.  Comments are due by June 11th.

Regulatory Burdens Reduced

CMS announced several rules, induced by the President’s executive order to review regulations for overburden, that the agency said will help save more than $1 billion in the first year and $5 billion over five years.  The “Reform of Hospital and Critical Access Hospital Conditions of Participation” rule was said to save $940 million per year through such changes as allowing one governing body to oversee multiple hospitals and removing the requirement for a single director of outpatient services and the elimination of the requirement for non-physician personnel to have special training in administering blood transfusions and intravenous medications.  A second rule, “Regulatory Provisions to Promote Program Efficiency, Transparency, and Burden Reduction” was said to save $200 million in its first year by eliminating duplicative, overlapping and outdated regulatory requirements for health providers.

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